Business Planning

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The Business Plan

Writing a business plan helps you to understand every component of your business from communicating your ideas and building a framework for decision-making and management. It serves as a reminder of your goals and for tracking the business’s performance. The plan is a tool to articulate investment needs, capital assets, business partnerships, and customer loyalty. If you take the time and energy to create a comprehensive business plan then you will be on the road to minimizing your risks while directed toward success.

Business plan outlines are basically all the same. There are different ways to complete a business plan from using self-guided books, working with a professional consultant or participating in a business plan class. You need to be realistic about how you work best, your time and the quality of results you want. Business Plan Template

Planning CirclesBusiness Plan Sections
1. Executive Summary
2. Mission Statement
3. Background Information
4. Organizational Structure
5. The Marketing Plan
6. Operating Controls
7. The Financial Plan
8. Feasibility Action Statement
9. Supporting Documents


The quality of the information is more important that the quantity

 1. Executive Summary

(This section is written last)

Write a brief description of the business including Mission Statement and overview of the Market Analysis, Competition, Organizational Structure, short and long term goals and the feasibility of the business.

 2. Business Mission Statement, Goals and Objectives General Description of the Business

  • Write a Mission Statement that will guide your work. A mission statement is only a few sentences long describing the purpose of the business, who you are, what you do, what’s important, and why you do it.


The mission of the Franklin County CDC is to stimulate a more vital, rural economy, to maximize community control over our future economic destiny, and to expand opportunities for low and moderate-income residents.

For a restaurant:XXXX is a great place to eat, combining an intriguing atmosphere with excellent, interesting food that is also very good for the people who eat there. We want fair profit for the owners, and a rewarding place to work for the employees.

Sample Mission Statements

  • List short and long term goals followed by measurable objectives that describe what needs to be accomplished in the next few years once you are in business. A goal describes the activity to be accomplished. The objectives outline the steps needed to be completed before reaching the goal. Make sure to include deadlines. (Activities that need to be done before you are in business are called actions steps different from goals)


Short Term Goal 1: Sales goals of $XX,XXX within 2 years

Objective A: Retail sales $XX,000 in first year growing to % more in year 2

Objective B: Wholesale sales $XX,000 from XX accounts in year 1 to XX in year 2

Objective C: Website sales $X,000 in year 1 with % increase in year 2

Short Term Goal 2: Marketing goals to reach 200 customers in 2 years

Objective A: Advertising through print and radio media reaching XXX customers

Objective B: Social networking using facebook/linked In reaching XXX contacts

Objective C: Market research through interviews, surveys and industry trends yearly

Short term Goal 3: Operations goal to reduce waste by XX%

Objective A: Review administrative processes and paper consumption

Objective B: Review production processes to minimize waste

Objective C: Review marketing materials purchased and inventory control systems

Long Term Goal: To pay off loan in 5 years

Objective A: To increase principle amount each month

Objective B: Seek refinancing if rates go down

Objective C: Reduce unnecessary spending

 3. Background Information - Provide background information on the Industry

  • Describe current and future industry trends — Is the industry stagnant, growing or mature? Are there new people entering the field? Are people in the industry specialists or generalist? How has legislation affected the industry?

Use this link to search for the industry that best fits your business:

Search for industry classification code

How to do research using the local Library

Contact a local reference librarian to help locate these reports for free:

1) IBIS industry report that describes the industry and trends

2) MINTEL report on various target customers to better understand buying motivations

    for example: Mintel report: Local procurement Feb. 2009

   "Interest in locally procured food and non-food items is enjoying significant growth.

A number of powerful trends are responsible for this:

    • Sales of organic foods are exploding from $2.6 billion in 2004 to an estimated $5.2 billion in 2008
    • A number of popular books and celebrity endorsees have made the concept of local procurement and being a locavore hip.   
    • The recession has driven some Americans to purchase from local merchants in the belief it will support their local economies...
    • A growing number of Americans are adopting "Positive Eating" following a diet based on seasonal vegetables, nuts, berries and other health foods...
    • Websites like Craigslist have made local procurement as easy as clicking a mouse.... "

Instructions in how to locate industry research materials from the MA Library system.

1) Go to the Boston Public Library: Boston Public Library FAQ:

2) Get a BPL e-card

3) Become familiar with the resources BPL Electronic Databases


    • Business/Company Resource Center for trade journals, plus company histories, ranking/data, industry reports.
    • Visit the D&B Million Dollar directory of 14 million U.S. companies; identify customers, competitors and suppliers.
    • Gale Virtual Reference Library for dozens of research encyclopedias including many business encyclopedias
    • Past Newspapers
    • General Business File which includes business journals and magazines
    • Trade journals
    • Mergent Online reports on 30,000 public companies worldwide (includes SEC finlings, annual reports)
    • TableBase - a "data" database-market share data, company/brand rankings and forecasts.

  • Describe how this business fits into the industry

What makes this business special or unique to the industry and competition?

Example for Cutting Edge Drapery Fabricator:
According to the U.S. Department of Commerce, the entire window treatment category reached $7.8 billion in 1996. The Paint and Decorating Retailers Association states that 30%, or $2.34 billion, was made up of soft window treatments. The population of the 17 communities in close proximity to Cutting Edge Drapery Fabricator is estimated at 277,253. Roughly, this would mean that this area comprises a total soft window treatment market in excess of $2.7 million annually. All of these treatments must be produced in decorator workrooms. There are various levels of workrooms which are discussed in more detail in this chapter. The company’s share of this nearby market is approximately 7.5%.

(from sample business plans website

 4. Organizational Structure — Business Structure, Management, and Personnel

  •  Describe the Business’s Legal Structure

SOLE PROPRIETOR, all business assets and debts, profits and losses is your individual responsibility.
PARTNERSHIP, two or more people share capital, earnings, and losses. If one partner should die, the partnership is void.
LIMITED PARTNERSHIP, similar to partnership except one person is a general partner with more control and the other is a limited partner with less control.
CORPORATIONS are owned by shareholders with board of directors and officers.
SUBCHAPTER S CORPORATION is a corporation but taxed as a partnership or sole proprietor.
LIMITED LIABILITY COMPANY (LLC) is a blending of the corporate and partnership structures providing owners with limited risk to personal assets and tax advantages.
COOPERATIVE is owned and operated by a group of individuals for their mutual benefit.

  • Describe Government regulations, taxes, contracts, and leases

Personal Income Tax
Business Income Tax
Sales Tax
Property Tax
Business License Fees
Employee Payroll Tax /Withholding
Hiring Regulations
Consumer Protection Regulations: Warranties
Commerce Regulations
— Professional Licenses
— Business Registrations
— Uniform Commercial Code
Zoning Regulations
Environmental Regulations
Other Regulations Specific to your business

For more specific information on government regulations, click here.

  • Describe the responsibilities of the management team including owners and staff. Include an organizational chart listing roles and responsibilities

  • Describe the Advisory Team you rely on for support. Possible members include an attorney, accountant, insurance agent, financial & business counselor, and associates in the field.

  • Describe the services you outsource. Possible services include a payroll service, bookkeeper and independent contractors.

  • Explain the personnel plan for employees: recruiting, hiring, retaining, firing, employee benefits and organizational chart.

  • Describe the risk management strategies related to liability, property, health, and life insurance.

 5. The Marketing Plan

Would you take a long trip without an itinerary? Make a cake without a recipe? A Marketing plan, part of a business plan, explains what you want to accomplish, and how you plan to do it. As a small business owner your resources and time are limited so you need to make more good decisions that are beneficial. A marketing plan will clarify your thinking and prevent you from spending on the wrong items.

The Marketing plan is your strategy to capture a select market. A typical way of describing a strategy is found in the marketing mix composed of the 5 P’s, the product/service, placement, promotion, positioning, and people. The objective is to organize this mix to accomplish the goals of the marketing plan.

Allen Kronick, Senior Management Counselor, Massachusetts Small Business Development Center Network frequently advises, “Know who your customer is, aim your efforts at your target market, stay focused. You can’t be everything to everyone!”

  • Describe the P’s of Marketing by seasonality and growth potential: Product/Service, Placement, Promotion, Positioning, People.

Product/Service: Describe what you are selling emphasizing the features, benefits and seasonality of the product. Know what you are selling. You should be able to talk about the product or service with style and confidence.


Features: Describe product and/or service by concrete descriptions like size, color, taste, weight, hours, activity, workshop, training, etc.

Benefits: Describe the product and/or service by intangible descriptions like how the customer would feel after using the product or service ("peace of mind") confidence, educated, comfortable.

Placement: Describe the surroundings that highlight the product or service. You don’t want to place the candy next to the toothbrushes or wedding rings next to books on divorce.

Where will you be selling? examples:


Product: In retail stores, farmers markets, consignment shops, specialty food stores, fairs and festivals, online...


Service: Collaborating with alternative health professionals, contractors, promoting workshops & classes, downtown office.

Promotion: Describe the following:

Marketing materials: (What is the look and feel?) Logo, product descriptions, labels, business card, hang tags, brochure, postcard, sign, website...

Media: Describe how you will use newspaper and radio

Social Media: Describe how you will use social media

Incentives: Describe coupons, give-aways, gift certificates

Positioning: Describe how your business relates to other alternative choices your customer will be choosing from. Make sure the image, customer service and quality fit with the target customer you are trying to reach.

People: Determining the characteristics of your customers will help you with pricing, packaging, labeling, and product placement. The more products/services you offer, the larger the market potential.

Examples of customer characteristics include income level, education, marital status, household type, location, or occupation. Defining purchasing influences of your customers is another way to profile potential customers.

Example of business customer characteristics: Industry (segment), location, size, quality, price, technology, uniqueness.

Other customer traits to examine:
– Basic need for love, good heath, beauty
– Buying patterns reflected in quality, price, trends and convenience
– Cultural orientations liberal, conservative, religious,
– Interests in gardening, cooking, athletics, reading,

   environment, arts

Refer to the U.S. Census to obtain information

  • Competition: Alternative Choices for the Customer — Describe each competitor by identifying their features and benefits. One way to compare the competition is to create a chart as follows: Plot each competitor comparing their price and quality to each other. Then select where you think your product belongs. The main competitors will begin to stand out.


Otherways to describe competitors: Products, Price, Quality, Selection, Service, Reliability, Stability, Expertise, Reputation, Location, Appearance, Sales Methods, Credit Policies, Advertising, and Image.

Describe your competitive advantage and disadvantages.

  • Environmental Sustainability — Determine how your business impacts the environment and society by considering the community, local-ness of materials and supplies, social capital, transportation, energy, toxins, water, air quality, and marketing.

Explain specific ways you will improve the impact of your business.

See The Environmental Sustainability Business Checklist for helpful information for the marketing strategy.

  • Finding Information for your Plan — Collect descriptive information to evaluate the market potential. There are many resources available for collecting information. Check out the Franklin Regional Council of Governments where you can get traffic counts and statistics. Ask the reference librarians to direct you to specific information. Check our Business Resources for many other organizations that have useful information.

 6. Operating Controls

  • Describe cash management procedures such as cash or accrual basis tracking.

  • Describe the systems used to track accounts receivable and accounts payables.

  • Describe who will be responsible for handling sales receipts, reconciliations of bank accounts and petty cash.

  • Describe person responsible and internal management procedures related to purchasing, inventory control, customer service, pricing and quality control.

  • Describe pricing strategy and relation to competition. How retail price was determined, cost per unit and how changes will be incorporated into strategy.

  • Describe quality control procedures.

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 7. The Financial Plan

An essential component in business planning details your financial needs and resources. The following worksheets will assist you in identifying your personal financial picture, business start-up expenses, repeating monthly business expenses, monthly profit and loss statement, and a yearly cash flow income & expense projection. Complete the financial worksheets as realistically as possible. Clarify your assumptions at the bottom of each page. Information explained in the previous parts of the business plan need to relate to the Financial Plan.

Example: If the Marketing Strategy refers to monthly advertising in the newspaper and radio there must be a corresponding amount for that expense.

Alan Singer, Business Lending Program Manager, often says, “Part of what makes a business plan work is really understanding your business. Finances and financial planning are just two of the tools in managing your businesses resources.”

Personal Credit History
If you’re planning to approach a lender you will want to make sure your credit report is accurate. If your credit report is wrong it may take a few months to make a correction.

Credit Reporting Agencies
Get a free credit report yearly

As a Massachusetts resident you are entitled to one free credit report per year from:

PO Box 2002, Allen, Texas 75013-0036
Request Phone: (888) 397-3742

Consumer Relations
2 Baldwin Place, Crum Lynne, PA 19022
Request Phone: (800) 888-4213
Dispute Line: (800) 916-8800

5505 Peachtree Dunwoody Road, Suite 600
Atlanta, Georgia 30374 - 0241
Request Phone: (800) 997-2493
Dispute Line: (800) 944-1122

For personal credit problems:
Consumer Credit Counseling Services
Credit counseling (24/7 by phone and internet) debt
management plans, credit score tools and resources.

Sources of Financing

    • Family or Friends
    • Credit Cards (Personal or Business)
    • Banks
    • Community Development Corporations (see the FCCDC's Lending section)
    • Alternative Lenders (see Business Resources section)
    • Loan Guarantor
    • Loan Brokers
    • Suppliers
    • Customer Deposits
    • Franchising
    • Insurance Companies
    • Grants

How to Borrow Money from People You Know
Friends and Family can be a source of financing. There are several parts to borrowing money starting with setting up a loan documentation, payment processing, and payment tracking and accounting. If you are seeking an outside service to mediate a private loan, consider Circle Lending, who can assist you in everything needed to make a private business loan work.

Circle Lending – 800-805-2472
Two Canal Park, Cambridge, MA 02141

TIP – Be aware of the following:

    • The dollar value of assets that have been accumulated in your business can be used as business equity and potential collateral for a lender.
    • Good personal financial health lays the foundation for good business financial health.
    • Include Health Insurance as an expense or explain how your coverage is being paid.
    • Business Planning classes at the FCCDC provide support for completing the business plan.

Short-Term Loan: Generally used to meet short-term needs, such as inventory purchase or short-term liquidity problems; repayments made within one year.

Intermediate Loan: Repayment made within three to five years. Generally used for permanent expansion or to acquire equipment.

Long-Term Loan: Used for real-estate purchases or for business start-up.

The C’s of Credit – Criteria used by lenders to determine whether to grant credit and credit terms

Credit History: What is the credit rating of the business
and the individual?

Character: Does the owner have the ability and intent
to manage the business?

Capacity: What is the ability of the business to repay
the loan?

Collateral: What is the equity contribution for the loan?

Conditions: Is the business sustainable?

Capital: What is the loan amount and purpose?

What you need to know before approaching a lender:

1. Know how much money you need to borrow.
2. Identify how you plan to use the money.
3. How will the money be repaid by the business.

 8. Feasibility Action Statement

This section describes and prioritizes the actions needed to move forward to implement the plan for year one. Set up a calendar that itemizes the actions, time and who is responsible. Integrate the objectives from Part 2.




Read business plan book by Sept 15.
Meet with business counselor by Sept 30.
Develop & Complete Market Survey by Oct 15
Research and Compile Information by Nov 15
Write Plan by Dec 1
Share plan with business counselor for feedback by Dec 10
Make corrections to plan Dec 13


Research Financial Institutions to determine best fit by Jan 15
Presentations to Lenders by Jan 20
Projected acceptance by Lender by Feb 20
Compilation of additional materials for lenders by Feb 28
Develop alternative plan if denied March 15 (see FCCDC Loan Program)

Find location, renovate and move in by May 15
Finalize Marketing Plan & Materials by May 20
Purchase Materials & Supplies by June 1
Target opening for June 20

 9. Supporting Documents

  • Resumes of key people
  • Personal Financial Statements
  • Photographs of product, equipment, marketing materials
  • Market Survey results