If I were opening my “Commercial Kitchens for rent” business without the rules and guide lines of the business world and the investors, I would ask banks to loan me money and based on me telling my idea and my word, they would just give me the money I need.

Well, in steps reality and my little dream goes “Poof”. To open a business that needs investors, there is a very standard format that needs to be followed. Let give you a little insight, as one investor said, “Some of the best business plans ever written were wrote on the back of an envelope.”

1.  The executive summary is the essence of the business. It should be no longer than two pages long. In the first paragraph you need to include the following; What problem are you solving? Identify it. What is your solution? What is your niche and how will you dominate the industry for some time? Be sure to include some numerics to prove it. And last but not least how much money do you need. An average paragraph is 4 lines long. This paragraph will decide if the investor will continue to read you plan. That is about 10 ½ seconds to make or break your chances with that investor.

2.      Include just the general information in your business plan. You do not want to include any in depth information. Doing this leaves an open window for someone to take all your hard work and open your business concept. When you are getting close to closing a loan, then you need to ask the investor to sign a notice of confidentiality (NC) to see the in depth information you have.

3.  Get a team together, like you would if you were opening a corporation. Be sure that you have a representative that has many, many years of experience and has a PHD, if you are opening in the IT world. These people do not need to be actively involved. Their name just has to be on the dotted line to prove they support your idea.

4.  You never want to be in a position where when you are asked a question by the investors, and you answer “I do not know the answer.” You can use, “I will get back to you as soon as possible.” as a response. You must follow through!

5. Investors do not want to own assets. Such as owning a building or something along those lines for you to open in.

6.  Funding requirements: You need three year projects – Revenue projections – Cost of goods sold projections – Net expense projections – A money schedule, list the time line for how the money will be spent. Be conservative on the amount of money you are asking for.  Take your amount you need and try to cut it in half.  (Out sourcing is a good way to cut expenses.) Use the money your make after opening to grow and better your product or location.

7.  Grown your business green. There could be extra money available if you prove your venture is green. These are three names to look for:
SRI – Socially responsible Investors
SRE- Socially responsible Entrepreneurs
SRC – Socially responsible Companies

8.  Put a contact name on the document somewhere.

9.  Hire a business coach! If Tiger Woods can have more than two, so can you. Do not try to do it on your own. You need a team.

I hope I have been able to shed a little more light on the world of business plan writing. The process is long and time consuming, but what part of running a business is easy. Just some food for thought as you work though the business plan writing process.