A business plan is a living, written document that describes in detail how a business is going to achieve its goals. It is a road map that provides marketing, financial, and operational direction, so that it can avoid many of the bumps in the road along the way. It is also extremely helpful when seeking investors or financial help, because it allows people to visualize the opportunity your business provides.
So, what exactly are the components of a business plan? According to the Small Buisness Administration (SBA) and Small Business Development Center (SBDC), there are several components of a business plan that you should be aware of. As a consultant, I've reviewed quite a number of business plans and the ones that I found to be the most thorough and helpful had these things included:
1. Executive Summary
The Executive Summary is just that- a summary. It's a short dive into what your business idea is, the market opportunity, and how you intend to make it succeed. You'll want to include brief information regarding the financials and the management team's experience, but don't worry, you'll be able to go more in depth later on.
Don't provide too much information or description, you only have a maximum of three pages for the summary. Think of it as your elevator pitch!
2. Business Description
Guess what you go over in the Business Description section? That's right, your business! Now, a lot of people will make the mistake of going into too much detail about their idea in the executive summary; however, THIS is really where you want to provide that information.
In the Business Description section you'll describe:
The business history
Performance to date (if you're just getting start, you likely won't have much information in this part)
Key goals and timelines
Legal and liability information
Insurance and security issues