2. Why will your target market purchase from you?

3. How will you reach your target market?

4. Where will you get the financial resources for start-up
and operations?

            A
well-developed business plan is more than a road map.  It serves to define the business concisely,
identifies goals and milestones and a desired timeline in which to reach them,
and serves as a resume for “selling” your business to banks and
investors.

            The most
important component of a business plan is the financial report. A financial
report should include at the least 3 components: an income statement, a balance
sheet, and a cash flow analysis.

            The
income statement is a summary of a company’s profit and loss over a certain
period, usually a year, but for a fledgling company, the time may be
shorter.  It serves to track all the
income and expenses of the operation; where expenses can be or should be
reduced, and where weak points in the business may be.  For example: is the phone bill excessive

A  balance sheet
serves as a snapshot of the company at any given point in time and shows the
kind of assets, liabilities, and ownership position of the investors within the
company.

A cash flow analysis shows how the company generated and
used cash for a period of time.  The cash
flow analysis shows three types of activities, operating activities, investing
activities, and financing activities. 

When writing your business plan make sure you know your
audience.  Typically your audience is
either going to be directed at what is known as ‘angels’; e.g. Mom and Dad or
wealthy investors that become personally involved in fledgling business.  If you are directing your business plan to
the Bank of Mom and Dad or to a wealthy family friend then your business plan
probably doesn’t have to be as perfect as if you were submitting your proposal
to a formal bank.

The second type of audience that your business plan could
be directed at are venture capitalists. 
This is were you need to make sure all of your i’s are dotted and t’s
crossed.   Venture capitalism is all
about taking a risk and getting a high return from it, so the only way to attract
investors in this market is to persuade them with a top-notch business
plan. 

Whatever you decide to do for your business, the critical
first step of a business plan will set the tone and provide a solid platform
from which you can grow and hopefully succeed.