Jessica The business plan cover letter is different from any other types of letters because it is addressed to a lender or an investor who will review the proposed business plan. The feasibility of the business will be judged by the business plan.
For example, to your bank manager or investors. Ask the intended recipient first. Content of a business plan Base the plan on detailed information where possible. But do not include all the detail in the plan.
Leave the detail for operational or marketing plans. Keep the plan short Focus on what the reader needs to know. Cut out any waffle. Make sure there are no spelling mistakes. Detailed business plans are often quickly shelved, because they are difficult to use on an ongoing basis.
Include any detailed information you need in an appendix For example, you might want: Base your business plan on reality, or it may be counterproductive Over-optimistic sales forecasts can lead to increased overheads followed by a cash flow crisis and drastic cost cutting, all of which can seriously damage morale.
Be realistic, even if you are selling the business to a third party. Financiers, business partners and employees will see through over-optimistic plans that ignore weaknesses or threats.
Management credibility can be damaged. Make the plan professional Put a cover on it. Include a contents page, with page and section numbering. Start with an executive summary. This summarises the key points, starting with the purpose of the business plan.
Use charts, if helpful. Even if the plan is for internal use only, write it as if it were aimed at an outsider Include company or product literature as an appendix.
Give details about the history and current status of the business. For example, try to imagine the impression the plan will make on your bank manager. Check that the plan is realistic. Make sure that it includes the evidence to back up what you say perhaps in an appendix or that you can provide evidence if needed.
What might go wrong eg if your main supplier closes down or you lose a key customer and what would you do about it? Concentrate on the executive summary. People often make provisional judgements based on the executive summary.
Only then do they read the rest of the plan to confirm their decision. Show the plan to friends and expert advisers and ask for comments. Which parts did they not understand or find unconvincing?
Business and products Explain the history of the business When did it start trading and what progress has it made to date? Who owned the business originally?
What is the current ownership structure? What are its disadvantages and how will you address these? What are the planned developments? Explain any key features of the industry For example, any special regulations, whether the industry is dominated by a few large companies or any major changes in technology.
Market and competition Describe the market in which you sell Highlight the segments of the market in which you compete.
What are the key characteristics of customers in each segment? How large is each market segment? What is your market share? What are the important trends, such as market growth or changing tastes?
Explain the reasons behind the trend. What are the key drivers affecting each important market segment? What is the outlook for those drivers and the market?
Describe the nature and distribution of existing customers Do they fit the profile of the chosen market segment?The financial section of a business plan is one of the most essential components of the plan, as you will need it if you have any hope of winning over investors or obtaining a bank loan.
Get inspired with our gallery of over example business plans. Choose the category that is closest to your own business or industry, and view a plan you like. LivePlan includes all business plan samples, so you can easily reference any of them when you’re writing your own plan.
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Every business plan, big or small, should start out with an executive summary that details what the company hopes to accomplish, how it hopes to accomplish it, and why this business is the right one for the job. Executive Summary The Executive Summary of a Business Plan is a one-page distillation of your entire plan, and often is the last section to be written.