Dr. Dan Nathanson
Anderson Graduate School of Business UCLA

What informatiuon should I include in my business plan?

It's really important that you make the plan into a story, a convincing compelling story. Not a fiction. Ok? It has to be real. But it has to be convincing. The problem with following too many guidelines and you need to follow the guidelines, but after following the guidelines of all the different sections, you need to take a look at you plan and say, "Is the storyline still there?" So for example, first start (and people debate about this) first start with the executive summary knowing that you are going to take that executive summary and you're going to change it anyway but just put it down so you get an overall picture. And in that executive summary will be your value proposition. What is your primary value proposition? How is your product or service going to serve that market? Not only how is it going to serve it, but how is it going to do it better than the competition? What's out there? What is the problem you are trying to solve and how are you going to solve it better? That's the key aspect of that. And not only how you're going to solve it, why are you going to be able to solve it? Is it you years of experience in the industry? Is it your knowledge of a particular market? Is it the team you built? Hopefully it's all of those things.

So, once you have done that executive summary, then you have sections. There is the product section, the market section, marketing and sales, operations, finance, management and personnel. All of those things have to be addressed in the plan. However, make sure you maintain that story line as you go through and all really detailed spreadsheets and things like that would go in the appendix so you can maintain that story and not get lost in the trees basically instead of seeing the whole forest. And then once you have finished that whole plan, go back again, look at your executive summary and I'm sure there will be changes from where you started. But once again, what is the business plan for? It's for a road map, it's a communication device. Let's say and many of you are going to want to look for capitol. As I said before, management, management, management. So what does the investor want to see? They want to see how credible you are, how committed you are, and how much contribution you have made toward your business. This is one of the reasons I say don't write a plan right from your basement. You have to have gone out and done something. If everything is just on paper, oh I have an idea for a particular widget and I'm going to take that widget and I'm going to do this and this and this. Well, what have you done so far about that business? Did you create a prototype? Did you get some of your team built? Did you check with the market? Did you arrange for a lease or space? What have you done? That's the kind of credibility that's going to come through. And if you wrote a plan that's believable, convincing and compelling, then you may be able to get some capitol from outside sources other than your friends, your family, and fools.