APP NUM='3' ID='AP
BizBuilder Business Plan
Use these worksheets and questions to create a more professional-looking business plan. Follow the guidelines in Chapter 2 to ensure the quality of the business plan. These features will make your plan a better roadmap for running your organization and will make it more attractive to investors.
Contents
Cover Page
Confidentiality
Table of Contents
Business Idea
Economics of One Unit
Ownership
Mission, Vision, and Culture
Company Description
Research
Target Customers
Industry Analysis
SWOT Analysis
Competitive Analysis
Promotion Strategy
Customer Service
Place of Business
Management Team
Employees & Policies
Corporate Governance
Advisors
Research & Development
Intellectual Property
Facilities
Inventory,Production,Quality Assurance
International Opportunities
Segmentation
Products/Services
Philanthropy
Pricing
Insurance & Risk Management
Record Keeping
Sources & Uses of Capital
Start-Up Costs
Financing
Cash Flow Projections and Fixed Costs
Balance Sheet Projections
Income Statement Projections
Breakeven Analysis
Ratio Analysis
Risks & Assumptions
Funding Request and Exit Strategy
Milestones
Appendices
Non-Profit Organizations
›› BizBuilder Business Plan Worksheet Questions/Notes
Cover Page
A. What is the full name of your organization?
B. Provide contact information for the organization including the names of majority owners (use the same format for as many as you have)
Name: ___________________________ Name: __________________________
Address: _________________________ Address: ________________________
City: ___________ State____ Zip _____ City: __________ State____ Zip _____
Phone: ___________________________ Phone: __________________________
Email: ___________________________ Email: __________________________
C. What confidentiality/non-disclosure language will you include?
D. Provide the date of the plan. (Month) (Day), (Year)
Table of Contents (can be placed before or after the Executive Summary)
A. List the key sections of the plan and the page numbers.
1.0 Executive Summary
2.0 Mission, Vision, & Culture
3.0 Company Description
4.0 Opportunity Analysis & Research
4.1 Industry Analysis
4.2 Environmental Analysis
4.3 Competitive Analysis
5.0 Marketing Strategy & Plan
5.1 Products/Services
5.2 Pricing
5.3 Promotion
5.4 Place
6.0 Management & Operations
6.1 Management Team
6.2 Research & Development
6.3 Physical Location
6.4 Facilities
6.5 Inventory, Production, & Quality Assurance
7.0 Financial Analysis & Projections
7.1 Sources & Uses of Capital
7.2 Cash Flow Projections
7.3 Balance Sheet Projections
7.4 Income Statement Projections
7.5 Breakeven Analysis
7.6 Ratio Analysis
7.7 Risks & Assumptions
8.0 Funding Request & Exit Strategy
8.1 Amount & Type of Funds Requested
8.2 Exit Plan
8.3 Milestones
Appendices
Resumes
Sample Promotional Materials
Product Illustrations/Diagrams
Detailed Financial Projections
1.0 Executive Summary
A. What is the name of your organization?
B. Describe your business idea using the following chart:
|Components of the |Start-Up |Buy Existing |Secure a Franchise |License Technology |
|Business | | | | |
|Customers |None |Established |None- but may have name recognition|None |
|Products or Services |None |Established |Developed |In process |
|Location |Needed |In place |Assistance possible |Needed |
|Management Control |Owner |Owner |Owner within terms of license |Owner within terms of license |
|Operational Control |Owner |Owner |Owner within terms of license |Owner |
|Marketing |Needed |In place (+/-) |Assistance possible. Rules |Needed |
| | | |absolutely. | |
|Reputation |None |In place (+/-) |Should be. If not, why license? |Possible |
|Royalties/Fees |Not usual |Maybe |Ongoing |Likely |
|Financing |Needed |Prior owner may provide |Assistance possible |Needed |
|Disclosures |None |Buyer beware |UFOC & contracts |Agreement |
Business Idea:
C. Target Market (Answer who, what, when, where, and why.)
|Factor of Target Market |Description |
|(who) | |
|(what) | |
|(when) | |
|(where) | |
|(why) | |
D. What type of organization are you starting? (Manufacturing, Wholesale, Retail? For-profit or not-for-profit?) What products and/or services will you offer?
Product/Service 1:__________________________
Product/Service 2: __________________________
Product/Service 3: __________________________
Product/Service 4:__________________________
Product/Service 5: __________________________
Product/Service 6: __________________________ (do as many as you need)
E. What is your marketing and sales strategy? Explain how your business idea will satisfy a customer need.
|Customer Need |How Your Business Will Satisfy It |
| | |
| | |
| | |
| | |
| | |
F. Describe the key success factors for the organization.
1.
2.
3.
4.
5.
G. Calculate the “economics of one unit” for your organization.
| |
|One Unit = |
| | |
|Selling Price per Unit |$ |
| – COGS per Unit | |
| – Other Variable Costs | |
| | |
|TOTAL Variable Costs per Unit | $ |
|Contribution Margin per Unit | $ |
H. What are your short-term business goals? (less than one year) Long-term business goals? (from one to five years)
1.
2.
3.
1.
2.
3.
I. What resources and skills do you (and the other owners and managers) have that will help make your organization successful? What other skills are needed and how will they be obtained?
|Resource or Skill |Possess? |Who? |How Obtained? |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
J. If there is more than one owner, describe how the ownership will be shared.
|Owner |Percent of Ownership |
| |% |
| |% |
| |% |
| |% |
K. What are the sources and uses of funds?
L. Include a summary of the financial projections.
|Topic |Key Measure |Growth or Growth Rate |Time Frame |
|Revenue |Sales Growth | | |
|Profitability |Return on Investment or Return | | |
| |on Sales | | |
|Industry Position |Market Share | | |
|Value |Net Worth | | |
M. What is the growth and exit strategy?
2.0 Mission, Vision, & Culture
A. Write a mission statement for your organization in 21 words or fewer that clearly states your competitive advantage, strategy, and tactics. ______ ______ ______ _______ _______ ______ ______ ______ ______ ______ ______ ______ ______ ______ ______ ______ ______ ______ ______ ______ ______
B. Create a vision statement for your organization.
C. Describe the core beliefs you will use to run your organization and how they will be reflected in its culture.
|Core Belief |How It Is Reflected in the Culture |
| | |
| | |
| | |
| | |
| | |
D. Identify the ways you plan to run a socially responsible organization.
1.
2.
3.
3.0 Company Description
A. What industry are you in?
B. What type of organization is it (manufacturing, wholesale, service)?
C. What needs will this business satisfy?
1.
2.
3.
D. What is your strategic advantage?
E. What is your organization’s legal structure (sole proprietorship, partnership, LLC, C Corp, etc.)?
F. Why did you choose this legal structure?
G. In what state are you registered or do you intend to register?
H. Where will you physically operate the organization?
I. What is the geographic reach of the organization?
J. Who will be the owner(s), partners, or stockholders for your company? If your business is incorporated, describe what percentage of the company is owned by each shareholder.
1. ____________________ ______%
2. ____________________ ______%
3. ____________________ ______%
4. ____________________ ______% (Do for each. % adds up to 100)
4.0 Opportunity Analysis & Research
A. Describe your research methods (surveys, focus groups, general research, and statistical research).
|Research Method |Respondents/Description |
|Written Survey (mailed) | |
|Written Survey (emailed) | |
|Written Survey (online) | |
|Telephone Survey | |
|“Street” Survey | |
|Focus Groups | |
|Document Research – Review of Books and Records | |
|Personal Interviews | |
|Observation | |
|Tracking (Media) | |
|Benchmarking | |
|Online Searches | |
|Article and Book Searches | |
|Trade Associations | |
|Chambers of Commerce | |
|Public Agencies | |
|Competitor Websites | |
B. Describe your target customer along as many dimensions as you have defined (i.e., demographic, geographic, needs, trends, decision-making process).
|Dimension |Target |
|Demographic | |
|Geographic | |
|Needs | |
|Trends | |
|Lifestyles | |
|Psychographics | |
4.1 Industry Analysis
A. What is the industry or set of industries in which your organization operates (include the NAICS codes)?
B. What factors influence the demand for your product or service?
|Demand Factor |What Is the Influence? |
| | |
| | |
| | |
| | |
C. What factors influence the supply for your product or service?
|Supply Factor |What Is the Influence? |
| | |
| | |
| | |
| | |
D. How large is your industry (historic, current, projected size)?
|Time Frame |Dates Included |Size ($ or units) |Data Source |
|Historic size | | | |
|Current size | | | |
|Projected size | | | |
E. What are the current and anticipated characteristics and trends in the industry?
1.
2.
3.
F. What are the major customer groups for the industry (consumers, governments, businesses)?
G. How large is your target market (number of customers, size of purchases, frequency of purchases, trends)?
|Measures of Market Size |Size |Source of Data |
|Number of customers | | |
|Size of purchases | | |
|Frequency of purchases | | |
|Trends | | |
4.2 Environmental Analysis
A. Perform a SWOT analysis of your organization.
|Strengths |Weaknesses |
| | |
| | |
| | |
|Opportunities |Threats |
| | |
| | |
| | |
B. What external/environmental factors are likely to impact your business?
1.
2.
3.
C. Are there customers for your business in other countries? How do you plan to reach them?
4.3 Competitive Analysis
A. How do you define/describe your competition--both direct and indirect?
B. Describe your competitive advantage.
C. Find three competitors and describe them.
| | |Your Company |Competitor #1 |Competitor #2 |Competitor #3 |
| |Wt. |
| | |
| | |
| | |
| | |
| | |
D. Describe your strategy for outperforming the competition.
|Competitive Advantage Question |Competitive Difference (USP) |
| | |
|The Offer: What will be better and different about the | |
|products and services that will be sold by the business? | |
|Target Market: To make it as successful as possible, which | |
|customers should be the focus of the business? | |
|Production and Delivery Capability: What will be better or | |
|different about the way that offer is produced and delivered | |
|to those customers? | |
E. What tactics will you use to carry out this strategy?
|Tactical Question |Issues |Solutions |
| | | |
|Sales Plan: Where and |How to identify prospects and convert| |
|how will you sell to your |them to sales | |
|customers? | | |
|Market Communications: How will you |How to make customers aware of your | |
|communicate with your customers and make |offer; how to attract them to the | |
|them aware of your business offer? |business | |
|Operating Plan: How will you manage your |How to make the business go, and | |
|internal operations? |determine who will perform the tasks | |
|Budget: How do |Possible sources of revenue; possible| |
|you plan to manage your |items that have to be purchased | |
|revenues and expenses? | | |
| | | |
F. What barriers to entry can you create to support your organization?
5.0 Marketing Strategy & Plan
A. Explain how your marketing plan targets your market segment.
|Segmentation Method |Segment(s) |Marketing Approach |
|Geographic | | |
|Demographic | | |
|Psychographic | | |
|Behavioral | | |
B. Write a positioning statement for your business.
(Your business name/brand) is the (competitive/industry category) that (provides these benefits or points of difference) to (audience/target market).
C. How do you plan to grow the organization (self-generated, franchising, acquisition)?
|Method of Growth |Details |
|Self-generated | |
|Franchising | |
|Acquisition | |
|Other | |
5.1 Products/Services
A. What products/services do you intend to sell?
Product/Service 1:__________________________
Product/Service 2: __________________________
Product/Service 3: __________________________
Product/Service 4:__________________________
Product/Service 5: __________________________
Product/Service 6: __________________________ (do as many as you need)
B. Explain how your product will meet a customer need.
C. Where is your product/service in the product life cycle?
|Life Cycle Stage |Applicable? (y/n) |Impact |
|Introduction | | |
|Growth | | |
|Maturity | | |
|Decline | | |
D. Describe the features and benefits of the product/service your business will focus on selling.
|Product/Service |Feature |Benefit |
| | | |
| | | |
| | | |
| | | |
| | | |
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| | | |
E. What existing copyrights or patents do you own? Project?
F. How will your organization help others? List all the organizations to which you plan to contribute. (Your contribution may be time, money, your product, or something else.)
|Organization |Constituency |Contribution |Rationale |
| | | | |
| | | | |
| | | | |
| | | | |
G. Do you intend to publicize your philanthropy? Why, or why not? If you do, explain how you will work your philanthropy into your marketing.
2. Pricing
A. Describe your pricing strategy and structure and the gross margins you expect to generate.
|Pricing Strategy |Using? |Pricing Structure |Expected Gross Margin(s) |
| |(y/n) | | |
|Keystoning | | | |
|Cost-plus | | | |
|Penetration | | | |
|Skimming | | | |
|Meet or beat the competition | | | |
B. What will your discount structure, if any, be?
C. Will you accept personal checks from customers? Credit cards? Will you offer charge accounts or customer credit?
|Type of Payment |Accept? (yes/no) |Rationale |
|Cash | | |
|Personal checks | | |
|Credit cards (which ones – VISA, MasterCard, | | |
|American Express, Discover?) | | |
|Credit terms (if so, what will they be?) | | |
5.3 Promotion
A. Identify the ways you plan to promote your product or service, including the message, the media, and the distribution channels. Describe why you have chosen these methods and why you think they will work.
|Method |Message |Media |Channel |Why It Will Work |
|Advertising specialties | | | | |
|Banner ads | | | | |
|Billboards | | | | |
|Blogs | | | | |
|Broadcast media | | | | |
|Brochures | | | | |
|Business cards | | | | |
|Catalog | | | | |
|Direct mail | | | | |
|Directories | | | | |
|Flyers | | | | |
|Networking | | | | |
|Newsletters | | | | |
|Online store | | | | |
|Print media | | | | |
|Promo items | | | | |
|Public speaking | | | | |
|Sales calls | | | | |
|Samples | | | | |
|Signs | | | | |
|Special events | | | | |
|Sponsorships | | | | |
|Telemarketing | | | | |
|Toll free # | | | | |
|Website | | | | |
B. Show examples of marketing materials you intend to use.
C. What is your business slogan?
D. Do you have a logo for your business? How do you intend to protect it?
E. Where do you intend to advertise (be specific including identifying reach and frequency)?
|Publication/Media (name specific |Size/Length of Advertisement |Frequency of Advertising |Reach |(Cost for Budget) |
|print publications or broadcast | | | | |
|channels) | | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
F. How do you plan to get publicity for your organization?
G. List ways you intend to provide superior customer service.
1.
2.
3.
4.
5.
H. Write a one-minute sales pitch for your product or service and describe five sales prospects you intend to pitch.
Sales Prospects
|Name |Description (include interest) |
| | |
| | |
| | |
| | |
| | |
Sales Pitch:
I. How will you keep your customer database? What essential questions will you ask every customer for your database?
Customer database type =
Question 1:
Question 2:
Question 3:
Question 4:
Question 5:
(You may want to make an Excel spreadsheet with all data fields to capture.)
5.4 Place
A. Where do you intend to sell your product? Describe the advantages and disadvantages of your location(s).
|Location |Advantages |Disadvantages |
| | | |
| | | |
| | | |
| | | |
| | | |
B. What are surrounding businesses? Access routes?
C. If vehicular traffic is important to your organization, what is the traffic count for this location?
D. What is the work force availability in the area as it pertains to your needs? (Be sure to get data from the census, local department of labor, or other reliable source.)
6.0 Management & Operations
6.1 Management Team
A. Create an organizational chart for your business.
[pic]
B. Will you be hiring employees? If so, describe what their qualifications should be, what you intend to pay them, and how they will help your business.
|Employee Role |Qualifications |Compensation |Contribution |When Hired |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
C. Do you intend to pay yourself a salary, wage, dividend, or commission? Explain.
D. What will your policies toward employees be?
Key Policies:
1.
2.
3.
4.
5.
E. Ways you will make it a positive and rewarding place to work:
1.
2.
3.
4.
5.
F. Describe the corporate governance plan for your organization. It should include five policies (rules) that will be the backbone of your organization’s ethics.
1.
2.
3.
4.
5.
G. Provide information for each of your mentors or advisors. If there is a board of advisors, list each member and describe his/her commitment to the board.
Name: ___________________________ Name: __________________________
Title: ____________________________ Title: ___________________________
Organization: _____________________ Organization: ____________________
Address: _________________________ Address: ________________________
City: ___________ State____ Zip _____ City: __________ State____ Zip _____
Phone: ___________________________ Phone: __________________________
Email: ___________________________ Email: __________________________
(indicate relationship of each, role, and include all)
G. Provide contact information for your accountant, attorney, banker, and insurance agent.
ACCOUNTANT ATTORNEY
Name: ___________________________ Name: __________________________
Title: ____________________________ Title: ___________________________
Organization: _____________________ Organization: ____________________
City: ____________________ State____ City: ___________________ State____
Phone: ___________________________ Phone: __________________________
BANKER INSURANCE AGENT
Name: ___________________________ Name: __________________________
Title: ____________________________ Title: ___________________________
Organization: _____________________ Organization: ____________________
City: ____________________ State____ City: ___________________ State____
Phone: ___________________________ Phone: __________________________
6.2 Research & Development
A. What type of research are you doing? What do you intend to do?
B. What are others in the industry doing?
C. How will you protect your intellectual property?
|Type of Intellectual Property Protection |How It Will Be Used |
|Patents | |
|Trademarks | |
|Service Marks | |
|Copyrights | |
6.3 Physical Location
A. Describe the actual physical place in greater detail than above.
B. What are the zoning laws in your area? Does your business comply?
6.4 Facilities
A. What type of building and equipment will you have?
B. Identify which technological tools you plan to use for your organization, and explain why.
|Technological Tool |Source |Value to Organization |
| | | |
| | | |
| | | |
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C. How do you plan to get access to the technology you need?
6.5 Inventory, Production, & Quality Assurance
A. Where are you purchasing the products you plan to sell, or the parts you will use to manufacture those products? Illustrate your supply chain.
|Product/Part |Source |
| | |
| | |
| | |
| | |
| | |
B. Do you intend to manufacture your product? If so, describe the manufacturing process you will use. If not, describe how your product is manufactured.
C. Are there any economies of scale to be attained for your business? At what point do you anticipate attaining them?
D. Have you developed and/or adopted any innovations in production, inventory management, or distribution that are significant? What are they and why are they meaningful?
E. Show the production-distribution channel for your business, and the mark-ups along the chain.
|Stage of Channel |Mark-up |Notes |
| | | |
| | | |
| | | |
| | | |
| | | |
F. What is the estimated delivery time between when you place an order with your supplier and when you will have the product available for your customers? (If there are multiple suppliers, you should identify each lead time and work on the basis of the longest lead time.)
G. What method(s) will you use to define and ensure the quality of your products/services?
|Method |Planned? (y/n) |Rationale |
|Benchmarking | | |
|Lean Manufacturing | | |
|ISO9000 | | |
|Six Sigma | | |
|TQM | | |
|Malcolm Baldrige National Quality Award | | |
|Other (identify) | | |
H. What types of insurance will your business need, and why?
|Type of Insurance |Needed (y/n) |Why? |
|Workers’ Compensation Insurance | | |
|Disability Insurance | | |
|Commercial Fleet Insurance | | |
|Property Insurance | | |
|Liability Insurance | | |
|Product Liability Insurance | | |
|Business Income Insurance | | |
|Errors and Omissions Insurance | | |
|Life Insurance—Key Person Insurance | | |
I. What methods will you use to ensure that you comply with federal, state, and local tax laws?
J. What laws—such as minimum wage and age requirements, health and safety regulations, or antidiscrimation laws—will affect your business?
|Law |Effect on Business |
| | |
| | |
| | |
| | |
| | |
7.0 Financial Analysis & Projections
1. Describe your record keeping system.
2. List the types of bank accounts you will open for your organization.
|Type of Account |Purpose |Which Institution? |
|Checking | | |
|Sweep | | |
|Investment | | |
|Other | | |
7.1 Sources & Uses of Capital
A. How much capital do you need? When? What type and on what terms?
|Type of Capital |Amount |When Needed? |What Terms? |
| | | | |
| | | | |
| | | | |
| | | | |
B. How will you use the money that you raise? Be specific.
|Use of Capital |Amount |When Needed? |Notes |
| | | | |
| | | | |
| | | | |
| | | | |
C. List the items you will need to buy to start your business and add up the items to get your total start-up capital. Then, add a cash reserve of one-half your total start-up capital.
|Item |Cost |Estimate/Actual |
|Start-Up Expenses | | |
|Accountant Fees | | |
|Expensed Equipment | | |
|Financial Institution Fees | | |
|Identity Set/Stationary | | |
|Insurance | | |
|Legal Fees | | |
|Licenses/Certificates/Permits | | |
|Marketing Materials | | |
|Payroll (with taxes) | | |
|Professional Fees – Other | | |
|Rent | | |
|Research and Development | | |
|Travel | | |
|Utilities | | |
|Web Fees | | |
|Other | | |
|Total Start-Up Expenses | | |
| | | |
|Start-Up Assets | | |
|Cash Balance for Starting Date | | |
|Equipment | | |
|Furniture & Fixtures | | |
|Leasehold Improvements | | |
|Machinery | | |
|Rent Deposit | | |
|Signage | | |
|Utility Deposit | | |
|Other | | |
|Total Start-Up Assets | | |
| | | |
|Total Start-Up Requirements | | |
|Item |Quantity |Cost |
|Equipment |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
|Other Costs |
| | | |
| | | |
| | | |
|Start-Up Investment—TOTAL |$ |
|Cash Reserve |$ |
|Total Start-Up Investment + Capital Reserve |$ |
D. List the sources of financing for your start-up capital. Identify each source as equity, debt, or gift. Indicate the amount and type for each source.
|Funding Source |Equity |Debt |Gift |
| | | | |
| | | | |
| | | | |
|TOTAL START-UP INVESTMENT | |
| |$ |
E. What is your payback period? In other words, how long will it take you to earn enough profit to cover start-up capital?
Payback = Start-up Investment
Net Profit per Month
F. Describe financing sources that might be willing to invest in your business in exchange for equity.
G. Describe any debt financing you intend to pursue. What is your debt ratio? What is your debt-to-equity ratio? Add a cash reserve of one-half your total start-up capital.
H. Do you plan to use bootstrap financing? Explain.
I. Do you plan to pursue venture capital? Why, or why not? List potential sources of venture capital.
|Venture Capital Source |Type of Fund |Amount Available |Expected Terms |
| | | | |
| | | | |
| | | | |
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7.2 Cash Flow Projections
A. List and describe your monthly fixed costs and add a cash reserve that covers three months of fixed costs.
|Fixed Cost |Amount |Description |
|Utilities | | |
|Salaries | | |
|Advertising | | |
|Insurance | | |
|Interest | | |
|Rent | | |
|Depreciation | | |
|Unexpected |_______________ | |
|TOTAL |$ | |
B. Create a projected cash flow statement for your business for the first four quarters and the second and third years of operation.
| | |1Q |2Q |3Q |4Q |YR1 |YR2 |
| Assets | | | | | | | |
| Cash $_____ $_____ $_____ | | | | | | | |
| Accounts Receivable | | | | | | | |
| Inventory | | | | | | | |
| Capital Equipment | | | | | | | |
| Other Assets | | | | | | | |
|Total Assets |$ |$ |$ |$ |$ |$ |$ |
|Liabilities | | | | | | | |
| Short-Term Liabilities | | | | | | | |
| Long-Term Liabilities | | | | | | | |
|Total Liabilities |$ |$ |$ |$ |$ |$ |$ |
|Owner’s Equity |$ |$ |$ |$ |$ |$ |$ |
|Total Liabilities & Owner’s Equity |$ |$ |$ |$ |$ |$ |$ |
A. Create a pie chart showing your current assets, long-term assets, current liabilities, and long-term liabilities.
7.4 Income Statement Projections
A. Create a Projected Income Statement for your business for the first four quarters and the second and third years of operation. (Note: you will need to create very detailed projections for the items underlying each of these. Such detailed projections would go into the appendices of your plan.)
Income Statement for (Company Name)
For the Year Ending December 31, Year
| |1Q |2Q |3Q |4Q |YR1 |YR2 |YR3 |
|Net Sales Revenue (+) | | | | | | | |
|Cost of Goods Sold (-) | | | | | | | |
| |______ |_____ |_____ |______ |______ |______ |______ |
|Gross Profit (=) | | | | | | | |
| | | | | | | | |
|Operating Expenses (-) | | | | | | | |
|General Expenses (-) | | | | | | | |
|Other Expenses (-) | | | | | | | |
| |______ |______ |______ |______ |______ |______ |______ |
|Net Income Before Taxes | | | | | | | |
|Taxes | | | | | | | |
| |______ |______ |______ |______ |______ |______ |______ |
|Net Income | | | | | | | |
B. Create a bar chart showing your Gross Revenues, Gross Profit, and Net Income.
7.5 Breakeven Analysis
Use Excel or another spreadsheet software to create a spreadsheet projecting the expenses for your business. Use this data to perform a breakeven analysis.
Breakeven Units = Fixed Cost
Gross Profit per Unit
7.6 Ratio Analysis
A. Use your projected financial statements to calculate all of your key ratios.
Current ratio = Current assets
Current liabilities
Quick ratio = Quick assets (Quick assets = Current assets – inventory)
Current liabilities
Debt ratio = Total debt (or liabilities)
Total assets
Debt to net worth ratio or debt to equity = Total debt (or liabilities)
Tangible net worth
Times interest earned = Earnings before interest and taxes (or EBIT)
Total interest expense
Average inventory turnover ratio = Cost of goods sold
Average inventory
Receivables turnover ratio = Credit sales
Accounts receivable
Average collection period ratio = Days in accounting period
Receivables turnover ratio
Payables turnover = Purchases
Accounts payable
Average payable period = Days in accounting period
Payables turnover ratio
Total assets turnover ratio = Net sales
Net total assets
Net sales to working capital ratio = Net sales
Current assets – Current liabilities
Net profit on sales = Net profit
Net sales (annual)
Net profit to equity = Net profit
Owners’ equity (or net worth)
Compare these ratios to your industry using publicly available data.
(Company Name) Ratios versus Industry Performance
|Ratio |(Company Name) |Industry Data* |Variance |Explanation |
|Current | | | | |
|Quick | | | | |
|Debt | | | | |
|Debt to equity | | | | |
|Times interest earned | | | | |
|Ave. inventory turnover | | | | |
|Receivables turnover | | | | |
|Ave. collection period | | | | |
|Payables turnover | | | | |
|Ave. payable period | | | | |
|Total assets turnover | | | | |
|Net sales to working capital| | | | |
|Net profit to sales | | | | |
|Net profit to equity | | | | |
* (identify the source here)
7.7 Risks & Assumptions
A. List the risks and assumptions that underlie your financial projections.
|Category of Risk or Assumption |Assumption |Significance |
|General economy | | |
|Interest rates | | |
|Inflation | | |
|Economic health | | |
|Tax rates | | |
|Industry growth/decline | | |
|Customer preferences | | |
|Competitive entrants/changes | | |
|Prices | | |
|Costs of goods sold | | |
|Other | | |
|Other | | |
B. Identify any external factors that you feel should be disclosed as substantial risks. (incorporated above)
8.0 Funding Request & Exit Strategy
8.1 Amount & Type of Funds Requested
A. Clearly state how much money you are requesting in this plan and the terms under which you anticipate obtaining the funds?
(Company) requests $(amount) in the form of (type and terms).
B. Do you intend to use debt to finance your business? Explain.
C. Do you plan to issue bonds to finance your business at some point in the future?
8.2 Exit Plan
A. How will investors get paid back/out? Public offering? Employee buyout? Merger or acquisition? Liquidation? Stock buyback?
|Form of Payment/Payout |Planned (yes/no) |Anticipated Time Frame |
|Repayment of debt | | |
|Public offering | | |
|Employee buyout | | |
|Merger/acquisition | | |
|Liquidation | | |
|Stock buyback | | |
B. Do you plan to franchise your business, or license any of your products? Explain.
8.3 Milestones
Create a PERT chart for your organization to make your plans clear to potential investors.
(Company) PERT Chart
|Task |Period 1 |Period 2 |Period 3 |Period 4 |Period 5 |Period 6 |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
Note: This chart should be as detailed as is useful in the business plan. It may cover periods as short as 1 month, even 1 week, or as long as 1 year.
Appendices
Resumes & Position Descriptions
1. Include a resume for each key team member.
2. Add position descriptions for any vital start-up positions that are not yet filled.
Sample Promotional Materials
1. Include any sample logos, letterhead, advertisements, brochures, or other items that can be inserted into the plan.
2. Add photos of any promotional items, signage, or larger materials to provide examples.
Product Illustrations/Diagrams
1. If you have non-proprietary drawings or properly authorized proprietary drawings, illustrations, or diagrams of your product or service concept, insert them here.
2. Any floor plans, assembly layouts, or the like should be included.
Detailed Financial Projections
1. Monthly financials and other financial projections that are in too great detail for inclusion in the main document go here.
2. Include detailed assumptions and notes underlying the projections.
3. Significant contracts.
If you are starting a not-for-profit organization:
1. What is the name of your nonprofit?
2. What problem(s) are you trying to reduce or eliminate?
3. Describe the mission of your organization. ______ ______ ______ ______ ______ ______ ______ _______ _______ ______ ______ _______ ______ ______ ______ ______ ______ ______ ______ ______ ______. (21 words or fewer)
4. Describe the programs and services you plan to create.
|Name of Program |Type (advocacy, financial |Target Population |Method of Delivery |Additional Information |
| |support, direct service) | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
5. How will your organization achieve the changes you intend to bring about?
a.
b.
c.
d.
e.
6. What is the unit of change (per person, animal, house, etc.)?
7. How will you measure these changes?
|Desired Change |Measurement |Methodology |
| | | |
| | | |
| | | |
| | | |
| | | |
8. Who are your competitors (direct and indirect)?
9. How much will it cost you to deliver a unit of service?
10. What are your sources of funding?
|Type of Funder |Specific Individual or |Rationale for Funding |Funding Range ($) |Likelihood of Support |
| |Organization | | | |
| |(profile or name) | | | |
|Individual | | | | |
|Foundation | | | | |
|Corporation | | | | |
|Charitable Organization | | | | |
|Religious Group | | | | |
|Federal Government | | | | |
|State Government | | | | |
|Local Government | | | | |
|Other | | | | |
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General Management
Marketing
Operations
Finance
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