[Company Full Legal Name]
Business Plan
[Month, year issued]
____
[Owner/Founder Name]
Founder & Chief Executive Officer
[Address]
[City], [State] [Zip/Postal Code]
[Telephone]
[fax] fax
[mobile] mobile
This document contains
Confidential & Proprietary Information
belonging exclusively to [Company].
This is a business plan.
It does not imply an offering of Securities.
Table of Contents
[Company Full Legal Name] ........................................................................................................................ 1
Table of Contents .......................................................................................................................................... 2
Executive Summary ...................................................................................................................................... 3
Market Opportunity .................................................................................... Error! Bookmark not defined.15
Vision, Mission, Goals & Objectives .......................................................... Error! Bookmark not defined.18
Company Overview ..................................................................................... Error! Bookmark not defined.22
Market Analysis ........................................................................................... Error! Bookmark not defined.25
Business Strategy ......................................................................................... Error! Bookmark not defined.33
Demand / Revenue Model ........................................................................... Error! Bookmark not defined.35
Product Strategy .......................................................................................... Error! Bookmark not defined.38
Competition .................................................................................................. Error! Bookmark not defined.49
Internet Strategy .......................................................................................... Error! Bookmark not defined.56
Marketing Plan & Strategy......................................................................... Error! Bookmark not defined.63
Risk ............................................................................................................... Error! Bookmark not defined.86
Management ................................................................................................. Error! Bookmark not defined.89
Present Situation .......................................................................................... Error! Bookmark not defined.95
Financial Plan .............................................................................................. Error! Bookmark not defined.97
Capital Requirements................................................................................ Error! Bookmark not defined.101
Exit / Payback Strategy ............................................................................. Error! Bookmark not defined.102
Conclusion .................................................................................................. Error! Bookmark not defined.103
Financial Models ........................................................................................ Error! Bookmark not defined.104
Supporting Documents .............................................................................. Error! Bookmark not defined.105
Executive Summary
[Company Full Legal Name] was [formed / created] in [Year Started] to [describe the purpose of your
business activities].
Overall, our company can be characterized as a [retail merchant / computer hardware installation, service
and repair / wholesale deli and bakery / childcare / car rental] business specializing in [your area of
specialization].
Background
For many years people have [x].
Today, the [market / industry] market [has grown exponentially / diminished significantly / remains
relatively constant / experiences fluctuations based on the economy], creating demand for [the gap your
business will fill].
“30 million households suffer from mouse attacks every day…”
- [PROMINENT INDUSTRY MAGAZINE OR RESOURCE]
[Company] [is creating an / will launch an / has an established] operating infrastructure, with [well-
recognized brands / customer letters of intent / proprietary content / satisfied business communities
/strategic partners / distribution channels / outsourced production]. [Company] is now transforming its
products and services, as well as its fundamental business model, to take full advantage of [the newest
Internet-based technologies /current market trends / recent changes in xxx].
We have just [started / completed] the [design / development / testing / introduction] of [product /
service]—a novel and proprietary [soap for cleaning vinyl / retail store display system / construction tool /
approach to bookkeeping / technology for xxx, etc.].
[Company] [has been / will be] established as [a / an] [Sole Proprietorship / S Corporation, C Corporation,
Limited Liability Company / Partnership / Limited Liability Partnership] based on the advice of our
advisory board. This structure [will give / gives] us the greatest tax and operational advantages based on
the nature of our business and our anticipated growth.
[Company] [is /will be] located at [Address], with satellite offices in [City, State]. Planned expansion will
[describe what you foresee regarding expansion and any additional facilities that you expect will become
necessary in the next two to five years].
By [benchmark year] our operation [was / will be] producing [$x] [sales / units / products] annually, and
[has operated / is expected to operate] at [financial condition—profitable, break-even, etc.] [ever since /
through the xxx phase of the product life cycle]. Revenue projected for fiscal year 20[xx], without external
funding, is expected to reach $[x]. Annual growth projections indicate an [increase / decrease] of [x]% per
year through 20[xx].
Now, [Company] is at a point where [what you need or want to do next]. We intend to secure $[x] through
[a / an] [line of credit / SBA loan / angel investor / venture funding] to [expand our product line / enhance
or improve our family of proven products / acquire xxx / upgrade our production facilities, etc].
Market Opportunity
The [your target market / market segment / industry] is [growing / shrinking / changing] [rapidly / slowly /
at a steady rate]. The market for [type of product] products amounted to $[x] million in 20[xx]–
representing a [x]% [growth / decline] as compared with $[x] million in 20[xx].
[Company] has investigated the number of people likely to use or benefit from our [x] products. Based on
market research / private research / industry surveys, etc.] we estimate the number of potential customers
to be [xxx] and the number we are likely to reach at [xxx].
According to the [research firm / industry report / trade journal—identify your source], dated [xxx], the
overall market for the [name of industry] industry [worldwide / nationwide / in this region] is projected to
be $[x] [billion / million / hundreds of thousands] by the end of 20[xx].
From our research, we’ve determined that customers purchase [your type of product] products primarily
[in supermarkets / via the Internet / from wholesalers / at street fairs, etc.]The greatest growth in the [x]
market is in the area of "[x]". Currently, market distribution is shared by [number of competitors]
participants, with [top competitor name (this could be you)] considered the market leader.
In the next [x] to [x] years, our forecasts indicate that there will be more than [x] [thousand / million] units
of [product name / product group name] distributed by [Company]. The market potential for [product
name] in these quantities – with a current retail price of $[x] per unit – is approximately $[x] [thousand /
million]. This translates to [Company]'s market share at [x]% of the overall market by 20[xx].
Customers
[Company]'s target market includes [list types of customers].
The typical customer for our products is someone who is [in the xxx field / uses xxx / needs xxx / wants
xxx] and who currently uses [product (yours or a competitor’s)] for [describe use, application or purpose].
A partial list of [Company] customers includes:
[20,000 asthma sufferers]
[5,000 practitioners of ______ [think about the people who influence your customers]
[xxx]
Product Strategy
[Company] [currently offers / will soon offer] [x] products for the [consumer / B2B / wholesale] [your
market] market. Our principal product, [xxx], gives customers [list customer benefits]
[Company]’s [product / service name] meets customer requirements with the unique [capacity /
functionality / service option] for [describe what it does / what it offers that other products don’t / why it is
a better value].
Other products in our product family include:
[List products and necessary definitions].
Overall our existing product line is in the [give status: introductory / growth / maturity / nearing the end of
its life cycle] stage. With several products in the [introductory] stage, [xx] in decline, and others at their
likely peak, we have multiple opportunities to [introduce new products / re-release more up-dated products
/ take waning products out of circulation / identify potential new markets / redirect declining products to
new international markets, etc].
[Company]’s proprietary [technology / intellectual property / patented processes, tools or products]
include(s):
[List proprietary assets].
These assets give us several options with respect to [growth / expansion / reorientation]. We have offers
on the table for [OEM deals / licensing / production / repurposing—describe the opportunities for your
company based on these assets.]
Business Model
[Company]’s business model [has evolved / is evolving]. Initially, we sold [xxx] [direct to customers /
business-to-business / through major retailers / to xxx manufacturers under OEM licensing / through home
shows in a multi-level marketing program / door-to-door / at sidewalk kiosks, etc].
With the rapid adoption of [xxx] in the past [xx] [months / years], we have had to rethink our business
model, to include [online sales / retail distribution channels / small retail shops / airport concessions / sales
directly out of our warehouses, etc.] In our current business model, we find we need to support [xxx] sales
with an [informational website / online store / army of sales reps, etc.] that allows us to penetrate the
market far more effectively than we could using the old business model.
Competition
Companies that compete in this market are [Competitor 1], [Competitor 2] and [Competitor 3]. These
competitors charge [comparable / a wide range / within a $x range of] prices: [list examples and range of
prices for each competitor to substantiate your statement].
Product [Company] [Competitor 1] [Competitor 2] [Competitor 3]
[Product 1] [$XX-XX] [$XX-XX] [$XX-XX] [$XX-XX]
[Product 2] [$XX-XX] [$XX-XX] [$XX-XX] [$XX-XX]
[Product 3] $[$XX-XX] [$XX-XX] [$XX-XX] [$XX-XX]
Competitive Pricing
The major strengths and weaknesses of our competitors include [example: price, location, quality].
The major competitors' objectives and strategies are [list].
The major competitors' most likely response to current [economic, social, culture, demographic,
geographic, political, governmental, technological, and competitive] trends affecting our industry will be
[list likely competitor responses].
Key factors, such as [Competitor 1’s first-to-market leadership position / Competitor 2’s recent infusion of
capital from an IPO / Competitor 3’s release of xxx / a widespread (downward / upward) sales trend in xxx
and related products] have resulted in the present competitive position in the industry. This means the
[Company] will need to [describe what you will need to do in response to these factors, such as: seize an
opportunity / overcome a threat / ride the wave / stabilize / rethink your strategy / introduce xxx, etc.].
Compared to competitive products (or the closest product available today) our [product / service] [can /
will] [describe your competitive advantage].
Our strategy for [meeting / supplanting / dominating] the competition is [adding value in the form of xxx
in every package / offering volume discounts / securing extensive media coverage and customer
commentary regarding the major improvements in xxx / reducing our prices / increasing our prices /
providing personal delivery / responding to specific customer requests within xxx hours / simplifying xxx
to make technical support almost unnecessary, etc.].
Risk
Top business risks for [Company] as we [create / enter / expand in] the [x] market include [current lack of
awareness / economic slowing or recession / recent losses in related industries / explosive growth that
exceeds our ability to respond—whatever your top risks are].
We face [briefly describe primary risk]. Our strategy for minimizing risk in this area includes: [describe
your strategy.]
Changes in [the market / the environment / legislative regulations / the economy] may also require that we
make adjustments to account for [describe the next specific area of risk].
An environmental risk that may cause some concern is [your top environmental risk]. We address this by
[x].
Marketing Plan
Responses from customers indicate that our [product name(s)] [is / are] enjoying an excellent reputation
and we fully intend to continue this trend. Inquiries from prospective customers suggest that there is
considerable demand that we are [prepared / preparing] to meet.
Relationships with [leading OEMs (Original Equipment Mfgs.) / retailers / Fortune 500 / 1,000 companies
/ major accounts / manufacturers and distributors] substantiate [Company]’s [fitness / readiness /
preparation] for [considerable growth / consistent sales volumes / market expansion] and accomplishment
in our [industry / market / region / area].
[Company]'s marketing strategy is to aggressively enhance, promote and support the significant benefits of
xxx—unique to our product’s [functionality / variety of uses / market acceptance / favored status].
Sales Strategy
[Product]'s special [functionality / market requirements / seasonal or geographic appeal—as mentioned in
your Market Analysis section / characteristics / usability] allows us to capitalize on xxx and as a result, our
sales strategy typically results in / is expected to yield] [$xx] in [annual / quarterly] sales. We are targeting
the [xxx] audience with [special promotions / a concentrated ad campaign, etc].
Distribution Channels
[Company]'s marketing strategy includes [plans to sell / selling] our [product(s)] through [several channels
/ an exclusive distributor relationship / authorized resellers / direct to consumers, etc.]. We will be driving
our [lower margin / high margin / specific / complete line of] products through [key distributors,
Distributor 1 and Distributor 2] OR [xxx product line] through [our online showroom / home shows /
individually-selected retailers / direct mail promoting retail channel resellers / extensive advertising with
publications that provide fulfillment in exchange for ads and part of the proceeds—whatever you’re doing
in available distribution channels].
The determining factors in choosing these channels are [access to resellers / minimal receivables handling
/ greatest direct access to the greatest number of potential customers, etc.].
Our mix of distribution channels will give us distinct advantages over our competition, including [list
advantages—faster response to market shifts / access to markets they don’t reach through xxx / presence
in xxx where we have an exclusive relationship / X,XXX-person sales force promoting our product(s),
etc].
With [number of] sales channels, [Company]'s primary channel [is / will be] [largest distributor / largest
retailers] where [x] % of our channels sales, and [x]% of our overall sales [originate / will]. Our objective
is to [maintain high sales volumes / increase our sales volume / reduce our sales volume / minimize our
sales volume / eliminate sales] through this channel, while [rapidly expanding / stabilizing / reducing /
eliminating] sales in [xxx channel] and [growing / stabilizing / reducing] sales in our [xxx channel].
Advertising & Promotion
Our advertising and promotion strategy is to position [Company] as the leading [manufacturer /
distributor] in the market.
We will utilize the following media and methods to drive our message home to our customers:
For the next [x] [months / years], advertising and promotion will require $[x]. We arrived at this figure
based on [current advertising response rates / launch plans for xxx / consistent ROI with xxx promotions,
etc.].
On an ongoing basis we will budget our advertising investment at [x]% of total sales. By consistently
tracking the results of our advertising, we [have determined / will be able to determine] the effectiveness
of our ad campaigns. This will allow us to adjust this budget allocation appropriately to ensure the highest
possible return on our investment in advertising and promotion.
Publicity / Public Relations (PR)
During 20[xx], [Company] will focus on the following publicity strategies:
Complete at least [x] media contacts per [month / quarter].
Have our products mentioned, included in competitive round-ups, and / or the subject of full articles at
least [x] times per [month / quarter / year].
We will track, wherever possible, all revenue generated from our advertising, promotion and publicity
efforts. We anticipate at least $[x] in sales to be generated directly from our promotions, and potentially an
additional $[x] in retail / distribution channel sales in response to our ads.
Production, Delivery & Fulfillment
Currently, production [is / is planned to be] [outsourced / handled internally at our xx plant in xx /
distributed among xx vendors / up for bid] OR of [product line] is handled [at xxx location / by x
supplier]. Key considerations in terms of production and delivery include [rising cost of fuel or electricity /
transportation costs / availability of raw materials / adequate personnel to meet demand / production
efficiency / costs associated with raw materials storage, etc].
Due to [expected rapid growth / anticipated product introductions / a downward trend in x / sustained level
sales], our production should [be expanded / exceed current production capacities / level off / drop for our
declining products / stabilize near current levels] within [number of months / years]. At that point, our
production facilities will need to [expand / move / be reduced / be distributed among several vendors / be
rolled out to a full turnkey contractor, etc.]. Our biggest production advantage is [describe advantage you
currently enjoy or expect to realize].
Management Team
Our management team consists of seasoned managers and experts whose backgrounds and experience
make them ideally suited to their respective roles. A brief review of the training and expertise they bring to
[Company] are as follows:
[Owner/Founder Name], Founder and CEO, [age], [degree(s) and major] started [Company] in [Year
Started] after working in [x] for [x] years. [CEO first name] has started [two / several] businesses, and
acquired invaluable experience with [x] that will help make [Company] successful in a relatively short
time. [Company], now in its [1st / second / third / Xth] year, [has operated / will operate] on [its own
revenues / owner equity / a family loan / a bank loan, etc.] without [external / other] funding [since it
inception / until (month and year funding is expected)].
[COO/Business Manager name], [age], COO, [degree(s) and major] has served as [title / role /
occupation] in the [field / industry] for [x] years, and in [field / industry] for [x] years. Additional
experience in [field / industry / research / training / experience] and [xxx] give [COO first name] the
necessary skills to direct the operations of [Company], with primary emphasis on streamlining operations
and implementing cost-saving alternatives.
[CFO/Accountant name], [age], CFO, [degree(s) and major] has served a variety of companies as CFO,
giving [him / her] a broad background of experience and opportunities to create financial stability in
differing environments and circumstances. [CFO first name] has taken [x] companies through the growth
phases planned for [Company], and is ideally suited to direct the financial aspects of our success.
Outside Management Support
[hourly / project basis]
[x], Accountant / CPA
[x], Corporate Attorney
[x], [Type of Consultant]
Additionally, our outside management advisors provide tremendous support for management decisions, as
well as broad experience and creativity.
Objectives
Projected revenues for fiscal year 20[xx], without external funding, are expected to be $[x]. Annual
growth is projected to be [x]% per year through 20[xx]. We feel that within [x] years [Company] will be
in a suitable position for [further expansion / an initial public offering / profitable acquisition]. At this
time, our objective is to [propel the company into a prominent market position / reclaim market share /
establish a new market in an emerging industry / seize an opportunity to fill a market gap created by the
demise of a major competitor, etc].
To achieve our objectives, we plan to [build a distribution channel / establish strategic partnerships /
introduce xxx product or service, etc.]. This will require [describe what you will need to do this in terms of
additional people, material, facilities, a company you’ll need to acquire, etc].
Capital Requirements
Based on the opportunities identified through research and analysis, and building on [Company]’s
experience and what we feel are sound business assumptions, our [initial / first-second-third year / total]
capital requirements are for $[x] by [month], [financing year].
To accomplish this goal, we have developed a comprehensive plan to [what you plan to do—provide
specific examples]. To implement these plans we require a [loan / line of credit] totaling $[x] for the
following purposes:
Build manufacturing facilities and ramp up production and inventory to meet customer
demands.
Maximize sales with an extensive campaign to promote our products / services.
Add retail outlets, regional marketing / sales offices, print a direct-mail catalog.
Reinforce Customer Support services to handle the increased demands created by the influx of
new orders and broader coverage of existing accounts.
Augment company staff to support and sustain prolonged growth under the new marketing
plan.
Increase Research and Development to create additional follow-on products as well as to
further fine-tune our competitive advantages.
Well-timed funding will allow us to achieve our marketing, development and sales goals for the
immediate future. Our projections for post-funding sales are as follows for the next 5 years:
2001 2002 2003 2004 2005
Projected Sales $xxx,xxx $xxx,xxx $xxx,xxx $x,xxx,xxx $xx,xxx,xxx
Series1
$6,000
$4,000
$2,000
$-
1 2 3 4 5
[Caption]
We anticipate additional financing requirements of $[x] and $[x] in [x] [months / years] and [x] [months /
years] to allow us to [increase production capacities / develop x new products or technologies / expand our
facilities and production area / increase income-producing holdings] to [meet market demand / take
advantage of the xxx emerging market / increase shareholder returns / create a new profit center or
revenue stream, etc].
Exit Strategy / Return on Investment
The attached financial projections indicate that the full repayment of our [loan / line of credit] will be
achievable in [x] years. With the requested financing, the results of our [use of funds—development /
marketing / upgrade, etc.] will be increased profits generated by [higher sales / lower COGS / existing
customers upgrading to the new product, etc.]. We anticipate repaying the loan by [Month], 20[xx].
Conclusion
The market for [Company] [product(s) / services] is clearly [what the market is doing], giving us a prime
opportunity to [what you’ve said you will do in your plan]. The [consistent sales volume / rapidly
expanding annual sales figures / explosive growth] for this market support [Company] reaching its break-
even point by [month / quarter / year] and profitability in just [x] years. By driving [x]% of profits back
into the company, we expect to [accelerate loan payments / reduce our line of credit balance to zero] and
be debt free by [month / quarter / year], a full [x] [months / years] ahead of schedule.
Initial responses to test marketing with potential customers indicate a strong affinity for [Company]
products. Test marketing also provided important insights into the customer and end-user experience, both
with the purchase process, and using the beta version of the product. This plan reflects the application of
suggestions from the test market. We anticipate even stronger growth than indicated in this plan, based on
our most recent test market responses. Our plan is to launch product sales first from our website,
generating cash flow before we move into the retail channel.