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How to Write a Business Plan - JVS Chicago

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How to Write a
Business Plan
A guide to writing a winning business plan
Presented by: Mike Cohen
Senior Business Analyst
Illinois Small Business Development
Center / Duman Entrepreneurship
Center at JVS Chicago
Jewish Vocational Service, a partner in serving our community, receives support from the Jewish
United Fund/Jewish Federation. Funded in part through a cooperative agreement with the U.S. Small
Business Administration and Department of Commerce and Economic Opportunity.
What a Business Plan is…
A business plan is a written document that clearly
defines the goals of a startup or existing business and
outlines specific methods for achieving these goals.
What will it tell the reader?
4 key elements:
 Product/Service – What product or service are
you providing that someone will pay for?
 Marketing – What need is being addressed and
how?
 Management and Operations – Who is running
the business and how?
 Financial – Why is the business financially viable?
Assembling the Pieces
Product/Service
Financial
Marketing
Management
and Operations
It must contain…
пЃ± Executive Summary
пЃ± Business Description
пЃ± Product/Service Description
пЃ± Marketing Plan
пЃ± Management/Operations Plan
пЃ± Financial Plan
Executive Summary
пЃ± Most important section - One or two paragraphs
that summarize your unique business.
пЃ± It includes your product/service description, target
market description, and overall goals and
objectives for your business.
 Write it last – everything else should be written
first so that you can accurately summarize just the
key points.
Business Description
пЃ± Include business name and location
пЃ± Describe the business in detail
пЃ± Describe what makes your business unique
пЃ± Describe why your business will succeed
 Describe the identity of your business….
Legal Identity
пЃ± What this means
пЃ± Relationship of the Owners
пЃ± Tax Treatment
пЃ± Complexity
пЃ± Legal entity
пЃ± Sole Proprietor
пЃ± Partnership
пЃ± Corporations
пЃ± S-Corp
пЃ± C-Corp
пЃ± LLC
пЃ± L3C
See Handout and…
www.cyberdriveillinois.com/departmen
ts/business_services/home.html
пЃ± How to Choose
пЃ± Responsibility and Accountability
пЃ± Ownership and Control
пЃ± Benefits
пЃ± Profits
пЃ± Sale of Business
пЃ± Some other considerations
пЃ± Type of Business
пЃ± Planned Growth
пЃ± Relationship of Owners
Liability Considerations
Unlimited Liability
пЃ±Sole Proprietorship (dba or Assumed Business Name )
пЃ±Partnership
Limited Liability
пЃ±S Corporation
пЃ±Limited Liability Company
пЃ±Low-profit Limited Liability Company (L3C)
Accounting Identity
пЃ±Federal Employer Identification Number
пЃ±Form SS-4
пЃ±Tax Returns
пЃ±Bank Account
https://sa2.www4.irs.gov/modiein/individual/index.jsp
пЃ±Workforce ID Number
пЃ±State Tax ID Number
пЃ±State Sales and Use tax
http://www.revenue.state.il.us/#t=tab1
Branding Identity
What is your real purpose?
Product/Service Description
пЃ± What is your product/service?
пЃ± Summarize the key technology, concept or strategy
on which your business is based.
пЃ± What features and benefits does your service have?
Product/Service Description
(cont.)
пЃ± How does your product/service solve or satisfy your
customers’ needs uniquely?
пЃ± Describe why would a customer patronize your
business.
Make it Remarkable!
Otto Rohwedder
Henry Ford
Remarkable Products
Developing a Marketing Plan
пЃ± Define in detail your target market.
пЃ± Analyze your competition.
пЃ± Include direct competitors
пЃ± Include indirect or alternative competitors
пЃ± What is the positioning of your service?
Marketing – Knowing Who Your
Customer Is
Who is buying this vehicle?
Who is buying this one?
Marketing – Knowing Where
Your Customer Is
Location, Location, Location
Marketing – Knowing Where
Your Customer Is
Location, Location, Location
Developing a Marketing Plan
(cont.)
пЃ± How will you price your product/service?
пЃ± How does your price compare to direct and indirect
competitors?
пЃ± Can you be profitable at your chosen price?
Developing a Marketing Plan
(cont.)
пЃ± How will you promote or advertise your service?
пЃ± How will you reach your target audience?
пЃ± Will you use mass or targeted media?
Developing a Marketing Plan
(cont.)
пЃ± Answer physical distribution questions in your business
plan.
пЃ±Where will your customers expect to find your service?
пЃ±Parking (Street or Lot)?
пЃ±Ease
пЃ±Cost
пЃ± Do you know who your suppliers will be?
Supplier Requirements
пЃ± Quality issues
пЃ± Personnel issues
пЃ± Availability issues
пЃ± Other unique issues
Management & Operations Plan
пЃ± Who will be in charge of your business?
пЃ± What special qualifications or expertise do you/they
have to run this business? (include resumes as an
appendix)
Management & Operations Plan
(cont.)
 Who will manage the business’ daily finances?
пЃ± How will you process and record sales?
пЃ± Does your business have special local or federal
regulations?
Management & Operations Plan
(cont.)
пЃ± When will you need to add employees or independent
contractors?
пЃ± What salaries will you pay?
пЃ± What training will you or your employees require?
пЃ± Will you give drug tests, check backgrounds, or bond
employees?
General Operational Items
пЃ± Cloud Computing
пЃ± Microsoft Office
пЃ± Grasshopper.com
пЃ± Regus Offices
пЃ± iPad
пЃ± Smartphones
пЃ± GoDaddy
пЃ± Google
пЃ± Gmail
пЃ± Ad Words
Management & Operations Plan
Start-up Lessons Learned the Hard Way
пЃ± Baby Planners
пЃ± Get it in Writing
пЃ± Fishing Expedition
пЃ± Et tu, customer
пЃ± Thanks, Mom
пЃ± Time for Love
пЃ± The Money Pit
http://articles.latimes.com/2010/aug/22/business/la-fi-smallbiz-pitfalls-20100822
Operations & Management Plan
пЃ± Who will be in charge of inventory and inventory
control measures?
пЃ± Are loss prevention policies in place?
Financial Plan
Financial Plan – Starting with
the Basics
пЃ± What is your current credit position?
пЃ± What are your personal financial monthly expenses?
пЃ± Do you have a working spouse or other outside income?
Financial Plan – Starting with
the Basics (cont.)
пЃ± How much money can you invest?
пЃ± Is there financial support from other family members?
пЃ± Do you need loans?
Financial Plan – Starting with
the Basics (cont.)
пЃ±
пЃ±
пЃ±
пЃ±
How will any loan proceeds be applied?
Do you have collateral for a traditional lending resource?
Can you get financing terms from your vendors?
Can you get a co-signer for a loan?
Financial Plan – The Numbers
пЃ± Have you estimated your initial year of sales?
пЃ± Have you prepared a monthly cash flow?
пЃ± Have you prepared a breakeven analysis?
Financial Plan – The Numbers
(cont.)
пЃ± Does your business have special seasonality issues?
пЃ± How much will it cost to open or expand your
business?
Measurable Goals & Objectives
пЃ± Include One-year and Three-year goals
пЃ± State specific measurable objectives
пЃ± State market share objectives
пЃ± State revenue/profitability objectives
Create a Movement
пЃ± Challenge the Status Quo
 Don’t be safe, but don’t be
stupid either
пЃ± Build a Culture
пЃ± Commonality
пЃ± Commit to the Cause
пЃ± People are watching you
Illinois SBDC/Duman
Entrepreneurship Center
Jewish Vocational Service –
Downtown
216 W. Jackson Boulevard, Suite 700
Chicago, IL 60606
Phone: (312) 673-3430
North Side
3525 W Peterson, Suite 400
Chicago, IL 60659
Phone: (773) 516-5538
Web:
Email:
www.jvschicago.org/duman
[email protected]
Today’s presentation by: Mike Cohen
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