THE BUSINESS PLAN: Description of the Business

What goes in a business plan? This is an excellent question to ask. And, one that manynew and potential small business owners should ask, but oftentimes don't ask. The body ofthe business plan can be divided into four distinct sections: 1) the description of thebusiness, 2) the marketing plan, 3) the financial management plan and 4) themanagement plan. Addenda to the business plan should include the executive summary,supporting documents and financial projections.
Description of the businessIn this section, provide a detailed description of your business. An excellent question to askyourself is: "What business am I in?" In answering this question include your products,market and services as well as a thorough description of what makes your business unique.Remember, however, that as you develop your business plan, you may have to modify orrevise your initial questions.The business description section is divided into three primary sections. Section 1 actuallydescribes your business, Section 2 the product or service you will be offering and Section 3the location of your business, and why this location is desirable (some franchisors assist insite selection).
1. Business DescriptionWhen describing your business, generally you should explain:1. Legalities - business form: proprietorship, partnership, corporation. What licenses or permits you will need.2. Business type: merchandizing, manufacturing or service.3. What your product or service is.4. Is it a new independent business, a takeover, an expansion, a franchise?5. Why your business will be profitable. What are the growth opportunities? How will franchising impact on growth opportunities?6. When your business will be open (days, hours)?7. What you have learned about your kind of business from outside sources (trade suppliers, bankers, other franchise owners, franchisor, publications).A cover sheet goes before the description. It includes the name, address and telephonenumber of the business and the names of all principals. In the description of your business,describe the unique aspects and how or why they will appeal to consumers. Emphasize anyspecial features that you feel will appeal to customers and explain how and why thesefeatures are appealing.The description of your business should clearly identify goals and objectives and it shouldclarify why you are, or why you want to be, in business.
2. Product/ServiceTry to describe the benefits of your goods and services from your customers' perspective.Successful business owners know or at least have an idea of what their customers want orexpect from them. This type of anticipation can be helpful in building customer satisfactionand loyalty. And, it certainly is a good strategy for beating the competition or retaining yourcompetitiveness. Describe:1. What you are selling.2. How your product or service will benefit the customer.3. Which products/services are in demand; if there will be a steady flow of cash.4. What is different about the product or service your business is offering.
3. The LocationThe location of your business can play a decisive role in its success or failure. Your locationshould be built around your customers, it should be accessible and it should provide asense of security. Consider these questions when addressing this section of your businessplan:1. What are your location needs?2. What kind of space will you need?3. Why is the area desirable? the building desirable?4. Is it easily accessible? Is public transportation available? Is street lighting adequate?5. Are market shifts or demographic shifts occurring?It may be a good idea to make a checklist of questions you identify when developing yourbusiness plan. Categorize your questions and, as you answer each question, remove it from your list.