What are the typical components of a business plan for a start up cover?

What are the typical components of a business plan for a start up cover?   [8 marks]

 Business plans are critical to the success of any new venture. They serve as the framework for the company and provide benchmarks to see if the goals are to be reached. Plans are keys to help think through the business and keep it on track. Business plan size and scope depend on the specific goals. The following are the business plan components for a start up cover.

Type of business

The type of business is a component of a business plan for a start up cover in the sense that, it should have a well detailed description of what type of business.  The business can either be profitable or non profitable.  Furthermore, it shows which industry it is whether it is in a retailing, manufacturing or any other business.

Management

The information about the management is so critical to the investors whether to invest or not to invest. This describes the management team which includes the experience of the members as well as their previous success. It also includes the top management addresses, their qualification and as well as their credentials. Generally the residential address of a top management member portrays a lot about the person in that are they going to be capable to run the business given the funding.

Company

This involves the detailed description of the company, in the sense that is the image of the business portrays the growth. It also shows if the company strives to change markets, change peoples’ lives and proves durable over time.

Products and services

It involves how the products and services are different. In this, the plan has to show the uniqueness of the product or service. This type of information will determine whether the investor will invest or not, so it has to be captivating so that the investor gains his confidence because the products will surely sell and they tend to benefit at the end.

Funding

In this, it shows the funds that the entrepreneur is putting for the new start cover. It also shows the collateral the entrepreneur has, whether the company is financed largely with debt financing or owners equity. All these factors will determine the attractiveness of the business whether the investors do invest or not.

Use of funds

The business plan should show how the funds will be used. It involves investing either in non-currents or current assets. Investing in assets work to make them better and seek to sell them for a profit.

Forecast

The business plan has to present the forecasted cash flow statements. A cash flow statement is a statement that indicates cash inflow and cash outflow of a business. The cash flow statement helps in considering how cash flow could impact growth. Thereby, developing a cash flow statement helps one understand what their needs are now and will be in the future.