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The
business plan template that follows has been designed as a guide for
you to write a Business Plan of approximately 15 pages. It can and
should be modified to best reflect your business opportunity.
I. Introduction (1/3 page)
The Introduction should be a brief paragraph or two that describes
the company and its value proposition - the amount of capital in the
business, the amount being raised, and the anticipated use of funds.
The value proposition is the product/service intended to be offered
to the market, the factors that make it compelling, the size of the
market and conservatively speaking the overall size of the opportunity
for investors in terms of anticipated revenue generation and profits
in 3-5 years.
II. History (2/3 page)
A brief description of the history of the company often provides useful
context for understanding management's current motivations. This section
could include years of operation, products and services, performance
highlights, and the reason for the current capital raise. If the company
is an early stage, pre-revenue company, describe briefly the evolution
of the idea and the catalyst that transformed the idea into a company.
Normally, ideas are motivated by a unique/discrete perceived market
opportunity. If your business instead grew out of the presence of
margin benefits, certain supply, or property, plant & equipment
opportunities, you must demonstrate that there is a market for the
product/service you intend to offer at the price points you are forecasting
and that you are likely to capture the market share you are projecting.
III. The Product or Service (1/3 page)
This section should briefly describe the product/service you bring
to the market. This description should convey the essence of the product/service
and the manner in which it is differentiated from similar offerings
in the market place.
IV. The Market Overview (1 page)
It is best to start with a broad, macro overview of the market and
then discuss the product/service more specifically. Your discussion
of your market/industry should include the size of the market and
market trends, both historical and projected. Discuss the dynamics
influencing the market on political, policy, regulatory and/or other
fronts. Describe how these market/industry trends create an opportunity
for your company.
V. The Competiton (2/3 page)
Present an overview of the competitive landscape, beginning with a
summary of the dynamics at play among the competitors and your company
and the reasons your company believes it can carve out a sustainable
competitive advantage. Include a brief description of the major competitors
in the industry - their names, size (in terms of revenues), and other
details relevant to the manner in which they could impact the company
(e.g. large entrenched player in European market with stated expansion
strategy). Discuss the ways in which you intend to manage the risks
the competitors present.
VI. Product/ Service Competitive Positioning
(1 page)
Describe the product/service in the detail required for the reader
to understand how it compares against competing products or services
or other market opportunities. It is helpful to identify the specific
attributes that appear to define purchase decisions and how those
compare with your competitors' offerings. Summarize the manner in
which this provides you with a market opportunity relative to competing
products and services in the market. Discuss the reasons you will
be able to retain this advantage. Provide substantiation - proof of
concept to support your argument. This can be in the form of historical
sales verification, purchase orders obtained for future orders, letters
of intent, survey results, and lastly anecdotal evidence.
VII. Target Customers (1-2 pages)
Identify your targeted customer base. Describe who they are, how large
a market they represent, what their purchase habits are, their profiles
(demographic, psychographic, etc.), the attributes that drive their
purchase decisions and the reasons and manner in which your product
or service is expected to be appealing to them.
VIII. Strategic Plan (1 page)
Describe your basic strategic plan over the next 3 years. Begin with
the market rollout and move to the product/services rollout level.
Include the customer segments you intend to address initially and
if this target will change. Explain how (by geography, by product
line, etc.) and why. Demonstrate the reasons this strategy makes sense,
giving consideration to the typical business issues an early stage
company has to balance including establishing a brand name or geographical
foothold, developing multiple revenue generation capabilities, product
diversification to mitigate risks, supply and infrastructure limitations,
etc. Discuss the strategic alliances you are developing in either
the sections they pertain to or within this section. Describe how
these are expected to bring value to the company.
IX. Marketing and Sales Strategy (1 page)
Describe the manner in which you intend to reach your target customer
base. If you are going to be appealing to several discrete customer
segments, describe your strategy for reaching each of them. Describe
the distribution channels you will be using and the incentive systems
you are providing them that should encourage them to promote your
product. Describe the features and benefits you expect to highlight
that your customer base is expected to find appealing. Describe your
pricing strategy along with the reasoning behind it, describe the
advertising mediums you expect to use and the reasons you anticipate
they will draw in sales.
X. Expansion Strategy (1/2 page)
Summarize the company's longer-term expansion strategy. Discuss the
manner in which it supports the exit strategy you are planning. Discuss
the reasons that make you feel that this expansion plan will be effective.
Discuss the amount of capital you anticipate it will require.
XI. The Revenue Model (1-2 pages)
Describe the company's revenue generating model. Discuss the manner
in which the basic concept behind the business is expected to increase
the revenue generating ability (e.g. more than one ecotourist location
provides cross selling opportunities, revenues from advertising space
sales, couponing, recycling, etc.). Describe the general manner in
which the model is expected to change with time.
XII. Infrastructure (1 page)
Describe the infrastructure you have in place and are expanding upon
or expect to put in place in order to accommodate your strategies.
If the infrastructure is going to be developed in phases, describe
those phases as they correspond to the strategy and revenue model
outlined above. Discuss the manner in which your infrastructure development
plans support and further strengthen the fundamentals of your company
(e.g. appreciation of land values as per historical evidence, stable
labor pool through use of local community people otherwise without
employment, etc.). Describe those elements of your infrastructure
that give advantage to your company over competitors.
XIII. Management (1/2 page)
Describe the full time management team. Discuss their background,
skills, and accomplishments as they relate to making this company
successful. If the company already has a Board of Directors or an
Advisory Board, describe the backgrounds of the members of the Board.
XIV. Financial Model (2-3 pages)
Outline the historical performance of the company. This should include
historical revenues, cost of goods sold, gross profit, SG&A expense,
earnings before income taxes, depreciation, and amortization, the
company's gross and net margins. If the company has been in business
more than three years, present this information on an annual basis.
If the company has been in existence less than 3 years, present this
information on a quarterly basis. If there has been a tremendous improvement
in the company's performance recently, it would be useful to show
this by presenting the information quarterly or in whatever way will
best demonstrate this.
The projections provided in the body of the business plan should also
be summary projections. Consider presenting the most macro level information
- as above on one page with the fundamental assumptions driving the
numbers beneath it. On the next page, consider providing further detail
- present the financials on a quarterly basis and embellish them with
more detail encapsulating the various revenue streams and the various
expenses you anticipate generating. On the following page you might
consider presenting the cash flow statement - again on a quarterly
basis with the same detail as the information presented on the previous
page. A common size income statement expressing the various revenue
sources as a percentage of total revenues, Cost of Goods Sold &
SGA expenses as a percentage of total revenues, and the components
of each expense as a percentage of total expenses would be useful
as well. Additional financial detail should be reserved for the Appendixes
or be available upon request. This detail should include a model -
developed from the bottom up that grows sales and costs "organically".
XV. Environmental and Social Benefits (1/2
page)
Explain the social and environmental benefits of your business. Remember
that these benefits alone should not dominate your business plan.
XVI. Other Information ( ½ - 1 page)
The information you include in this section will depend upon the specifics
of your company. Consider including pictures of your products, testimonials
from customers, articles on your company, information on patents,
etc. It would be useful to include a capitalization table that presents
a picture of the investments that have gone into the company to date
(both debt and equity), the entities that have provided the money,
the percentage ownership the investment has obtained or the terms
of the debt with the amount outstanding.
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