M5A1 Chapter 06: Managing Start-Ups and New Ventures Attempts Average/3 6. Planning a start-up (Connect, Perform) On its website, the U.S. Small Business Administration suggests that a good business plan should have nine components: 1. Executive Summary: A concise overview of the entire business plan 2. Market Analysis: A description of the target market for the business, and the industry in which the business operates 3. Company Description: A high-level overview of the nature of the business and why it will be a success 4. Organization and Management Descriptions of the company's organizational structure and ownership as well as profiles and qualifications of the company's ownership and board of directors 5. Marketing and Sales Management: A description of the sales and marketing strategies for the business, including market penetration channels of distribution, advertising, and sales activities 6. Service or Product Line: A detailed description of what the business is selline, including the product life cycle, copyright information and research and development activities 7. Funding Request A specific request for whatever money is needed to run the business, including current and future funds needed how the funds will be used, and the terms under which the funds will be obtained 8. Financials A complete financial overview of the business, including forecasted Income statements, balance sheets, cash flow statements, and capital expenditure budgets for at least five years 9. Appendix: Supplemental material provided as needed. May include things such as personal credit histories, product pictures, legal documents, and so forth Imagine that you are reviewing a business plan. In which component of the business plan could you expect to find the answers to the following questions? Funding Request Organization & Management Market Analysis Question Financials How much interest do owners expect to pay on the money they borrow to start the business? 0 How many levels of management will this business have? How many customers is this business likely to have? O O O What will the business's expenses be in the third year of operation