How to Create a Business Plan for a Small Business
- 1). Locate and contact similar businesses in order to find out what your future competition does to succeed. Find key information including: equipment costs, redecorating costs (if necessary), rent for the building, marketing costs, payroll, and insurance. Most of this information can be found by simply picking up the phone and asking.
- 2). Write your statement of purpose. A statement of purpose is a brief description of what you hope to accomplish with your business. Making money, although a definite goal and something the bank wants to hear, will not suffice as a sole purpose. You need to include what you will offer that no existing business offers. Describe why your business will be more attractive to new customers than existing businesses. Give a hint as to why you want to start this business.
- 3). Begin writing the plan. It will be written in three major sections. Cover the description of the business Include: operating procedures, a profile of your competition, marketing strategy, employees and their job descriptions, and insurance. Remember, at this point you are already "selling" your idea to a potential lender. This section must sound as attractive as you want your business itself to sound.
- 4). Assess the financial information. Include: loan application, start-up costs, monthly operating costs, month-by-month projections of income and costs for the first year, a three year projection, balance sheet and cash flow. This section is extremely important to the lenders. By crunching these numbers and projecting what the business will look like in the next three years, not only will the bank know whether it is feasible or not, but you will also realize your plan's feasibility.
- 5). Include supporting documents.Secure copies of resume's for all principle operators, lease for your building, letters of intent from suppliers, and necessary licenses, and relevant tax information.Assemble all documents in an logical, orderly manner. No one wants to guess what a document is or why it is where it is. This is important because it is the first time you will get to demonstrate your organizational skills to you lender.
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