Building a Better Business Plan

Today, I had an interesting experience — I met with an advisor at my local small business center to talk about my business plan for Army Ant Publishing… and how I can secure more funding to get the company off the ground.

For those who haven’t been following my story, I founded Army Ant Publishing earlier this month, and I’ve spent most of the summer researching the publishing industry and writing my business plan. As a business school student, I understood that a well-crafted business plan is the first step towards gaining investor confidence, and so I went all out, putting together a 55-page business plan that laid out my entire strategy for the next five years.

I won’t get into the details of my business model here, but suffice it to say that my advisor, Jo Ann, said she was impressed with the plan, and thrilled that I’d taken the time to plan out even the minute details. She gave me some tips on better organizing the plan, which I thought I’d include here for those struggling with their own plans…

Here is the structure she suggested:

1) A title page: I’m including my logo, too, just for good measure.

2) Table of contents: Jo Ann also reminded me to add page numbers to my plan, which I neglected to do.

3) Executive Summary: A one page summary of the business plan with about three to four paragraphs. The bottom of the page can include the Mission Statement and/or the Vision statement. A company values statement is probably not necessary for a startup plan.

4) History/Concept: For a startup business like mine, this should be a brief description of the business, including little details like the proposed location, the business’s name and the proposed services. This section doesn’t need to be too long; just a paragraph to a half a page.

5) Industry: The plan can get a little more descriptive here, discussing the industry in broad terms and defining quantitative data like how much the industry is making per year and what the customer base looks like. In my case, I have to include data on the publishing industry and the comic book industry, since both are relevant to my product lines.

6) The Business: The outline Jo Ann gave me recommends breaking this into four sections: Overview, Product/Service Description, Employees and Management. In the Product Description section, she encouraged me to list technical information about my initial books as well as general information about each line.

7) The Market: This is my favorite part, and it makes up the bulk of my plan. Again, the outline recommended four segments: Target Market, Marketing Strategy, Competition, and Competitive Advantage. The first three segments should be pretty detailed, but that fourth segment only needs to be a few paragraphs at most.

Fiscal: This is my least favorite part, because this is the section of the plan where I have to explain what I’m going to do with the money I’m seeking. I’d prefer a blank check, thanks; I don’t want to be so accountable! Unfortunately, lenders want to make sure I can repay my debts. Jo Ann reminded me to remember to include loan repayments in my calculations; after all, banks don’t wait until you’re making money to get those loan payments started!

9) Projections: Following the Fiscal plan, the Projections need to show how the company plans to manage its cash flows over the next 36 months. The first 24 months are supposed to be broken down individually, while the final 12 can be lumped into an annual column. She gave me a paper chart to help set this up, but she also sent me an Excel spreadsheet, which I posted here if you’d like to use it:

Cashflow Projections Sheet (Excel Spreadsheet)

10) Appendix: Finally, close the plan with supportive materials, as well as management resumes for the company managers involved. I ended my original plan with a “future outlook” section, but apparently, lenders would rather have facts than glowing speculation. Ah well.

Reorganizing the plan will take me a few hours this weekend, but it’s worth the effort if we can be heading “to the banks” in the next couple of weeks, as Jo Ann suggested. I can’t wait; having some extra funding will help me get this company revved up and ready to go!

Writing Scraps

by Sean J. Jordan