What is a business plan? What Types?

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I am currently taking this class. My final is a finished business plan. I will be inserting all of my notes here to help you all on your journey of a complete business plan. Hope all the information I add over time will help. If any of you have questions let me know, and I will ask my professor for some answers.

Business Plan
Is a document that outlines the basic idea underlying a business and describes related startup considerations.

The business plan should lay out your basic idea for the venture and include descriptions of where you are now, where you want to go, and how you intend to get there.

A business plan is used primarily in two ways:

1.To provide a statement of goals and strategies for use by individuals within the firm
2.To aid in the development of relationships with outsiders who could help the company achieve its goals

The insiders group consists of the internal users of the plan:
the new firm’s management and its employees.
The second group consists of outsiders who are critical to the firm’s success: its prospective customers, suppliers, and investors.

For the entrepreneur starting a new venture, a business plan has three basic objectives.

1.To identify the nature and the context of the business opportunity—that is, why does such an opportunity exist?

2.To present the approach the entrepreneur plans to take to exploit the opportunity

3.To recognize the factors that will determine whether the venture will be successful

Two Types of Business Plans
The entrepreneur has two basic choices when it comes to writing a business plan: the summary plan or the comprehensive plan.

The Summary Plan
Is a short form of a business plan, presenting only the most important issues and projections for the business. Focusing heavily on market issues, such as pricing, competition, and distribution channels, the summary plan provides little in the way of supporting information. This type of plan is adequate if you are seeking outside financing primarily from banks. A summary plan is better than no plan at all.

The Comprehensive Plan
A full business plan that provides an in-depth analysis of the critical factors that will determine a firm’s success or failure, along with allthe underlying assumptions.

Such a plan is beneficial when:

1.Describing a new opportunity (start up)

2.Facing significant change in the business or the external environment (changing demographics, new legislation, or developing industry trends)

3.Explaining complex business situations