Business Plan Outline

by Dick Stevenson, SCORE Chapter 432, Moline.

Please follow the suggested outline and consider the questions listed under each heading. Omit areas that are not applicable to your specific business. The Cover Sheet
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Identify the business and the document. Identify the location and telephone numbers of the business or where the principals can be reached. Identify the person who wrote the business plan.

Statement of Purpose
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Who is asking for the money? How much money is needed? What is the money needed for? How will the funds benefit the business? Why does this loan or investment make business sense? How will the funds be repaid?

Table of Contents
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Section One: The Business o A. Description of Business o B. Product/Service o C. The Market o D. Location of Business o E. The Competition o F. Management o G. Personnel o H. Application and Expected Effect of Loan o I. Summary Section Two: Financial Data Section Three: Financing Proposal Section Four: Exhibits Section Five: Supporting Documents

Section One: The Business

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A. Description of Business o What business are you in? o What is the status of the business? (startup, expansion, takeover) o What is the business form? (Proprietorship, Partnership, Corporation) o Why is your business going to be profitable? (or continue to grow) o When will (did) your business open? o What hours of the day and days of the week will (are) you in operation? o Is your business seasonal? B. Product/Service o What are you selling? (not "what are your products or services?") o What are the benefits (as opposed to the features) of what you are selling? o How do your products and /or services differ from competing products and/or services? o If your product is new or state-of-the-art or otherwise unique, what makes it different? Desirable? o If your product or service line is not special, why would people buy from you? C. The Market o What are your markets?

Which ones are buying from you now? What products are they buying? Who are the people who are buying from you? How would you characterize your markets? (growing, steady, declining) Why do these people buy from your company? Why do they buy from you and not the competition? What are they buying from you? On what cycle? How can you find more buyers like these? What is the size of your market? What percent of each market do (or will) you have? What is each market's growth potential? As each market grows, will your share increase? Is the market competitive or not? If not, why not? How will you attract and keep these markets? How can you expand your markets? See Exhibits for Annual Sales Forecasts D. Location of Business o Where are you located? o What are the physical features of your building? What should you have? o Do you lease or own your space? o What renovations are needed, and how much will they cost? o Does zoning in your area permit your kind of business? o What other kinds of businesses are in your area? o Why did you pick this site over others? o Why is this the right location for your business? Where should it be? o How will this choice of location affect your operating costs? o Are any demographic or other market shifts taking place? E. The Competition o Who are your five nearest competitors? o How is their business? (steady, increasing or decreasing) o How are their operations similar and dissimilar to yours? o What have you learned from watching their operations? o How will your operation be better than theirs? F. Management o 1. Personal history of the Principals  Who is on the management team?  What is your business background?  What management experience have you had?  What education (including both formal and informal learning experiences) has a bearing on your managerial abilities?  What are your ages, special abilities and interests, reasons for going into business, where do you live and have lived, etc.  Are you physically up to the job?  Why are you going to be successful in this venture?  What is your personal financial status? See Exhibits for Owner's Personal Financial Statement. o 2. Related work experience  What is your direct operational experience in this kind of business?  What is your managerial experience in this kind of business?  What other managerial experience have you had? (different businesses, clubs, teams, civic or religious organizations, etc.) o 3. Duties and responsibilities  Who does what?  Who reports to whom?  Who makes final decisions? G. Personnel o What are your current needs ? o What skills will your employees need in the near future? In five years? o What are your plans for hiring and training personnel? H. Application and Expected Effect of Loan
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How much money do you need? For what purposes will it be used? See Exhibits for Sources and Uses of Funds I. Summary o Summarize ideas developed in the preceding sections. o Make sure the different parts of the analysis make sense, support each other logically and coherently, and project probable success.
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Section Two: Financial Data (forms attached)

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List additional financial documents to be found in the Exhibits section. o A. Sources and Uses of Funds o B. Capital Equipment List o C. Balance Sheet o D. Break-Even Analysis o E. Projected Income Statement  1. Three Year Summary  2. Detail by Month, 1st year & Quarter, 2nd and 3rd years o F. Cash Flow Projections  1. Three Year Summary  2. Detail by Month, 1st year & Quarter, 2nd and 3rd years o G. Budget Deviation Analysis o H. Historical Records (Balance Sheets, Income Statements and Tax Returns for past 3 years. o I. Summary  Explain basic assumptions used in their preparation.  Provide other comments necessary to understand the documents  Position the documents in the Exhibits section.

Section Three: Financial Proposal

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Explain fully your proposal to the lender.

Section Four: Exhibits (as required and/or appropriate) Section Five: Supporting Documents
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For example: Brochures & advertising materials, industry studies, blueprints & plans, maps & photos of locations, magazine or other articles, lists of equipment owned or to be purchased, copies of leases & contracts, letters of support from future customers, other materials which support the assumptions in this plan.

SUBSIDIARY SCHEDULES FORM

Sources of Funds Owners Investment A. B. Total Owners Investment Bank Loans A. B. Total Bank Loans

Other Loans Econ. Develop. Loans Total Other Loans Total Sources Uses of Funds Buildings/Real Estate Land/Improvements Construction Remodeling Leasehold Improvements Total Bldgs/Real Estate Capital Equipment Furniture Equipment Fixtures Machinery Total Capital Equipment Administrative Costs Deposits Prepaid Insurance Goodwill Total Administrative Costs Opening Inventory A. B. C. D. Total Inventory Preopening Expenses Accounting & Legal Advertising Car/Delivery/Travel Insurance Interest Outside Services Payroll Taxes Rent Repairs & Maint. Supplies Taxes Telephone Utilities Wages Misc. 0 Total Preopening Expenses

Owners Withdrawal Working Capital Requirement Contingency Fund

SUMMARY SCHEDULE FORM SOURCES OF FUNDS Owners's Investment Bank Loans Other Loans Total Sources USES OF FUNDS Building/Real Estate Capital Equipment Administrative Costs Opening Inventory Preopening Expenses Owner's Withdrawal Working Capital Requirement (from Cash Flow Projection) Contingency Fund (amount required to make Cash Flow Projection breakeven) Total Uses

SECURITY AND COLLATERAL FORM Collateral for Loans .......... Value .......... Description Note: Value is lower of cost or market value Total Collateral Signers for Loans (Requires all major owners) Guarantors for Loans (Other than owners)