If someone has been running a business part time for extra income but the company has recently experienced rapid growth and this person has been considering taking on the business venture full-time but the current earnings are not yet enough to sustain the growth and they have come to you seeking advice.
(1) Explain the elements of a business plan.
(2) Give explanations as to why a business plan is needed exploring start-ups, expansions, relocations, and franchising elements. Provide an analysis of the financial aspects of going full-time and include what bankers, lenders, or investors want in a business plan as well as give advice on how to present the business plan to the bankers, lenders or investors.
(1) Explain the elements of a business plan
A good business plan is needed for many reasons. It helps businesses in determining objectives and reveals potential markets. It also helps businesses to determine their weaknesses and develop strategies and take advantages of opportunities. Most importantly, it also focuses on goals and crystallizes the vision of business. It also increases the chances of financial approvals. A business plan has three primary functions:
1. Serve as an Action Plan
2. Serve as a Road Map
3. Serve as a Sales Tool
Elements of the Business Plan:
1. Cover Page
2. Table of Contents
3. Executive Summary: It explains the fundamentals of the proposed business (details about the product, customers, and owners and future of the business). When applying for a loan, it should also include how much money is needed and how it is going to be to make business more profitable, thereby ensuring repayment.
4. General Company Description
- Mission statement
- Company goals and objectives
- Business philosophy
- About industry
- Company strengths and core competencies
- Legal form of ownership: Sole proprietor, Partnership, Corporation, Limited liability corporation (LLC)?
- Products and Services: In depth description about the products or services (technical specifications, pricing of products, competitive advantage etc.)
- Background of entrepreneur
- Industry and market forecast
5. Marketing Plan: A marketing plan will include market research and the complete information about the marketing mix with information regarding total size of market, current demand in target market, trends in target market, etc. It will ...
A part-time to full-time business plan is examined. An explanation as to why a business plan is needed exploring start-ups, expansions, relocation and franchising elements is determined.