Business Plan Brainstorming
Start with a concise and informative Executive Summary
The Executive Summary is a high-level abstract of the entire business plan. The summary ideally provides the reader with highlights and pertinent points to be delivered in detail in the remainder of the Business Plan.
It’s not a simple summary, but it precisely punctuates the critical points of the entirety of the Business Plan. Correlations between key points mentioned in the Executive Summary and business, operations, financial, and marketing strategies should be clear and connect the relevant links.
Whether the intended audience is a financial institution, an investor or a potential buyer, the Executive Summary should be a concise summary of the entire business plan.
A traditional Executive Summary is a concise paragraph at the least. According to Kuratko and Hornsby (2021), the length of the Executive Summary should be anywhere from two to three pages. Their focus is on new ventures that require a lot of Research and Development efforts.
For a small business, the length can range from half a page to a full page for the Executive Summary (SYOB, 2018). The rule of thumb is that it varies on the type of business and the complexity of the business structure and/or funding requests.
Here’s a sample of an Executive Summary created for a fictional business plan was originally written in 2021. It’s a fictitious business for an allotment garden as a service business in the Cary, NC area.
Executive Summary
Capture your reader’s attention with a clear and concise Executive Summary. Make sure to correlate key findings from the industry overview, marketing plan, and strategies for growth, IPO, exit, or M&A.
A sentence that needs improvement for clarity and focusing on the key business related information and correlations to the overall strategy.
Unlike community gardens, the allotment garden offers a perfect place for serious gardeners to gather and enjoy a well maintained premises.
The above sentence should communicate that a well maintained, semi-private allotment space is a competitive advantage and a point of difference from competitors, i.e. community gardens. The target market is identified as serious gardeners, not hobbyists.
Another sentence with room for improvement and a rewrite is:
This business model is therefore scaleable if the location is chosen well based on market research.
If the long-term strategy is to expand the business model, then data regarding the real estate market where land availability and proximity to urban areas with potential customers should be fine-tuned. This statement should be tighter and demonstrate how and where the model can be scaled successfully, backed by research and data.
The next step is the business description
Next, the business description as it relates to the current state of the business should have enough information to provide the reader with an understanding of business performance. Related to the above, the future plans for the business should be included in this section.
If this is a brand new business venture, then focus on describing the products or services offered and the value proposition. Also, include a brief industry overview.
part 1 of the marketing section is the market analysis
The Marketing section has two sections. The first section focuses on the target market and should detail the intended consumers of the product or service. This section will also include market research detailing the size of the market and current trends. At the end of this article, there are some recommendations for the marketing research part. All of this information should be supported by industry research and referenced.
Continuing with the example provided above, the fictional business’ Market Analysis section with a subtopic of Industry Overview section has not changed much since August 2021, when the business plan was initially created.
Here’s an excerpt from the Market Analysis section.
Original Industry Overview - 2021
The Industry Trends or Overview section was originally written in 2021. The highlighted statistics require updated information based on current data.
Revisions required (in order to keep the statistics relevant to 2023):
Based on data available from Harvard’s America’s Rental Housing 2022 Report, there are now 44 million renters in the US (p11).
According to landsearch.com, there are 4.2 million acres of land for sale (retrieved on Feb. 9, 2023).
Additional trends that are relevant as of 2022 in terms of new demand trends:
Another notable trend is that renter households tend to reside close to urban areas since that is where the supply is located (America’s Rental Housing Report, 2022).
Demographic groups between 18 and 34 in age contributed to new demand for garden products, especially organic products and supplies (IBISWorld, 2022).
Based on more recent data above, the Industry Overview will be rewritten accordingly.
Besides the fact that data needs to be updated on and outdated sections of a Business Plan, this is an opportunity to make any other updates or corrections.
Reading each section of the Business Plan to ensure cohesiveness and accuracy is critical in presenting correct information to financial institutions, investors or for the management team to make informed strategic decisions.
Keep in mind, if there are charts, graphs, or references to the number of renters or acres of land available for sale in subsequent sections, that information needs to be updated to be consistent with current data.
The Marketing Plan section includes detailed information about the strategy and how the company intends to handle sales, distribution channels, price, place, and promotion. That information will be included if there are plans to run advertising campaigns.
Stay tuned for more details about the Marketing Plan section. Part 2 of this series will look deeper into the Marketing Plan.
Resources for industry research:
Business Source Ultimate - this is a go-to resource for academic research and is a resourceful database of business and academic journals.
IBISWorld - very dense reports for a deep dive into an industry. This is very comprehensive so it’s ideal for substantial industries and companies with a large market share.
Statista - this is an excellent resource for charts and graphs. The industry insights are useful and the filters for geographical regions are also helpful.
A few of the resources listed by Kuratko and Hornsby (p263-4):
Where to find sample business plans - this article by Larry Kim on Inc.com provides a few options worth checking.
References:
Kuratko, D. F. and Hornsby, J. S. (2021). New Venture Management, The Entrepreneur’s Roadmap for Development: Management, and Growth. Routledge/Taylor & Francis Group. Third Edition. https://doi.org/10.4324/9781003034292
Staff of Entrepreneur Media, Inc. (2018). SYOB/Start Your Own Business. Entrepreneur Press. Seventh Edition.
(2022). America’s Rental Housing 2022. Joint Center for Housing Studies of Harvard University. Harvard Graduate School of Design, Harvard Kennedy School. 1-44.
Industry Report 44422. Nursery & Garden Stores in the US. (2022). IBISWorld.1-45.