Starting a Small Business Part 3

Starting a Small Business Part 3

Business Plan

Today let’s talk about creating a professional business plan for your small business.

This is absolutely essential when you are ready to start your own small business.

There are several reasons that this step is so important to your success. Including the fact that banks and prospective investors will require that you show them a solid business plan so that they can evaluate your potential for success and decide if they will fund your business.

Business plans commonly have three major sections as well as a cover sheet, table of contents and an executive summary. Your business plan should be proportioned according to your small business.

If it takes you numerous pages to explain the aspect of your small business then so be it but keep in mind that people do get tired of reading page after page of documents, try to minimize the wording in your business plan as much as possible while still getting your point across.

Let’s go over a few of the components of a professional business plan that will help you get started:

Business plan cover page

This page is solely for identifying your business from the others. Include things like your business name, logo, contact information, address, and the names of principals for your business.

Loan requests

A small loan request should be ten pages or less with adding in the attachments. If you are seeking a small business loan, keep in mind that most conventional lenders will accept a summary sheet along with the loan application. you’ll usually need three years of income as well as tax records when applying for small loans.

Business plan executive summary

This is nothing more than a summary of the rest of the plan. It should be placed first within the business plan. This page is what investors and banks will most definitely read. Keep in mind that your business plan is a sales proposal that’s presented to other people for investment purposes.

Supporting documents

Supporting documents are very important. Ensure that you attach copies of these to the business plan. These will be documents will prove your points on many topics within the business plan. Also include any professional licenses you might have, contracts, resume’s, leases or even company brochure’s you might have created for the business you want to start. Promotional material is always a good addition as well.

As I mentioned above these are only a few of the components of an effective business plan. There are many factors to consider and it can be a very daunting task, but it’s essential especially if you want to obtain outside funding for your business. As with anything, before you begin you’ll need to do your research and learn as much as you can about constructing a solid plan.

Crafting an effective business plan can be very time consuming as well as stressful. If you don’t feel confident in your skills to write the actual plan yourself, you may want to consider hiring a professional to construct your business plan for you. Keep in mind this can be a big expense, but it often pays for itself in the long run.

Remember you’ll be presenting this plan to possible lenders and investors, so it has to be well written if you want to secure the funding you are seeking for your business.

Look for Part 4 in one week!

We’ll be talking about taxes and your small business.

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