Writing a Small Business Plan

Writing a small business plan is simple.  Creating one that you can take to the bank or show to investors can be more difficult.  Much of the work involved has to do with research.  If you are already working in the field, you are in the perfect environment to do that.

Whether or not you have access to the numbers is another story.  Some owners are happy to share information about how long it took to break even or make a profit.  Others are more resentful and close-mouthed.  They fear that you will become one of their competitors, which could hurt their profits.

In some industries, there is always room for more competition.  For example, you might see a dozen profitable restaurants on the same street.

Restaurants are good businesses in some ways, bad in others.  People always need to eat.  But, industry researchers say that people are eating in more often and eating out less. 
So, if you wanted to open a restaurant, you would want to find a place where you had little competition, but enough of a population to support you.  That can be hard to accomplish.

You will find it harder to create small business plans if you have no experience in the industry.  It may also be hard for you to get funding.

Banks and the SBA, which sometimes guarantees loans, look at your experience as they are reviewing your application.  It helps to have some management education under your belt, but experience is a practical necessity.

If you will have partners, you will need their help in creating a plan.  Tax returns and personal financial information are requirements for banks to consider a loan or the SBA to consider making a guarantee.

Even private investors will want information about your personal finances.  Small business plans aren’t just about the business.  They are also about you.

Copies of resumes, licenses (if applicable) and documents may need to be included.  For example, if you planned to open a beauty salon, you would want to include a copy of your cosmetology license.

You will also need to include letters of intent from suppliers, assuming you will be using supplies from other companies.  These letters show that other companies are willing to provide what you need, if you are able to come up with funding.

If you don’t need outside funding, writing a small business plan is a simple matter of writing down your objectives and your mission statement.  The paperwork is for the investors.

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