This is the final post in my four-part series on how to write a business plan. We have walked through Part I: How to develop a Business Model, Part II: Your Marketing Plan and Part III: Operations and Cash Flow Projections. Part IV will focus on developing your executive summary and is the last step of writing a business plan.
The Executive Summary
An executive summary provides a snapshot of the business. It is essentially a sales document that highlights the main points of an in-depth business plan and is written for people who want to understand quickly whether or not your business idea is worth their time. The executive summary should contain enough information for the reader to get interested in reading the full plan and therefore should be the most compelling part of the business plan.
Here is how to write an effective two-page executive summary.
The executive summary should provide answers to the following questions:
- Who are you and who is your management team?
- What is the business idea?
- Where is your market opportunity?
- When will your business be profitable?
- Why will your target customer do business with you?
- How much money do you need and what will you do with it?
Your executive summary should be written last – after the bulk of your business plan has been developed. It should be no more than two pages. If you can’t sell your idea on paper in two pages, well then perhaps you need to reconsider your business idea.
Your executive summary should list the highlights of your business plan in the order that your plan is organized. Avoid using unnecessary technical material or industry jargon. It is likely that the person reading the business plan may not know anything about your business and if they are in a position to make a funding decision, it is best to not frustrate them.
Use plain language and do not hesitate to add supporting sentences to further explain. As a test, ask a friend or family member to read your business plan’s executive summary to make sure your business idea is clear, conveys passion and, above all, entices the reader to read further into your business plan.
A business plan is the small business owner’s hypothesis of what they think will happen in once they open for business. The plan will change once the business is exposed to the marketplace, which means the plan must change regularly. In fact, in the first few years of running a small business, the business owner should review and update their business plan every two to three months to make sure the business is on the right track.
I strongly suggest that you use business plan software. Check out bplans.com for great business plan examples or use enloop.com. Then, sign up for a business plan course to finish your business plan. Find a business plan course at a local community college, Small Business Development Centers, 1-800-8-ASK-SBA or a local nonprofit serving small business.
No more excuses. Now you have everything you need to finally get your business plan done. Please let m know if this post was helpful, I love to hear from you.