If you are starting up a new business your business plan will be a little harder to prepare than if you’ve been in business for a while. However, this will be the most important part of your loan application. Show the lender you know what you're doing with a good business plan.
Write Your Executive Summary
Start out by writing your mission statement. Keep it focused and concise and explain exactly what your business is about. Keep it brief; don’t ramble on with a lot of explanation. Next list all of the owners and what their function in the company will be. And then list how many employees you will need and what their jobs will be. Location of the business is very important to include here and describe how the location will be used. Include a list of description of products or services you will be offering, banks that you deal with and a short paragraph or two on the plans for your business.
Research your market and write why your product or service will be successful over your competition. Because your business has no history you will need to explain about your background and how many years experience you have that will enable you to build a successful business. Lastly, expand on the plans for growing your business.
Write a Market Analysis
This is where you will want to include all the information you have researched about the market you are targeting. Describe this target market including demographics, location of the market and the needs of the market. Describe all of your competition. You must show that you know what you are getting into and what you are up against. Include information on the history and trends of the type of business you are starting. In this section you would want to go into detail about your pricing structure. You would also include your marketing plan. Such as, where you plan to advertise and how much you plan to advertise. In the last part of this section you want to list any restrictions to your product or service, how you will handle them and what it will cost to comply.
Write Detailed Pages
You can write a page or two of the details of the description of your company, the owners and managers of the company and your products and/or services. If you feel you haven’t been able to fully describe these things in your summary or market analysis then write out the details and include them here. Make sure to put a heading on each new subject at the top of the page.
Loan Details
The reason for writing the business plan is usually to show a lender all the things they need to know to make a lending decision. It is very important to do this section well because you have no history. How much money you need, why you need it and how you plan to pay it back are the questions that must be answered. They will want to know how much of your own money you are investing and where it’s coming from. Include projected earnings here and make sure you back it up with research. You may also want to a few different loan amounts and how you can work with each one.