Executive Summary Of Your Business Plan Part 1

I. Instructions: Executive Summary The Executive Summary is the most important part of your business plan. Often, it’s the only part that a prospective investor or lender reads before deciding whether or not to read the rest of your plan. It should convey your enthusiasm for your business idea and get readers excited about it, too. Write your Executive Summary LAST, after you have completed the rest of the business plan. That way, you’ll have thought through all the elements of your startup and be prepared to summarize them. The Executive Summary should briefly explain each of the below. 1. An overview of your business idea (one or two sentences). 2. A description of your product and/or service. What problems are you solving for your target customers? 3. Your goals for the business. Where do you expect the business to be in one year, three years, five years? 4. Your proposed target market. Who are your ideal customers? 5. Your competition and what differentiates your business. Who are you up against, and what unique selling proposition will help you succeed? 6. Your management team and their prior experience. What do they bring to the table that will give your business a competitive edge? 7. Financial outlook for the business. If you’re using the business plan for financing purposes, explain exactly how much money you want, how you will use it, and how that will make your business more profitable. Limit your Executive Summary to one or two pages in total. After reading the Executive Summary, readers should have a basic understanding of your business, should be excited about its potential, and should be interested enough to read further. After you’ve completed your business plan, come back to this section to write your executive summary on the next page. Executive Summary (Write after you’ve completed the rest of the business plan.) II. Instructions: Company Description This section explains the basic elements of your business. Include each of the below: 1. Company mission statement A mission statement is a brief explanation of your company’s reason for being. It can be as short as a marketing tagline (“MoreDough is an app that helps consumers manage their personal finances in a fun, convenient way”) or more involved: (“Doggie Tales is a dog daycare and grooming salon specializing in convenient services for urban pet lovers. Our mission is to provide service, safety and a family atmosphere, enabling busy dog owners to spend less time taking care of their dog’s basic needs and more time having fun with their pet.”) In general, it’s best to keep your mission statement to one or two sentences. 2. Company philosophy and vision a. What values does your business live by? Honesty, integrity, fun, innovation and community are values that might be important to your business philosophy. b. Vision refers to the long-term outlook for your business. What do you ultimately want it to become? For instance, your vision for your doggie daycare center might be to become a national chain, franchise or to sell to a larger company. 3. Company goals Specify your long- and short-term goals as well as any milestones or benchmarks you will use to measure your progress. For instance, if one of your goals is to open a second location, milestones might include reaching a specific sales volume or signing contracts with a certain number of clients in the new market. 4. Target market You will cover this in-depth in the Marketing Plan section. Here, briefly explain who your target customers are. 5. Industry Describe your industry and what makes your business competitive: Is the industry growing, mature or stable? What is the industry outlook long-term and short-term? How will your business take advantage of projected industry changes and trends? What might happen to your competitors and how will your business successfully compete? 6. Legal structure a. Is your business a sole proprietorship, LLC, partnership or corporation? Why did you choose this particular form of business? b. If there is more than one owner, explain how ownership is divided. If you have investors, explain the percentage of shares they own. This information is important to investors and lenders. After reading the Company Description, the reader should have a basic understanding of your business’s mission and vision, goals, target market, competitive landscape and legal structure. Use the Company Description worksheet on the next page to help you complete this section. Company Description Worksheet Business Name Company Mission Statement Company Philosophy/ Values Company Vision 1. Goals & Milestones 2. 3. Target Market 1. Industry/ Competitors 2. 3. Legal Structure/ Ownership III. Instructions: Products & Services This section expands on the basic information about your products and services included in the Executive Summary and Company Description. Here are some items to consider: 1. Your company’s products and/or services: What do you sell, and how is it manufactured or provided? Include details of relationships with suppliers, manufacturers and/or partners that are essential to delivering the product or service to customers. 2. The problem the product or service solves: Every business needs to solve a problem that its customers face. Explain what the problem is and how your product or service solves it. What are its benefits, features and unique selling proposition? Yours won’t be the only solution (every business has competitors), but you need to explain why your solution is better than the others, targets a customer base your competitors are ignoring, or has some other characteristic that gives it a competitive edge. 3. Any proprietary features that give you a competitive advantage: Do you have a patent on your product or a patent pending? Do you have exclusive agreements with suppliers or vendors to sell a product or service that none of your competitors sell? Do you have the license for a product, technology or service that’s in high demand and/or short supply? 4. How you will price your product or service: Describe the pricing, fee, subscription or leasing structure of your product or service. How does your product or service fit into the competitive landscape in terms of pricing—are you on the low end, mid-range or high end? How will that pricing strategy help you attract customers? What is your projected profit margin? Include any product or service details, such as technical specifications, drawings, photos, patent documents and other support information, in the Appendices. After reading the Products & Services section, the reader should have a clear understanding of what your business does, what problem it solves for customers, and the unique selling proposition that makes it competitive. Use the Product and Service Description Worksheet on the next page to help you complete this section. Product & Service Description Worksheet Business Name Product/ Service Idea Special Benefits Unique Features Limits and Liabilities Production and Delivery Suppliers Intellectual Property Special Permits Product/ Service Description IV. Instructions: Marketing Plan This section provides details on your industry, the competitive landscape, your target market and how you will market your business to those customers. 1. Market research There are two kinds of research: primary and secondary. Primary market research is information you gather yourself. This could include going online or driving around town to identify competitors; interviewing or surveying people who fit the profile of your target customers; or doing traffic counts at a retail location you’re considering. Secondary market research is information from sources such as trade organizations and journals, magazines and newspapers, Census data and demographic profiles. You can find this information online, at libraries, from chambers of commerce, from vendors who sell to your industry or from government agencies. This section of your plan should explain: The total size of your industry Trends in the industry – is it growing or shrinking? The total size of your target market, and what share is realistic for you to obtain Trends in the target market – is it growing or shrinking? How are customer needs or preferences changing? 2. Barriers to entry What barriers to entry does your startup face, and how do you plan to overcome them? Barriers to entry might include: High startup costs High production costs High marketing costs Brand recognition challenges Finding qualified employees Need for specialized technology or patents Tariffs and quotas Unionization in your industry 3. Threats and opportunities Once your business surmounts the barriers to entry you mentioned, what additional threats might it face? Explain how the following could affect your startup: Changes in government regulations Changes in technology Changes in the economy Changes in your industry Use the SWOT Analysis Worksheet on the next page to identify your company’s weaknesses and potential threats, as well as its strengths and the potential opportunities you plan to exploit.