How To Write A Business Plan Proposal

It’s not the plan that is important, it’s the planning. ~ Dr. Graeme Edwards

Business Plan Outline

Dr. Edwards’ words are revealing. Writing a business plan is not merely putting pen to paper, which can be done in an hour. Rather, as Henry Ford pointed out, the process of thoughtfully thinking through matters is what counts, and a most important business activity. Sadly, businesses that failed have spent precious little time thinking about creative ways to operating a solid, thriving business.

There are three goals to achieve in Part 6—
For you to pause awhile, to think about your vision and how to apply it to your business mission, goals and philosophy, before writing a business plan.

We’ll review what you’ll need to include in writing a business plan.

How to write and present your plan to the public, investors and the media.

Goal 1
If you need to, stop here for a while. Take time out to reflect on your vision for your company. How will you weave your business philosophy and goals into the fabric of your company? Revisit Part 2 above, especially pages 4-5, to recap these points. They are:

Focus and clarify your vision, plus goals and actions for your company’s mission.
Provide a framework for the company’s operations that also generates profits.
Ask what products and services help promote the bottomline; be frugal.
Figure out how employee activities contribute as productive enhancers.

Goal 2
In this section, we’ll address the nuts and bolts of what to include in a business plan. These are the eight essential components briefly mentioned in Part 4 - [ The Essential Components of A Good Business Plan ]. You’ll want to tweak them to suit your particular needs and purposes.

Executive summary. A business plan has many pages. To simplify matters for potential investors and bankers, include an executive summary at the start of the plan. Write this last as your thoughts will have crystallized by then. It must:

1.1] Summarize the gist of your plan in a few paragraphs

1.2] State your vision

1.3] Define the mission of your company

1.4] State the goals for achieving mission

1.5] Show a competitive analysis (or analyzing the market and competition)

1.6] Include your owner info (education, background experiences)

1.7] Have the loan amount if requesting a loan application

Management bios. If sole owner and employee, you’ll have lots of opportunity to toot your horn. Most first-time entrepreneurs are shy to tout their capabilities—which can diminish their chances of credibility and therefore, securing loans. Keep in mind:

2.1] Your prospective lender wants to know your personal worth—education; background experiences related to your business; community participation with giving back to schools, arts festivals and sponsoring athletics events; honors, awards and special certifications

2.2] Your backgrounder is also great to pull as a bios page for your media kit

2.3] Write in a first-person voice. For example, “I founded…, my vision…, etc.”

2.4] If a partnership or LLC (limited liability company), include top managerial bios emphasizing background experiences related to the business, too.

Describe the features and strengths of your business. Describe your most important company strengths and core competencies. Why do you think your company will succeed beyond your wildest dreams?

What will you, the visionary founder, bring to this business? How will your philosophy and goals jibe?

Goals are destinations—where you want your business to go.

Objectives are progress markers along the way to accomplishing goals.

For example, you see your restaurant as leader of the pack in providing gourmet vegetarian take-out meals. Clearly and distinctly identify how you’ll achieve this goal. (For a working example, please see the sample business plan in Part 9.)

3.1] List all products and services you’ll be offering

3.2] Explain how each item serves and benefits customer needs

3.3] Show how you’re creative in packaging items with value-added appeal—two-for-one promos, holiday specials to drive extra traffic, etc.

3.4] Calculate and show how your add-on promos actually impact profits

3.5] Show how you can realize savings for you and your customers with win-win marketing strategies.

When you articulate accounting savings, you’re also articulating advertising copy to tout in marketing materials and collateral

3.6] Can you explain the status of your industry and show how you’ll deal with changing trends and contingencies?

3.7] How might you maximize short- and long-term market trends?

Competitive analysis. Describe and analyze how you’re besting competition. These tactics are by no means exhaustive. Common sense and keen observation (remember Charles Darwin?) will win, and save, the day.

4.1] Show how your unique products and services differentiate your specialty

4.2] Will you be able to truthfully offer superior, quality items and services?

4.3] How will they provide *value* compared to competition?

4.4] How will your niche specialty earn you name and fame from the git-go?

4.5] Will you be able to go the extra mile with free delivery, gas prices notwithstanding?

4.6] Will your employees personalize services with smiles?

4.7] How clean and attractive is your storefront, and inside as well?

4.8] Is parking free for customers, and close by?

4.9] Do you care to donate to community causes? (Tip: Donations are tax deductible, plus earn bonus points for putting your company’s name out there.)

4.10] Do customers feel peaceful and happy in your store? No kidding, ambiance is important for continuous foot traffic to your door, not competitors’

Pricing strategy. It’s important for customers to find value in your prices. Here are some tactics for manifesting superior standards and besting competition.

5.1] List prices clearly for each specific item or professional services you’ll perform

5.2] Along with value, be sure to always offer quality items

5.3] Compare how your prices show value because of slightly under pricing competition

5.4] Show why customers will value your personal touches

5.5] All businesses enjoy the advantage of writing off promotional discounts. Just be sure your occasional, special event discounts generate enough mass volume to make up for markdowns

5.6] Are you experimenting with portion-size and cost control in your café? What have you learned? What are you learning about seasonal shifts for produce costs?

5.7] Do you understand how fixed and variable costs affect pricing and profits?

5.8] How would you calculate and price items for profit potential?

Marketing strategy. Businesses flourish thanks to word-of-mouth reputation. It takes longer to earn a good reputation via this method, but it’s also one that’s incredibly effective and long lasting. But, before this happens, you’ll need to:

6.1] Create a unique brand image. What image would you like to convey?

6.2] Identify how you’ll promote and position products and services

6.3] Will you be passing out business cards, brochures and flyers?

6.4] Remember to periodically refill and refresh these supplies at strategic locations that relate to your business?

6.5] Will you assemble a media kit for positive free publicity with good PR (public relations)? Caution—better to have no publicity than garner bad publicity

6.6] Are you comfortable on the air with local radio stations to talk about the benefits you provide? Radio remotes and giveaways? TV interviews?

6.7] Are you ready to dive into the new frontier of online marketing—YouTube, MySpace, Faceboot, Twitter? Create a user-friendly website?

6.8] Do your customers feel they’re treated special enough to unconsciously generate free publicity with word-of-mouth referrals and endorsements?

6.9] Do you tastefully solicit endorsements from local celebrities?

Operations strategy. Moving goods efficiently with people power and good will grease the wheels of effective commerce.

How will you gain maximum advantage coordinating the many arms of operations from efficient and productive employee output to logistics?

Most business plans short-shrift mentioning employees in their overall operations strategy.

It’s counter-productive. People power is part of operations, and a most valuable component and contribution, as well.

7.1] How will you know you’re hiring trustworthy and reliable people?

7.2] Are you able to offer free delivery without incurring prohibitive external costs?

7.3] How efficient are cost-savings from food wastage in a restaurant and spinning your wheels as a courier service?

7.4] How adept are you at juggling cost controls across the board? What have you learned, and how do you apply your insights? Adroitly changing gears with market demands and variable costs of doing business?

7.5] Plan on being your own bookkeeper. This way, you’ll be in control of cash flow and not at the mercy of someone else.

It’s super easy with QuickBooks software—which keeps the general ledger, payroll and taxes with simple clickable operations, including printing out customer invoices. Come tax time, it’s a breeze to print out monthly reports for your accountant to consolidate as annual returns

Financial projections. Prospective bankers and investors are most interested in knowing how you’ll repay your loans. Can you offer convincing figures for constantly growing revenues against expenses in enhancing cash flow?

8.1] In other words, bankers look out for ROIs (returns on investment) that allow your projections to materialize realistically. So, even though you may be tempted to rig up statements with impressive figures, be sure that they’re realistic

8.2] Banks are most concerned about your cash flow statement. Calculated on the accrual (and not figures for actual cash sales) accounting method, the data include projected incomes against expenses.

But the expected revenues have to materialize, and they must be factual and precise. And, be careful of lean times when your cash flow statement points out the need for cash infusions

8.3] Banks also like to have a solid balance sheet—a snapshot in time of your business health in balancing assets against liabilities

8.4] Profit and loss (or income) statements covering a number of months and years show how your business is growing, stagnating or declining. They, too, offer good insights to running a business, and an invaluable component of a business plan for every business that’s been operating for a few years

Goal 3
We’ll review tips for presenting a professional-looking business plan in this section. Here are suggestions on how to write and present a business plan that looks professional.

As the saying goes, and however unfortunate it appears, the COVER sells the book. Ditto the cover of your business plan. Bankers always fish out the most attractive looking plan. Why? Because attention to details with a clean and neat appearance reflect a professional and reliable attitude in doing business.

CHECK that grammar, spelling and punctuation are correct. It’s worth outsourcing this project. Especially if you’re not a writer and have other more pressing duties to manage when starting or running a business.

ASK for advice from your banker before writing your plan. His or her input matters in hitting the mark if you’re serious about getting a loan and credit line.

FOCUS on what needs to be analyzed. Don’t end up frustrated writing a plan that doesn’t aim directly at the target reader—your banker. Your words have to assure her or him of an unspoken faith in you and in your company’s success.

If you’re stumped and have no idea what some of the terms mean, here are two handy, free online BUSINESS GLOSSARYand the Washington Post newspaper’s listings of over 1250 business terms

There, it’s not hard to write a business plan after all, is it? It’s a logical process where thinking through scenarios matter more, rather than merely putting words and figures on paper.

To reiterate, three primary caveats are:

Prior clear thinking makes it effortless for writing your business plan. Heed Henry Ford’s advice to thoughtfully think through all aspects of running your company. Getting suggestions from seasoned owners is also helpful.

Attention to details. Now that you’ve been asking questions posed above, and variations thereof, it’s just a matter of budgeting a few hours into your schedule to writing it down (or hitting your computer keyboard).

Remember Charles Darwin? Emulate Darwin’s passion and zeal for new discoveries. Periodically review and refine your opportunities by revisiting the business plan. Survival of the fittest depends on flexibility and adapting to volatile forces that impact, change and shape market demands.

Part 7:
Business Plan Software

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