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

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

 

BUSINESS PLAN OUTLINE

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.

Example

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.

• 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)

Example:

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

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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 the most recent 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 

   “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

2) Get a BPL e-card

3) Become familiar with the resources BPL Electronic Databases

Example:

• • 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?

(from sample business plans website https://www.bplans.com/samples/sba.cfm)

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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
OSHA
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.

5. Management

• 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.

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6. 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.

Amy Shapiro, FCCDC Business Development Director helps you identify who the customer is, how you reach them, and reminds you to stay focused because   “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 costs and benefits of using social media

Incentives: Describe costs and benefits of using coupons, giveaways, and 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.

Other ways 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. 

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7. 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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8. 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 www.annualcreditreport.com

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

EXPERIAN
PO Box 2002, Allen, Texas 75013-0036
Request Phone: (888) 397-3742
www.experian.com

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

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

For personal credit problems:
Consumer Credit Counseling Services
1-866-515-2227
www.moneymanagement.org
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 
  • 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.

• • Prepare appropriate business planning documents
  • Write a loan agreement with terms and conditions
  • Meet with an attorney
  • Maintain good payment records

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.

LOAN TYPES:
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.

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9. 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.

Example:

Example:

Action Step 1: TO COMPLETE BUSINESS PLAN BY DEC 15
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

Action Step 2: OBTAIN FINANCING BY MARCH

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)

Action Step 3: BEGIN START-UP PHASE OF BUSINESS JULY 1
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

10. Supporting Documents

• Resumes of key people

• Personal Financial Statements

• Photographs of product, equipment, marketing materials

• Market Survey results

Building the Business Team

Consider these points when hiring personnel or consultants

• Interview professionals and make sure they understand your business plan and relate well with you. Prepare questions ahead of time.
• The cost of personnel may be the greatest expense of the business.
• Hiring, training and empowering your employees can create a cooperative team that will motivate and reward peak performance.

Hire your employees carefully

• Review resumes and check references.
• Consult your state business resources to find out what questions you can and cannot ask in an interview.
• Always get a signed waiver from a potential employee allowing you to conduct a background check.
• If your new employee isn’t working out, then it’s wise to let them go as soon as possible.
• Business owners often say it is the employees they should have fired but didn’t who cause them the most grief.

Give employees meaningful feedback

• Some employees need more guidance than others to do a good job.
• Always let employees know what is expected of them and let them know when they have done a job well.
• Establish company rules, and be sure all employees understand these rules, and why they exist.
• Encourage questions.

Provide employees a clear description of their job responsibilities

The best way to clarify a person’s roles and responsibilities within a business is to create a job description. This can also serve as an outline for measuring job performance.

Creating a “Personnel Policy Manual” can also create better employees. The manual should include the business overview and mission statement, employment policies, conditions of work, wage compensation, benefits plan, training and development, travel and relocation stipend, absence policy, termination and retirement procedures, equal opportunity employment statements and procedural requirements.

Motivate Employees regularly

• Attending meetings regularly being honest and compensating hardworking employees, are good ways to motivate employees.
• Listening and reacting to employees often helps the business, and motivates employees.
• You can compensate employees with salary, vacation time, sick time, holiday leave, insurance investment coverage and profit sharing.

Decide on business communication details early! It’s important.

• Schedule employee meetings, meet with lawyers, accountants and bankers on a regular basis, or be in contact through the phone or e-mail.
• For business operations, use a tack board or create inboxes, e-mail accounts or a business operations journal.
• Empower your employees by creating a safe environment for employee input.
• To fulfill communication expectations, maintain personnal files as well as vendor and customer files.
• Document confrontations, conversations, and actions taken.

Hiring Employees

You will need to fill our Form SS-4. This can be done online at the Internal Revenue website. (This website is also an excellent resource for information.)

You will also need a state employer identifier number. The state number will usually be the same as your federal employer identification number however you still need to register with the state to let them know you will be subject to employment taxes. Massachusetts requires all new businesses to file and pay their taxes online. For additional information, visit the Massachusetts Department of Revenue website.

You will need to register with the Massachusetts Department of Unemployment Assistance for state unemployment taxes. This is done with Form 1110-A available at the Massachusetts website.

Before any employee starts work for you, it is necessary to secure from them a completed W-4. New hires must be reported to Massachusetts within 14 days or a $25 penalty may be imposed upon the employer. Also it is necessary to have employees complete an I-9 to assure your potential employees are legally allowed to work in the U.S.

Also, before your hire your first employee, you must have workers compensation insurance. Your local insurance agent should be able to assist you.

The IRS and Massachusetts websites are a wonderful resource to guide you through the considerable number of forms and filing requirements.

Cost of payroll to the employer example:

FICA and Medicare: 7.65%
FUTA for the first $7000 of wages per employee is 0.8%
Mass unemployment: Depending on the kind of business and employee turnover could be 2% – 15% for the first $ 14,000 of wages per employee. Workers compensation insurance: Directly related to payroll and depends on nature of business ranging from 0.005% – 100%

See this resource for child labor laws and best practices for hiring teens.

Health Insurance

Research and compare programs.

Franklin County Chamber of Commerce
The Insurance Partnership 1-800-399-8285
National Association for the Self Employed 1-800-232-6273
Trade Associations

Networking

Business planning involves collecting information and assessing the quality of its usefulness. Today we are bombarded with information from so many directions that filtering the essential information becomes a regular task. Planning a business takes being a “Jack or Jill of all trades.” You can’t know everything but you can think strategically. Networking with people creates an opportunity to receive a personal recommendation for suppliers, vendors, real estate opportunities, potential employees, professional consultants, sales leads, electricians, sign makers, the list is endless. Hearing from someone about the positive and negative will help you determine who is right for the job.

Networking groups can be beneficial to you, your business and also the community. There are all types of networking groups, for example the Chamber of Commerce, local business associations, Rotary Clubs, Kiwanis, Women’s Business Organizations, Toastmasters, Business Networking International, Guilds and Trade Associations to name a few. Building business relationships creates a give and take that can take time to develop but in the end are rewarding.

How To Begin To Network

What do you seek to learn about? Sales leads, new suppliers?

Create a list of people you feel comfortable approaching for a referral. Prioritize that list in an order of most connected to least connected. Practice your ask on a friend or family member. Keep track of results and always say thank you.

Advertising Advice

Avoid making these common mistakes.

1. You forget the real reason you advertise.
Tip: To increase your sales and profits.

2. You don’t have specific objectives for your advertising.
Tip: Be specific, decide on measurable objectives.

3. Your advertising is written for the wrong people.
Tip: Create your advertising for potential buyers – not suspects.

4. You worry about whether people will “like” your advertising.
Tip: Your not in a popularity contest. Worry about if it will be seen, read, and believed by people. It must be informative and persuasive enough to get them to act.

5. You confuse “attractive” advertising with “effective” advertising.
Tip: Advertising is more effective if it looks “newsy” not “addy.”

6. You equate “creativity” with advertising effectiveness.
Tip: An advertisement which offers a simple solution to the reader’s problem will be substantially more costeffective than one with a dazzling creative concept.

7. You think biggest is best.
Tip: You need the most cost effective unit you can buy to achieve your goals. Smaller more frequent advertising may be more effective.

8. You create advertising to solve your problem – not the reader’s problem.
Tip: Remember that the reader is concerned with their problem not yours. Evaluate how you include competitors.

9. Your advertising fails to start with its ‘big gun’.
Tip: The advertisement is your sales presentation. It should say something very important, very quickly.

10. You talk product features instead of customer benefits.
Tip: Your customer wants to know what your product or service will do for them. Product features (glossy paint) are not product benefits (durable,
scratch-resistant, washable, etc.).

11. You forget to establish the NEED for what you’re selling.
Tip: Explain why the reader needs your product.

12. You say it — but don’t prove it.
Tip: “Fluff” doesn’t sell. Use case histories and testimonials to support your claims.

13. You spend your money on advertising that’s funny, cute or clever.
Tip: You’re not in show business to entertain. You’re in business to sell.

14. You don’t seek tangible, measurable results from your advertising.
Tip: Get something in your advertising to attract a response so you can measure the effectiveness of each ad in each publication.

15. You don’t like “long copy.”
Tip: Your advertisement should attract a potential buyer. They need information to make a buying decision.

16. You’re concerned with style instead of content.
Tip: Does your ad have information that may stop someone using a competitive product and start using yours?

17. You insist upon advertising that is “different.”
Tip: Make sure your advertising informs and sells.

18. You fail to say immediately how you can benefit the reader.
Tip: Be direct. Get to the point.

19. You don’t understand the importance of the headline.
Tip: The right headline can attract the people who need the product your selling. Don’t use cute, clever or indirect headlines. Your ad will not be
read by the people who need your product.

20. You’re too ‘advertising campaign’ oriented.
Tip: Test to find out your most effective advertisement. Use that as a control until you develop a better ad to replace it.

21. You never think about WHY people read a publication.
Tip: To get news or information. If your advertising offers none – you’re in trouble.

Download this page as a PDF

Worksheets and checklists can help you organize your business

Business Plan Template

Financial Worksheets:
Personal Balance Sheet (fillable PDF)
Profit and Loss Statement (fillable PDF)
Start-up Cost Worksheet: One Time Expenses (fillable PDF)
Start-up Capital Worksheet: Repeating Expenses (fillable PDF)
Income and Expense Projections (fillable PDF)
Cash Flow Projections
Cash Flow Projections as Excel Spreadsheet
Personal Financial Statement

Marketing and Advertising Worksheets:
Developing a Market Survey
Market Planning Checklist
Advertising Advice
Advertising Ideas Checklist

Operational Structure & Operating Controls Worksheets:
Job Description of a Business Owner
Legal Structures
Government Regulations

General Business Worksheets and Checklists:
Environmental Sustainability Checklist
Location Checklist
Real Estate Lease Checklist
Manufacturer’s Site Planning Checklist
Leasing vs. Purchasing Equipment Checklist

Business Training Events are listed on the training calendar.

Government Regulations

BUSINESS REGULATIONS

Massachusetts Information Privacy Laws
New data privacy laws went into effect March 1, 2010, and all businesses must comply – regardless of the size or location of your business.  If you take checks, debit or credit card payments, keep social security info (for employees or others) or drivers license numbers, you must comply.  Businesses that use personal information of Massachusetts residents must have a Comprehensive Written Information Security Program (WISP) and have policies and practices in place to safeguard personal information against identity theft. More information

Sales Tax
Some businesses are required to collect sales and use taxes from customers that will in turn be paid to local, state or federal governments.

Self-Employment Tax
Every working person contributes to Social Security and Medicaid. As self-employed, you contribute through a selfemployment tax through your personal income taxes.

Business Taxes
As a business owner, you are required to file state taxes though your personal income taxes. Business tax forms and
information can be found by contacting the Department of Revenue’s Customer Service Bureau.

Business Licenses
Depending on your business type and it’s location, you may be required to obtain licenses, certificates or permits.
Check with the license office in the city or town your business will be located to find out what is required.

Fictitious Business Name
The county recorder has a list of business in their office. You must apply for a business license using a business name that is not already being used by another business.

Business Insurance
Protect your business against unforeseen events. Business insurance may be required by law. Contact your insurance
agent or broker for more information.

Resale Certificate
This permit allows products to be purchased, tax free, for
resale. To apply for this certificate, you must have a State Issued Employee Identification number (EIN). Information
and applications can be found by contacting the Massachusetts Department of Revenue, Sales and Use division.

Employee Identification numbers (EIN)
All businesses must have this number to pay social security, federal withholding and federal unemployment to the IRS.
You can obtain the application at most SSI offices. You can download the application (SS-4) from the IRS website or by requesting one over the telephone. If you tele-TIN the completed application, it would be processed immediately.

Zoning Regulations
Depending on your business type check with the office in the town hall or city your business will be located to
find out zoning restrictions.

Environmental Regulations
Some business may have to comply with environmental regulations that mandate responsibility and awareness.
Some examples: Hazardous Material, Petroleum storage, Wetlands regulations, USDA regulations, FDA Regulations, DEQ Regulations

EMPLOYEE REGULATIONS

Workman’s Compensation
If an employee is injured on the job this insurance will cover medical bills. Policies can be obtained by contacting your insurance company.

State Withholdings
You are required to deduct from employees pay for state payroll taxes. Information can be found
by contacting the Dept of Revenue & Division of Unemployment Assistance.

Federal Withholding
Some businesses may need to withhold Federal Income Tax, Social Security, and Unemployment taxes. Information can be found by contacting the Internal Revenue Service.

Hiring Regulations
Businesses are required by law to abide by nondiscrimination regulations. Some interview questions are illegal. Hiring a person under-18 years of age requires a business to follow guidelines outlined by the Department of Labor.

Safety and Health Regulations
All business with employees must comply to Occupational Health and Safety regulations. Information can be found by contacting the Federal Occupational Safety and Health Administration
(OSHA).

Launching a Food Venture

The Western Mass Food Processing Center (FPC) is available to help guide you along the path to the success of your product. FPC members have access to complete technical support including business planning, product development, regulatory compliance, manufacturing, marketing, and distribution of wholesale and retail products.

Our facility provides access to shipping, receiving, dry and refrigerated storage, and commercial processing equipment. In addition, we regularly offer workshops, exhibitions, and other opportunities to network with other small- and medium-scale food ventures.

We advise that entrepreneurs develop a basic business plan, perform small batch testing, and understand the complexities of cost and technical requirements for manufacturing food products before fully launching into production. With food products, the first priority is food safety. Know and understand all relevant regulations affecting your product before you move ahead. The Western Mass Food Center is here to assist you in merging the basic business plan with the details of food manufacturing, distribution, marketing and sales.

See our Food Processing Center section for more information on our services, facilities and membership rates, along with member bios.

Getting Started Checklist

• Business plan narrative: Explain your business concept and product attributes. Describe your market, and the outlets where your product will be sold. Explain how you will manufacture, sell, and deliver product to customers.
• Product development: Start with your home-scale recipe, and record all ingredients by weight. Perform small batch testing to perfect recipe. Keep records of the cost and source of all materials and ingredients used.
• Lab review: for any shelf-stable product, an outside lab should review your recipe or process to verify that the finished product will be safe for consumers. Establish the shelf-life of the product.
• Get ServSafe Certified: You can take a class or study materials online and then take the ServSafe test. To find a ServSafe class nearby, go to ServSafe,com or check the Greenfield Community College listings
• Develop a draft or mock-up of the label and packaging.
  Remember, the packaging is often the first and only contact the consumer has with your product. Your package must do the selling without you there in the store.
• Work with commercial suppliers of food products to obtain the best pricing for your product. Develop a worksheet for each product to help you calculate the cost of each unit.
• Complete worksheets for your overhead expenses and sales projections. You’ll find downloadable worksheets in the Business Planning Worksheets section.
• Work with the FCCDC and Food Center staff to develop pricing that includes all your costs, profit, and distributor costs.
• Obtain general and product liability insurance.
• Register your business with the FDA.
• Apply for all required licenses.
• Print your label once approved by the regulators.
• Get out there and sell, sell, sell!

Regulatory Agencies

Wholesale License to Manufacture and Distribute Food:
Mass Department of Public Health,
Food Protection Program
305 South Street
Jamaica Plain, MA 02130
Telephone: (617) 983-6700
https://mass.gov/dph/dphhome.htm

Retail Food Service License (Pushcarts, catering, farmstand):
Greenfield Health Department
Town Hall, Greenfield, MA 01301
(413) 772-1404

USDA: Regulates meat and poultry products for wholesale:
Food Safety Inspection Service (FSIS)
(402) 221-7400
https://www.fsis.usda.gov/

Food and Drug Administration (FDA)Domestic Food Producer Registration:
https://www.cfsan.fda.gov/~furls/ovffreg.html

General information
https://www.cfsan.fda.gov/list.html

Laboratory Analysis/Process Review
Office of Dr. Olga Padilla Zacor
ATTN: Elizabeth Keller
Cornell University/NYSAES
630 West North St., Geneva, NY 14456
(315) 787-2273
necfc@cornell.edu
www.necfe.org

General Food Business Resources

• Northeast Center for Food Entrepreneurship
• New England Extension Food Safety Service
• Department of Agricultural Resources
  “Food Processors Resource Manual”
  https://www.mass.gov/agr/markets/specfood/
  251 Causeway St., Suite 500
  Boston, MA 02114
  (617) 626-1753