Parts of a Business Plan

Not every Business Plan will be the exactly same, but every Plan should incorporate several key elements.

The Parts of the Plan

Here are the key pieces to a solid Business Plan.

Title page
 The title, or heading, of the plan, and very brief description of the business.
 The date
 The name of the owner
 The company name and location
 A copyright or confidentiality notice
Table of Contents
 A list of the individual sections and their page numbers, starting with the Title Page and ending with a
section for Special Materials (references, etc.).
Summary/Overview
 A brief, but focused statement (a few sentences or paragraphs) stating why the business will be
successful. This is the most important piece of a Business Plan because it brings everything together.
Market Analysis
 Identifies specific knowledge about the business and its industry, and the market (or customers) it
serves.
 An analysis that identifies and assesses the competition.
Description of the Company
 A close look at how the different components of the business fit together, such as:
o Information about the nature of the business and the factors that should make it successful .
o Special business skills and talents that provide the business with a competitive advantage, such as
a unique ability to satisfy specific customer needs, special methods of delivering a product or
service, and so on.
Organization & Management
 The company’s organizational and legal structure, Is it a sole proprietorship? A partnership? A
corporation? (See: “Ownership Structures“)
 Profiles of the ownership and management team: What is their background, experience and
responsibilities?
Marketing & Sales
 The company’s process of identifying and creating a customer base. (See: “Market Research“)
Description of Product or Service
 A detailed description of the product or service – from the customer’s point of view:
o How they will benefit from the product or service?
o Specific needs or problems that the business can satisfy or solve, focusing especially on areas
where the business has the strongest skills or advantages.
Funding
 The amount of current and future funding needed to start or expand the business. Includes the time
period that each amount will cover, the type of funding for each (i.e., equity, debt), and the proposed or
requested repayment terms.
 How the funds will be used: For equipment and materials? Everyday working capital? Paying off debt?
Financials
 Explains or projects how the company is expected to perform financially over the next several years.
(Sometimes called a “pro-forma projection.”) Because investors and lenders look closely at this
projection as a measure of your company’s growth potential, professional input is strongly
recommended.
Appendix
 Provides specific information that certain individuals (such as creditors) may want review. It allows the
addition and/or deletion of information as needed, such as:
o Credit histories (personal & business)
o Resumes of key personnel and partners
o Letters of reference
o Details of market studies
o Copies of licenses, permits, patents, leases, contracts, etc.
o A list of business consultants, attorneys, accountants, etc.
On this page you’ll learn how to structure and format your business plan
professionally, ensuring that readers look beyond distracting style to the real
meat of your idea.

Business Plan Cover Sheet

Every business plan should begin with a simple business plan cover
page including the business name, your name and contact information. An easy
to read table of contents should follow. The cover sheet should leave no question
for readers to be able to identify the plan when it is in a stack with dozens of
others on their desk. The table of contents allows them to easily refer to sections
within the plan. For example, after reading the executive summary, some
investors with an eye for numbers may turn directly to the financial plan and
statements.

Follow This Business Plan Outline

There are 10 business plan components or sections that every entrepreneur and
business owner must include in your plan. These are the executive summary,
company overview, industry analysis, customer analysis, competitive analysis,
marketing plan, operations plan, management team, financial plan and appendix.

Within these sections of your business plan template, charts and graphs
displaying information in a graphical format are welcomed and help to break up
long blocks of text. However, charts and graphs shouldn’t be used for their own
sake. They must make the information easier to pass on than text would.

The business plan format that investors and lenders expect includes the follows
10 sections:

1. Start with Your Executive Summary

An executive summary gives readers a crisp overview of your business at the start
of your plan. This section should not be more than two pages long and should
include the following:

 What is the business about?

 Where and why did the idea of the business originate?
 Who are the owners?
  Which industry is it operating in?
 What is its core function?
 Where is it located?
 How is it going to make money?
 How much money (if any) is it already making?
 What are its financial projections?

2. Company Overview Section

The company overview is the perfect place to highlight the strengths of your
business. This section gives the reader additional information about your
products and/or services and describes your company’s past accomplishments.

Including the below in this section will provide further clarity about your business:

1. What type of business you are (e.g., C-Corporation, sole proprietor)

2. When your business started
3. Business’ accomplishments to date

3. Industry or Market Analysis

The industry or market analysis gives the reader a clear understanding of your
industry and the audience it serves. It includes a detailed explanation of your
market size and trends.

4. The Customer Analysis States Who Your Customers Are and What They Need

In this section of your plan, explain who your target customers are and identify
their specific needs. Doing this will help you better target and attract customers.

5. Competitive Analysis

The Competitive Analysis section identifies your direct and indirect competitors. It
discusses who they are and their strengths and weaknesses. It then details your
areas of competitive advantages.

Whether your competitors are small or large businesses, describe them. Telling
investors there are no competitors (big or small) often gives the impression that a
market does not exist for your company.

6. Your Marketing Plan is a Key Section

The marketing & sales section of your business plan should outline how you plan
to attract new customers and retain old ones. This section should outline the
ways customers can be introduced to and engage with your offerings and
describe how you will convert these prospects into paying customers.

Set marketing objectives that include the following (if applicable):

 Introducing new products

  Extending the market reach
 Exploring new markets
 Boosting sales
 Cross-selling
 Creating a long-term partnership with clients
 Increasing prices without affecting sales
 Creating a content marketing strategy

Organize your Marketing Plan into the 4 P’s – Price, Product, Promotions and
Place.

7. The Operations Plan Format

Your Operations Plan identifies your key operational processes and milestones
you expect to accomplish. Using a Gantt chart is a great way to show your
expected future milestones.

8. You Need to Prove Your Management Team Can Execute

“A company is only as good as the people it keeps.” – Mary Kay Ash, American
Entrepreneur and Businesswoman

The Management Team section of your business plan focuses on the people who
run the business.

Who are the decision-makers, who is the product expert, who is the operations
head, and who is running the entire show? A glimpse into the expertise and
capabilities of your team members and how their experiences will help grow your
business will boost stakeholder confidence.

9. Format Your Financial Plan

The goal of this section is to convince the reader that your business is stable and
will be financially successful. Arm this section with past and/or forecasted cash
flow statements, balance sheets, profit & loss statements, expense budgeting and
sales forecasts.

If you run an operational business, include 3 years of historical data to help

investors gain an understanding of how feasible your funding request is and if
your business is capable of generating good returns.

Also include your funding request, if applicable, in this section. You should
mention how much investment is required to take your business to the next
significant milestone and how the money will be spent. You should also define if
you are seeking debt or equity funding. If you are seeking debt financing like an
SBA loan, ensure your financial projections include the debt and show steady
repayments of both the principal and return under reasonable loan terms.
If you are seeking equity financing, you don’t need to include your valuation
expectations in the business plan, but you should be aligned within your
ownership team on the amount of equity you are willing to exchange before you
pitch investors.

10. Appendix

This section includes supporting documentation of your business case. This could
include renderings of a planned store location, market research reports
referenced in the plan, key supplier or buyer contracts that substantiate your
financial projections or historical marketing and sales data.

Formatting Your Business Plan

Overall, business plans should use simple and standard formatting. Twelve point
font size in a standard font like Arial or Times New Roman is best, as well as the
standard margin size of one inch on each side. Pages should be numbered, and
the name of the company should appear on each page in the header or footer.

Use charts whenever possible as it makes it much easier for readers to consume
the information in your plan

References

https://business.phila.gov/business-plan/

https://www.growthink.com/businessplan/help-center/business-plan-format-how-structure-your-business-
plan#:~:text=Formatting%20Your%20Business%20Plan,one%20i