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How to Make a Business Plan

Opening a new business can be overwhelming, especially if you don’t have any experience in the world of business. There are so many things to consider, from identifying the perfect product or service to sell to finding the right financing.

With so many moving parts, getting started can seem rather challenging. A business plan is always a first good step. It will help you lay out your plans, anticipate how you will manage your business and help you get the right financing. In other words, it can really help your company succeed.

A business plan includes:

  • Executive summary: Every business plan begins with an executive summary which features basic information about the business, the types of products and services it sells, the state of the industry and future plans. If you are just opening a business, this summary should include your professional experience and the reasons why you think your company will succeed.
  • Company description: This section describes your business goal and details the different parts of your company, including the types of product or services it sells, consumer demand and potential new clients. It also describes its competitive advantages in the marketplace, such as its location and type of operation. It can be as long as a few paragraphs, but the shorter the better. The goal is for the reader to have a good idea of what the business is about and understand its competitive advantages.
  • Market analysis: Who are the customers? How big is the market? Who is the competition? A market analysis answers many of these questions in detail. You can describe, for example, the type of customers you anticipate having (office workers and area residents) and describe the area where the business is located (there are five commercial buildings and 200 residential apartments within a mile radius, etc.)
  • Company organization: Here you explain how your company is organized and who is involved. In other words, describe who is doing what. This information is useful particularly if you’re looking for financing. Bankers need to know how your company is structured and who they are dealing with.
  • Description of products and services: Use this section to explain in more detail the products or services you plan to sell. How will your product be consumed? How often? How will consumers benefit from your products?
  • Marketing plan: This is your chance to explain in detail how you will market your products and services to potential clients. This can include plans for a website, advertising in local newspapers, promotions or other ads.
  • Finances and projections: The purpose of this section is to provide financial information about your company, including short and long-term sales projections. You can also include fixed and variable costs and when the company anticipates profits.

How to Get More Help

The Small Business Administration (SBA) can help you perfect your business plan. Use this locator to find a local SBA office and schedule an appointment.

If you own a small business—or are thinking of starting a small business—get the training you need to help your business succeed.

The U.S. Small Business Administration offers free online courses to help you start a business, manage a business, finance a business, work with the government as a contractor, and more.

Asked by Anonymous

Job is being outsourced. Is there any small business loans available

The Small Business Administration is the best source of information about government resources for small businesses, including loans and grants.

Learn more about starting, managing, and financing a business.

How the Government Helps Small Businesses

Whether you’re thinking about opening a new business or you’re trying to strengthen or expand an enterprise you already have, the Small Business Administration (SBA) is there to help.

The SBA is a federal agency that helps small businesses grow and succeed. It provides business counseling and training, and offers a wide range of financing programs such as loans and grants.

Counseling and Training

You can get immediate help from the SBA by taking one of its online training courses on how to start, manage and finance a business. Each subject features a variety of courses about successful business management.

The SBA also works with community centers that provide free or low-cost training and mentoring. For example, SCORE is a nonprofit organization comprised of volunteer counselors with extensive experience in the business world. SCORE provides mentoring and counseling services to new business owners.

Finally, you can always visit local or regional SBA offices for support. These offices are located throughout the country and can counsel you on:

  • How to find your local women’s business centers
  • How to get technical assistance
  • How to get disaster assistance

Access to Capital

A lot of people think the SBA lends money. The truth is that it only guarantees loans made by financial institutions such as banks. SBA-backed loans can be very attractive because they generally have low interest rates and longer repayment terms.

The SBA offers several loan programs, including:

  • 7(a) Loan Program: This program is for businesses operating in specific industries such as exports or for businesses located in rural areas or underserved communities. Active duty military personnel and veterans can also benefit from these types of loans.
  • Micro-Loan Program: This program is for certain small businesses and nonprofit organizations, including childcare centers. The maximum loan amount is $50,000, which can be used to pay for inventory or purchase equipment. However, money from these loans cannot be used to pay debt or to purchase real estate.
  • CDC/504 Loan Program: This is a program for businesses looking for long-term financing. The money can be used to purchase real estate, new facilities and machinery or equipment. The program has several stipulations, including one that requires the funds to be used to encourage economic development in a community.

You can get more information about some of these programs as well as additional local resources by going to SBA Direct.

Other Types of Financing

Besides guaranteeing loans, the SBA can also help entrepreneurs locate other types of financing, such as grants. It’s important to note that the SBA does not provide grants for starting or expanding a business. The agency does provide grants to nonprofits and educational organizations for counseling and training purposes.

Local and state governments do provide grants to small businesses, specifically those involved in childcare, energy efficiency and local tourism. You can learn more about the different types of government grants available by visiting Grants.gov.

Business.USA.gov also provides information about how small business owners can access financing.