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12.4 Business Plan Template

Note 12.3 "Business Plan Template Part 1" presents an overview of a business plan. It should not be viewed as a checklist, to be filled in extensively with bullet points and narratives. It should be viewed as a set of guidelines for constructing and developing a business model. Some of the subheadings for the sections may not even be addressed in the business plan and others may be addressed in great depth. It depends on the business context.

Business Plan Template Part 1

  1. Business plan title

    1. It should include the name of the business and the name of the founders.
  2. Acknowledgements page
  3. Table of contents
  4. Executive summary (1–2 pages)
  5. Business overview (2–3 pages)

    1. Description of products and services to be offered. If it is a complex product, provide a detailed description of the functions.
    2. Provide a prototype, a scenario, a picture, a diagram, or a mock-up of your product or service. Briefly discuss the prototype. It is often a good idea to illustrate your concept early if the product or service is complex or very unique.
    3. Describe how the product or service solves an important problem or presents an opportunity to fill an important market niche. Be sure to explain why the product or service is not just a good idea, but a sustainable source of revenue that can eventually generate a profit.
    4. Discuss how product is competitive compared with existing product or service offerings.
    5. Will you differentiate your product on price, quality, service, or all the three?
    6. Present a Strategy Canvas illustrating how your product or service compares to the competition.
    7. What is the size of the market you expect to enter?
    8. What is the growth potential of the market?
  6. Industry, economic, and regulatory analysis (2–3 pages)

    1. Describe the current and potential competitors (substitute products). Be sure to discuss potential products and technologies that could make your offering irrelevant.
    2. How will the competition react to market entry?
    3. What are the barriers to entry in the marketplace?
    4. Are there any governmental or regulatory issues that should be considered?
    5. Economic issues?
  7. Marketing strategy (1–3 pages)

    1. Exactly how will you price your product?
    2. What customer segments are you trying to reach?
    3. How will versions be matched to customer segments?
    4. How will you go about promoting your product?
    5. What techniques will be used to acquire customers?
    6. How will you answer inquiries about the product specifications, features, and functions?
    7. How will you retain and lock-in customers?
    8. How will you interact and distribute your product to your customers?
  8. Operations strategy (1–3 pages)

    1. Who will design the product or service and where will product or service design take place?
    2. Where will the product be made, who will make it and how will it be made?
    3. What are the detailed variables and fixed costs for producing the product or service?
    4. Are their important issues related to the supply of components and materials?
    5. How will order fulfillment take place? Are there important issues related to the fulfillment of orders?
    6. How will you provide customer service and support including tech support?
  9. Human resource strategy (1–3 pages)

    1. What kind of employees do we need to run the business?
    2. Where will we recruit them from?
    3. What kind of compensation incentives will be offered in terms of salary, stock options, and benefits?
    4. How will employees be trained and developed?
    5. How will employees be evaluated?
  10. Financials and forecasts (1–3 pages)

    1. Present a simple pro forma sources (cash inflows) and uses of funds (cash outflows) for 3 years after launching.

      1. The sources of funds include starting cash, incoming cash from sales, investor funds, loans, and personal funds.
      2. The uses of funds include payroll or salaries, rent, materials, supplies, land, office space, equipment, warehouse costs, transportation costs, maintenance, marketing, and other overhead.
      3. Include ending cash balance for each year. Can also include net present value and internal rate of return calculations.
    2. Present a simple pro forma income statement for 3 years after launching. Be sure to discuss assumptions for sales, expenses, and growth.

      1. Income should include total sales, less production costs or cost of goods sold, and net or gross margin.
      2. Include operating expenses that have been somewhat aggregated and total expenses.
      3. Bottom line should list net profit or loss.
    3. Start-up and development costs needed before launch (see above). How will they be funded?
    4. What are the capital or funds requirements over the next 3 years?
    5. What type of accounting system will be utilized? Will it be ready by launch date?
    6. Risk assessment: How will you handle extraordinary events (such as changes in demand, turnover, economic conditions, disasters, and employee loss)? How will the risk factors affect the bottom line.
  11. Stage of development and the implementation plan (1–2 pages)

    1. What resources have already been committed?
    2. What stage of development are you in?
    3. What needs to be done before launch?
    4. When and how will the system be implemented (show timeline here)?
  12. Angel and venture capital funding (1–2 pages)

    1. How much funding is needed?
    2. What are you offering in return for funds?
    3. When can your investors expect a return on their investment?
    4. What are your projections for the investors’ return on investment?
  13. Business plan summary (1 page)
  14. Appendices (1–5 pages)

    1. Short bios or resumes for principals.
    2. Critical financial, operational, marketing, or financial details.