American Institute of Small Business: How to Write a Business Plan

INTRODUCTION

Going into business, either independently or with others, is a dream
that most Americans would like to fulfill during their lifetime.
Each year more than 1 million new businesses start up, while more
than three to four times that number never leave the planning or
thinking stage.

It has often been said that SMALL BUSINESSES come and go just like
NIGHT and DAY. How often have you driven by a shopping center one
week and observed a sign announcing a “GRAND OPENING”; then, within
one year or less, driven by the same location, this time seeing a new
sign saying: “GOING OUT OF BUSINESS SALE”?

How often do we hear stories about people and companies having to
close or enter bankruptcy? And why is it that we keep hearing
statistics that say: 9 out of 10 new businesses will fail or close
within two years?

The answer can be found in any number of reasons. These reasons
include:

* LOW SALES VOLUME
* INSUFFICIENT CAPITAL
* WRONG LOCATION
* INCORRECT MERCHANDISE
* COMPETITION IS TOO STRONG
* INEFFECTIVE ADVERTISING
* CHANGING MARKET CONDITIONS
* POOR MANAGEMENT
* LACK OF KNOW HOW

One could list a dozen more reasons why businesses fail. Regardless
of the reason, the ONE WAY OF INSURING A MUCH HIGHER DEGREE OF
SUCCESS WHEN STARTING OR OPENING A NEW BUSINESS, and even continuing
with a current ongoing successful business, is to have a BUSINESS
PLAN.

This is what your: HOW TO WRITE A BUSINESS PLAN SOFTWARE PROGRAM is
all about. You will learn:

* WHAT IS A BUSINESS PLAN
* WHAT THE BUSINESS PLAN SHOULD CONTAIN
* WHY WRITE A BUSINESS PLAN
* SEE AN EXAMPLE OF A COMPLETED BUSINESS PLAN

WHAT IS A BUSINESS PLAN:

The three main functions of a business plan are:

Provide a communications tool which conveys your ideas, research, and
plans to others.

A basis on which to manage your business.

A yardstick by which to measure progress and evaluate changes.

WHAT THE BUSINESS PLAN SHOULD CONTAIN:

The seven basic elements of a business plan are:

A. Business concept. A summary of basic business idea.
B. Product or service you will offer.
C. The market. Who will buy the product or service
D. Marketing strategy. How the product/service will be made.
E. Personnel. Employees or contractors needed.
F. Production plans. Where products/services will be made.
G. Financial plans. Cash required for materials, production.

WHY WRITE A BUSINESS PLAN:

There are many reasons why a business plan should be prepared. Each
is sufficient by itself for why one must go through the exercise of
preparing the actual business plan. Regardless of the specific
reason, the underlying goal of preparing a business plan is to insure
the success of the business. Here are the main reasons why a
business plan should be prepared:

1. Provides you with the ROAD MAP that you need in order to run your
business. It allows you to make detours, change directions, and
alter the pace that you set in starting or running the business.

2. To assist in financing. Whether one is starting up a small
business or is an entrepreneur, banks and financial institutions want
to see that you know where you are, where you are going, and how you
are going to get there.

3. The plan will tell you how much money you need, when you will
need it, and how you are going to get it. In other words, how you
will do your financing? 4. Helps you to clearly think through what
type of business you are starting, and allows you to consider every
aspect of that business.

5. Raises the questions that you need to have answered in order to
succeed in your business.

6. Establishes a system of checks and balances for your business so
that you avoid mistakes.

7. Sets up bench marks to keep your business under control.

8. Helps you develop the COMPETITIVE SPIRIT to make you keenly
prepared and ready to operate.

9. Makes you think through the entire business process so that you
do not open the business blindly or lack vital information in opening
and maintaining your business.

10. Forces you to analyze competition.

11. Will give you a “GO” or “NO GO” ANSWER about starting the
business.

EXAMPLE OF A COMPLETED BUSINESS PLAN:

THE WAY-OFF-BROADWAY DELICATESSEN

Date

TABLE OF CONTENTS

PLAN SUMMARY

I. BUSINESS DESCRIPTION

A. OVERALL PURPOSE: The WAY-OFF-BROADWAY DELICATESSEN will be a
delicatessen type restaurant patterned after New York delicatessens
which serve Jewish ethnic style foods. The delicatessen will offer
counter, table and take out service.

B. SPECIFIC PURPOSE: The delicatessen will be located at the St.
Pauls U.S. Interstate I-95 exit and will be open seven days a week
serving luncheons and dinner. A breakfast menu will be added three
months after the opening. Prices will be moderate compared to New
York deli’s but somewhat higher then other St. Paul restaurants.

C. MARKETING STRATEGY: The great majority of customers will come
from Interstate I-95. Accordingly, heavy use of billboard
advertising will be made to attract customers.

D. FOOD PREPARATION STRATEGY: Since many of the ingredients used in
menu cannot be supplied locally, arrangements will be made with out
of the area food suppliers and wholesalers. Even though management
is assured of overnight deliveries, a one week inventory of all food
items will be maintained in either a walk-in cooler or freezer.

E. MANAGEMENT TEAM: Mary and John Ashford will own 100 Per Cent of
the capital stock of the corporation. Each will own 50 per cent of
the outstanding stock. John Ashford is President. Mary Ashford is
Vice President and Secretary.

F. OBJECTIVES OF THE TEAM: It is the objective of the team to
operate the business with a minimal first year loss and have an
operating profit by the first quarter of the second year of
operations. The principals will pay themselves a minimum salary so
as not to imperil the cash flow of the business.

G. FINANCIAL CONSIDERATION: Anticipated profits for the first years
of operations are forecast as follows:

Year 1 $ 6,892
Year 2 $41,773
Year 3 $57,715

Sources of the necessary funds for financing the business are as
follows:

Building Mortgage $25,000
St. Pauls State Bank
Working Capital $29,167
St. Pauls State Bank $15,000
Ashford Savings $14,167

PRODUCTS

THE WAY-OFF BROADWAY DELICATESSEN MENU

Appetizers and Soups

Orange Juice
Tomato Juice
Potato Skins
Chopped Liver
Daily Soup
Lox and Cream Cheese
Chicken Noodle (Served daily)
Tomato
Vegetable
Split Pea
Chicken Vegetable
Clam Chowder

Main Dishes, Sandwiches and Side Orders

Bologna
Corn Beef
Turkey Salami
Rueben
Chopped Liver
Chicken Salad
Tuna Salad
Potato Pancakes
Kosher Hot Dogs
Potato Salad
Cole Slaw
French Fries
Bagels with Cream Cheese
Daily Hot Meal
Chicken
Hamburger
Steak
Roast Beef
Fish Minute Steak

Desserts

Cheesecakes
Hot Fudge Cake
Chocolate Cake
Walnut Cake
Ice Cream
Fresh Fruit in Season

Beverages

Coffee
Teas
Milk
Coca Cola
Root Beer
Orange Soda
Dr. Brown’s Sodas
Milk Shakes
Ice Cream Sodas

UNIQUE FEATURES OF THE MENU

The entire menu has been patterned after typical New York- style
delicatessens. Most of the items are unavailable at all other St.
Pauls’ restaurants with the exception of the daily hot meals and
future breakfast menu.

The menu will be very unique to St. Pauls and the surrounding
community, since almost all of the food items will not be available
at any place other then the WAY-OFF-BROADWAY DELICATESSEN.

Because of the menu and the marketing strategy, management forecasts
that approximately 80 to 85 per cent of it’s business will come from
the Interstate I-95. Approximately 10 to 15 per cent of it’s
business will come from North Carolina State Highway 20 and U.S.
Highway 301.

Only 5 per cent of the deli’s business is expected to come from the
local community.

Future Breakfast Menu

The final menu has not yet been determined but will include such
items as:

Eggs
Pancakes
Hash Brown Potatoes
Grits
Bacon
Ham
Sausage
Toast
Danish Pastry
Bagels
English Muffin
Fruit Juices
Fresh Fruit in Season

It is expected to begin serving breakfasts approximately three months
after the initial opening of the deli.

II.MARKET DEFINITION

A. CUSTOMERS:

The primary market for the WAY-OFF-BROADWAY-DELICATESSEN is that of
the I-95 Interstate Highway travellers going in both north and south
directions. These travellers are primarily vacationers and those
driving long distances. Their primary vehicle is the automobile.

It is expected that the average number of passengers per vehicle will
be two. There will be some seasonality to the business in view of
the much heavier traffic that is expected on the interstate during
the winter months.

B. CUSTOMER SIZE:

It is anticipated that approximately 100 customers will be served
daily. Weekend traffic should be 25 to 30 per cent higher than
activity from Monday to Friday noon. Traffic count studies made by
the Robeson County Highway Department indicates the following average
motor vehicle traffic flow: North to South 23,000 vehicles South to
North 24,200 vehicles During the period of November 15 through April
1, average daily traffic increases by approximately 4,000 vehicles.
In addition to this very high traffic flow, U.S. Highway 301 has
some 5,000 vehicles and North Carolina State Highway 20 has some
3,000 vehicles in average daily traffic flow. Finally, within the
town of St. Pauls, local vehicle traffic approximates some 5,000
vehicles a day.

All of these traffic flow figures make for a very large potential
market. Management strongly believes that 85 Per Cent of their
customer base will come from the Interstate. An additional 10 Per
Cent will come from U.S. 301 and North Carolina State Highway 20.
Only 5 Per Cent of the total volume of business and customers are
expected to come from the local population. Initially however,
business from the local community will be somewhat higher simply
because of curiosity.

III. MARKET GROWTH:

First month sales are forecast at $18,000. Business is expected to
grow by approximately $500 per month. Translated into numbers of
customers served, the anticipated monthly increase will be
approximately 166 customers. Initially, the Delicatessen will serve
some 100 customers daily, or a monthly total of 3,000. Therefore,
within six months, the monthly number of customers will be
approximately 4,000, or on a daily average basis, will number 110.

IV. COMPETITION:

The town of St. Pauls has four eating establishments and one
facility for lodging. With the exception of Joe Don Danny’s, all of
the other eating establishments are located within St. Pauls and
away from the Interstate Highway 95 exit. They are not visible from
the highway. A brief description of each is as follows:

Cliff’s Barbecue: A barbecue house that serves both lunches and
dinners with moderate pricing.

Ferguson’s: Specializes in sandwiches, including hamburgers and hot
dogs. Serves breakfast and is the oldest continuous operating
restaurant in St. Pauls.

Hardee’s: Very successful food operation, and is the only fast food
restaurant in St. Pauls. It’s very popular with both the highway
tourist traffic and the local citizenry. It’s open for breakfast and
into the late hours of the evening.

Joe Don Danny’s: Busiest restaurant. Attracts customers from U.S.
Interstate I-95 since it is the only truck stop in the area. It is
quite popular and is visible from the Interstate.

Hardee’s and Joe Don Danny’s are mentioned in national automobile
publications. They also have billboard advertising, and Hardee’s is
able to take advantage of national advertising in view of its
national affiliation. Joe Don Danny’s, a truck stop, is well known
within trucking circles.

The fact that Joe Don Danny’s and Hardee’s have such visibility is
considered an advantage to THE WAY-OFF-BROADWAY DELICATESSEN,
bringing traffic off the exit of I-95.

V. COMPETITION STRENGTHS AND WEAKNESSES

A. Competitive Strengths:

1. HARDEE’S is a national franchise with a highly favorable
reputation for both food quality and speed of service. In addition,
it has both a very strong advertising campaign and a high name
recognition. It is especially popular with the children of many
tourists, the primary drawing population by the deli.

2. JOE DON DANNY’S has an excellent reputation. Its location puts
the restaurant into a very competitive position with the deli since
it is located off of the I-95 exit.

3. Both of the above competitors are open for breakfast.

4. Both of the above restaurants, as well as the two others in St.
Pauls, are popular with the local population.

B. Competitive Weaknesses:

1. None of the competitors will offer the uniqueness in their menu
which is offered by THE WAY-OFF-BROADWAY DELICATESSEN. The menu will
be an attraction for many of the I-95 Interstate drivers.

2. Only JOE DON DANNY’S is located adjacent to the exit, which means
the deli will compete with only one restaurant for its clientele.

3. The mere name of the deli: THE WAY-OFF-BROADWAY DELICATESSEN
will offer considerable curiosity appeal to some vehicle occupants,
thus bringing in a certain amount of traffic.

VI. MARKETING PLAN

A. OVERVIEW: THE WAY-OFF-BROADWAY DELICATESSEN will offer high
quality food at moderate prices compared to the pricing of New York
delicatessens, which it will be modeled after. However, the menu
prices for the WAY-OFF-BROADWAY DELICATESSEN will be somewhat higher
than comparable dishes at other St. Pauls’ food establishments.

It will not be a fast food restaurant, although quick service will be
offered either at a counter or at sit down tables. Take-out service
will also be available. The owners recognize that Interstate I-95 is
the main highway travelled by tourists coming from as far north as
Bangor, Maine, including residents of the heavily populated cities of
Boston, New York, Philadelphia, Baltimore, and Washington, D.C., who
are going to Florida vacation spots.

New York-style delicatessens that serve Jewish ethnic foods are
immensely popular with these northern tourists. Thus, a restaurant
such as the WAY-OFF-BROADWAY DELICATESSEN will be a welcome change
and relief to these tourists from the conventional fast food
establishments that they normally find along an interstate highway.

THE WAY-OFF-BROADWAY DELICATESSEN will be open for business seven
days a week. Initially it will provide luncheon and dinner service
to its patrons, remaining open until the early hours of the evening.
Both cold and hot dish selections, together with unique desserts,
will be available.

Mary and John Ashford believe that a very viable business opportunity
exists for the opening of a New York-style delicatessen at the exit
of U.S. Interstate I-95 in St. Pauls. In view of the proposed
location of the delicatessen, the anticipated restaurant business
should be excellent.

B. MARKETING OBJECTIVES:

1. The primary objective of the WAY-OFF-BROADWAY DELICATESSEN will
be to attract customers from the very heavily travelled U.S.
Interstate I-95 Highway. These customers are mostly tourists
travelling between the Florida vacation areas and the heavily
populated eastern seaboard urban and suburban centers. Additional
customers will come from U.S. Highway 301 and North Carolina State
Highway 20. Some local customers are expected to patronize the deli.

2. A second marketing objective will be to gain repeat customers
from those who patronize the deli for the first time as well as to
gain customers through word of mouth advertising from first time
users. This will be done by serving a high quality food product in
pleasant surroundings and a clean comfortable atmosphere.

C. MARKETING STRATEGY-ADVERTISING AND PROMOTION:

1. An important consideration in the total marketing effort of the
Deli is found in the name itself: THE WAY-OFF-BROADWAY DELICATESSEN.
This name will not only arouse interest and curiosity from travellers
and tourists, but it will also lend itself well to the major theme of
the establishment. The theme will be carried out in every aspect of
the deli, including advertising, promotion and public relations.

2. Since it is anticipated that the great majority of customers who
will patronize the WAY-OFF-BROADWAY DELICATESSEN will be tourists
using U.S. Interstate I-95, the company will make wide use of
billboard advertising. An important feature of the building purchase
and land lease includes the use of four large billboards, two on each
side of I-95 approximately one and one half miles from the St.
Pauls’ exit going in both north and south directions, and two similar
signs located approximately 5 miles from the St. Pauls’ exit in the
same manner. The use of these billboards is for the remaining three
years of the current land lease, and subject to renegotiation at that
time. Additional billboard locations will be placed on both U.S.
301 and North Carolina State 20 highways. It is expected that the
billboards will carry the same message and theme of the name.

3. Since the name THE WAY-OFF-BROADWAY DELICATESSEN connotes the New
York Broadway name, the use of theatres, theatre lights, a Broadway
stage, and Times Square will be used. The format and decor of the
deli include spot lights as used on stage. For example, with regards
to the exterior of the building, the deli’s name will be highlighted
by two large spotlights in the evening hours, thus giving it a
showtime look. At the take-out counter, the menu items will be
encased in circulating theatre lights similar to those found on a
theater marquis. The menus will not only have the theater theme done
artistically on their covers, but each item will contain names having
a Broadway theme also. For example, “The Big Apple Rueben”, “The
Times Square Hot Dog”, “Lindy’s Cherry Cheesecake”, and so on. A
likewise similar art and copy approach will be given to the
point-of-purchase displays used throughout the delicatessen. Items
with a Broadway theme will be used to give the interior a proper
finishing touch. These will include Broadway Show posters, pictures
of actors and actresses, VARIETY magazine pages and reviews of famous
shows.

4. Delicatessen items will be attractively displayed in refrigerated
delicatessen cases. Also, each of the dessert specialties will be
similarly displayed in a refrigerated bakery display case. Such
displays will give a high point-of-purchase advertising appeal to
patrons.

5. Finally, all of the staff, including waitresses and waiters, will
wear T-Shirts specially silk-screened with the WAY-OFF-BROADWAY
DELICATESSEN logo.

VII. SALES:

All sales will be for cash or major credit card. Credit cards from
VISA, MASTER CARD, AMERICAN EXPRESS, and DISCOVER-AMERICA will be
accepted. Only checks from local residents of St. Pauls will be
accepted.

VIII. THE PRODUCTION PLAN:

A. FACILITY REQUIREMENTS:

1. The deli will be located in a building immediately adjacent to
the I-95 exit. This facility was a former restaurant. It has
current seating of 60 and can be expanded to accommodate 90 persons
at a very moderate cost.

2. Since it is a former restaurant, it contains very important
restaurant equipment and fixtures which would be available for
purchase together with the restaurant building. The asking price on
the building is $30,000. B. EQUIPMENT REQUIREMENTS:

1. Equipment furnished with the building at a cost of $5,000
includes:

1 Small desk
1 60 gal. water heater
1 2 Compartment sink
1 6X10 walk-in cooler
2 6 X 8 walk-in freezer
1 Small bake table
2 three ton heating and air conditioning units
1 6ft. stainless steel table with hot dog warmer
1 Small bake oven
12 42 inch tables
44 black upholstery chair
1 48 inch grill
1 stainless steel up-draft unit with exhaust fan
2 19 quart deep fryers
1 pan steam unit
2 19 Hobart dishwasher
1 2 burner electric cooker
2 Sandwich Refrigerators
48 feet metal shelving

2. Additional tableware, kitchen tools, and accessories will have to
be purchased as well as the following:

2 Microwave ovens 1 Large refrigerator
1 Cash register 1 Scale
1 Meat slicer 1 Bread slicer
1 Refrigerated deli display case
1 Bakery display case
1 Large freezer

IX. LABOR REQUIREMENTS:

A. The two principal positions needed to operate the deli are that
of the Manager and the Cook. Both Mary and John Ashford will
co-share these responsibilities. Arrangements have been made to take
a special one week delicatessen cooking and food preparation course
in New York City.

B. The following employees and their projected monthly salaries are
as follows:

Manager-CookJohn Ashford$1,500
Co-Manager-Cook Mary Ashford $1,200
Half time cook 600
Waiters/Waitresses 2,400
Dishwasher/Custodial 900
Miscellaneous 400
Total Labor Costs $7,000

X. FOOD PREPARATION PROCESS:

A. As a Jewish-style delicatessen, many of the ingredients and final
menu items will have to be supplied by out-of-the-area food and
restaurant wholesalers.

B. There is no concern for the freshness of these items since
arrangements are being made to keep a one week minimum inventory on
hand at all times. This will be done with the use of the freezer and
walk-in cooler. Arrangements have been made with the following food
suppliers and wholesalers to provide for their specialty food
requirements.

C. Each of these wholesalers have assured the Ashfords that they can
deliver orders within 48 hours and, if necessary, deliver within 24
hours subject to an added delivery charge.

1. Lincoln Delicatessen Bakery, Washington, D.C.
Bagels
Rye Breads

2. Fancy Foods, Norfolk, Virginia
Cheesecakes
Chocolate Cake
Walnut Cake

3. Zion-Kosher Company, New York, New York
Nova Scotia Lox

4. Hebrew National Products Company, New York, New York
Bologna
Corn Beef
Kosher Hot Dogs
Salami

D. A back-up supplier and wholesaler for all of the above products
is:

Rueben Foods, Washington, D.C.

E. Some purchases will be made on a periodic basis from Rueben Foods
to assure the company of a second source of supply. All other food
products and ingredients can be purchased from local wholesalers who
make daily runs to St. Pauls from neighboring North Carolina cities.
These include dairy products, fruits, vegetables, seasonings, baking
needs, breads, canned goods, etc.

F. Management expects to make wide use of Microwave ovens.
Delicatessen meats will be stored in the freezer and then in the
refrigerated delicatessen case. All meats will be freshly sliced
upon demand. Salads and soups will be prepared daily. Most desserts
will be kept in the freezer until the day of use.

XI. COMPANY STRUCTURE:

A. Mary and John Ashford have incorporated their restaurant under
the name of the WAY-OFF-BROADWAY DELICATESSEN. John is the president
while Mary is vice president and secretary. Each have fifty percent
of the capital stock of the corporation.

B. With regards to the day-to-day operations, they have assumed the
following titles: Manager John Ashford Co-Manager Mary Ashford

C. John expects to work 60 hours a week until the operation can
afford additional staffing. Mary expects to work a 40 hour week.

XII. BUSINESS ADVISORS:

A. The following business advisors have been or will be used as
needed:

Accountant Michael Stefanson with Stefanson and Byron, Certified
Public Accountants

Lawyer Susan Fallek with Fallek, Hamline, and Zimmerman

Banker Jerome Pinkerton, President of St. Pauls State Bank

Insurance Bobby Maisel with Bear, Rose and Mythroat General Agents

XIII. THE FINANCIAL PLAN SUMMARY:

A. Taking into consideration that the WAY-OFF-BROADWAY DELICATESSEN
will be a new eating establishment catering to the highway traffic on
U.S. Interstate I-95, conservative accounting procedures and
projections have been made. The following Profit and Loss
projections are as follows for the first three years of operations
for the deli:

YEAR 1- $ 6,892
YEAR 2- $41,773
YEAR 3- $57,715

B. Cash flow projections indicate that the deli will have a positive
cash flow beginning with the fifth month of operations. At that time
it is forecast that monthly cash receipts will amount to $20,000 with
expenses of $19,633. Until that time, the commercial loan from the
St. Pauls State Bank should be sufficient to provide the deli with
it’s necessary cash needs.

C. The three year balance sheet projects indicate that the net worth
of the WAY-OFF-BROADWAY DELICATESSEN will be as follows: YEAR 1- $
6,769 YEAR 2- $ 48,542 YEAR 3- $106,257

D. The three year projections for PROFIT AND LOSS, CASH FLOW and
BALANCE SHEETS are shown on the following pages. (Financial Forms
would be inserted at this point).

XIV. SOURCES OF FUNDS:

Building Mortgage 11 years at 11% $25,000
St. Pauls State Bank

Commercial Loan, St. Pauls State Bank 15,000

Cash from the Ashfords Savings and common Stock sale 14,167

Total Start Up Funds $54,167

A. The St. Pauls State Bank has also agreed to provide the
WAY-OFF-BROADWAY DELICATESSEN with an added/open line of credit
amounting to $10,000 should it be necessary.

XV. BIOGRAPHIES OF THE PRINCIPALS:

A. John and Mary have been married for 18 years and have two
children, David, age 16 and Susan, age 14.

B. Mary Ashford has a degree from the University of North Carolina
where she majored in elementary education. She taught upon
graduation.

C. John Ashford received his degree in Textile Engineering and after
spending three years as a Commissioned Reserve Naval Officer took a
position with the Yorkville Atlantic Yarn Company in St. Johns. He
has been with the company 18 years. His last position was Assistant
Chief Engineer.

John has had considerable retail store experience since he worked at
his father’s hardware store while in high school and during his
summer vacations while attending the University of North Carolina.
During his term of service in the Navy, he was stationed at the
Brooklyn Naval Shipyard and became very acquainted with Jewish style
delicatessens.

D. John is 42 years old and Mary is 40. They have lived in St.
Pauls for the past 16 years and participate in a number of community,
school and church activities.

E. John has resigned his position at Yorkville Atlantic Yarn
Company. Mary has given notice that she most likely will not be
available to do substitute teaching since both will devote full time
to operating and running the WAY-OFF-BROADWAY DELICATESSEN.

BUSINESS QUESTIONNAIRE

Questions to answer prior to writing your Business Plan.

PART I: PERSONAL QUESTIONS TO HELP ME SELECT MY BUSINESS.

1. In order to assist you in selecting the business that’s right, we
recommend you complete the following questions regarding your
personal profile, experience, aptitude, and personal and business
goals.

a. What “businesses” or enterprises were you involved in during your
early childhood and teens?

b. Were one or both of your parents self-employed? Explain.

c. Have you ever been fired from a job because of conflict with or
competition with your boss or upper management? Explain.

d. Where do you fit in order of offspring in your family? Oldest?
Youngest? In between?

e. How would you rate yourself on the following entrepreneurial
traits?

i. Desire to make money strong medium not important

ii. Hard worker very average I just get by

iii. Special talent yes no

iv. Success oriented very average don’t care

v. Sociable very average I just fit in

vi. Organized very average I never know where anything is

vii. Competitive very average Winning isn’t important

2. Why do you want to go into business? List your reasons below.
Include both “practical”, measurable reasons and personal reasons.

3. In what ways do you expect your new business to change your life
during the first year? List your expectations.

4. How strong is your desire to succeed? Describe what you feel:

5. How strong is your diligence? What are some examples of how
you’ve displayed diligence in the past?

6. How good are you with details? What are some ways you keep
yourself organized?

7. How disciplined are you? What are some examples of difficult
tasks you’ve pushed yourself to do?

8. How determined are you? What are some examples of pushing on
when you’ve found the going tough?

9. Do you have success-oriented habits? Check yourself on the
following:

a. Sleeping habits

early to bed, early to rise

late to bed, late to rise

early to bed, late to rise

b. Physical condition

excellent average poor

c. Personal finances, checking accounts, etc.

always accurate, current

often behind, overdrawn

a sorry mess

d. Personal appearance

always look sharp

always casual

dress up only when I have to

e. Punctuality

always on time

usually late

win a few, lose a few

f. Keep appointments, promises

always

most of the time

I’m undependable

g. Friendliness

I love people

I tolerate people

Prefer to be alone

h. Work ethic

I’m a steady hard worker

I need to be pushed

10.What are your qualifications? Fill in the “Resume” questionnaire below.

What skills do you have?

What experience have you acquired that could be applied
to your own business?

What are your three most satisfying accomplishments?

What are your hobbies and interests?

What knowledge/expertise have you acquired from schools, seminars,
and special training?

11. On the top of a sheet of paper, write “I Can Do”. Then think
about your school, work, community, and domestic experiences. List
everything you have done well. Examples: organized a fund drive,
built a cabin, coached a little league team, etc. List below the
five things you did best or were most proud of:

a.

b.

c.

d.

e.

12.Turn over the paper and list the skills you have developed over
the years. It may help to list skill areas at the top of the page
such as social, verbal, manual, domestic, organizational, problem
solving, etc. and categorize your skills accordingly. Examples: I
am convincing; I can examine the facts and make sound decisions.
List below your five strongest skills.

a.

b.

c.

d.

e.

13. On the top of a new sheet of paper, write “I Am”. List as many
adjectives or descriptive phrases as you can think of that
characterize you as a person. Examples: I am dependable; I am
impatient. Put a (+) in front of your positive characteristics and
an (-) in front of the negative characteristics. List below what you
would consider your five most important personal strengths.

a.

b.

c.

d.

e.

14. Then list two personal weaknesses you would like to improve:

a.

b.

15. On the top of a new sheet of paper, write “I Enjoy”. Complete
this phrase with a listing of things you like to do. In the space
below, write down five things from your list you would like to do
more of:

a.

b.

c.

d.

e.

16. On top of another sheet, write “I like People who…”. Make a
list to complete the phrase. Do the people you generally associate
with in your daily life have these characteristics? List below the
two that are most important to you.

a.

b.

17. Take out another sheet of paper. Make a list of things you
would like to gain, possess or accomplish in your life. From your
list, write down one goal for each of the following areas of your
life:

Family:

Financial/Business/Professional:

Physical:

Social:

Mental/Intellectual:

18. Select one of the goals you identified in Question 16. What
resources do you already have that will help you achieve this goal?
What resources do you lack?

19. Outline a step-by-step procedure for achieving this goal.
Estimate the time it will take to achieve the goal, and if
applicable, each step in the process:

a.

b.

c.

d.

e.

f.

g.

h.

20. List two active steps you will take to help maintain a positive
attitude:

a.

b.

21. Review your list of skills from Question 12. List five outlets
for using these skills to benefit others.

a.

b.

c.

d.

e.

22. What steps can you take to manage your time more efficiently?

23. Think of an unfortunate event in your recent past. How can you
use it to benefit your future?

24. List five specific things you plan to do to improve your
interpersonal relationships.

a.

b.

c.

d.

e.

25. How does your body tell you it is reaching the point of stress
overload? What symptoms do you experience?

26. What are five things you routinely do to help you relax?

a.

b.

c.

d.

e.

27. List five specific things you plan to do to control stress in
your daily life.

a.

b.

c.

d.

e.

28. Prepare a list of the activities you do now or will do for your
business. Do not identify every task, but list the major items, such
as making the product or rendering the service, invoicing, paying
bills, answering the phone, making sales calls, etc. Be sure to
include travel.

Task Time Task Time

29.Go back through your list and estimate about how much time you
devote to each item in an average week and write it in the blank
beside the task.

Put a plus sign (+) by those items you feel could use more time than
you are now able to give. Put a minus sign (-) by the ones you think
you already spend too much time on.

31. From the items with minus signs above, develop a list of
specific tasks which someone else could do for you, with proper
training.

32. Discuss how important employee contact with customers will be in
the business you are considering.

33. What are your business goals and personal goals? List your top
ten (in both categories) below.

BUSINESS GOALS: (Typically concern independence, money, location,
size of business, travel, people relations, status.)

PERSONAL GOALS: (Typically concern self-realization, creative
expression, family, spirituality, physical health, self-esteem.)

34. How many business ideas can you come up with? List them below.

35. What are your top six priority business goals? List them below.

BUSINESS GOALS:
1.

2.

3.

4.

5.

6.

36. What are your top six priority personal goals? List them below.

PERSONAL GOALS:
1.

2.

3.

4.

5.

6.

37. What five business candidates have you selected? List them
below.

1.

2.

3.

4.

5.

38. How do your top five candidates stack up against the three
questions posed below? Answer yes or no for each question and each
candidate.

BUSINESS ANALYSIS CHART

#1 #2 #3 #4 #5

A. Satisfies most of my wants
and desires

B. I have, or can develop or
hire, the attributes and
capabilities required for
success.

C. Current condition/outlook
is favorable.

39. After completing your BUSINESS ANALYSIS CHART, what business
have you selected? Enter it below and list five important reasons
why you chose this one.

MY BUSINESS CHOICE IS:

MY REASONS FOR CHOOSING THIS ONE ARE:

1.

2.

3.

4.

5.

40. Write your principal business goal for the next year ( or your
first full year in business). Be sure it’s specific, attainable, and
measurable.

41. Write three objectives that will help you accomplish the goal
stated above.

a.
b.
c.

42. Write at least two tasks that will help you accomplish each of
the three objectives you named.

Objective 1:

Task:
Task:

Objective 2:

Task:
Task:

Objective 3:

Task:
Task:

PART II. Now that I have completed my personal profile and
established initial goals what additional questions about my business
need to be answered?

1. Write below at least 10 questions about your business that you
would like to have answers to:

a.

b.

c.

d.

e.

f.

g.

h.

i.

j.

k.

l.

2. If you did not list the following topics as part of the 10
questions listed above please add them to your list. The following
questions need answers:

Size of market

Characteristics of your customers
Income of your customers

Present sales volume of your competitors

Information about long-term trends in your industry

3. What information sources do you have at hand that can help answer
your questions, i.e. customer lists, coupons, etc.

4. Keeping your answers to number 3 in mind, what other sources of
information do you plan to use?

5. What information do you need that a survey could help you get?

6. Think about your answers to question number 5 and list below 5
questions you could use on a survey to find out more about your
customers or potential customers. For now, try to avoid questions
that just give you a Yes or No answer — you’re looking for
specifics. Be sure to test the questionnaire before you use it for
your market research.

7. What group of people do you plan to survey?

8. What method of survey do you plan to use?

Why?

9. Get specific about factors affecting your business.

a. What is the size (geographically and by population) of your
market area?

b. How many prospective customers are in your market area?

(A prospective customer is a person who is likely tomakeat least one
purchase in the next 12 months.)

c. How many customers will actually buy from you?

d. How much will they spend with you?

e. What seasonal fluctuations or other variables must be taken into
consideration when planning the level of your sales during the next
12 months?

10. Where will your business be located.

To properly answer the location question, it will be necessary for
you to obtain a map of your community. You will be able to mark the
location of your competition when you identify them. You may obtain
a map from either your local city or town hall, a map store, a
service station, or you may draw one if no map exists.

This activity is designed to be both a summary of WHERE TO LOCATE
YOUR BUSINESS, and a practical guide to your own location search.

a. What business are you in, or planning to enter?

b. Why do (or will) your customers buy from you instead of the
competition?

c. Why is the location of your business important to you?

d. What are the customers’ needs that you must meet in order to keep
their business?

e. Where is the best place to start your SITE LOCATION SEARCH?

f. List six places where you can get population information about
your community:

1.

2.

3.

4.

5.

6.

g. List FOUR kinds of CULTURAL CHARACTERISTICS of a population.

1.

2.

3.

4.

h. What business trends are occurring in the community in which you
are considering locating your business? Please check where
applicable.

i. Population: growing declining stable

ii. Progressiveness of the community:

Active Inactive

Promotes business activity

Receptive to change

Open evenings (retailers)

Open Sundays (retailers)

i. Using your map, place an “X” where your competitors are located.
Circle the spot where you feel your best location is. If you have
more than one location, you may circle more than one.

j. List the names and addresses of each of your present and future
competitors.

k. Rank the following factors as to their importance to your
business. The number “1” will indicate the most important, “9” being
the least important.

Public transportation

Parking availability

Distance from residential areas

Distance from business areas

Traffic congestion

Side of the street to locate on

Width of street

Location on block

Appropriate business neighbors

l. Will you be able to make a TRAFFIC COUNT at YOUR LOCATION or the
LOCATION YOU ARE THINKING ABOUT?

yes no

m. List at least FIVE QUESTIONS you should answer in selecting a
building for your location.

1.

2.

3.

4.

5.

n. What do you need if you establish a home office?

After you have answered these questions, ask your family to complete
the comment section.

How many square feet are available? (Measure)

Is remodeling necessary?

Cost:

Is redecorating necessary?

Cost:

Are safety features necessary?

Cost:

Compute tax deductions:

Divide total costs of your residential utilities, maintenance,
improvements and telephones by percentageoffice space you will use in
the home. Example:

Total s.f. of office 300

Total s.f. of residence 3000 = 10% of costs

List necessary licenses, permits and coverage for home office:

Family Comments:

11. The next major element to be considered, is the financial
aspects of your business.

a. What are the three stages of financing that reflect the life
cycle of a business?

Seed money

Start-up Financing

Growth Financing

b. Debt Financing is another way of defining the word loan.

c. In addition to Family or Relatives you should consider several
different sources of loan money. For example:

i. Friends

ii. Small business investment companies

iii. Banks

iv. Savings & loans

v. Community development companies

vi. Insurance companies

vii. Credit unions

viii. Suppliers

ix. Loan companies

x. Leasing companies

xi. Business Brokers

12. What are the four purposes of a budget?

13. What are the titles of the three columns on a forecast
(projection)?

Projected sales

Fixed expenses

Variable expenses

14. You have selected your type business, potential market, and
location. What additional items do you need to determine?

a. Choose a Name for you business!

List five names you are considering for your business. Rate them on
a scale of 1 to 4 (Excellent, Good, Fair, Poor) as to Appropriate,
Length, Descriptive and Personal Choice.

Name Approp. Desc. Lgth. P.C. Total

b. Identify your office equipment requirements.

List the equipment you will need and the delivery dates. Check
whether you will lease or buy.

Equipment Date Lease Buy

c. What communication equipment and service is required?

Number of Lines Number of Phones

Call Forwarding Call Waiting

Recording Machine Answering Service

Beeper

Long Distance:

List systems serving your area:

Incoming 800 number: Yes No

On a separate sheet of paper, compare costs of these systems.

d. What, if any, signs do you need?

Complete the section that is appropriate to your business.

Home Office

Do you need a sign? Yes No

List types and sizes:

Type Size

Office Building

Exterior signs in place? Yes No
Do you need to negotiate
for additional signs Yes No

Cost

Retail Signs

List exterior signs:

TypeSizeCost

List interior signs:

e. Decorating your office.

Complete the section that is appropriate to your business.

Home Office

List items on hand:

List items to purchase:

Office Building

List items needed (excluding equipment) and check New, Used, Lease,
or Buy. Note: You can lease some art.

Item New Used LeaseBuy Cost

Retail Business

List items needed (excluding equipment) and check New, Used, Lease,
or Buy.

Item New Used Lease Buy Cost

f. What are my immediate cash requirements?

List equipment needed: Yes No Cost

Cash box and adding machine?
Cash register?
Type?
Safe?

Personnel

Bonded?

Number of employees in cash area?

g.What are my parking requirements?

List Restrictions:

Reserved Spaces?
#
Handicapped Spaces?
#
Customer Parking?
#

h.Landscaping
Yes No Cost

Complete?
Items needed:

Shrubs?
Trees?
Ground Cover?
(Grass, rocks, etc.)
Fencing

Other

i. What will be your hours of operation?

Definite: Total

Days From To

Flexible:

Total Hours:

j. Special Arrangements for Children:

k. How will you handle paperwork i.e. filing?

List equipment and supplies needed: Yes No Cost

4-drawer cabinet

Hanging folders (Pendaflex)
Quantity

Manila Folders
Quantity
3-ring binders
Quantity

Card Files
Quantity

Follow-up file

In & Out baskets
Quantity
Other:

Obtain an office supply catalog from one or two vendors. Leaf
through for suggestions.

l. Shipping and Receiving

List choices of vendors for shipping:

Local
Long Distance
(Surface)

Long Distance
(Air)

Calculate total space available for receiving:

Calculate total shelving space:

Number of employees available to receive?

m. Establishing Procedures

In the space below, draw your own organization chart, leaving room
for additional departments and employeesas you grow.

List procedures that need to be posted, such as hours, schedules,
emergencies, etc.

n. Review possible problems. After discussions with friends,
competitors, suppliers, and family, list additional ones that may be
common to your business.

o. Under what conditions will you accept returns?

Yes No
Anything and Everything?

Exchange only?
Within how many days?

Repair only?
Share cost with customer?

No cash refunds?

Breakage:
No charge Cost only Retail

In your business there are certain customer-related problems that
will develop. If any problems are your fault, give three examples of
these problems and what you would be willing to do to correct them.

p. Sales: Will it be your policy to offer –

Yes No

Money back guarantees

Limited warranties

Free home trials

Demonstrations

Price-matching

Classes

q. Deliveries: Will it be your policy to offer –

Yes No

No deliveries

Deliveries at cost
UPS
Local service
Your vehicle
Mail

r. Hours: Answer the following questions.

i. Are there established merchants hours in your area?
Yes No

If so, what are they?
Days From To
Days From To

ii. What hours do your competitors keep?

Days From To
Days From To

iii. Based on the above, what hours will you keep?

Days From To

s. Gift Wrapping:What will be your policy?

Yes No
Free

Box only
With your name
Will you charge customer?
How much?

Paper, box and ribbon?
With name on sticker?
Charge customer?
How much?

No gift wrapping:

t. Miscellaneous Policies

Yes No No concern

Smoking

Food

Pets

Music

Dress code

15. List two charities to which you will contribute initially.

16. Establishing your credit

Yes No

Have you asked your bank what kind
of credit reference they will provide?

Is there a dollar limit?
If so, what is the amount?

Have you asked for a report of your
personal credit from your local credit
bureau?

Do you have any negative or
incorrect reports?

If so, how will you correct these?

Explain:

17. Extending Credit

Yes No

Will you offer any credit?

If so, what kind?

Your own business charge
Visa
MasterCard
American Express
Diners Club
Regional Card (Shoppers, etc.)

18.Security:In the following questions, check the security
precautions you plan to take.

Yes No

a. Fire extinguisher
How many?

b. Fire drills and/or posted escape
procedures?

c. Signs stating policy on theft
Will you prosecute?
If so, at what level of
dollar loss?

d. Security guard

e. Surveillance camera

f. Other security measures (lighting,
windows, one-way glass, etc.)

Explain:

g. Internal audits

h. Perpetual inventory

i. Accounting review
How frequent?

j. Duplicate records off-site

Name of Civil Defense contact:

Name:

Address:

Telephone:

19.What inventory procedures will you use?

Yes No

a.Which method will you use for
inventory control?

Stock count

Perpetual

Both

Stock/Sales Ratio

b. List six vendors from whom you plan to order, with their
addresses, phone numbers and contacts. After contacting, fill in
approximate time required for delivery.

Delivery Time

1.
Business Name Contact

Street Address Telephone

City and State Zip

2.
Business Name Contact

Street Address Telephone

City and State Zip

3.
Business Name Contact

Street Address Telephone

City and State Zip

Delivery Time

4.
Business Name Contact

Street Address Telephone

City and State Zip

5.
Business Name Contact

Street Address Telephone

City and State Zip

6. Business Name Contact

Street Address Telephone

City and State Zip

20.Memberships: List organizations you plan to join and the contacts
for information:

Organization Name of ContactPhone

21. It is time for you to evaluate the product or service you plan
to sell in your small business. If you will be selling a variety of
products or services, select one to answer these questions. Not all
of the questions may apply to your type of business. Write N/A (not
applicable) when the quest

a. List the main features of your product or service:

b. Think of how each feature will benefit the customer. List the
main benefits of each feature concentrating on the following:

Savings of time, money, effort, etc; comfort, pride, enjoyment,
health, life-style, peace of mind, advancement, etc.

c.What would motivate a customer to buy your product or service?
List as many subjective and objective buying motives as you can think
of:

Subjective Objective

22. Think about a major purchase you made last year. Who assumed
the following roles:

Initiator:

Influencer:

Decider:

Purchaser:

User:
Understanding buying roles will help you sell your product or service
because you will be able to determine best approach to use in various
selling situations.

23. List the information you will need to qualify your initial
business prospects and to prepare for the first contact. (Look for
ideas like the following) Income, age, sex, educational level, life
style, size of family, personal preferences, etc.

a. In your business, what makes a prospect qualified?

b. List your 10 most qualified prospects:

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

c. How will you make your first contact with these prospects?

d. Create a benefit offer in the form of a question to be used in
your opening to generate interest in your product or service:

e. What specific needs will your product or service satisfy? What
problems will it solve?

f. Write three questions you would ask a typical prospect to asses
his/her needs.

a.

b.

c.

g. Create a benefit statement for your product or service.

a. Assume your prospect, Mr. Smith, has a specific reason to buy.
What could you say to support his need?

b. Write a statement showing how a feature of your product or
service relates to that need.

c. Create a benefit statement for Mr. Smith.

h. List five objections a prospect might raise when you ask him to
buy:

Examples

a. Your price is too high

b. I’m short of cash right now

c. I hear your service is sub-par

d. We’re satisfied with our supplier

e. I’m too busy to listen

i. Create statements to answer each of these objections as you would
in a sales presentation:

a. I can understand your desire to keep your costs down, but I can
show you that our cost is lower in the long run.

b .You can put in a small order now, and we can extend your credit
for 60 days.

c. Here’s a list of satisfied customers you can contact. And our
guarantee covers you completely.

d. I suggest you take a trial order, then compare the results with
your present supplier.

e. Would it be alright if I call you next week to set up a time that
is more suitable?

j. How might your prospect signal a strong desire to buy your
product or service?

Statements such as:

What is your delivery schedule?
How much could I save if I buy more than one?
How does your quality compare with?
Would it really save me time?
What would my profit be?

k. Create a trial close statement you would use during the sales
presentation:

Examples:

When is your best day for delivery?
Would you prefer to pay cash, or may we bill you?
How many do you need during the next month?
Do you see how this would save you time and money?

l. Your prospect seems ready to buy. What will you say to close the
sale?

Examples

We can have these delivered tomorrow.
How many of each do you need?
Can we start your service this week or next?

m. In your business:

i. What are some ways you can use the telephone to sell your product
or service?

ii. When would your prime selling time be?

iii. Devise a record keeping system for your telephone selling.

n. What is the objective of direct mail in your business?

Possible answers: To create a pre-qualified prospect list; to
generate sales, to create awareness, to announce special events or
special sale.

o. What action do you want the reader to take?

p. Compile your mailing list.

q. Plan your direct mail package.

i. Write a sales letter. (Use a separate sheet of paper and attach
it.)

ii. Design an order form. (Use a separate sheet of paper and attach
it.)

PART III: Now that you have started your business what do you need
to look for?

1. Are you getting discouraged? If so, list the reasons or factors
involved.

2. What steps might you take to get yourself “up” again.

3. Are you noticing any signs that might indicate you are in the
wrong business? If so, what are they? (If not, move on to Question
4.)

4. What are the five reasons you’re confident you have chosen the
right business?

a.

b.

c.

d.

e.

5. What problems, if any, do you detect regarding your business
professionals (CPA, attorney, etc.), potential partners or current
employees?

6. Based on your experience to date, what mistakes did you make and
how would you correct them?

7. What activities during the past 48 hours consumed more than 15
minutes each (itemize)?

8. How many of the activities listed in Question 7 contribute
substantially to your productivity and business goals? Circle the
ones that do.

9. Other than salaries and fixed overhead expense, what are five
expense items you could reduce without seriously affecting sales or
productivity?

10. In what way are your company money matters safeguarded against
embezzlement and theft?

11. What “danger signs” can you look for regarding a disgruntled
employee, shrinkage, bottlenecks and/or turnover? Specify.

12. What could you do to correct problem(s)?

13. What transaction can you recall in which you “won” in a
compromise? How about one you “lost”? Describe both:

WON:

LOST:

14. In what ways do you monitor and control the quality of your
product or service?

15. In what ways might your market (your customers, their buying
patterns/needs) change during the next three years?

16. Who are your top four competitors? How much of the “market”
does each of you share?

17. In what ways have you used and/or might use the SBA?

About author

SMB Reviews
SMB Reviews 473 posts

SMBReviews is committed to providing small and mid-sized business owners with the information and resources they need to select the best service or product for their company.

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