Analyze your strengths and weaknesses, paying special attention to your
business experience, education and personal objectives. Then consider
the following questions to help you develop your business plan:
Nature of Product or Service
1. What is your business?
2. What does your product or service do for your customers?
3. What does it fail to do?
4. What distinguishes your product or service from others?
5. What might it do later, but doesn't now?
6. Is the product or its components manufactured or purchased?
Is that advantageous? Why? What do competitors do?
Markets
1. What do you buy? What do you sell?
2. What evidence establishes a need for the product or service?
3. What comprises the market? (age, income, geographical area, sex,
occupation, etc.)?
4. What are your target customers buying habits?
Distribution
1. How will the product or service reach its market?
2. How will the product or raw materials reach you?
3. Who are your suppliers? What are their trade & credit terms?
4. How long does it take to receive orders?
Competition
1. Who and where are they?
2. How does your product compare (quality, cost, delivery, etc.)?
3. What advantages do you have over competition?
Start-up (Out-of-Pocket) Expenses
1. What will be the down payment on purchase of land/building or
deposit on lease?
2. Cost of fixtures or remodeling?
3. Permits, fees and licenses?
4. Professional services (attorney, accountant, etc.?)
5. Utility deposits and installation costs?
6. Cost of purchase or lease of equipment?
7. Cost of initial inventories?
8. Cost of operating supplies?
9. Advertising and Promotional costs for opening?
10. Employee salaries?
11. Accounts receivable?
Projecting Sales and Expenses
1. How will prices be determined?
2. Is the business seasonal?
3. What is your first year's anticipated sales per month?
4. What are your projected variable costs (materials, labor, freight, etc.)?
5. What are vour projected fixed costs (rent, utilities, insurance, etc.)?
6. What are your selling costs (advertising, sales promotions, etc.)?
7. What is vour projected net profit/loss by the month?
8. What is the basis for estimating each expense item (including
management salaries)? Is it realistic?
9. Have you anticipated enough start-up capital?
10. Using the data developed from the questions above, what are your
annual forecasts for the next two to four years? Allow for unforeseen
problems and expenses.
11. Will net profits satisfy your family's expectations and allow for
additional capital to ensure the business'continuity and growth?
Choosing the Type of Business
1. What business structure do you favor? Sole proprietorship?
Partnership? Corporation? S Corporation?
2. What are the advantages and disadvantages of each?
3. Where will start-up capital come from?
4. How will it be used or invested?
5. What skills can you provide? What others are needed?
6. How much control will you have over the business?
7. How will the business be taxed?
8. To what extent will you be personally responsible for debts or
claims against the company?
9. What will happen to the business if you are incapacitated?
Employment
1. Will you need to hire others? When?
2. What duties and responsibilities will they have?
3. What are the required skills, experience, knowledge for each?
4. What salary or wage scales will retain competent employees?
5. How and where will you find them?
6. What and how much training will be required? By whom? Will training
plans and written procedures be available?
7. What rules apply? Are written copies available for each employee?
8. Are you familiar with the federal and state regulations on minimum
wage, overtime, child labor and other employment considerations?
9. Have you considered the requirements and costs of payroll taxes,
workers' compensation, unemployment compensation?
10. Are you aware of employee relations laws?
Taxes
1. Are you familiar with federal and state income taxes?
2. Employment and unemployment taxes?
3. Excise, saies and use, property and inventory taxes?
4. Will you encounter impact fees?
5. How and when do you file and pay?
6. Have you included them in your projections?
Regulations
1. What federal regulations apply?
2. Do you know filing requirements for incorporation?
3. What state, county, and/or city licenses apply?
4. What zoning laws, building codes and health, fire and police
standards apply?
5. What are the norms for the community?
Financing
1. What net income per year do you expect to get from your business?
Can you live on this? How much can you put back in the business to
help it grow?
2. Do you need additional capital? For what? When? From whom?
3. How and to whom do you apply for a business loan?
4. What about govemment loans?
5. How will you handle cash flow problems if sales don't cover expenses
or receivables are late?
6. Do you have a system designed to set aside funds for meeting tax
payments (sales, income, unemployment compensation or other
required remittances)?
Site Locations
1. Does your product or service require specific location(s)?
2. Does proximity to suppliers or customers play an important role?
3. What about transportation, labor supply, utility costs, state and
local taxes and regulations?
4. Do traffic counts, parking and other area businesses play important
roles in location?
Leasing Arrangements
1. Should you lease or buy your business facilities?
2. How is rent determined (flat rate, percent of sales or other)?
3. Is the rent high or low in relation to the area and facilities being rented?
4. Who owns improvements that the tenant makes?
5. How much insurance does the landlord hold and does he ask the tenant
to have coverage?
6. What are the lease renewal provisions?
7. Does the tenant have the right to sublet?
8. Are there any options for expansions
9. Are there required operating hours?
10. Can you negotiate terms of the lease?
11. Is it zoned for your type of business?
Insurance Coverage
1. What kind of property insurance is needed (fire, extended coverage,
burglary, robbery, business interruptions)?
2. What kind of casualty insurance (liability, automobile)?
3. What about life insurance (sole proprietorship, partnership or
corporation, key man, worker's compensation)?
4. Do you need fidelity or surety bonding?
5. Do you need fringe benefit insurance for your employees?
Record Keeping
1. What records do you need (payroll, taxes, sales, inventory)?
2. What financial statements do you need and at what Intervals?
Do you know how to use these statements?
3. What kind of record keeping system will you use?
4. What services do you need from an accountant? How will you select
one?
Advertising
1. How will you provide visibility for your products, services and business?
2. What image do you want for your business?
3. How will you identify you business site?
4. What is your market and what medium or media will reach the market?
5. How often do you advertise and how much will be spent?
6. What message should reach your potential customers?
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