What is a Business Plan?
A business plan is a formal statement of business goals, reasons why and how they are attainable, and plans for reaching them. It is a roadmap for your business that outlines goals and details how you plan to achieve those goals.
1. EXECUTIVE SUMMARY
An executive summary of your business idea and concept should include the following topics. The outline should give a complete idea of what is the goal of business. Bullets can be used in order to be concise and to the point.
This is a summary of the idea. Describe the background of the company that is planned to be formed or already formed, and give a general idea of what the business seeks to accomplish.
This is an outline of the technology behind the idea. Describe the technology and its feasibility. Be sure to discuss the uniqueness of the business idea relative to competitors along with the following:
- What is the business competitive advantage (i.e., what is stopping other competitors from entering this area, how is this business idea better than everyone else in the market?)
- Describe the need for this product or service — what does this business idea bring to the table?
This area describes the marketing approach.
- Describe the potential customer base in terms of: Income, Where They Shop, How They Buy, Geographical location, Age, Gender, etc. – Who is the target market?
- Describe the channels that will be utilized in terms of where the product will be sold and how (i.e. direct Salesforce, by catalog, online, business to business, etc.) – how will you reach the target market?
- Describe the pricing strategy (i.e. is this a premium product that is priced high?)
- Describe the types of promotional activities. Highlight the branding strategy and how customers will be made aware of the product or service.
- Describe the size of the market and any other factors that might need to be considered and/or are integral for the idea.
This section discusses the funds necessary to operate this company, where these monies will be generated, and how the company can survive over time.
- Describe the financial plan
- Describe the price at which the product/service will be sold, the costs associated with the business, margins, and profits.
- Describe projected future costs and revenues
- Describe what the model for revenue is and how the company will be sustained over time.
- Identify sources of additional funding
2. PRODUCT/SERVICE SUMMARY
Describe briefly the specifics of the product or service.
- Features: Describe what the product/service is.
- Benefits: Why is the product/service valuable? Value proposition.
- Competitive comparison: General comparison of the features of the product/service with the existing providers of a similar offering in the market. (Not to be confused with the description of competition that follows, as this section just deals with very general competitive comparison. For example: a comparison of medical records online as compared to the providers of medical records through traditional channels in general.)
- Technology (if it is a technology related product/service): Do not be too technical, but mention the unique or core technological features of the product/service.
- Fulfillment: Describe how the service/product features are going to be fulfilled. For example: how the customer service is going to be fulfilled.
- Future products/enhancements/services: For example: medical records for wireless devices.
3. MARKET SUMMARY
Summarize segmentation, target market, size and growth of the market.
- Market segmentation: How is the market segmented, i.e., how are the future clients classified. Explain the entire market and not just the target market.
- Target market segment: Describe who comprises the target market. Mention the size and growth of the market.
- Market need: What is the pain that the future clients are suffering from? Is the pain legitimate and how this product/service will help in solving the problem?
- Competition: Describe the main groups of competitors and then the individual business participants in each group. This is one of the most important parts of the business plan.
- Competitive advantage: What advantage does this product/service have compared to the competitors?
4. STRATEGIES SUMMARY
- Entry strategy: Who will be the first customers?
- Marketing strategy: Describe the marketing techniques that will be used.
- Selling strategy: How will the product/service be sold? Direct sales, salesmen, Web, brick and mortar, or all of the above.
- Distribution strategy: What are the channels of distribution?
- Pricing strategy: How is the offering priced?
5. MANAGEMENT TEAM SUMMARY
Describe in brief the summary organizational structure of the company.
- Management team: Describe briefly what each member brings to the table.
- Board of advisors: Describe briefly what each member brings to the table.
- Personnel plan: Show the number of people needed to be hired in the next five years and their cost.
6. FINANCIAL PLAN SUMMARY
Summarize the financial plan:
- Important assumptions
- Break-even analysis
- Profit and loss statement for five years
- Cash flow statement
- Projected balance sheet
- Exit strategy
Plans should be submitted as a single, printable PDF file. The business plan is limited to no more than 10 pages. This would include a single cover page, single table of contents page, and two page executive summary, 8 pages of a business plan (note cover page and Table of Contents are required). Page format is 1.0 line spacing with 1 inch top, bottom, left and right margins, and 12-point font. This line spacing and font requirement applies to the textual content of the document and not to titles and descriptions accompanying pictures, graphs, tables or worksheets. All pages must be numbered excluding the cover page.
To review, here are the required elements and their page limits:
- Cover page— one page(Name of team leader and team members should be mentioned on cover page)
- Table of contents— one page
- Executive Summary— two pages
- Body of Plan—8 pages