Now you must be a classic capitalist and ask yourself, "How can I turn a buck? And why do i think i can make a profit that way?" Answer that question for yourself, and then convey that answer to others in the business concept section. You don't have to write 25 pages on why your business will be profitable. Just explain the factors you think will make it successful, like the following: it's a well-organized business, it will have state-of-the-art equipment, its location is exceptional, the market is ready for it, and it's a dynamite product at a fair price. If you're using your business plan as a document for financial purposes, explain why the added equity or debt money is going to make your business more profitable. Show how you will expand your business or be able to create something by using that money. Show why your business is going to be profitable. A potential lender is going to want to know how successful you're going to be in this particular business.
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Once you've described the business, you need to describe the products or services you intend to market. The product description statement should be complete enough to give the reader a clear idea of your intentions. You may want to emphasize any unique features or variations from concepts that can typically be found in the industry. Be specific in showing how you will give your business a competitive edge. For example, your business will be better because you will supply a full line of products; competitor A doesn't have a full line. You're going to provide service after the sale; competitor B doesn't support anything he sells. Your merchandise will be of higher quality. You'll give a money-back guarantee. Competitor C has the reputation for selling the best French fries in town; you're going to sell the best Thousand Island dressing. How Will i profit?resume
By structure we mean the type of operation,. Wholesale, retail, food service, manufacturing or service-oriented. Also state whether the business is new or already established. In addition to structure, legal form should be reiterated once again. Detail whether the business is a sole proprietorship, partnership or corporation, who its principals are, paper and what they will bring to the business. You should also mention who you will sell to, how the product will be distributed, and the business 's support systems. Support may come in the form of advertising, promotions and customer service.
When writing your statement of purpose, don't waste words. If the statement of purpose is eight pages, nobody's going to read it because it'll be very clear that the business, no matter what its merits, won't be a good investment because the principals are indecisive and don't really know what they want. Make it easy for the reader to realize at first glance both your needs and capabilities. Business Description Tell Them All About It The business description usually begins with a short description of the industry. When describing the industry, discuss the present outlook as well as future possibilities. You should also provide information on all the various markets within the industry, including any new products or developments that will benefit or adversely affect your business. Base all of your observations on reliable data and be sure to footnote sources of information as appropriate. This is important if you're seeking funding; the investor will want to know just how dependable your information is, and won't risk money on assumptions or conjecture. When describing your business, the first thing you need to concentrate on is its structure.
It should point out just exactly what will be sold, to whom and why the business will hold a competitive advantage. Highlights the important financial points of the business including sales, profits, cash flows and return on investment. Clearly states the capital needed to start the business and to expand. It should detail how the capital will be used, and the equity, if any, that will be provided for funding. If the loan for initial capital will be based on security instead of equity, you should also specify the source of collateral. Furnishes relevant information about the company, its legal form of operation, when it was formed, the principal owners and key personnel. Details any developments within the company that are essential to the success of the business. Major achievements include items like patents, prototypes, location of a facility, any crucial contracts that need to be in place for product development, or results from any test marketing that has been conducted.
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The following pages will books describe in detail the seven essential sections of a business plan : what you should include, what you shouldn't include, how to work the numbers and additional resources you can turn to for help. With that in mind, jump right. Executive summary, within the overall outline of the business plan, the executive summary will follow the title page. The summary should tell the reader what you want. This is very important. All too often, what the business owner desires is buried on page eight. Clearly state what you're asking for in the summary.
The statement should be kept short and businesslike, probably no more than half a page. It could be longer, depending on how complicated the use of funds may be, but the summary of a business plan, like the summary of a loan application, is generally no longer than one page. Within that space, you'll need to provide a synopsis of your entire business plan. Key elements that should be included are: Business concept. Describes the business, its product and the market it will serve.
12 - promotions Plan your promotions plan details the tactics you will use to attract new customers. For example, you might choose radio advertising, or online pay-per-click ads, or press releases, and. In this section, detail each form of promotions you will use. 13 - distribution Plan your Distribution Plan outlines the ways in which customers can buy from you. In many cases, they can only buy directly from you, perhaps at your physical location or web address.
In other cases, you might have distributors or partners who sell your products or services. In such a case, detail this structure. There are seven major sections of a business plan, and each one is a complex document. Read this selection from our business plan tutorial to fully understand these components. Opinions expressed by, entrepreneur contributors are their own. Now that you understand why you need a business plan and you've spent some time doing your homework gathering the information you need to create one, it's time to roll up your sleeves and get everything down on paper.
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9 - competitive advantages Importantly, identify your Competitive advantages in this section. Specifically, state what is taxi it about your company that will allow you to effectively compete (and win) against both direct and indirect competitors. Section vi - marketing Plan your Marketing Plan section has four sub-sections as follows: 10 - products services Here is where you give the details of the products and/or services your company offers. 11 - pricing Detail your pricing here. In particular, discuss how your pricing relates to competition. For example, are you the premium brand? The low cost brand? Discuss your expected branding based on your chosen pricing model.
For example, do customers care most about speed, quality, location, reliability, comfort, price, value, etc? Section v - competitive analysis your Competitive analysis section has three sub-sections as follows: 7 - direct Competitors Direct competitors are companies that fill the same customer need you fill with the same solution. For example, if you operate an Italian restaurant, other Italian restaurants would be direct competitors. In this section of your business plan, outline who your direct competitors are, and their strengths dfig and weaknesses. 8 - indirect Competitors Indirect competitors are companies that fill the same customer need you fill with a different solution. For example, if you operate an Italian restaurant, a french restaurant would be an indirect competitor. In this section of your business plan, outline who your indirect competitors are, and their strengths and weaknesses.
sub-sections as follows: 3 - market overview The market overview section discusses the size and characteristics of your market. For example, if you are a restaurant, you would include the size of the restaurant market, a brief discussion of sectors (e.g., fast food versus fine dining) and market trends. 4 - relevant Market size the relevant market size is a much more specific calculation of your market size. It is the annual revenue your company could attain if it attained 100 market share. Your relevant market size is calculated by multiplying 1) the number of customers who might be interested in purchasing your products and/or services each year and 2) the amount these customers might be willing to spend, on an annual basis, on your products and/or services. Section iv - customer Analysis your Customer Analysis section has two sub-sections as follows: 5 - target Customers your Target Customers section precisely identifies your current and/or intended customers. Include as much demographic data on your target customers as possible, such as their gender, age, salary, geography, marital status and education. 6 - customer needs In this section of your business plan, specify why customers want or need your products and/or services.
Next, explain why your company is uniquely qualified to succeed. For example, does your management team have unique competencies? Do you have any patents? Are you the first mover in your market? Does a huge, unmet market opportunity exist? Finally, include a synopsis of your financial projections in your Executive summary. Specifically, include your expected revenues, expenses and profits for each of the next five years, how much funding you are seeking, and the key uses of these funds. Section ii - company overview 2 - company overview, the company overview section provides a brief history of your company. Here you will answer questions such as when and how your organization was formed, what type of legal entity you are, and accomplishments to date.
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If youre looking for funding for a new or existing business, you need a business plan. Your business plan gives lenders and investors the information they resume need to determine whether or not they should consider your company. Your business plan outline is the first step in organizing your thoughts. And, when you follow the outline below, you ensure your business plan is in the format that prompts investors and lenders to take action. In the business plan outline below, you will see the ten (10) sections common to business plans, and the twenty-three (23) sub-sections you must complete. Also, to help you out, here is my proven business plan template, that allows you to quickly and easily complete all the sections of your business plan. Section i - executive summary 1 - executive summary, the Executive summary is the most important part of your business plan. Because if it doesnt interest readers, theyll never even get to the rest of your plan. Start your Executive summary with a brief and concise explanation of what your company does.