If you need help writing a business plan, you have to understand what it is and why it’s necessary. A business plan accurately explains what your business is about, establishes your goals, and serves as a resume for your company. It basically contains the current and pro forma balance sheet, a cash flow analysis, and income statement. It helps you properly allocate resources, handle unexpected complications, and make sound business decisions.

It’s a good idea that you’re seeking help writing a business plan because it is an essential tool for applying for a loan as it details organized and specific information about your company and how you plan to pay back borrowed money. In addition, it provides information about your goals and operations to suppliers, sales personnel, and others.

Being very comprehensive and thoughtful is very important and can really help in writing a business plan. There are so many crucial elements tied to it such as: credit from suppliers, outside funding, management of operation and finances, marketing and promotion, and achievement of your objectives and goals.

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“The business plan is a necessity. If the person who wants to start a small business can’t put a business plan together, he or she is in trouble,” says Robert Krummer, Jr., chairman of First Business Bank in Los Angeles.

Even though it is extremely important, many entrepreneurs slack off in getting help writing a business plan or in writing one themselves. Their argument is that the market changes too quickly for a business plan to be of any use or that they have no time for it, but you shouldn’t rush into starting a business without a plan just as a builder would not begin construction without a blueprint.

These are important questions to answer before you begin.

• What service or product do you sell and what needs does it satisfy?
• Who will be your customers and why will they purchase from you?
• How will you reach those customers?
• Where will you get the money to start your business?

Here’s some information to help in writing a business plan.

A business plan can be divided into four sections: business description, marketing, finances, and management. Included in the agenda should be executive summary, supporting documents, and financial projections. Even though no single formula exists for writing a business plan, there are some elements that are commonly used. Here’s an outline to help in writing a business plan.

1. 1. Cover sheet
2. 2. Statement of purpose
3. 3. Table of contents

I. The Business
A. Description of business
B. Marketing
C. Competition
D. Operating procedures
E. Personnel
F. Business insurance

II. Financial Data
A. Loan applications
B. Capital equipment and supply list
C. Balance sheet
D. Breakeven analysis
E. Pro-forma income projections (profit & loss statements)
F. Three-year summary
G. Detail by month, first year
H. Detail by quarters, second and third years
I. Assumptions upon which projections were based
J. Pro-forma cash flow

III. Supporting Documents
A. Tax returns of principals for last three years Personal financial
statement (all banks have these forms)
B. For franchised businesses, a copy of franchise contract and all
supporting documents provided by the franchisor
C. Copy of proposed lease or purchase agreement for building space
D. Copy of licenses and other legal documents
E. Copy of resumes of all principals
F. Copies of letters of intent from suppliers, etc.