This document outlines the major components of a Business Plan. Although some questions may not apply to your business, complete as many sections as possible. If you require additional assistance, please call our offices or make an appointment to meet with one of the SLBDC staff.

Business Plan Outline

Contents:
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1. Cover Page
2. Executive Summary
3. Table Of Contents
4. Business Description
5. Business Objectives
6. Market Description
7. Marketing Strategy
8. Operations
9. Financial Plan
10. Appendices

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1. COVER PAGE

business name, address, phone number
contact's name, address, phone number
can include a logo, if available.
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2. EXECUTIVE SUMMARY

summary of main facts and plans, to be written after plan is completed
funding requirements



3. TABLE OF CONTENTS

list all topics
page numbered index



4. BUSINESS DESCRIPTION

Describe your business in detail:

product(s) and/or service(s) provided
type of business (i.e. manufacturing, retail, service)
status of business (i.e. start-up, expansion, takeover)
ownership (i.e. sole proprietorship, partnership, corporation, franchise)
if a new business, give the anticipated opening date
describe the geographical trade area
list the hours of operation
describe any seasonal trends
explain where the idea for this business originated
if an existing business:
provide a brief history of the business
provide date of registration or incorporation
list sales, gross margins and profits to date
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5. BUSINESS OBJECTIVES

Objectives or goals for your business should be outlined and should be SMART:

Specific
Measurable
Attainable
Realistic
Timely

Goals may be short-term (by end of year 1 or 2) or long-term (by end of Year 5)
For example, some objectives for consideration:

Gross sales expectations (e.g. to achieve $100,000 in sales in the first year of operation)
Number of clients/customers served
Plans to hire employees (number of employees at what stage)
Hours of operation
Making major purchases (e.g. to buy a newer model full size van by Month 12)
Plans for expansion (e.g. to build another plant, franchise the business, purchase another business, etc.)
Use the following format:

Year 1:

1. ___________________________________________________________________

2. ___________________________________________________________________

3. ___________________________________________________________________

Year 2:

1. ___________________________________________________________________

2. ___________________________________________________________________

3. ___________________________________________________________________

Long-Term Objectives (Goals for Years 3-5):

___________________________________________________________________

___________________________________________________________________

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6. MARKET DESCRIPTION

The Business Environment

The "environment" in which your business operates is something you cannot control. Any or all of the following environmental factors may have an impact on your business. Explain whether or not these factors will create threats and/or opportunities for your venture, and why.

Demographic

i.e. aging population, increasing number of two-income families, more working women, increasing/decreasing population, etc.
Economy

i.e. trends in the inflation rate, average income levels, unemployment levels, general economy of the country or region, etc.
Social

i.e. increasing concern for the environment, people more value-conscious, etc.
Technological

i.e. any new technological advances, such as the Internet, that may affect your business either positively or negatively
Political

i.e. any pending government regulations that could affect your business
The Competition

Research the competitors who sell similar products and/or services in your trade area, and determine the exact number. Consider various levels of competition: Those which are exactly like you; those which might offer part of what you offer, or something similar to what you offer; and those which sell something entirely different than what you are offering, but they have the market you hope to gain.
Indicate if the number of competitors is increasing or decreasing and explain why.
Explain how you will compete with your competitors - what will make your business different or more desirable?

Describe your competitors in either a chart format or write a paragraph about each one. Include the following information (if available):

Name of competitor
Location
Age of business
Form of ownership (sole proprietorship, partnership, corporation, franchise)
Estimated sales volume
Estimated market share
Estimated number of employees
Major strengths, weaknesses
The Target Market

Give a profile of your "target market" - i.e. the characteristics of customers who are most likely to purchase your product and/or service and explain whether your target market is the Industrial Market (you want to sell to other businesses) or Consumer Market (you want to sell to the general public).

Industrial Market:

i.e. type of business, size, product application, frequency and size of typical orders, decision maker, etc.

Consumer Market:

i.e. age, income, family size, education, lifestyle, frequency of purchase, decision- maker, etc.

Explain why your target market buys the product(s) and/or service(s) you will sell and explain what need(s) is/are being filled by the product(s) and/or service(s).
List the major criteria your customers use when deciding which business to purchase the product(s) and/or service(s) from. (i.e. price, quality, delivery time, level of customer service, credit terms, reputation, product features, etc.)
Conclude with an actual number of potential customers in your target market.

Market Research

Market Survey

Now that you have identified your target market (potential customers), you want to know what they think about your product or service. Create a market survey, then go out and question people who could be your potential customers. Keep the questionnaire brief - only 8 to 12 questions. Use a variety of questioning techniques, keeping questions fair and free of bias. Ask if the person would use your product or service, how often they would use it and what they would pay for it. Include other questions that will help you determine how best to reach and serve your customers/clients. Be sure to survey a representative sample of your target market.

Raw Results

Compile your survey results, tabulating the numbers for each response.

Sales Interpretation

Using the survey results, prove that a market exists for your product or service. Then project your sales figures for the first year of operation.

7. MARKETING STRATEGY

Product

Create a "menu" of your products and/or services. Put your list into appropriate categories, if necessary.

Pricing

List the prices you will charge for your product(s) and/or service(s)
Show how these prices are calculated. Explain what pricing strategies you are using. i.e. most businesses price their products or services based on what the market will bear, using information they learned when they conducted their market survey.

Provide the credit terms, if any, you will offer to your customers.
List any discounts and/or allowances you will offer to your customers.
Place

A. Location

Describe your business location
Explain the advantages of your location
If you have not selected a location yet, explain the criteria you will use when selecting the site

(i.e. cost, access to customers, location of competition, appearance, zoning, security, access to transportation lines, parking facilities, traffic flow, access to employees, community services, compatibility of neighbouring businesses etc.)
B. Distribution (Manufacturers Only)

Explain how you will distribute your product to the end-user
(i.e. wholesalers, distributors, retailers, etc.)

List and describe any of the agents who have already agreed to distribute your product

Include a copy of any contract(s) you have signed with your distributor(s) as an appendix to your Business Plan

Promotion

Describe the methods you will use to promote your product(s) and/or service(s).
List all costs associated with your promotional ideas.

Outline the amount you intend to spend in total for promotion in the next year (i.e. annual promotional budget).

A. Personal Selling

Describe your personal selling strategy and tactics

B. Advertising

List the form(s) of advertising which is/are the most effective for your business
Explain why this/these form(s) of advertising is/are the most effective for your business
(i.e. radio, business cards, newspaper, television, brochures, direct mail, etc.

C. Sales Promotion

Outline your plans for promoting your product/services - give away items such as caps, fridge magnets, mugs, etc., coupons, samples, trail offers, frequent user cards, etc.

D. Public Relations and Publicity

Describe any plans you have for building positive public relations or obtaining free publicity for your business
Create a media release announcing your opening
Outline plans for media releases in the future
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8. OPERATIONS

Personnel

List the job titles (include any owner(s)/manager(s)) of all people to be employed by your business; include any "angel helpers" (friends or family who will work without pay)

Indicate whether employees are full-time or part-time
Provide the wage or salary each of the employees will be paid.
If you plan to hire any additional employees within the next year, describe as above

Advisors

List the names, addresses, and functions of any individuals or organizations who will be working with you to ensure your business is a success. Include business advisors as well as technical advisors who are specific to your type of business. (i.e. lawyer, accountant, business consultant, government representatives, community/industry organizations, etc.)

Suppliers

List the major suppliers
List the product(s) and/or service(s) each supplier will sell to you
List back-up suppliers in case of emergency
Include any insurance requirements
Government Regulations

List government regulations (business name registration, GST, PST, EHT, WSIB, employee deductions, etc.), licenses, permits and insurance requirements that pertain to your business
Indicate whether the items have been addressed
If applicable, explain proceedings for environmental assessment
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9. FINANCIAL PLAN
Financing Requirements

List (be very specific) all items for which you require financing
Provide an estimated cost for each item listed
State the amount you will need for business start-up
Sources of Financing

List your proposed sources of financing
Give the amount that you anticipate each source is going to provide to your business
Detail the repayment terms for each funding source (i.e. personal investment, SLBDC loan, bank or credit union term loan, operating line of credit, venture capital company, private investors, etc.)
Include confirmation letters in your Business Plan for any lender(s) and/or investor(s) that have already agreed to help finance the business
Collateral for Loan(s)

List the items you are willing to use as collateral for any loans as well as their estimated value

Business Collateral
i.e. accounts receivable, inventory, equipment, vehicles, etc.
Personal Collateral (include a Personal Financial Statement)
i.e. personal guarantee, home equity, stocks/bond, automobile, other investments, co-signer(s), etc.
Financial Statement Projections

Create a spreadsheet showing your projected cash flow for the next 12 months of business operations
Include a projected Income Statement and a projected Balance Sheet
Cash Flow and Income Statement projections should be done monthly for at least one year
Include year end projections for Years 2 and 3
Write "Assumptions" explaining how all projected amounts were calculated
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10. APPENDICES
Include any extras that will support your Business Plan, for example:

Owner/management résumé(s)
Owner's Personal Financial Statement(s)
Business mission statement
Media release samples
Letters from vendors
Letters from customers
Copy of major contract(s) or copy of lease agreement(s)
Copy of certificates, diplomas, licenses, etc. required by owner or personnel
Drawings/photos/brochures of products and/or services
Drawings/maps of business location, layout, competitors' locations, etc.
Promotional campaign - samples of flyers, advertisements, etc.
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For More Information regarding your Business Plan contact:

Mike McDonough, H.B. Comm., CA, CGA, CPA (Michigan)
General Manager
Sarnia-Lambton Business Development Corporation
109 Durand Street
Sarnia, ON N7T 5A1

(519) 383-1371
1-800-263-7047
fax: (519) 383-8115
email: mikemcd@slbdc.com

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