Successful Business Plans

Lesson 1: Setting the Foundation

Present Situation

In this section, define clearly how you have come to your current situation. Identify how your idea was conceived up to your present position. Here are some questions to answer in this section of your business plan:

1. Explain the current Market Environment. Is it undergoing changes in technology, demographics, competition, customers, financial conditions?
2. What is the present stage of your industry: infancy, intermediate, or mature stage? Is it reinventing itself, resisting the status quo?
3. Are there factors that would contribute to the growth or decline of your product or service? Indicate both weak and strong points here. It will show that you have done your homework.
4. Where are your products assembled or manufactured?
5. What is your product's average life cycle?
6. With regards to pricing and profitability, are current prices from suppliers increasing, decreasing, or constant?
7. Indicate how you plan to make whatever adjustments are necessary to manage those possible changes in prices.
8. How are your current, or potential customers using your products and services? If your business is a start-up enterprise, how will they use your products/services?
9. Where will your main distribution center be? Do you have any plans to open other offices and distribution centers? If so, indicate when and where.
10. Give some additional information about your management team. Are they all in place? Will you need to hire additional managers or consult with outside consultants?
11. Include some information about your current financial resources. For example, you can briefly mention your current cash available as of a certain date, current ratio (assets/liabilities), or current quick ratio (cash + accounts receivables/current liabilities).
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