my Internet Business Secret

Free Yoga Studio Business Plan for Loans

Obtaining Business Financing

When obtaining a business loan for a yoga studio business, it is imperative that you have a properly structured business plan that will assist you in showcasing how you intend to operate your Yoga Studio, how the business will operate, how you intend to market the business, the anticipated financial results of your company, and how you intend to repay your debt obligations. This sample loan business plan will provide you with the framework that you need in order to acquire a business loan for starting or expanding this type of business.

Executive Summary

Introduction

When obtaining a business loan for a Yoga Studio, it is imperative that your business plan has a clear and concise executive summary that provides an outline of what are seeking to accomplish, how much capital you are seeking to raise, the management biography of the business owner, and an overview of the anticipated profit and loss statements of the business. Here is an example of how the title paragraph should be written:

Yoga Studio, Inc. (“the Company”) is seeking a business loan of 0,000 in order to launch the operations of a yoga studio business that will be based in San Francisco, California. The Company was founded in (Insert Year). The business was founded by Mr. John Doe.

Products and Services

In the next segment of the business loan and business planning document, you should showcase the products and services that you will be providing to the general public. For instance:

The Yoga Studio will provide a broad number of classes that pertain to training the body via yoga and related stretching practices. The business will generate income from the ongoing fees associated with yoga classes at the studio while concurrently generating secondary revenues through the sale of yoga mats and related accessories used during the course of yoga training.

The third section of the business plan will further discuss the services offered by the business.

Business Loan Terms

Now it is time to discuss the anticipated terms of the business plan that you are seeking. An example paragraph of how this is stated:

At this time, Mr. Doe is seeking a conventional business loan in the amount of 0,000. The interest rate, loan terms, and loan covenants are to be determined during negotiation. However, this business plan assumes that the business will receive a seven year business loan with a seven percent interest rate due on the outstanding principal balance.

Management Biography

Now that the summary of the business has been provided, it is time to provide a brief overview of the owner of the business. An example paragraph summing up the owner is as follows:

Mr. Doe is a highly experienced business person that has years of experience regarding the direct ownership and management of business. He will be able to effectively bring the operations of the Yoga Studio to profitability while ensuring that the business loan’s payments and its covenants are met at all times.

Financial Statements

The most important thing to your lender when applying for a business loan is how you intend to repay the bank. In this section of the business plan, you should provide an overview of the finance’s of the business discussing the anticipated revenues, expenses, and profits/losses. You can also discuss the applicable collateral within the business plan that will be used to secure your business financing.

Expansion Plans

One of the most important aspects of your business plan is how you intend to expand the business over a three to five year period. Banks and finance companies always want to see that the business will experience a moderate to strong level of growth. This is especially true in business lending because as your business grows the cash flow that secures your business loan will decrease proportionality against your monthly credit obligations. An example of how this is stated is as follows:

The Yoga Studio will continue to expand through organic means including increasing the Company’s advertising budget via the reinvestment into the after tax cash flows of the business. Additionally, if the business is highly successful then the Company may seek to establish additional Yoga Studio locations after the third year of operations.

The Financing

Use of Business Loan Proceeds

In this section of the business plan you should focus on how the proceeds of the business loan will be used. An example of this would be as follows:

Yoga Studio Establishment – ,000
FF&E – ,000
Working capital – ,000

Management Equity

In this section of the business plan you should discuss the percentage ownership of the business among the owners of the business. For example:

Mr. Doe will own 100% of the Yoga Studio.

Board of Directors

When applying for business financing, the bank will also want to know who serves as the board of directors. For small businesses, usually the owner serves as the director of the business. An example of how this is worded:

Mr. Doe will be the sole director of Yoga Studio, Inc.

Exit Strategy

Any bank or financing company is also going to want to know what you intend to do with the business over a set period of time. Many business owners will develop and expand a business with the intent to sell the company to a third party at a later time. When drafting this part of the business plan you should focus on what you intentions are in regards to potentially selling the business. This is often worded as:

Mr. Doe would most likely sell the Yoga Studio to a third party for a significant earnings multiple. Yoga Studio usually sell for approximately one to three times earnings given the financial strength of the business. In this event, the business would be sold by a business broker and the business loan sought in this plan would be repaid according to the covenants of the business loan agreement.

Products and Services

When developing a business plan that is appropriate for obtaining a business loan or other business credit facility you need to clearly showcase the services or products that you will be offering to the general public. An example of how this section is worded goes as follows:

As stated in the executive summary, the primary revenue center for the business will come from ongoing yoga classes hosted at the Company’s retail storefront location. For each yoga session, Management intends on charging a fee of approximately . The average yoga class will have five to ten students. Classes will be held five to six times per day.

The business will also generate sales through the sale of yoga mats and other products as they related to yoga training.

Industry and Market Analysis

The Current State of the Economy

It is important to let your financial institution know that you are well apprised of the financial situation of the general economy when you are applying for a business loan. This is especially true in today’s environment where lending has become more difficult and will remain more difficult in the foreseeable future. Specifically, you should gear this section of the business plan analysis towards the industry that you are operating within. For example:

The current economy has remained difficult over the past few years. However, Yoga Studios have faired well despite the current economic issues. This is because yoga, by its students, as seen as an integral part of their lives. As such, the Yoga Studio will be able to remain profitable and cash flow positive in any economic climate.

The Yoga Studio Industry

In addition to providing your business loan officer with an understanding of the general economy, it is important that you showcase that you have an equal understanding of the industry in which you are operating within. As such, you will need to provide you business loan institution of a brief overview of your industry and any potential changes that may affect the way that your company does business. An example of how an industry overview is as follows:

Within the United States, there are approximately 10,000 locations that operate as Yoga Studios. The popularity of yoga has increased substantially over the past ten years as more Americans have become concerned with their fitness. Each year, the industry generates more than 0 million of revenues. The excepted growth rate of the Yoga Studio industry is expected to remain in line with that of the general American economy.

Target Market

In this section of the business loan application and business plan analysis, you should focus on the demographics of your localized market (or national market if applicable). This section should discuss how many people live in your area, the anticipated number of people that would require the use of Yoga Studio, the median household income of people living in the area, poverty line statistics, and any applicable laws that would apply to your operation of Yoga Studios.

Competition

Many people that are developing new businesses or expanding existing businesses often feel that their business does not have any competition or limited competition at best. However, this is almost never the case. Unless you have re-invented the wheel – you will have competition. When applying for a business loan, you should clearly showcase your competition in your business plan. This is especially important to your banker as they will be able to gauge your ability to be successful in your targeted market. Many business loan underwriters will aggressively confirm that competitive nature of your local market and your local industry.

When drafting this section of the plan you should heavily discuss the competitive advantages that you intend to have over your competition.

Marketing Plan

In addition to all of the above information that we have covered, your business loan officer is also going to want to know how you intend to market your business to the general public. Most people do not quite understand how to effectively market their business outside of prominent signage or flyer distribution. When applying for a business loan (again in this difficult lending climate), your banker is going to want to see that you have a clear methodology of how you intend to market your services or products to the general public. In this section of the business plan – we will overview how to showcase your services/products to the general public.

Marketing Overview Example

The Yoga Studio will place prominent signage on the facility to draw a significant amount of foot traffic.
The business will maintain listings in the Yellow Books.
Yoga Studio, Inc. will also maintain an internet website that showcases the Company’s operations, hours of operation, and relevant contact information.

Marketing Strategies Overview

Additionally, you will be required to further drill down (in your business plan) how you intend to implement your strategies when you launch or expand your business’s operations. In this section of the business loan and business plan documents, you should amplify the bullet points from the section above. For instance:

The Yoga Studio intends to use a number of strategies that will create instant traffic and customer flow to the Company’s location. These strategies include not only using prominent facility and road signage, but also distributing flyers to people that fall into he Company’s targeted demographics. The business will also regularly take out advertisements in localized newspapers that showcase the Company’s hours of operations, yoga studio services, and specials that are occurring within the Yoga Studio on a regular basis.

The business will also maintain a highly informative website that showcases the Yoga training services, its hours of operation, and other relevant information in regards to the Company’s services. This website will be listed on major search engines such as Google as many people now use the internet to locate local businesses such as Yoga Studios.

The Financial Plan

Beyond any other part of your business loan application or business plan, the financials section of these documents are what matters most when applying for a business loan or any other type of credit facility. Ultimately, this section of the business plan showcases not only what your anticipated profitability will be, but also how you intend to repay the funds that you have borrowed through your business financing facility. An example of how this section is structure is as follows:

Assumptions

Yoga Studio, Inc. will have an average annual growth rate of 10% per year.
Mr. Doe will acquire 0,000 through a business loan in order to launch the operations of the business.

Proforma Financials for a Business Loan

Now it is time to showcase how you intend to repay your loan, generate a profit, and increase the book value of your business over a three to five year period. BusinessPlansForLoan.com has developed an easy to use financial model that you can use when drafting out the financial model for your business plan and business loan application. Through your business loan application, you will be required to have the following:

Profit and Loss Statement for your Yoga Studio
Cash Flow Analysis for the Yoga Studio
Balance Sheet for the Yoga Studio
Business Loan Amortization Tables

In this continuing series of articles on how to write a Business Plan or Information Memorandum to raise capital, Part 5 discusses business plan content specifically ‘Market & Market Strategy’.

Market and Market Strategy

This is another important section of the business plan as it sets the scene for the rest of the plan by estimating total available market size and the share the venture’s product or service has a substantial market in. Preferably the target or established market is in a growing industry that can achieve sales despite existing or likely future competition. This section of the business plan provides the basis of projected turnover which will determine the dimensions of the venture and will influence the amount of finance sought.

Owing to its importance, this section should be prepared first, with time and care being spent collecting market data regarding overall size and growth rates, and presenting facts, figures and their source wherever possible. Concentrate on the market segments which specifically relate to the products or services offered rather than more general analysis, as prospects and trends directly applicable to your business may not be representative of the market as a whole. Extracts from relevant surveys where available or statistics which you have gathered should be appended to the report as supporting information. In situations where either a market is being entered for the first time or a new market is being created, actual experience cannot be used for comparison. Here it is even more critical to undertake relevant research to comfort the venture capitalist regarding the reasonableness of sales projections.

The ‘Market’ section needs to address the following:-

1. Customers

• Who are the existing or anticipated customers for the product or service?

• What is the basis of their purchase decision: price, quality, services, personal contacts or some combination of factors?

• Indicate potential customers who have expressed an interest in purchasing the product or service and why.

• Similarly, indicate potential customers who have shown little or no interest in purchasing and explain why.

• Explain how negative customer responses will be overcome.

• Consider what customers expect in the way of price, quality and service.

2. Market Size and Trends

• What is the total size of the current market for the product or service offered? Indicate the source of the estimates.

• Is the market, expanding, contracting or static? (Discussions with customers, distributors, dealers, agents and sales representatives may prove useful in determining both market size and trends).

• If the intention is to sell regionally, a regional breakdown should be given.

• Indicate the major factors affecting market growth (economic, industrial, political, climatic, population shifts).

• Seasonality and how the effects on the business can be minimized.

3. Competition

• Make a realistic assessment of the strengths and weaknesses of competitive products or services and name the companies which supply them.

• Compare competing products or services on the basis of price, quality, performance, service, warranties and other relevant features.

• Indicate the current advantages and disadvantages of competing products or services and say why they are not fully meeting customer needs.

• Highlight your three or four principal competitors and explain why customers buy from them. Indicate why the venture will be able to compete favorably and take market share from them, and what responses this will provoke from them.

4. Estimated Market Share

• Summarize the features of the product or service which will enable it to be sold in the face of existing and potential competition.

• Highlight customers who have made or are prepared to make purchase commitments and indicate future major customers and why they will become so.

• Based on this customer intent and the assessments made so far in points 1, 2 and 3 above, estimate what share of the market the company is aiming to achieve in the next three years. The anticipated growth of the company’s sales and its estimated market share should be related to the growth of the industry, customers and strengths and weaknesses of competition.

5. Market Strategy

Explain how you intend to achieve sales targets. This should cover overall marketing strategy, pricing distribution, after-sales service and advertising, detailing what is to be done, how it will be done and by whom.

6. Overall Marketing Strategy

This should be developed from market research and analysis and outline the general marketing philosophy and strategy to be adopted.

• Which customers will be targeted for sales efforts, initially and thereafter.

• How customers will be identified and contacted.

• Where the company intends to be positioned versus the competition (i.e. by way of price, quality, response, etc).

• Whether sales will be generated regionally, nationally or internationally, and the timetable involved in graduating from one to another.

7. Pricing

This is a critical aspect as the ‘price must be right’ to allow market penetration, sustain market position and generate profits. If products or services are superior to competitors, investors will be surprised if the price is below theirs. Two things should be remembered here:

i. Costs always tend to exceed expectations (“Murphy’s Law”) and

ii. Price cuts are more acceptable than price hikes.

Since both of these imply pressure on gross margins it is important to demonstrate that the pricing policy adopted will generate net profits after all direct and indirect costs, allowing for possible future price competition.

8. Sales Strategy

How will sales be achieved and by whom?

• Will the company use its own sales force, sales agents, distributors, OEMs (original equipment manufacturers)?

• What incentives will be given to stimulate maximum sales efforts by internal sales people and by third parties?

• What is the longer term intention with regard to an own sales force?

• How are distributors/dealers attracted and chosen and what are the terms of trade?

9. After Sales Service

If the intention is to offer a product which will require services and warranties, indicate the importance of these in the customer’s purchasing decision and how the commitments will be met. Detail any service charges to be rendered and compare your after-sales service with that provided by competitors.

10. Advertising and Promotion

Describe the approach that will be adopted to generate sales leads by creating customer awareness, i.e. exhibitions, trade magazine advertising, direct mail, promotional literature, advertising agencies, etc. A schedule of the costs should be presented in an appendix.

The content of Business Plans will be further covered in subsequent articles by Len McDowall.

© Len McDowall, Integral Capital Group 22nd October, 2007

www.integralcapital.com.au

A business plan helps an aspiring business owner organize his business in a systematic way. It can sometimes be difficult to come up with a realistic and good business plan, especially if you are looking for funding. Many people feel the need to impress potential lenders and investors so that they can get a positive response. While this may be so, it is important that while you are writing your plan, you realistically want to achieve whatever you set out to achieve.

One trick about a business plan is that it should be simple and clear to the reader. Use understandable and direct language to convey your message. Since you need to have that professional look, the use of a business plan example can help you accomplish this. There are many examples of business plans available.

One place to source this is the Internet. Many websites are there with specific information about a particular business plan. For example, if you want to start a car wash business, all you have to do is go to the Google search engine, type in the words “car wash business plan example.” You will get a variety of lists that are links to all the plans available. You just can then read through and use the ideas you get from there to create your own.

There is also the use of software that is designed to make the entire writing process easier. They contain concepts and guidelines which you can use to create your own business plan. In addition, there are previously used business plans from other entrepreneurs that you can borrow ideas from and modify to suit your business situation.

Obtaining Business Financing

Free Pawn Shop Business Plan for Loans

When obtaining a business loan for a pawn shop or related pawn brokering business, it is imperative that you have a properly structured business plan that will assist you in showcasing how you intend to operate your pawn shop, how the business will operate, how you intend to market the business, the anticipated financial results of your company, and how you intend to repay your debt obligations. This sample loan business plan will provide you with the framework that you need in order to acquire a business loan for starting or expanding this type of business.

Executive Summary

Introduction

When obtaining a business loan for a pawn shop, it is imperative that your business plan has a clear and concise executive summary that provides an outline of what are seeking to accomplish, how much capital you are seeking to raise, the management biography of the business owner, and an overview of the anticipated profit and loss statements of the business. Here is an example of how the title paragraph should be written:

Pawn Shop, Inc. (“the Company”) is seeking a business loan of 0,000 in order to launch the operations of a pawn brokering business that will be based in San Francisco California. The Company was founded in (Insert Year). The business was founded by Mr. John Doe.

Products and Services

In the next segment of the business loan and business planning document, you should showcase the products and services that you will be providing to the general public. For instance:

The Pawn Shop will provide general pawn brokering services to the general public, which includes providing small collateral loans to individuals based on the value of the property that they bring into the Company’s store. The business will specialize in making loans that are specific to jewelry.

Business Loan Terms

Now it is time to discuss the anticipated terms of the business plan that you are seeking. An example paragraph of how this is stated:

At this time, Mr. Doe is seeking a conventional business loan in the amount of 0,000. The interest rate, loan terms, and loan covenants are to be determined during negotiation. However, this business plan assumes that the business will receive a seven year business loan with a seven percent interest rate due on the outstanding principal balance.

Management Biography

Now that the summary of the business has been provided, it is time to provide a brief overview of the owner of the business. An example paragraph summing up the owner is as follows:

Mr. Doe is a highly experienced business person that has years of experience regarding the direct ownership and management of business. He will be able to effectively bring the operations of the Pawn Shop to profitability while ensuring that the business loan’s payments and its covenants are met at all times.

Financial Statements

The most important thing to your lender when applying for a business loan is how you intend to repay the bank. In this section of the business plan, you should provide an overview of the finance’s of the business discussing the anticipated revenues, expenses, and profits/losses. You can also discuss the applicable collateral within the business plan that will be used to secure your business financing.

Expansion Plans

One of the most important aspects of your business plan is how you intend to expand the business over a three to five year period. Banks and finance companies always want to see that the business will experience a moderate to strong level of growth. This is especially true in business lending because as your business grows the cash flow that secures your business loan will decrease proportionality against your monthly credit obligations. An example of how this is stated is as follows:

The Pawn Shop will continue to expand through organic means including increasing the Company’s advertising budget via the reinvestment into the after tax cash flows of the business. Additionally, if the business is highly successful then the Company may seek to establish additional locations after the third year of operations.

The Financing

Use of Business Loan Proceeds

In this section of the business plan you should focus on how the proceeds of the business loan will be used. An example of this would be as follows:

Pawn Shop Store Establishment – ,000
Inventory – ,000
Working capital – ,000

Management Equity

In this section of the business plan you should discuss the percentage ownership of the business among the owners of the business. For example:

Mr. Doe will own 100% of the pawn shop.

Board of Directors

When applying for business financing, the bank will also want to know who serves as the board of directors. For small businesses, usually the owner serves as the director of the business. An example of how this is worded:

Mr. Doe will be the sole director of Pawn Shop, Inc.

Exit Strategy

Any bank or financing company is also going to want to know what you intend to do with the business over a set period of time. Many business owners will develop and expand a business with the intent to sell the company to a third party at a later time. When drafting this part of the business plan you should focus on what you intentions are in regards to potentially selling the business. This is often worded as:

Mr. Doe would most likely sell the Pawn Shop to a third party for a significant earnings multiple. Pawn Shops usually sell for approximately one to three times earnings given the financial strength of the business. In this event, the business would be sold by a business broker and the business loan sought in this plan would be repaid according to the covenants of the business loan agreement.

Products and Services

When developing a business plan that is appropriate for obtaining a business loan or other business credit facility you need to clearly showcase the services or products that you will be offering to the general public. An example of how this section is worded goes as follows:

The Pawn Shop will specialize in making small collateral loans to individuals that will last two weeks. On each item brought in by the customer, the Company will grant a loan equal to 10% to 20% of the saleable value of the item. The customer, should they return to receive their item back, will be required to pay back the loan amount plus a fee equal to 20% of the loan amount. On every item accepted for pawn brokering by the Company, the business will follow all applicable state laws regarding the acceptance and handling of merchandise. Additionally, the business will generate secondary revenues among people that do not return for their merchandise. In this event, the Pawn Shop will resell the item to the general public or to a used goods wholesaler.

Industry and Market Analysis

The Current State of the Economy

It is important to let your financial institution know that you are well apprised of the financial situation of the general economy when you are applying for a business loan. This is especially true in today’s environment where lending has become more difficult and will remain more difficult in the foreseeable future. Specifically, you should gear this section of the business plan analysis towards the industry that you are operating within. For example:

The current economy has remained difficult over the past few years. However, Pawn Shops typically operate with a strong state of economy stability as these lenders are often used as a last resort among borrowers that are in need of quick loans or do not have the ability to sell the merchandise that they can use as collateral. As such, the business should be able to remain profitable and cash flow positive in any economic environment.

The Pawn Shop Industry

In addition to providing your business loan officer with an understanding of the general economy, it is important that you showcase that you have an equal understanding of the industry in which you are operating within. As such, you will need to provide you business loan institution of a brief overview of your industry and any potential changes that may affect the way that your company does business. An example of how an industry overview is as follows:

The Pawn Shop industry, despite the current economy climate, has remained strong despite the fact the general economy has suffered. Within the United States, there are 20,000 businesses that operate in a pawn brokering capacity. On a yearly basis, these businesses generate revenues of billion and provide jobs to more than 100,000 people. The total payrolls paid by the pawn shop industry has exceeded .4 billion on an annualized basis over the past five years.

At this time, there is currently no pending legislation or changes to the economy that are expected to change the nature of how the Pawn Shop Industry conducts business.

Target Market

In this section of the business loan application and business plan analysis, you should focus on the demographics of your localized market (or national market if applicable). This section should discuss how many people live in your area, the anticipated number of people that would require the use of pawn shops, the median household income of people living in the area, poverty line statistics, and any applicable laws that would apply to your operation of a pawn shop.

Competition

Many people that are developing new businesses or expanding existing businesses often feel that their business does not have any competition or limited competition at best. However, this is almost never the case. Unless you have re-invented the wheel – you will have competition. When applying for a business loan, you should clearly showcase your competition in your business plan. This is especially important to your banker as they will be able to gauge your ability to be successful in your targeted market. Many business loan underwriters will aggressively confirm that competitive nature of your local market and your local industry.

When drafting this section of the plan you should heavily discuss the competitive advantages that you intend to have over your competition.

Marketing Plan

In addition to all of the above information that we have covered, your business loan officer is also going to want to know how you intend to market your business to the general public. Most people do not quite understand how to effectively market their business outside of prominent signage or flyer distribution. When applying for a business loan (again in this difficult lending climate), your banker is going to want to see that you have a clear methodology of how you intend to market your services or products to the general public. In this section of the business plan – we will overview how to showcase your services/products to the general public.

Marketing Overview Example

The Pawn Shop will place prominent signage on the facility to draw a significant amount of foot traffic.
The business will maintain listings in the Yellow Books.
The Pawn Shop will also maintain an internet website that showcases the Company’s operations, hours of operation, and relevant contact information.

Marketing Strategies Overview

Additionally, you will be required to further drill down (in your business plan) how you intend to implement your strategies when you launch or expand your business’s operations. In this section of the business loan and business plan documents, you should amplify the bullet points from the section above. For instance:

The Pawn Shop intends to use a number of strategies that will create instant traffic and customer flow to the Company’s location. These strategies include not only using prominent facility and road signage, but also distributing flyers to people that fall intot he Company’s targeted demographics. The business will also regularly take out advertisements in localized newspapers that showcase the Company’s hours of operations, pawn shop and pawn brokering services, and specials that are occurring within the store on a regular basis.

The business will also maintain a highly informative website that showcases the Pawn Shop’s services, its hours of operation, collateral and lending information, licensure information, and other relevant information in regards to the Company’s services. This website will be listed on major search engines such as Google as many people now use the internet to locate local businesses.

The Financial Plan

Beyond any other part of your business loan application or business plan, the financials section of these documents are what matters most when applying for a business loan or any other type of credit facility. Ultimately, this section of the business plan showcases not only what your anticipated profitability will be, but also how you intend to repay the funds that you have borrowed through your business financing facility. An example of how this section is structure is as follows:

Assumptions

Pawn Shop, Inc. will have an average annual growth rate of 10% per year.
Mr. Doe will acquire 0,000 through a business loan in order to launch the operations of the business.

Proforma Financials for a Business Loan

Now it is time to showcase how you intend to repay your loan, generate a profit, and increase the book value of your business over a three to five year period. BusinessPlansForLoan.com has developed an easy to use financial model that you can use when drafting out the financial model for your business plan and business loan application. Through your business loan application, you will be required to have the following:

Profit and Loss Statement for your Pawn Shop
Cash Flow Analysis for the Pawn Shop
Balance Sheet for the Pawn Shop
Business Loan Amortization Tables

This is a continuing series of articles on how to write a Business Plan or Information Memorandum to raise capital, Part 10 discusses the business plan content specifically ‘Financial Information’.

Financial Information

This section is important as it represents the ‘gelling together’ of the business plan in the form of financial projections. It should include:-

1. Details of any previous financial record explaining briefly, historic trends and hiccups if any. If available, the past 5 years’ results should be summarized and the audited accounts together with latest management figures included in the appendices.

2. A summary of projected results for the next 3 to 5 years concentrating on the principal features of the projections, trends, rising and falling margins, fluctuations, commitment to R&D, major capital expenditure and key assumptions. Detailed projections together with the assumptions on which they are based should be provided in the appendices and should include:-

(a) Profit and loss accounts by month for at least 12 months, preferably 3 years, annually thereafter. The breakeven point should be clearly identified.

(b) Cash flow projections, monthly and yearly as above

(c) Balance sheets, monthly and yearly as above

3. A commentary on the forecasts considering the overall shape of the company as projected rather than a detailed review of specific points.

4. The nature of existing or planned financial reporting and control systems.

5. Sensitivity analysis covering key risk areas and a summary of the effects of such on the projections, in particular their impact on the funding requirement.

Investors routinely expect business plans to project sales, profits and other financial information for 3 to 5 years into the future. These projections are basic to the evaluation of the investment opportunity and to a large extent will determine how much of the company’s equity, investors will expect in return for their investment.

Projections must represent the entrepreneur’s best estimate of future operations and should be supported by the strategies described in the previous sections of the business plan. They should also provide the operating plan for the financial management of the venture.

When compiling projections, always work from top downwards, ie. start with the sales projections determined by the market and market strategy sections. It is a common mistake to project from the manufacturing cost level on the assumption that everything that can be made will be sold by the sales team. Additional salesmen do not necessarily equal greater sales!

Although profit and loss statements are important from the point of view of probable returns (again, the need for realism is stressed: forecasts which are too optimistic or too pessimistic have little value as aids to decision making and policy formulation), the cash flow forecast can be more critical as it details the amount and timing of expected cash inflows and outflows. Generally the level of profits, particularly during the early years of a venture, will be insufficient to meet the working capital needs and, as inflows do not match outflows on a short term basis, this forecast allows management to identify and plan cash needs. It also helps the investor ascertain the finance required.

Balance sheet information details the assets required to support projected levels of operation and shows how these assets are to be financed (liabilities). These are important tools for both investors and banks who will analyze balance sheet ratios to determine whether they are within acceptable limits to justify investment. The opening balance sheet will form the base for the financial projections. It is important to state when it was compiled and from what source (year end audited position, monthly management figures or blank piece of paper).

Once the company’s projections have been prepared it is necessary to draw upon section 9 of the business plan to highlight any major risks that could prevent the achievement of the forecasts and the sensitivity of the figures to these risks. Although a venture capitalist will form his own view about risk factors he will take note of the company’s own view about risk factors and he will take note of the company’s own assessment. Using the original projections as the ‘base’ both positive and negative sensitivities should be considered such that a best, worst and median set of projections results. As a result, the total finance required, plus contingency to take account of principal risk areas, will be determined.

The ability to meet income and cash flow projections will depend upon the company’s ability to monitor and control costs. Investors will want to know what accounting and cost control systems are or will be employed by the business and hence brief details should be given.

The content of Business Plans will be further covered in subsequent articles by Len McDowall.

© Len McDowall, Integral Capital Group 24th October, 2007

www.integralcapital.com.au

Writing a business plan can be pretty tedious. There’s the cover, the table of contents, some 20-25 pages of content and the back cover. The innards are typically long paragraphs punctuated with bold font sprinkled hither and yon.

And it’s all a big bore.

There’s a reason for this. The “how to write business plans” books are classics. That means they are old. They were all written pre-internet. And that’s an important consideration in capturing and holding an audience.
The writing style of the internet has changed the way people think. And the way they read.

For instance, glance through this web site, or most any other successful web site, and you will see some real differences in style and layout, such as:

1. Short Paragraphs. Computer monitors don’t have the tight resolution of a printed page, so our eyes get tired. To help us focus, good writers use shorter paragraphs.

2. Bulleted Lists. But sometimes there is still a great deal to be communicated, so bulleted lists have become quite popular (or indented lists).

3. Block Indents. Block indents give visual variety, so your eyes don’t get so tired and I can hold your attention a bit longer.

4. Left Align. In the old days, nearly all paragraphs were indented five spaces. No more.

5. Judicious Use of Color. A bit of color is nice. Splashes of color all over is yucky.

6. Style that Reflects the Topic. Your business plan layout, like your web site, is going to pick up on the style of your business. A presentation for stylish clothes for teenage girls will look a lot different than one for biotech research. Other than that, your business plan layout is pretty much up to you. Make sure that all the pertinent parts are there, but put them in any order that makes sense for your business.

7. The Tiny Font Stuff. And when you’ve got a glump of stuff that really needs to be included, but it is in tiny print and long paragraphs, put it as an attachment, either in hard copy form or on a disk, or both. That way, the information is still there for those who want it, but you wont’ lose your reader before you get started.

8. How to Use Your Logo. Incorporating your logo is important too. I very small logo in a corner of the page, or on the first page of each section is fine. A big, intrusive logo splashed over every page is not fine.

As straightforward as this advice seems, I am continually astounded by how poorly written most business plan area. Many follow the rather dorky outline of business plan software. Most haven’t a clue how to include a chart or an image.

My “Bad Example”: I have one business plan that I got a couple of years ago that I hold onto as a “bad example”. The business was actually pretty good. It was for an online business incorporating a particular ethnic style of art. The owner was from that ethnic group, so it was a nice fit. But the business plan was 100+ pages of tight, tight paragraphs. And not a single solitary image of the art. Not one. I just couldn’t believe it.

Just as an entrepreneur can’t plunk down three pages and shout, “Here I am! Drop your money in the bucket!”, neither can he expect a serious lender or investor to overlook a lousy business plan. This business plan represents you and your company.

Make it professional.

Make it real.

Make it reflect your energy and your style.

The money will follow.

A small business plan is very important to a growing business.  It helps you to focus your business.  A business plan also says to potential investors, “I’ve thought this through.”  You don’t have to wait until your business plan is completely perfect to go on and start your business.

Sometimes you really can’t even get your financial projections right until you have at least one year of operation.  A business plan can help you see where your slow months will be and help you prepare for your down periods. Here are some more reasons why you should write a plan for your small business.

When you write a small business plan you provide a daily blueprint for operation.  A business plan helps you budget your resources because you don’t have to guess how many staff people you need.  You won’t have to guess how much material you need to make your products.  
A small business plan will provide you with guidelines on how much to spend on advertising per day.  You will have a good road map for your business when you write a business plan.

Another reason that a small business plan is helpful is that it will provide some benchmarks for you and your staff.  You’ll be able to tell whether or not you are actually making a profit because your business plan will have milestones laid out for you.  You’ll know exactly what you need to do and when you need to do it because it will be all spelled out in black and white.

A business plan is essential to the growth of a small business.  Writing a the plan requires you to do research on your niche market and your competitors.  Your plan will allow you to get funding for your business from potential investors later down the road.  A small business plan can help your company stay on track when you see shiny new opportunities that don’t meet your company’s original goals.

Whether you are an entrepreneur looking to start your first
restaurant, or you have been working in the service industry for
a long time, restaurant business plan software can help you
create a streamlined business plan that will improve your
chances of funding. Here are few things to keep in mind when
comparing various packages.

Your needs – Various business plan software packages are geared
toward different sizes of restaurant business and different
levels of funding needs. Make sure the software does what you
need it to do. Don’t go overboard on a program that offers more
than you need.

Feedback – Make sure to get in touch with other people who have
used the software before and get their feedback. The more
reputable restaurant business plan software vendors will provide
testimonials and contact information of previous customers. Make
sure to compare. Keep an eye out for positive comments about
ease of use.

If you have been in the restaurant business already, you
probably have a number of contacts you can network with for
information. Ask other restaurant owners you trust if there was
a software program they used or have heard good things about.
Word of mouth recommendations can often provide valuable leads.

Support – Make certain your software vendor offers full support
for their programs. Many top vendors offer 24/7 online and toll
free support for their programs. When weighing benefits, this is
an important factor to take into consideration. You want to be
assured you can get the software to work.

Cost – Once you’ve narrowed your choices down by the above
benefits, it is time to consider costs. Check different vendors,
as there can often be a large difference in prices between
vendors for the same title. Make certain to factor in shipping
and handling costs and delivery time of your restaurant business
plan software when comparing prices.

Once you’ve chosen and installed your software, it’s time to get
to work creating the business plan for your restaurant. If you
have any trouble, be sure to get in touch with the vendor’s
support as soon as possible. Good luck with your new business
venture

This is a question that many people try to find an answer for. The answer, however, is not as simple as you might think if you take into consideration how easy it is to find information on the internet. You can find a marketing plan example or a plan de mercadotecnia, like it is called in Spanish, but chances are that the plan you will come across will be a general one, as no plan de mercadotecnia is available for free. If you don’t want to pay large sums of money for some marketing professional or business guru to write your own personalized business plan or plan de ventas, then your best bet is to purchase a far less expensive marketing plan guide that will contain a marketing plan example, or plan de mercadotecnia, and all the details necessary for you to draft your own plan. For people wanting to practice drafting a marketing plan example, this article contains a set of tips that can be used to create a basic marketing plan example, or plan de mercadotecnia. The presence of a correctly drafted marketing plan is absolutely essential to any start up business, so you need to be able to understand all the principles of an accurate and effective marketing plan example or plan de ventas. This is not meant to be a step by step guide to creating the perfect business plan, just to give you a general idea as to the basic requirements and rules of drafting a marketing plan example or plan de ventas, as it is called in Spanish. It must all start with you putting down the general idea and guidelines for your business, general information about the risks involved, information about the customers pool and the market, and other details. The first section of the business plan example or plan de ventas must be focused towards providing an exhaustive description of the future business. Other details also need to be included, such as staff planning and individual skills and roles. The next section needs to cover information about the general orientation of the company, and its services or products. You need to include descriptions about the costs involved with each aspect, details about partner companies such as suppliers or retailers. The next stage is perhaps the most important for your marketing plan example, or plan de ventas. You need to present your expectations about the future prospects as realistically as possible. Trying to improve the possible results and costs would be just like cutting the branch from under your feet. This part of the business plan should also contain some details about other companies operating in that sectors, with information about their products or services, estimated costs and income, and more. You also have to present the situation from the customer’s perspective, and include details about the number of companies offering the same products or services, their prices, etc. The last part of the plan should contain not only an overview but also a further presentation of the benefits of investing, revenue and spending forecasts.

Starting a business plan is a detailed process that is both educational and revealing. With existing companies it is a chance to re-evaluate profit margins and focus on the prominent areas of the business while cutting out the departments that are losing money. For business plans for new companies it is an opportunity to really focus on, and understand the industry and evaluate whether your next big idea will be successful before you make a large investment.
Although up to 44% of new businesses survive 4 years or more the success of any new business is good planning, access to capital and good business management.
Here are the 5 best tips for creating a killer business plan that will undoubtedly impress:
1) Consider Your Audience
Business plans are developed for many different reasons. Is it for presenting to a panel for project approval? Will it be to submit for funding? Is it simply to restructure the business for profitability? Each of these avenues will require adjustments to the plan format and style you will need to use throughout the document. If you are attempting to obtain funding then you will have to have very detailed cost and ROI projections that are measurable and realistic. If you are making a presentation to a non-profit or a board of directors it is likely that you will need to include a directive on community impact or involvement and impact (either positive or negative) to the existing business. Remember your audience as you creates your document to ensure you focus on the important topics and leave no questions unanswered.
2) Quality Reference Material Is Key
It is important to integrate a diverse mix of reference material in your plan document. The web is great for the latest news but is not nearly as highly regarded as printed documents. Be sure to use a good mix of reputable internet reference along with well-known facts and industry statistics most often found in printed literature. Industry specific publications and industry magazines are an excellent way to get the latest news and trends in a reliable place. Always include references from industry publications as well to raise the standard your business plan and build credibility in your due diligence. Always make sure to cite your research or any quotes you may use. This will also build credibility while ensuring you are not infringing on any protected or copyrighted content you use. To quickly and easily cite your sources there is a web-based tool that you can use to enter in your info and get back the properly formatted entry for the works cited page. It makes the process a breeze: easybib.com.
3) Do Your Own Research
Creating a solid business plan is the singular first step in knowing your industry and understanding what it will take to be successful in your chosen field. Part of developing a plan should be to evaluate competitors, define your business strategy and start to understand if your value proposition meets a tangible need in the marketplace. Walking through the initial steps of creating a business plan is an invaluable process that will help to ensure that your business can survive the market trends. Don’t pay someone else to do your research for you or it may end up costing you more than you think.
4) Using a Business Plan Template
Now that you have various notes and articles, market information and loads of statistics it is time to put it all together in a layout that will highlight the data you have compiled. Finding business plan examples can be a challenge as every business plan is different (see point #2 above), however you can develop your own based on a compilation of the different topics or areas you want to cover. If you want a business plan template that comes formatted with sample headings and the different categories already setup, try using the plan layout from online websites. This site has a real business plan in Word format for quickly changing out headings and information. In addition the plan comes with a break-even analysis template in Excel as well as a 1 year Pro-Forma template in Excel with the formulas already built for easily updating and projecting costs for your business. This is a big time saver and an easy way to quickly get the business plan document underway without having to start from scratch.
5) Seek Out Experts in the Industry
Finally, after you have organized your information reach out to some industry experts like local college professors, trade show organizers, or even your local Chamber of Commerce for some insight and feedback on your plan. It always helps to get a second opinion on the plan before making the final presentation. Having one or more individuals look over the plan will shed light on areas that need to be revised or reinforce that the business plan is ready to present.
Don’t get distracted spending valuable time figuring out the Works Cited, Table of Contents or overall plan layout. Use the templates or resources that are readily available to you and spend the time focusing where you should, on the reporting and presentation of your business idea.

For potential small business owners hoping to start one business in their lifetime, there isn’t a need to become a business plan writing expert. Even serial entrepreneurs who form business after business will often make use of business plan consultants to speed the process of creating a business plan and make the results more professional. Small businesses should seek the help of a business plan consultant as well, or, at the very least, use a business plan template to make the business plan development process simpler and faster.

What is a Business Plan Template?

A business plan template is an outline of a business plan, sometimes with a fully written sample, which uses the format and structure that is recommended by its creators for funders to see. Some basic templates are provided for free, but the most useful templates, including sample text, directions, and a customizable Excel financial model and pro forma financial statements, are sold online for a fee.

Start With Your Sector

If you are starting one of the top 50 or so types of small businesses, why use a generic business plan template when you can find one already customized for your business sector (such as a retail store, restaurant, salon, insurance brokerage, non profit, or financial planning business, to name some of the most popular)? By using a template customized to your sector, a lot of the legwork of making the plan more specific will be prepared for you. For example, a great deal of time savings will be from using a financial model more closely aligned with the nature of the costs and revenue drivers for your company.

How to Choose

Business plan companies and organizations supporting specific sectors are good sources for sector-specific business plan templates. Evaluate whether to purchase a template by looking at the track record of success of its creator, the type of support offered to customers, and guarantees. Don’t waste your time on purchasing multiple templates if they don’t rate well in these three categories.

A business plan guide is a great place to start when you are getting ready to write your first business plan. Perhaps you have found a book about writing business plans, or are following a template, but chances are, these materials will only focus on the steps necessary to create your business plan and will fail to point out the critical mistakes that most new business owners make. So let’s ignore the step-by-step tutorial for a moment and focus on the real world mistakes you need to avoid.

1. Don’t Put it Off.

Yes, writing a business plan can be a monumental chore. It’s easy to procrastinate while you focus on the more exciting processes of your business. Many new business owners will wait until the day before their scheduled meeting with the bank — and then frantically try to write a plan overnight. You can imagine the results.

Don’t wait until you have more time. There will never be more time. You need to clear your calendar for a week and make your business plan a top priority. Or if that isn’t feasible, schedule a certain period of time each day to work specifically on planning. No doubt you have heard the old saying: “If you fail to plan, you are planning to fail”.

2. Don’t Confuse Profit With Cash Flow.

Unless you have an accounting background, you are very likely to define the success of your business in terms of profits. A simple definition of Profit would be Sales minus Expenses equals Profit. But in the business world, profits do not equate to cash. Your profit formula does not take into account the amount of cash you have tied up in production costs for products that have not yet sold, or the customers who still owe you money for sales that have already been made. Your business can look quite “profitable” while your bank account is over-drawn.

Make sure your business plan includes a table that addresses cash flow. Ideally, you should detail the monthly cash flow for the first two years of the business and annually thereafter.

3. Don’t Fall in Love With Your Idea.
Too many business plans blabber on for pages about the “newness” and “uniqueness” of the idea. But the truth is, investors want to invest in people, not ideas. It is only the people who can execute the systems necessary to bring the idea to life.

Instead of waxing poetically about your business idea, focus your energy, and your reader’s eyes, on the ways you plan to implement this great business idea.

4. Don’t Succumb to Fear and Dread.

If you have never written a business plan, the process may loom like Mount Everest. But, like most new challenges, writing a business plan isn’t as hard as you have imagined it to be. You aren’t writing a doctoral thesis or the next great novel. If you have invested in a business plan guide, use it. You can easily find helpful resources such as books, software programs and templates. Remember, you eat an elephant one bite at a time, so start chewing.

5. Don’t Over Sell.

Skip the vague and meaningless business phrases such as “best ever”, “highest quality” and “unsurpassed customer service”. You will lose your reader’s interest and respect if you engage in hyperbole that isn’t supported by measurable facts. Remember that the objective of a plan is its results, which require tracking and follow up. Focus your goals on specific dates, management responsibilities, budgets, and measurable milestones. Think fewer words and more numbers.

6. Don’t Engage in One-Size-Fits-All

Business plans can have many different purposes and they should be written to reflect the specific purpose at hand. You may be using your plan to start a business, or just run a business better. Your purpose may be simply to sell an idea for a new business to one particular business partner. Your plan may be intended to secure a small business loan, or it may be needed to secure millions of dollars of venture capital. Each of these purposes would require different information, presented in different ways to meet the needs of different readers. Keep a picture of your intended reader firmly in your mind and your business plan will stay focused as well.

7. Take Off the Rose Colored Glasses
Optimism is a wonderful resource. Without it, a business owner would find it difficult to summon the energy necessary to launch a new venture.  However, this is not the time to engage in unbridled projections. If your company’s growth chart is based on an “industry average” of 15% annual growth, you should certainly be prepared to prove that assumption. When in doubt, be less optimistic.

By using a good business plan guide, and avoiding these common mistakes, you can prepare a plan that almost guarantees your business success. Good luck!