BUSINESS PLAN - TITLE PAGE
ABC COMPANY
1234 Anywhere Street
Somewhere, Saskatchewan
S4S 2X8
Phone: 123-4567
Fax: 234-5678
Contact: Principal Name(s)
Plan Date: Month 2005
ABC Company Business Plan Commercially Confidential
7/6/2006
Wherever possible, you should indicate the source of your information and provide the
appropriate references. If the information is based upon your own knowledge and experience,
state this and provide any supporting evidence that may be available.
The following is a guide to the type of information required. You should include any
information that will help someone understand your business and how you intend to run it.
EXECUTIVE SUMMARY
The executive summary is a clear, concise, one to three page summary of the key points
in your business plan.
It describes the current status of your business.
It identifies your products and market/customer characteristics.
It provides information on your marketing strategy in terms of where the business is at
and where the business wants to be.
It identifies any projects for which financing is being sought, the total cost of these
projects and how you propose to fund them.
BUSINESS OVERVIEW
This section provides an overview of your business and does not include a lot of detail;
additional information will be provided in other areas of the business plan. The overview may
include information about the following:
The organization's goals and objectives;
The business start date;
The form of organization, e.g. sole proprietorship, corporation, partnership;
Name of owners, managers and key personnel;
The geographic location of the operations;
Products;
Customers;
The geographic location of its customers;
Major assets, e.g. land, building, machinery and equipment;
Major liabilities;
Sources of financing;
Number of employees;
Sales and net income levels;
Any closely related company (provide relevant information in appendices); and
Any significant changes to any of the above being proposed.
MARKET ANALYSIS
The market analysis section describes the industry, or business environment in which your
business operates; for example:
It presents a profile of your customers;
It measures the size of your market;
It provides information on the pricing of your product;
It identifies your competitors; and
It can highlight other factors pertinent to your business, such as special government
regulatory product requirements.
Where appropriate, this information should be presented in segmented form, e.g. by geographic
area or product line. The market analysis section should address the following points:
Industry (Business Environment) Overview
This overview can be used as an introduction to your market analysis. The introduction
could include:
A description of the industry and its size;
Comments about the current and future industry outlook; and
Identification of key customers, such as retail consumers,
businesses, or
government.
Customer Profile
A profile of the customer that uses or will use your product or service should be
developed. The customer profile would include identification of the following:
Who is the customer;
What are their product needs/wants;
How often do they buy and when do they buy;
If applicable, what is the age, sex, education, income level of your customer; and
Who influences the customer's decision to buy.
Target Market Profile
The target market section measures the total size of the market in which your product or
service competes, or will compete. In some cases, it may be difficult to obtain specific
information, therefore, use your best judgment given available information and what you
know about the market. In general, the target market profile should identify the
following:
Number of prospective customers;
Total annual sales, including dollar value; and
Market growth rates/trends.
Market Penetration
Market Penetration measures how much of the total targeted market you are forecasting
to attain. In general, market penetration should:
Identify your existing and projected market share, including the dollar value; and
Provide rationale for the market share you believe can be achieved by your
business. For example. are sales targets supported by research information?
Product Pricing
This section provides information on the price of your product. Generally speaking the
price of the product may be based on the cost of the product, or the price may be driven
by what the market will bear, or price may be negotiated. Also, you may have to
consider various pricing structures (e.g. a wholesale price as well as a retail price)
depending upon how you get your product to the end-user (e.g. do you sell direct to the
end-users, wholesalers, retailers, or brokers). Product pricing information requires
answers to the following questions:
What is or what will be your product price;
How does your price relate to your competitor's price;
What price and sales volume do you need to be profitable;
What control do you have over your product prices;
Can the same product be sold at different prices in different markets (e.g. different
geographic locations);
Can the same price level be maintained over time;
Will you have to offer discounts and if so how much; and
Summarize your pricing policy.
Competition
The more you know about your competitors, the more you know about your market. This
section represents a profile of your competitors and should identify the following:
Who are your competitors;
The product(s)/service(s) they compete with;
Their strengths and weaknesses (e.g. financial condition, market share, reputation,
price, product features, services etc.);
Their possible reaction to you as a competitor; and
How you compare with your competitors.
Regulations
This section is used to comment on any government regulatory requirements or
restrictions that could be related to your business or product/service. If government
regulations or restriction apply to your business, you should:
Identify the regulation or restriction; and
Comment on how you will overcome any barrier related to the regulation or
restriction.
Other
This section may be used to provide any additional information pertinent to your market
analysis.
PRODUCT PROFILE
This section provides a description of your product/service which meets the need of the end-user.
The profile may include the following:
Existing Products and Services
Provide a description of the product/service;
Identify specific benefits, including how the product/service meets the needs of
the end-user;
Identify key features of your product/service versus that of your competitors;
Comment on the useful life of your product/service; and
Identify special patents, copyrights, or royalty arrangements associated with your
product.
New (proposed) Products/Services
Comment on activities in progress and anticipated results.
MARKETING PLAN
This section identifies marketing activities (e.g. strategies, actions, policies) that will enable you
to attract and keep customers and meet financial forecasts. The marketing plan should include
the following:
Marketing Strategy Overview
This area can represent an introduction to your marketing plan; for example, it may
describe your growth strategy and where you want to position your business relative to
your competition.
Promotion
Promotion involves undertaking activities that will create demand for your
product/service. The promotion program that you implement will depend upon factors
such as the type of product or service being sold, the type of customer, the method of
distribution, the type of sales force, and the available finances. Product promotion may
include the following:
Advertising in newspapers, magazines, trade journals, product brochures,
catalogues, videos, and multimedia presentations;
Attending trade shows, personal selling by company employed staff, or a nonemployee
sales agent;
In-store product sampling and demonstrations; and
Other as required.
For product promotion you should:
Identify the promotional activities to be carried out;
Provide a budget for promotional strategies; and
Provide a rationale for your promotional activities.
Distribution System
The distribution system, or channel of distribution, represents the route taken by your
product in order to reach the end-user. The route taken by your product will often
involve the use of a middleman such as a distributor, retailer, original equipment
manufacturer, or broker. However, in some cases the route may not involve a middleman
as you may sell your product directly to the end-user. For your distribution system:
Identify your distribution system(s); and
Provide the rationale for your distribution system. Ask yourself:
- Is it a good match for my company and product? Why?
- Is it the most cost effective channel?
- Is it the best way to reach my target market?
Product Packaging and Labeling
This area involves having the right package and label for the product and its market. For
your packaging and labeling, you should:
Identify any special requirements, which may be requires to protect or enhance its
appeal to the customer; and
Identify governmental or industry regulations which must be met.
Transportation
Depending on your product, transporting the product to a middleman or end-user may or
may not be a major issue. For transportation you should:
Identify your transportation system and related costs.
Other Considerations
In some cases, depending upon the product, you may have to consider other customer
related factors; for example, your product warranty or product servicing.
OPERATING PLAN
The operating plan is basically a description of the inputs required to manufacture or process
your product, along with the information on how to manufacture or process your product, as well
as information on any environmental considerations. In your operating plan you should include
the following:
If you are an existing business, identify existing facilities and production capacity or
capacity level;
Describe existing or proposed method of manufacturing or processing,
provide flow
charts if available;
Identify proprietary technologies;
Identify if operation is seasonal and comment on the seasonal nature of the operation;
Describe raw materials, supplies, labour etc. required for your manufacturing or
processing operations;
Comment on sources of supply of raw materials and the availability of those raw
materials;
Comment on special employee training programs including the nature of the training,
identification of who will be trained and who will do the training, and the length of
training required; and
Comment on any environmental issues related to the operation (e.g. air, water, noise
pollution) and indicate whether your business currently meets all applicable
environmental regulations. Identify what steps will be taken to reduce/eliminate
environmental impacts.
MANAGEMENT
This section is required in order to provide information on your management expertise as it is
this expertise which will attract a willing lender or investor. In this section you should include
the following:
Current Management Team
Identify the key managers and their main duties;
Identify any special or unique skills which enhance the business's competitive
advantage; and
Include a resume for each key manager in the appendices section.
Additions to Management Team
Identify new managers which may be recruited within the near future.
OWNERSHIP
In this section, identify the current or planned owners of the business. If it is a corporation,
identify who owns the shares and percentage of ownership.
FUTURE PLANS AND REQUIREMENTS
This section includes a detailed description of your plans, in particular any new projects that are
to be undertaken. In general, it should include a summary of the costs and funding requirements
and your assessment of the risks. The following information should be provided:
Details of Any New Capital Projects
Identify and itemize land, building, machinery/equipment, pre-production or
working capital requirements;
Identify production and processing capacity needed;
Indicate anticipated start date, completion date, possible start of commercial
production, and any other critical deadlines;
Identify number and type of jobs that will be created by the project;
and
If a third party assessment was undertaken on your project, include this
assessment in the appendices section.
Details of New Market Development and Research
Summarize the opportunity (detailed information regarding the marketing or
R&D opportunity should be provided elsewhere);
Identify what activities (steps and tasks) will be carried out;
Identify who will carry out the activities;
Identify the project time frame and appropriate milestones;
Identify what special resources will be required (e.g. special equipment,
consultation, etc.); and
If a third party assessment was undertaken on your project, include this
assessment in the appendices.
Costs
This area summarizes all costs to be incurred, details will be given elsewhere. A
summary table is usually all that is required.
Funding
In this section, identify the sources of funds (e.g. new equity, internally generated funds,
financing from a bank, or any other sources) for the costs summarized in the section
above. For borrowing funds, check with the potential lender regarding interest rates,
available funding, and repayment schedule, before you complete this section as this
information should be incorporated into this section and it can be used in the
development of your financial statements.
Proposed Project Risk Factors
Describe your assessment of the main risks (e.g. technical, financial, management,
market, etc.) associated with the project.
FINANCIAL STATEMENT DATA
All potential lenders or investors will require financial information on your business. As a
minimum requirement for start-up operations and major expansions, you will likely have to
provide the following information:
For a new business:
Provide an opening balance sheet;
Provide a three to five year financial projection including balance sheet, income
statement, and cash flow. The first year cash flow should be on a monthly or
quarterly basis;
Ensure that the projections are consistent with the rest of the business plan; and
Identify all significant assumptions used to develop the financial forecast.
For an existing business, provide the above as well as:
Where possible at least three years of historical annual financial statements; and
Interim financial statements for the current year to date with a projection to year
end.
APPENDICES
The appendices of a business plan can include any supporting information to claims made in
your business plan. The following is some of the information that may be included:
resume(s) of the owner(s) and key personnel
personal financial statement of each owner (and their spouse, if applicable)
letters of support from vendors/suppliers/customers
copy of major contract(s)
copy of lease or purchase agreement(s)
quotation on any major planned purchases
photos/maps of business area, store layout, competitors' locations, etc.
promotional items (sample ads, brochures, menus etc.)
For information on other programs or services, please contact Ventures
Community Futures Development Corporation by telephone at 306-782-0255,
toll free at 1-877-782-0255, or through e-mail at info@venturescfdc.com.