Business Plan Outline

The business plan concentrates on implementation of the strategic plan with heavy emphasis on the next year.  The business plan is often used to sell the company officers or external investments on the business prospect.  Where the strategic plan looks at the company as a whole, the business plan will generally focus on a specific target market segment or an initial offering.  The business plan should be no more than 20 pages, not including appendices.  The elements of the plan are:

· Cover

· Title Page

· Table of Contents

· Executive Summary

· Should be one to three pages

· State the problem you solved

· Summarize why this is important

à Customers – who are they?

à Describe their problem and how much pain the customers are in today without your product or service (putting this in terms of DOLLARS of pain makes the argument more compelling)

à Market size – how many customers and if they bought your product, how much they will spend

à Growth potential

à Why this hasn’t been done before – break-through technology?  Talent within the principles of the company?

· Summarize who the people of the company are

· In concise bullet points, state the most desirable points concerning the business (not the product) – why investors should want to invest

· Specifically state what action you want from investors, bankers, backers, etc.

· State the expected return for the investors

Opportunity, Products, and Services

· Briefly describe the business – what it provides

· Keep this short!

· Product and Service Description – What are the products, services, and/or solutions offered by the company?   What are the features (strong selling points), benefits (advantages the customer derives from the features), value (the dollar value of the benefits)?  At what stage in the product life cycle are the products of the company and the competitors?

Management and Key People

· List key people and board of directors

· Summarize their experience and skills

· Describe the management philosophy

· Show the team is willing and able to succeed

Market Analysis

· Customers – Tell a story.  Who are the ideal customers?  How do they “struggle” through their days without your products and/or services?  How much does this cost them in money and/or time?  How will their days improve as a result of your products and/or services?  Why will they buy the products and services? 

· Market Segmentation - What are the characteristics, needs, and benefits sought of each segment or customers?  How can the company meet these needs?  What specific opportunities do the segments present?  What are the demographics of each segment (age of the customers/or customer companies, size, geographic distribution, expertise, and profitability)?  What are the buying patterns for each segment (channel, payment performance, brand decision making process, technology adoption characteristics, and size of purchases)? 

· Target Market Segment Strategy

à Customer Needs - In terms of the products and services, what are the needs of the target customers – quality, reliability, price, delivery, support, features, and bundles and solutions?  What are the minimum needs and requirements?  What offerings would cause the customers to change their buying decision?  What do the ideal products and services look like?

à Market Trends - What are the prevailing patterns of change occurring in the market?

à Market Growth – What is the growth rate of the target segment?

· Industry Analysis

à Industry Participants – Who are the members of the food chain in the industry and what part do they play in shaping the industry – suppliers, distributors, wholesalers, resellers/retailers, customers/users, consultants, regulatory groups, universities, and professional associations?

à Sales Channels – What roles do the direct sales force, manufacturer’s reps, distributors, wholesalers, and retailers play in the industry and for what classes of customers and competitors?

à Buying Patterns – What are the buying patterns for each segment (channel, payment performance, brand decision making process, technology adoption characteristics, and size of purchases)?  Who are the decision makers?  Who are the influencers?  What motivates and how does their corporation measure them? 

à Main Competitors – Who are the main competitors in each segment?  What are their revenue and market share?  How do they measure up against the company?  How does their products and services compare to those of the company?

· Describe the sales channels?

· Summarize the market validation steps and further actions necessary

 

Next:  Business Plan  - Part 2