The Executive Summary: Ivanka's Business Plan Guide - Season 1

      You have a few seconds to grab your readers’ attention and get them interested in your proposal.  Your  readers are busy; they have a dozen phone calls to make, some of which will lead on to other calls, ten-emails to send, a couple of letters, two meetings and then a launch appointment, a meeting after launch, and their child’s school concert this evening; they have to squeeze in time to write a report and work out some numbers and to cap it all there are four other business plans on their as well as yours. They are busy and they will skim your document. However, the one thing they will read is your summary – as long as it is short ideally only one page long. Let the client decide if she or he want further detail on key issues of Business Plan.

Meri is a professional business plan writer with a passion for business across all stages, from start-   ups to established businesses. She has a strong background in market research and financial forecasting. She produces excellent business plans that are bespoke. She don't use templates, each business plan is tailor made for a business. This is the she put it:
          “This is a new, express and light version of my incredibly successful and bespoke business plan. It is succinct, shorter and to the point, but is still effective. This version will be more suited to start-ups applying for funding. It will contain an executive summary, business model description, startup requirements, background, strategy and implementation summary including SMART objectives, keys to success, SWOT analysis and risk analysis, marketing plan, target market, competitor analysis, legal requirements and a brief industry analysis, a 12 month cash flow and profit and loss. It all depends on how client want it.

            The Structure of the plan

Organize what ought to be in the plan before you start writing it. This will save you a lot of editing later on as you realize that you have put something in the wrong logical place or wrong place for the flow of your narrative.

      It also helps to write down the key headings – leaving plenty of space between the headings – and then to jot down a list of the key issue that should be in the section. These may become sub-headings in your plan but they don’t have to.

      For example, we wanted to establish a new chain of book shops in the UK so we might have had the following first list of headings for key issues:

•   The market background;

• Why we are different;

•   The management team;

•   Operational details;

•   The proposals;

•   Forecasts;

•   Exit strategy.

This was an existing and a mature market: one that the potential readers of our business plan would think they knew well because they would be users of bookshops. Clearly, we deem fit to explain how the market operated, which can enable us to correct any misconceptions. Then we needed to convince them that we could make a successful new entry into this well-established marketplace with something different. In order to complete this it was essential to explain why we were a particularly strong management team and also to explain how the; mechanics’ of the trade worked, since this was where we proposed to introduce innovations.  Comprehensively, all challenging issues to be covered followed a fairly standard pattern, covering the proposal itself, what we hoped to achieve (the forecasts) and how investors would get their return (exist strategy).

         Within the operational detail section, for example, our sub-headings were:

•   Customers;

•  Products;

•   The supply chain;

•   Systems.

We had to explain who our customers where – and were not – in order to persuade the reader why would get more customers than our competitors.

       Under the product sub-heading we covered our product range: the most popular general books (ie not academic books) and a complementary range of CD ROMs, music CDs, greetings cards, gift wrap, etc.

        Failing not to put you through on how it relate supply chain because we were intending to approach it slightly differently from our competitors, so that too had to be explained.

        Finally, within this section, our systems were crucial to making our ideas work and so they needed to be discussed and explained. It was particularly important persuade the reader that effective systems could be put in place quickly and cheaply. 

TO READ EXAMPLE OF THE 'EXECUTIVE SUMMARY' CLICK ON THE IMAGE

       Once you have produce your complete list, look at it critically, Is anything important that is missing? Add it in – ensure that every issue that you think is important has been covered within the plan.

         The exact item in a structure plan will vary from business to business but, broadly, they will be:

•   Summary;

•   Introduction;

•   Business background;

•   The product;

•   The market;

•   Operations;

•   Management;

•   Proposal;

  Financial background:

-          Trading to date;

-          Forecasts;

•   Risk

•   Conclusion

•   Appendices.

The order will depend upon how it projects the story best. Remember that you are trying to tell a clear and convincing story. You may merge some sections, such as the product and the marketing, but on the other hand you may have extra sections that are not mentioned above.

         To keep a clear structure you will find yourself repeating some things. The contents of your summary will obviously be repeating in more detail in the body of the plan. You may find some things set out in the introduction or background being repeated elsewhere. That is fine as long as you don’t explain all the detail in two or three places, which will make your document boring to read.

           There may be other items that are necessary to explain your business. The list above does not include anything on technology, politics, trading partners or options (concerning the different ways you may develop the business), any of which may be appropriate for particular activities.

           Most businesses nowadays make extensive use of computers and the internet and so a section on technology is becoming more usual. This is not question of going into technical detail but of explaining how business critical issues have been covered. An example would be a business trading through it own website whose plan should cover who will build, maintain and host the forecast included in the plan. This might fall within a section on ‘operations’ but depending upon how central it is to the business may justify a dedicated section.

           Using appendices

Your plan may have a lot of detailed evidence to support it. If that is the case then consider carefully whether you need it to be included or whether you could just refer to it and have it ready if asked for. If you feel it adds significantly to your credibility then put it in appendices and summarize it in the plan. Always refer clearly in your plan to the appropriate appendix so that the reader can find it easily. The appendices may be in a separate bound document if that prevents the main document from being too bulky. A huge tome can be very intimidating to your reader so try to keep the plan itself to a manageable size. It is better for the appendices to a bulky document and for the plan to be relatively short.

        Do not put detail data or evidence in the plan itself. That disrupts the story you are telling and makes the document dull. Summaries and explain what the evidence say and refer to it. An easy example would be where you have several years of accounts for a business. It is easy to summaries the key numbers in the plan while putting the accounts themselves in a separate document.

        There are two types of document you may want to put in an appendix to a plan:1) something that persuades the reader of your case: 2) proof of what you are saying in the plan. The former is essential, the latter may be held in reserve unless it really adds weight to you case. The sort of data you may wish to include in appendices may be:

•   Copies of patents, copyright evidence or trademark registrations;

•   Copies of leases;

•   Detailed account;

•   Market research reports

•   CVs of key personnel

  Photographs that provide relevant support, e.g. of retail units if you are in a retail business or if designs if yours is design business;

•   Technical descriptions;\

•    Product brochures.

This is far from being a comprehensive list because there are so many possibilities, but it gives a flavor of the sort of evidence you may consider important.

         In this one page you must sell your idea. You audience must be sufficiently interested to read the rest of your document. In your summary you must explain yourself, your team and your background, what your business is , what is exciting about the proposal,  why it will succeed, what you  want them to do -  to invest how much, when – and what their reward will be . Whatever the really they points are, they must be in the summary – only you can decide what they are but the minimum must be an outline of

:

•    The business;

•   The team

•   The proposal;

•   Why it will succeed;

•   Why the rewards will be :

•   Any major risks and how you can minimize them:

•   What you want from the reader.

You will probably refer to the market and the competition but possible only passing. And all this in one page! It is all order but it can really be done. The secret is to choose the really essential points, then to write them down and then to edit out all the bit that are unnecessary, starting with flowery adjectives and descriptions. Imagine you are standing outside your project and writing a newspaper articles about it.

                 The one significant difference from a newspaper is that you must put the really important number into the summary. There may not be many vital figures but they must be there; they are the key evidence that will persuade the reader, they communicate the size of the project, the market, the investment and its rate of return to the investor. They help to fix the key points to into each reader’s mind. They also ensure the reader understands what the project is all about. Numbers are an essential part of communication in business.

The summary is written last although it goes at the beginning of your plan. It is the most important part of your plan.

                  The following is an abbreviated example:

The promoters propose to establish a new book store chain to take advantage of an unexploited gap in a E 1 billion retail market in the UK, having considerable growth potential which arise from demographic changes and the imminent removal of regulation. The fragmented bookshop market is consolidating into a small number of national chains and this this project opens the prospect of constructing one of these. The management teams have direct experience of developing and running the largest bookstore chain in the UK, with 150 outlets.

                  The concept is for single-floor, general bookstore in good locations in towns, where competition is currently limited and where they would be the dominant bookseller. The store will be different from competitors in product, environment and service as well as achieving a lower cost base. Carrying around 30,000 titles together with complementary products the store will have the authority of a specialist , but welcome, atmosphere to attract a wider audience that most competitors.

                 Single-floor units will avoid the higher staffing and building cost of multi-floor operating. A lower cost base will result from central purchasing and from the extensive use of wholesalers for supply. Administrative costs will be reducing whilst improving the quality of buying through access to a large database. By stocking a more popular general range the store will achieve a better stock turn that competitors who also stock academic titles.

                  The promoters plan to raise an initial E 750, 000 to open three shops in the first year and will then raise a further E 4 million to finance the opening of eight shops per annum, with an eventual target of 50 shops. Based on forecast sales of E 300 per square foot and stocks of E80 per square foot, the stores are forecast to generate cash from their second year of operation and the business will be cash generative from the fourth year.

                 The attached forecasts show a business achieving rapid growth and producing attractive returns on net assets. By year five, the return on investment is 30 per cent. The peak funding requirement is E 3.5 million in year four, but the promoters intend to raise a sufficient sum in the second round of financing to cover this and to allow for unforeseen problems as well as for faster growth. The promoters are investing E 200, 000 in Ordinary Shares themselves and seek investors to join them on the same basis. It is anticipated that investors will be able to realize their investment in three to five years through a trader sale.

As you see from this example, in less than an A4 page the summary cover;

•   The market;

•   The management team;

•   Why the proposal is different;

•   The proposal;

• The return;

•   The exit.

Some points are omitted: reference to risk, for instance, is not included because we decided that the several risk would take too much space – they were covered in the main document. You may decide that you do want to include a few words on risks in the summary – only do so if it provides an opportunity to show how small they are not or how overwhelmed they are by the returns. Your summary is short - you want to concentrate on positive thought; don’t let readers finish you summary with a negative thought in their minds.

                 Figures in the example are used to illustrate the points but their use is limited to the most important issues and rounded numbers are limited are used. The reader will not absorb the meaning of figure precise to several decimal places. The summary is a place to fix impressions, not to go into detail.

                Looking forward to hearing about you and your business and getting you one step closer to the funding you need.