Lesson 3.

2
What Goes into a Business Plan?

Learning Objectives
3.2-1 List and describe the basic elements
of a business plan.
3.2-2 List and describe the other elements
of a business plan that capture
readers’ attention and provide
supporting information.
Chapter 3 Entrepreneurship: Ideas in Action 6e
Slide 1 © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
 Basic Elements of a Business Plan

1. Introduction
2. Marketing
3. Financial Management
4. Operations
5. Concluding Statement

Chapter 3 Entrepreneurship: Ideas in Action 6e

Slide 2 © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
 Introduction

 Detailed description of the nature of the business and its

goals
 The ownership of the business and the legal structure
 The skills and experience you bring to the business
 The advantages you and your business have over your
competitors

Chapter 3 Entrepreneurship: Ideas in Action 6e

Slide 3 © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
 Marketing

 Product/Services
 Market
 Industry
 Location

Chapter 3 Entrepreneurship: Ideas in Action 6e

Slide 4 © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
 Financial Management

 Identification of Risks
 Financial Statements
 Pro forma financial statement: Financial statement
based on projected revenues and expenses
 Funding Request and Return on Investment

Chapter 3 Entrepreneurship: Ideas in Action 6e

Slide 5 © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
 Operations

 Day-to-day management of the business

 Equipment needed for production of the product or
service
 How the product or service will be produced and
delivered

Chapter 3 Entrepreneurship: Ideas in Action 6e

Slide 6 © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
 Concluding Statement

 Summarize the goals and objectives you have for your

business.
 Emphasize your commitment to the success of the
business.

Chapter 3 Entrepreneurship: Ideas in Action 6e

Slide 7 © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
 Complete the Business Plan

 Introductory Elements
 Cover letter: Introduces and explains an
accompanying document or set of documents
 Title page
 Table of contents
 Statement of purpose: Brief explanation of
why you are asking for a loan and what you
plan to do with the money

Chapter 3 Entrepreneurship: Ideas in Action 6e

Slide 8 © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
 Complete the Business Plan (continued)

 Introductory Elements (continued)

 Executive summary: A short restatement
of the report
 Appendix
 Put it all together
 Your business plan should follow a
standard format and be organized.

Chapter 3 Entrepreneurship: Ideas in Action 6e

Slide 9 © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
 Sample Cover Letter

Chapter 3 Entrepreneurship: Ideas in Action 6e

Slide 10 © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
 Statement of Purpose

Chapter 3 Entrepreneurship: Ideas in Action 6e

Slide 11 © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
 Executive Summary

Chapter 3 Entrepreneurship: Ideas in Action 6e

Slide 12 © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
 3.2 Quiz/Questions Review

1. Regardless of the business, all business plans serve the same basic purposes. T/F
2. Only corporations need to include a section detailing the form of ownership in a business plan. F/T
3. The marketing section of your business plan should describe the location of your business. T/F
4. A financial state based on projected revenues and expenses is called an informal financial statement. F/T
5. The financial management section of your business plan should state how much money you need to
borrow and how you plan to use the money. T/F
6. A brief explanation of why you are asking for a loan and what you plan to do with the money is called
an executive summary. F/T
7. The executive summary appears after the body of the business plan. F/T
8. A handwritten business plan is acceptable if it is neat, well organized, and inviting to read. F/T
9. A business plan’s title page includes the name of the company. T/F
10. I love being a MCHS cowboy/cowgirl! T

Chapter 3 Entrepreneurship: Ideas in Action 6e

Slide 13 © 2017 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.