Writing A Business Plan

The market—You must convince prospective investors that the company’s market is large, growing and receptive to your products or services. If the market is small or stagnating, investors are less likely to invest. Appendices can include more detailed market information.

The competition—The competition section of the plan identifies competing products and technology. Compare your product or service with the competition. How will your price or quality be different? What will make it successful.

Marketing—The marketing section of the business plan should describe the company’s marketing plan and strategy in as much detail as possible.

Financial statements and projections—The body of the plan should include a summary of the key aspects of the financial forecasts, which appear in more detail in appendices. These may include total cash requirements, the time frame for positive cash flow and the anticipated growth in sales and profits. The financial forecasts appendices should have more detail: balance sheets, income statements and cash flow projections for a 3- to 5-year period, with the information presented monthly for the first year and quarterly in following years. The projected income statement probably is the most important projection. The most significant aspect of the forecasts is the set of assumptions supporting your numbers. Make sure your discussion sufficiently communicates the basis of your assumptions—they must be realistic, logical and attainable. If you are not a financial statement guru, get help. Credible financial forecasts are very important-if you are not familiar with financial statements, seek help from an accountant or other reliable source.