Absolute Entrepreneurship Part 3: Your Best Business Plan

1. Introduction: everybody has their thing, whether you make things, sell things, build things, play things. We all work hard in our things. Well, some of us are happy to do our thing on someone else's terms. A lot of us feel the need to forge our own fat. I'm a musician by training. I even earned a PhD in music in the early two thousands while the record companies were collapsing. I was teaching myself to start companies. I'm now a college professor with a number of successful companies and a few flops. I'm excited to share with you how I've learned what I know and all my experiences along the way. My job is to share what I've learned in a simple, understandable way because I believe anyone can turn their thing into a successful business . This is absolutely wonderful. - How are they doing? Like what can I find out about them? Are they successful? Are they good? If they are making a lot of money, then how are they making a lot of money? What is their marketing? But they do. That's great. But if you can get an exclusive deal, that's better, because if you're just using pepperoni from Johnny's Butcher Shop. That's not something that the person across the street can't do. Also, what you want to try to get is an exclusive agreement so that Johnny's Butcher Shop is not going to sell pepperoni to the place across the street so they can't do that should how much cash we should have on hand at any given time. So it'll it would account for those bumps each each of those payments going into the future . So another great little worksheet from that same website I'll give you in the next segment . So this just talks about everyone. Welcome to entrepreneurship. Three. So in this class we are going to focus entirely on your business plan. We're gonna start off talking about if you need a business plan. In most cases, you do. But there are a couple of cases where you really need one. Writing a business plan as you'll see in this class, is not easy. There's kind of a formula to it, and there's a ton of pieces to it. I mean, this is a small book that you're gonna have to do, but it is really useful in almost all cases for you to have one. So after we get through that intro section of the course, we're gonna we're gonna move into talking about the actual business plan, and I'm gonna walk you through step by step, writing the whole bloody thing. So by the end of it, we will have a business plan for your business. So each little element we're going to stop, We're going to say, Here's what you need to say Here, here's what investors want to hear. Here's what they're asking here. Um, this is what's expected in this paragraph. So really gonna walk through every little section and in some areas will get down to the paragraph like, have a paragraph? It says this center paragraph that says that paragraph. It's also going to give you a bunch of worksheets, Um, for all of your financial stuff. So when we get to things like the cash flow statement, it will say we'll talk about what that means, what that is. And then I'll say, Here's a worksheet where you can plug in your numbers and then you can pop that worksheet right into your business plan, and that will work Great. That's what people want to see. So the goal of this class By the end of it, you're gonna be done. You're gonna be done with the business plan as long as you stick with me throughout the whole thing and then you'll be ready to go start knocking on some investors doors or a bank , stores or grants, doors or whatever. So there's no time like the present. Let's get started. Let's knock this thing out on, be done with it by the end of this class, so let's get started. 2. Why Make a Business Plan?: Okay. Why should you make a business plan in the first place? The first reason, um, which is the best reason is that it's actually useful to you. Um, we're gonna talk in a minute about how it's useful to other people. But what writing this big document is going to do is it's going to sort everything out in your head, let you put everything down on paper. You might make some discoveries while you're doing that, because there's a little bit of research we're gonna have to dio Ah, to really flesh this out. Um, and you're going to realize elements of how your business fits into the world and into the economy that you're going into and just how you're gonna pull off doing business. There have been times when I've written a business plan. I've gotten 3/4 of the way through, and I said, You know what? This isn't gonna work like once I lay it all out in a business plan, you're like, Oh, there's like a fatal flaw in here, and I don't think I should probably do this business, so it is actually useful. It's an exercise that you can do that will let you see a lot of how your business is going to run. And it's gonna It's not gonna be something that tells you if your business is going to be successful or not, because there's a ton of factors that go into that. But it will be something that tells you if you are set up for success or not, or if you're set up for failure, which is something you confined. Ah, often in a business plan. So it's going to tell you what I'm gonna call your market strategy, gonna tell you if this is gonna work. If it's going to fit into the market now, like I said in the previous thing, you will probably find yourself revisiting your business plan a number of times. We call this in the kind of start up world. We call this a pivot, so you might write a business plan that says you're going to do everything a certain way, and then when you get down to it and your business is up and running, you might say, Well, this isn't working, but this other thing kind of is, so let's realign our business to go this other direction. We call that a pivot. We're gonna pivot. We're gonna go this way. Now it's healthy. It's good to do. And every time you do that, you should revisit your business plan. Um, and make sure it's aligned with what you're actually doing and go through the process again . So the business plan is really valuable to you. Toe. Look through everything and have a document that you can look back at later. So you when your business is running, if you're struggling, you can look at your business plan and say, What am I not doing that I planned for or what is in my plan and is not working? It's kind of like a road map for how you're going to do everything. That's one reason, one reason, and what I think is the best reason is that it's for you. Other reasons is that there are some other people that would like to see your business plan as well. Ah, and let's talk about those next 3. Loans And Grants: all right cases. Ah, where you need a business plan? For other people, the one of the biggest ones is loans and grants. So you're applying for a loan? You go to the bank very, very, very likely that they're gonna want to see your business plan and they're gonna want it to be written, um, in a specific way. There's kind of a formula to a business plan, which is what we're going to do in this class. So they're gonna want to see it laid out exactly how they expect it to be laid out. Ah, and for it not to be short on details, because the business plan in this case when you're working with the bank for a loan is essentially you showing them that you thought this out. You know what you're doing. You know the risks. You know the rewards and you have a plan to make money. That's exactly what it is, right? Like a business plan is a plan to make money. So you need to prove to the bank that you've thought everything through. And this is a good document that they're used to seeing, um that will prove to them that you start this out now there's another element to this, too. The other element is that you need to prove to the bank that you as a person are reasonably intelligent because if they don't think you're reasonably intelligent, they're not going to give you alone. A good way to show them that you're reasonably intelligent is the hand them a business plan already prepared that doesn't have any typos that's written Well, that, um, uses good English and good grammar. All that nonsense that your teacher told you in high school was gonna come back and get you because you are putting apostrophes in the wrong spot. This is where it's gonna come back and get you. So call that sixth grade teacher that was yelling at you about how you were using apostrophes and thank them for doing that. Um, because now we need those skills. We've got to write this thing well, cause we have to show them that we know how to be Ah, reasonably intelligent that I think that's that sounds like a bad thing to say. But I can't think of a better way to say that. Um, we need to prove to them that Ah, we know how to fill out some paperwork and we know how to do things correctly. Because if you don't, then there the bank is going to say, You know, this person doesn't know how to spell a lot of words. So I don't trust that people are going to buy things from them because they're advertising is gonna be sloppy. Everything's gonna be sloppy. Um, and it's not gonna be a safe business. So Ah, we need to make sure that's all good and proper so that the banks and the foundations given grants and the feds whoever Ah, no, that we mean business. And we've got a plan and we're ready to do it now. The third case that comes to mind is investors. So let's go to a new video and talk about business plan as it relates to investors. 4. Investors: Okay, investors. Now, in my experience, an investor, a serious investor. It's not going to talk to you unless you can hand them a business plan. That's not to say that they're gonna read it always, but they need to know you have a business plan most of the time they're going to read it, Um, and they're going to scrutinize it. But there's a part of the business plan. It's kind of the first part, but it will be the last part we talk about. And that'll make sense in a minute. Um, it's called the executive summary. It's kind of like the elevator pitch kind of. It's just a little bit of text that says what this business is about, what you're going to do to make money and how you're gonna make it. Um, the investors are going to read that, and if they are satisfied with that, they will continue reading it. If they are not satisfied with that first page, they will throw it in the trash and move on to the next um, company, the next entrepreneur. But if you walk into investors office for a pitch meeting or something like that, uh, and you don't have a business plan there. They're either gonna just ask you to leave or you're actually gonna never really get into their office without having one. Now, that term pitch meeting that I just said, that means that everybody has you'll get used to and we'll talk about this in the future. But if you're courting investors, you'll get used to this thing called the pitch. If you've ever watched Shark Tank like I mentioned in previous classes, you know what a pitch is. It's, Ah, highly scripted, usually kind of campy presentation about your company. You need Teoh throw a little pizazz into it. They get really funny and silly to me. I've sat through a lot of them and I've been part of giving a lot of them, and they're just so scripted and acted like you. You take. You kind of act them out sometimes, and it's it's terrible acting because it's by, like, business people, and I don't know, they're just funny and terrible and kind of stupid. But, ah, that's the game we play if you want to get investors, so what usually happens and this doesn't happen on Shark Tank. But this happens in real life is if there's some kind of opportunity to pitch to do this silly little presentation, it's going to start with submitting a business proposal, and then you might get invited to pitch if they like your proposal, so you have to have this business plan first. Now there are some cases when you don't really need a business plan and let's let's go to a new video and talk about that. 5. When Do You Not Need A Business Plan?: okay. When do you not need a business plan? In the previous class, we talked about raising money for your company, and we talked about a number of different ways to raise money for your company. Equity financing, loan financing, crowd sourcing and, ah, bootstrapping. If you're bootstrapping, you don't necessarily need a business plan because when you're bootstrapping accompany, you don't have loans or grants and you don't have investors. You just have you and maybe a partner. So in that case, a business plan is not required. It's still useful because of this 1st 1 right? This one was for us. Ah, toe, analyze what we're doing and see if it's gonna work. So there is a reason to do it if you're bootstrapping, but you're not really gonna show it to anyone until much later. And I'll be honest for Slam Academy. I did not write a business plan. We just dove in and started doing it. Um, I did do some market analysis, which we'll talk about later to kind of figure out if I thought it was gonna work. But we never pitched to anybody, so I didn't need to have it once things got up in going and I had employees and things that I had to worry about a little bit more. I did put together a business plan that we still stick to, but I actually don't think anyone has seen it other than, you know, my business partner. Ah, and some close advisers that I asked to get their opinion on it while I was writing it. But it's it's for me. Other companies have been involved in like like the video company I just showed you. They've had hundreds of business plans because they have investors and loans, although I don't think I on has alone right now. But we have investors, lots of them. Um and they need to see a business plan. So at the risk of having you just turn off this class and say, Well, I guess I don't need to do this, um, there are cases when you don't need a business plan. It's fine to not have one. Um, but you're not gonna get alone and you're not gonna get investors, and you're at a little bit of a disadvantage when it comes to hitting the ground running with ah, making money. So it's always a good idea toe have. Even if you're bootstrapped, having a business plan will not hurt your company. You know, it'll take a couple days to write it. Although I'm gonna walk you through by the end of this class, we're gonna have written one. So So it'll just take you as long as it takes you to get through this class. But no matter what you do, it's not gonna hurt toe have one. So don't turn off the class. Ah, stick with it. Because even if you're not planning on writing one while you're in this class, all of the elements of it are still good things for you to be thinking about. So don't go. Don't go anywhere. It's still gonna be useful even if you don't plan on running one right now. However, why not write one right now? It's not gonna hurt. It'll be useful. Trust me. Okay. In the next video, it's actually not a video. In the next segment, I'm going to give you a template. This is a template for a business plan. And what we're gonna dio is throughout this course, we're gonna fill this thing out, and we're gonna end up with a full finished business plan. So I want you to download that template, um, get it all set up, and then, um, continue on in the class and we're going to go through what every little bit is in there, how to write it, how to write it so that it is the most appealing and get it done. So download the template and then we'll get started. 6. Executive Summary: Okay, So I am now looking at the same template that I just gave you in the previous section. So open this up and we are gonna fill out this whole thing. So this looks like a whole bunch of blank pages except for these couple tables. Um, but that's okay. We're going to get all the way through this, Um, by the end of this class. So, um, first, let's go through each section of it and just kind of talk in general about what's gonna happen so that you know what's coming as you work on each section. Very important. So first, let's talk about the executive Some? Well, actually, first, before we do that, let's fill in some of this stuff. So you're gonna put your company name here. Ah, put the date. This is just a title page. Fill in this stuff, right. You can put a logo here if you want. If you have one, doesn't really matter. Table of contents will come back and do that once we're all done. Ah, if you're using word, it can generate that for you in many cases. Um, okay, So executive summary. Here's the deal with Executive summary. This is like gonna be a short way to say everything in this. I think we talked about Executive Summary a minute ago where we basically want someone who is an investor. Two are a potential investor to be able to read this one page and then decide if this is their cup of tea. Okay, so this should be one page, maybe two pages. Ah, at most no more than two pages. No pro tip to write this. We're going to come back to it and do it last, because once we go through all this other stuff you're going to see, you're gonna get a much better picture of what should go in your executive summary. So if you start with the executive summary, you might be able to do that. But, um, it's kind of tricky to do it that way. It's much easier to do your executive summary last a couple things that should be in the executive summary, obviously just ah, one or two sentence kind of elevator speech about the company. An elevator speech is, you know, kind of referencing that old thing where you end up in an elevator with someone who is really powerful. And they say, What is your company? And you've got about 30 seconds to explain to them what your company is as you go up the elevator or down the elevator, whatever. So, like one or two sentences. What is your company all about? Um, that's kind of the first and most important thing in this. Probably an entire document. Ah. Then you want to elaborate on that a little bit more. So we're gonna talk about, you know, description of what we do, what we sell. Ah, what are the goals of the business? Target market? How we're gonna make money. Um, who is our competition? Who is your management team? You want this? That's your room to name drop stuff right there. You say I have You know, these five geniuses on my team? Ah, and they're awesome. Ah, And then the last thing is a summary of your financial ah situation for the business. Like we have raised x amount of dollars or ah, we have not raised anything yet, but we are ready to go or we are already up and running. Or however you want to say that. So all of those little elements were going to figure out in the business plan. So will be much easier to put a summary of them into the executive summary. Ah, as the last step, right? So don't worry about just diving into the executive summary because you need it to be accurate with everything else that you're saying later, so much easier to do this last, um so that being said, uh, let's go on and talk about the next section the company overview. 7. Company Overview: Okay. The next section is kind of the main overview of the company. So this is where we start. Teoh, drill down a little bit deeper. Um, but not super deep yet. We're still at kind of a superficial level here. So remember, the flow that we want to happen is someone who is a potential investor reads that executive summary. And they say I'm interested. And then they go on to the company overview, they get a little bit deeper, and if they're still interested, they get a little bit deeper in the next section. We're going to take him deeper and deeper and deeper. Um, so with this, this is really kind of fact based more or less so you can actually just use this little table if you want. So the business name, the mission statement of the company. So with this, remember, in the very first class, the very first entrepreneurship class I made if you took that, we didn't exercise where we talked about kind of finding your values and things that can really help you in crafting this mission statement. We'll talk more about this mission statement in a bit, but this is a really important little thing that just kind of says what you're all about. Um, it can kind of be that that first, that first objective that we looked at when we were talking about objectives in that first class. So this could be your service objective. Your profit objective maybe, but your social objective could work. Your service objective is better. Um, so if you didn't do that, jump back to that class and reviewed that, we'll talk more about it later. But, um, General, things that can go into the company overview, um, philosophy and values. That can really be that social objective that we talked about in that first class company vision. Think about this as, like the future. Where you going? Goals and milestones just outlines bullet point. You know, like a couple things that you want to do. Your target market market. Like I'm aiming at 20 something millennials who like to buy shoes. Man, I got to get over this shoe store analogy. I'll come up with something better soon. Trust me. Industry competitors. We're going to talk more about this shortly. Um, but we want to talk about our competitors and how we're gonna beat him and then legal structure ownership. Who owns it? Who are your partners? Things like that. So just some real general things in the company overview. 8. Products And Services: Okay. Up next comes our products and services section. So this is drilling a little bit deeper into what we're actually selling. Um, again, We can do this in a one sheet table. Ah, reiterate our business. Same. Just in case we print this out separately. Um, are are basically are our idea, you know. Ah, what are we selling? What are we doing? Advantages of someone owning that unique features of it. Limits and liabilities. Ah, you want to be really transparent about this stuff in your business plan? Ah, production, delivery suppliers, intellectual property. Intellectual property is like, um, non tangible things like like in music. In my world, intellectual property is almost everything because music is a primarily an intellectual property. Unless you're buying, like, a CD or something like that, Um, it's not often a physical thing that you can hand someone. It's an idea. Um, it's something that just exists in the air. Um, intellectual property is things like ideas. Things like, um, concepts. A lot of art is intellectual property. Things like that. And then kind of description. Ah, more detailed description of your product and your service or your service. I should say also in this section we're going to talk about, you know, how we price stuff like how we've come up with our price. Whatever we have, that gives us an advantage over our competitors. We can get that into this section, Um, and also, in a way, there's kind of this. There's this really attractive idea that people like to see, which is the problem and solution. So the problem is, ah, all shoes air poorly made. My solution is make awesome shoes, right? So if you can identify, like here is the problem that your average consumer totally gets like they see it and I'm proposing a solution. This is especially handy in technology when you're saying the problem is that the problem is that people forget to lock their door. And I've invented a thing that ah automatically locks your doors when you leave the house, right. That exists. But, um so that would not be a great business idea because someone already has made that thing. There's actually a lot of those things out at this point, um, but problem in solution things that weaken described in our product and services section 9. Marketing And Sales: Okay. Up next is our marketing and sales plan. Ah, how we're gonna let the world know about our awesome solution to this problem or our awesome product. Um, this section is a little bit research heavy. We have to do some homework to make this really stand out to make a really good marketing and sales plan so that research means things like, ah, figuring out what the market looks like. Uh, who is already doing similar stuff? How are they doing? Are is Are those companies doing well? Let's say, for example, I want to open um, a pizza shop. I was just last night thinking you know what my neighborhood needs and this is not like me pretending to be someone. This is actually me. I was actually thinking last night. My neighborhood needs a good pizza by the slice, because it was late and I was hungry. I didn't feel like doing anything about it. And where I used to live, we had a pizza by the slice place. I could go down there, could get a slice pizza, like walk back. It was done, right. Um so if I was gonna open a pizza by the slice shop here in my neighborhood. What I would do is look for I would do some research on competitors. Is there a pizza by the slice shop in my neighborhood already know there's not. So that's good. Uh, where is the nearest one? Nearest one's about a mile, two miles away. How are they doing? Like what can I find out about them? Are they successful? Are they good? If they are making a lot of money, then how are they making a lot of money? What is their marketing that they do? Basically everything I can figure out about a similar business. Ah, will be valuable So all of that will go in, or marketing and sales plan more details on that shortly. Um, all right, let's talk about Oh, I forgot to mention the SWAT analysis. This will go into our marketing and sales plan. Um, this is not something that we necessarily want to include in our business plan as a chart you can, but it's more or less a chart to help us figure something out, and we'll talk about that shortly. So SWAT stands for strengths, weaknesses, opportunities and threats. It's kind of like a acronym we use in a business that kind of cover a lot of stuff and say , this is what I'm good at. This is what I'm not good at. This is what I can take advantage of. And this is what could sink my company. So we'll talk about that when we get to it shortly. Okay, Let's move on to operations. 10. Operations: okay. In the operation section, we're talking about kind of the day to day. Ah, operating of our company. I hate to use the word twice, but that's what it is. So let's go back to my pizza by the slice analogy. What I want to talk about here is, first of all, I talk about production. I talk about how we're gonna make our pizza, Um, where we're gonna make it, Um, in terms of like, the building. Are we gonna rent a building? We're gonna buy a building. Are we going to What kind of equipment are we gonna have in it? What's my staffing like, things like that. Um, I'm gonna talk about quality control. Who's in charge or how are we maintaining? Ah, high quality product. I might talk a little bit more about the location and the need for this in my neighborhood . And any problems that arise from that. For example, I might say I know that it's very difficult to get a liquor license in my neighborhood, so we probably won't be able to serve alcohol at all. That might be a problem. That might not be a problem. Depends on how I decided to set it up. But any restrictions that come with that neighborhood legal stuff permits, licences, trademarks, copyrights, all that kind of stuff. Uh, anything that's relevant, we would talk about here. And then the last thing is the personnel. What? How many people do I need to keep the operation going strong? You know, I need ah, maybe a couple cooks to make pizza. I need a couple, ah, sales staff. Ah, someone to run the register. If I'm gonna have seating, I need to have hostesses in wait staff. Or if it's just ah to go kind of place, then I don't need that. You know, what kind of personnel do I need on a day to day level? 11. Company Organization: Okay, next is the company organization. So this is, Ah, me and my partners and the kind of high level people that are in charge of running all the shots. So and here, very normal to include biographies. So here I'd say something like, you know, a brief biography of me says, You know, like, um, academic degrees experience in the field, whatever. I don't know if I'd emphasize my academic degrees so much if it's a pizza shop. I might not say he has a PhD in music, because that's not relevant, but it does. Well, it's kind of relevant because it shows that I'm reasonably intelligent, and it shows that, um, I know how to get something done, I guess. But more about what I talk about, probably for myself, is other companies I've built. Um, that shows kind of a pattern of being able to build companies and keep him alive. Also, you might want to list here advisers any people you can name drop that are helping you out formally or informally. Um, we have on slam academies website we have a list of ah, an advisory board. We call it. It's not a board necessarily It's completely powerless board. They can't do anything. All it means is that, um I have some friends that give me advice, and I put them on my website because they are influential people, and it gets me good search traffic. So I kind of put them on the website so that because it helps me. Um, but also, I on occasion buy them lunch and pick their brains about stuff. So I call that the advisory board. Ah, and that's a typical thing to do. That's totally okay to do. But you might also list. You know, your attorney, your accountant, your ah, insurance agent, your contact at the bank, whatever you want to do. Ah, and then you might also include a flow chart of how the company is set up. Um, I'll show you how that looks. Ah, when we get to this section in full detail 12. Financial Plan: Okay. Financial plan. Ah, this is the money stuff. So this is where we're gonna get down and dirty about the money. You're going to say what everything's gonna cost, and you're gonna say how you're gonna do it. Essentially, um, you got your start up costs. You're gonna list how much money you're gonna have. Ah, the day you open the doors, you might list some of your personal financial information if that helps. Um, if that looks good, you might do it. Ah, and a lot of the information that we put together in the previous class. Ah, when we talked about funding your business so we put together that whole budget. We're not gonna probably just put that entire budget in here. Um, but we might kind of write it out in words more than numbers, necessarily. Although we do have to include a lot of numbers in this section. So more details on that in just a minute. But essentially, this is our whole budget report so that the potential investor could get a big idea of where we're at with money where we're getting money, what it's gonna cost and if they think that were spending money wisely, and we want to show them that we have a good plan. We've thought this out, um, and we're doing everything we can to raise money. That's why having some of your personal stuff in here is good, because it shows that you got little skin in the game. You know, you're putting a lot on the line for this. No one's gonna invest in your company, which is a risk. And so no one's going to take a risk on you unless you're willing to take a risk on yourself. So you've got to show that, you know, you're you got skin in the game. That's the phrase everyone uses. I hate that phrase, but that's the phrase people use skin in the game. 13. Appendix: Okay. Last but not least, the appendix. I know when you're reading a book and you get to the appendix, you always skip it. If you're like most people, however, this appendix is kind of important. What we're gonna put here is any relevant documents we're gonna attach to the end of this thing. Relevant documents would be like if we already have a lease. Um, we're gonna put that in there. If we have any orders, like, let's say, Ah, pizza analogy doesn't really work on orders. But let's let's go, man. Let's go back to the shoe thing again. I don't know why. Obsessed with shoes, I'm not really obsessed with shoes. I'm not one of those people, but nothing against him. Um, but let's say we're making shoes and let's say, ah, amazon dot com likes our shoes and they send us an order for 1000 pairs of shoes. Ah, which we have to deliver in six months. That is a purchase order that you should definitely including your appendix, because what that says is I have guaranteed money coming in as soon as I can make these shoes. Basically, that really minimizes the risk. If you have anything like that? Put that letter in the appendix. Um, you would also put here if you have any patents. If you have any trademarks, any of that intellectual property stuff that you can prove put that in here. Full resumes of any of the key people. Um, anything that we've referenced anywhere else in the business plan. We can put the full document here, right? As long as it's not like a book. Um, but basically, this is our chance to prove anything we've said previously. So if we said previously, we have a lease on this building, then let's include our lease here just so that there's no question about whether, like I've made that up or something crazy like that. So we're gonna put all that stuff. We're just going to smash it into the appendix so that they can look at it if they want to . That's what goes there. Okay, so, um, those are main sections of the business plan. Now, next, we're gonna drill in deep, um, and try to get this thing done. We're gonna go back up to the top. We don't need to fill that out. Remember the executive summary we're gonna save till the end. We're gonna come back to that and do that last. So our first thing we need to do is our company overview. Let's go to a new section and start working on that. 14. Mission Statement And Vision: Okay, uh, looking at our company overview section. Let's deep dive here and get this done. So I think for the purposes of this class and because I'm getting super tired with my fancy shoe store custom shoes store Agassi analogy, maybe I'll stick with my pizza by the slice analogy, although that's a little dangerous because I'm going into turf that I don't know real well cause I've never dealt with anything in the food service before. Um, but let's do it. Let's see what happens. Um, so just for an example Ah, as we fill this out, I'm going to use my pizza by the slice shop. Um, actually, Well, yeah, Let's use my pizza by the slice shop, And but you should use your actual business. Ah, and fill this out with me. So company overview. Business name. Let's call it pizza by this slice that's knows, boring name. Ever pizza by the slice. Let's not call it that. That's the most boring thing ever. Let's call it Jay's pizza Shop. That's on Lee incrementally less boring, but that's fine. Okay, company mission statement. Now, remember for this the exercise we did back when we were talking about our objectives, right? We talked about the service objective for our company. And what we said there was I will provide the highest quality something. Buy something, right? So if you still have that, go back to it and look at what you did there because it can give you a head start on this mission statement. So I'm gonna I'm gonna format mind that way. Um, I'm going to say, Senator, that a mission statement is I instead of I am to say, Jay's pizza shop will provide oops. Spelling is important in these because you'll look silly if you smell spell things wrong. Um, James Pizza shop will provide healthy pizza by the slice to customers through a drive up window. I think that's key to a good pizza by the slice places. I just want to be able to drive up there, um, and get it and then get home. So no in store dining just to drive up window. And I'm also going to say healthy pizza by the slice. It's a healthy in expensive pizza by size to customs or drive up window. So my kind of niche hear what I'm saying here is I think the key is healthy. Where I'm saying this isn't gonna be little Caesars. Nothing wrong with Little Caesars, but, ah, this is gonna be heavy on vegetables. It's gonna be a healthy slice of pizza. Um, so a lot of vegetables and, you know, I think that's kind of okay, that's a fine start to a mission statement. So don't forget that the mission statement. We don't have to be married to this. What we make now, as we go through the rest of our business plan here, this might come into focus a little bit more, so I'm gonna leave it at that. And if we decide to change it as we plow through everything else, that's totally cool. So let's stick with that for now. Okay, let's move on and talk about the philosophy and values. Now, if you remember from our objectives that we talked about in the 1st 1 this is where we might use our social objective. Um, what are the values? What we stand for? What do we care about? Um And remember these values are not just hoity 20 liberal stuff. These are highly marketable things. So since I said we were gonna focus on healthy, ah, things that gives me some good ammo for my ah, philosophy and values. So philosophy is I'm going to say pizza can be a healthy food. That's gonna be a core philosophy that we can get, um, healthy vegetables and things into my pizza and my company. Okay, uh, here's what I came up with here, my hard time spelling. Um, pizza can be a healthy food that can be enjoyed by everyone, regardless of dietary restrictions and allergies. Let's say that that's my main philosophy and my main value. What I've said here is that it's a healthy. It can be a healthy foods, not always, But in my case, it's gonna be, um, and regardless of dietary restrictions, when I'm saying here is that I'm gonna offer something that everyone can eat. So I'm gonna offer some gluten free pizza. I'm gonna offer some vegetarian pizza. I'm gonna offer peanut free because looking at allergies also, there's a lot of people allergic to peanuts. I'm gonna offer something completely made to order for ah, as many possible people is possible. I'll have vegan pizza. I'll have everything you can imagine when it comes to providing a healthy product. I'm basically aligning myself to be a health food. Ah, pizza as a health food. Interesting. That gives me a good idea what I can do. And hopefully I'll remember this. I'm going to jump down to a later section to my marketing stuff, and I'm just gonna make a note here. My note is going to be offer a discount for people on foot. Like that kind of works, right? If I have a drive up window and I'm trying to do a healthy food wouldn't it be cool if I said if you're if you walk, run or bike to my drive up window? Um, you'll get 10% off your pizza because I'm trying to promote a healthy lifestyle here. Right. Um, that could be a cool marketing thing. So I was gonna jotted down, down here s so I don't forget about it, and then we'll deal with it when we get down to the marketing stuff. Cool. Okay, let's talk about ah, vision and milestones. And let's go to a new video for that 15. Vision And Milestones: Okay, let's move on to vision and milestone. So vision, we're thinking long term here we're thinking, What's the not necessarily the end game, but what could this become? So what I want to say is that this could become a, um, franchise. The company vision, I mean to say, Ah, become a chain with franchises around the country and international. Sure, lofty goal franchisees. So what do I want this thing to become? I think if it's successful, it's reasonable to say that at some, if everything goes right, this could become a chain with franchises all over the country. I guess I don't want franchisees franchises all over the country. That's great. That's a great goal. Put that in the center there, sort of in the center, whatever goals. OK, so we want to talk about short term and long term goals here. Milestones, benchmarks, um, and ways to measure them. Okay, so let's say gold number one, Um ah, and let's think about what goals are going to lead to the success of this vision. I think about this one funneling into that one. So my first goal, I'm going to say hi sales volume and profitability in the first year, I should get more specific about high sales volume, but, um, I should say a number there, but I don't know this industry super well, So, um, you will know your industry better, So you can kind of say what kind of sales you expect. Um, I'm gonna say in the first year, profitability in the first year. From what I understand, food services kind of unseen. Um, I've heard it takes up to five years for even the best restaurants to make a profit, but I'm kind of talking about fast food here, so maybe it's different, but I'm gonna set as a goal. Anyway, My second goal and milestone is too open. Second location in northeast Minneapolis, and I'm going to specify Northeast Minneapolis just because my idea here was to start this in my neighborhood, which is South Minneapolis. So I'm gonna Southwest Minneapolis. So I'm gonna put in Northeast Minneapolis just to say and put it on the other side of town . And let's do one more just cause three is a good number. Okay, so I'm gonna say for my 3rd 1 achieves statewide brand recognition through sponsorships of body focused events. So I'm body focused events is kind of a weird term that I just came up with. But what I'm trying to say there is athletic events. Maybe that's better athletic events like marathons and triathlons. So imagine a pizza joint is sponsoring a marathon. That's super weird, right? But I think it would be unique and powerful if we could do it. I think that's my niche, right? Health, health, food, pizza. So if I can get in on endorsements with marathons and triathlons Ah, and that achieves statewide brand recognition, brand recognition doesn't mean that everyone in the state is buying my stuff. It just means that everyone in the state knows who I am if you say McDonald's. Everybody knows what you're talking about because they have worldwide brand recognition, right? Everyone, not everyone in the world. But let's stick to the US Everyone in the US knows what McDonald's is. They have brand recognition all over the place. Um, and we want to set a reasonable goal of statewide brand recognition. Everybody in the state knows Jay's pizza shop. Is this goofy health food, pizza, cool 16. Target Market And Industry: Okay, Target market. This is going to be something we cover in great detail later when we get into the marketing section. So this is just ah in ah, summary of our marketing plan in a way to talk about our target market meaning who is our target market? The main. Another way to look at the same thing is to talk about or think about it, like who is the low hanging fruit? That's a really kind of Ah, I feel like whenever that phrase comes up, I feel like it's like, oddly disrespectful in some way. But who is the person most likely to buy my stuff? So in my case, um, the most likely person to buy my pizza, my target market is gonna be So we're talking about customers here, so I would say, health conscious, health conscious. Ah, that's happening to college students. Twentysomethings, um, college students and twentysomethings, health conscious college students and twentysomethings there, The probably the most likely to buy my stuff. The low hanging fruit, the college student, because college soon see pizza a lot, and I want them that are particularly health conscious. No moving on to the industry section the first thing we want to think about with industry is is this market Ah growing or not growing? I'm gonna try to put this into sentences. So I want to say, um, this is a growing market. Um, the other terms you might use our stable market or a mature market is are kind of fancy buzzwords here. So growing market means it's getting bigger. Ah, stable market means it's a good market. Um, it's not necessarily going any direction. It's just kind of a good market or a mature market has been around for a long time. Um, you don't really want to say at all that this market is getting smaller because that would be bad. And you don't want to that. Ah, so this is a growing market. Um, as more people become as more people look for health food alternatives, right. Um, it's true. People are always looking for healthier things to eat. Not everyone but a lot of people are, and I think that's growing. Okay, What else could we stay here? How about, um how will I take advantage of those people? And wow, that sounded really vicious. How will I take advantage of those people know, how will I get those people interested in my product? There we go. A little bit better. Okay, so I'm gonna stay here. Customers will benefit from our involvement in the local slash organic food involvement and social cause. So what I'm saying here is that, um I'm gonna appeal to customers by, ah, appealing to something that they already are interested in, which is local food and organic food. So I'm gonna latch on to the local organic movement, Um, by doing it by having my vegetables be local, organic, all that good stuff. Um, and the social cause that I'm talking about here is the organic food. So maybe I should maybe just to clarify that to say and cause So the local organic food movement and cause So there's, um, a lot of advocacy around organic food, and we will be an advocate for it. So that could be it was any kind of social cause. Getting your company involved in is a little dangerous. But since it's this health idea is so core to this business, I think it works. Um, and then 1/3 thing I want to talk about here is, I want to address my competitors and how I'm going to compete. Some say the competition in this market. Let's give an example. What's a healthy food? You know? Ah, healthy fast food or a fast food that bills itself as healthy? The only one I can think of is Chipotle Chipotle makes burritos and things. Um, it's like Mexican food, but and it's fast food ish, but they try to build it as being fairly healthy, and I don't know if it is or isn't. Um, I'm not an expert here, but ah, it's it's pretty good. So there's that. It's tasty. So the competition in this market chipotle a, um, is not involved in local organic causes that we will capitalize on. Okay, um, it's not particularly brilliant, but it works. What I'm saying is that Chipotle doesn't get involved in any of these causes, and they don't, um, use local food. They're part of a big corporation. Corporations are not very fashionable right now. In terms of the people that are into health food. They want local stuff, organic stuff, and that's where we're gonna beat him. So we're really trying to say here is that's where? How are we gonna beat the competition? Um, so kind of three bullet points. Now, what you might do here is put all of this into a nice two paragraphs. You don't need to stick to this amount of space that I've given you in this chart. OK? So don't worry about that. You could make it longer. So putting this into a nice paragraph or two paragraphs would probably be better than just these bullets that I've done. 17. Legal And Ownership: Okay, Last one here is Ah, legal structure and ownership. We've covered a lot of this already. This is gonna be pretty easy. Um, we're gonna say Jay's pizza shop is in L l C. Because, um, I'm gonna call it a single member. I'll see, because I'm gonna own all of it because it will be primarily, no, entirely owned and operated by its founder. There are no outside investors. Okay, so I'm just going to say, um, this is a single member LLC because it will be entirely owned and operated by its founder. No, it goes right. There are no additional investors. The start of costs have been funded by a small business loan from US banks. So what I'm saying here is we do have some debt. There is a loan on the books, but there are no other investors. Uh, if someone is an investor or a potential investor, they really want to know this. How many investors air in the game and, ah, how much debt is on the books? If there's a ton of other investors of ah, and potential investor might say No, I'm not interested. Um, or investor might say if there's a ton of other investors. If there are no investors, they might say, I'm not interested. Um, now I've caused a little bit of a problem here by saying I'm a single member. L see that essentially says there can be no investors. And if I'm trying to solicit investors, let's take that off there. Um, the rest of it still makes sense. Ah, we're an LLC. Because it will be entirely owned and operated by its founder. There are no additional investors. But now, because I haven't said it's a single member, Elsie, there can be additional investors. Um, we might have to convert to a corporation or for to do that. But that's OK. I haven't ruled that out. Um, but there is, um, debt on the books. Cool. Okay, we finished our first section, the company overview. So I'm going to save this as a new burgeon, um, called pizza. And I remember I give this to you at the end so you can reference mine if you like. Okay, let's go on to the next section. 18. Products And Services Outline: All right, let's talk about the products and services section of your business plan. Um, so let's get started. So, first of all, um, I've given you another chart here. I would not right this section as a chart. Um, this chart is really just to kind of help you organize your thoughts. You want to write this as a page? Um, narrative. So read it as a paragraph. Don't just fill in this chart. This is to give you a good idea of the kinds of things that should be in here. Okay, So, um, if you're struggling to write this stuff rights, you know, through your so sentences per every one of these lines and then go back and rewrite it all as, ah, a paragraph or as multiple paragraphs, this chart will just kind of help you get started. That being said, let's talk about the main things that should go in here. I'm gonna augment this a little bit. Start with outline of products and services. So that would be this end this and this kind of the 1st 3 things here. So we've already talked about our idea. Our idea is healthy pizza that, um is available by the slice. This idea is gonna be hard to come forward. I'm thinking we should just re filmed this whole thing and do this Not such a weird idea, but, ah, I I am committed to this bit, so I'm going to stick with it for now. We'll see. Um and the reason I'm saying that it's gonna be hard is because I don't know a lot about food service industry, but that's okay. And it's a weird idea. And the reason it's a weird idea and let me just point this out is that it falls into this category and this doesn't have anything do with business plan. But I'm just gonna tell you anyway, because this is something you should know. It falls into this category of business that we considered to be, ah, training the market is what it is. Which is to say that this is something that doesn't currently exist, and in order for it to be successful, we have to find a market for it. And then we have to train that market, meaning there are people don't know that they want this. We have to convince them that they want it, which is a difficult thing to do. There's some companies that do it really well. The most famous is Apple. Apple is famous for training the market. They can make a new thing like an iPad, and they can say, Look, you didn't know you needed this in your life But you do, Uh and they're really good at it. And now everybody wants an iPad because it's there. And Apple has convinced them that they needed in their life. And a whole bunch of other companies have come along and said, We make iPad like things tablet computers. So this idea of healthy pizza by the slice is something where I'm gonna have to train the market to convince them that pizza can be a health food. Um, well, that's the big the big thing that I'm gonna have to train him. So it's tricky. Uh, it's not insurmountable. If you feel in a field where you're gonna have to retrain the market, that's OK. It's not. It doesn't mean you should stay away from it. It just means it's, ah, not the easiest thing to do so But let's press on. Um, so product service idea. We're going elaborate on that. A little bit more. I'm not gonna write out a whole thing for this, but, um, basically, what we want to do here, let's go a little bit deeper than we did up here, right? We're drilling deeper and deeper and deeper, so I want to go. More specifics we want to talk about. Was it? How is our product manufactured? How are we getting it to customers? Is there? Um, do we have relationships, Ships with suppliers already? Um, these are all things that we can fit into these 1st 3 What suppliers we're gonna use name, drop them. Um, do we have partners that can help us? Not stuff that can kind of go down here. Products and delivery suppliers. Um, so some of this bounces all over, but ah, those were the main things we want to get out of. This section is Let me bullet that over time. Ah. Are we gonna make it? How are we going to get it to customers? Do we have relationships with suppliers? Name those suppliers. Do we have relationships with manufacturers? If we need them, name those manufacturers. Do we have any partners that can be of use to us. Name those partners, and that's about it. That should get us kind of everything we need on a surface level. But there's a couple other things we want to talk about in our narrative here. Um, that isn't super well defined by this chart. So let's go to a new video. Let's talk about some of these other things that we should include in this paragraph or in this page. 19. Problems And Solutions: Okay. Other things that we should cover in this section are problems and solutions. So I think we talked about this in the previous statement Are in the previous page. We're gonna get a little deeper here. So we want to talk about, um, What problems are we solving? So in my pizza, by the slice, healthy stuff example, I might say that a problem is and there could be multiple problems if we want. I might say one of them is that there is no pizza by the slice in my neighborhood. That's a small problem. Um, a bigger problem would be that Ah, pizza is not considered a health food. And yet everybody loves pizza. Um, another problem. And this is maybe a better one. I think this is my favorite one. So far, a problem could be that kids don't eat healthy. That's a big problem, right? Big, big, big, big problem. Um, kids don't eat healthy food. The solution. Kids love pizza. Make him healthy. Pizza. That's good, Right? So that's something that a an investor can latch onto and say, OK, kids don't eat pizza. I buy that. I I think that's her. Kids don't eat healthy. I buy that. I think that's true. Um, kids like pizza. Okay, I buy that. I think that's true. Therefore, make healthy pizza. That makes sense. We can sell this. This could be something that parents can get on board with. That will especially appeal to an investor who is a parent. So, um, problems and solution outlined what the problem is. Talk about how your business is going to solve it. A lot of people would say that no business can exist without being a solution to a problem . All businesses are solutions to problems. You think about every business in the world, and at the core of it, there is a problem in a solution. I don't know if that's necessarily true. Um, because I have a hard time thinking about, like my coffee shop down the street. Um, when there are, like, four coffee shops in my neighbourhood, like, what is the solution that they're solving? Um, the problem they're solving. But, uh, other things you could say, you know, what's Wal Mart solving? Well, Walmart, you could say, is solving a number of problems. One is that, um, people need access to a lot of stuff at a low price. That's possible. You could also say people need jobs. That's another way to look at it. It's providing a lot of jobs. There's some debate about the quality of those jobs, but it's providing job. So there's a lot of different ways you could look at this, Um, from the consumer element, it would be, um I I'm gonna be providing healthy pizza, kids, whatever. Or you could look at it from the employment side of it, saying I'm gonna be corrected jobs. Um, there's a lot of fun way to look at it, but think about a problem in solution because these investors know to look for that, the key element. 20. Proprietary Advantages: okay. Also, we want to get into this section proprietary advantages. What that means is, what do we have that gives us an advantage over somebody else trying to do the same thing? Imagine that there's someone else opening the exact same business right across the street from your business, right? Just imagine that hopefully I doesn't happen. But imagine that what makes yours better? That's the question where I entering and the solution is going to be proprietary. Advantages. Proprietary means stuff unique to you. Um, this is where you might talk about if you have any patents, including anything. Ah, pending of any kind of patent. This is where you should get that into this section. Talk about patent your any patents you have or patent applications you are working on Even , um, that investors love patents. So anything you have with that any exclusive agreements. So let's say there is, um, a butcher shop in town that everybody loves. Everybody loves this butcher shop. And you say I'm gonna get my pepperoni from this butcher shop, and that's like advertise herbal, right? You could say you could market that. You could say, you know, pepperoni provided by Ah, Johnny's butcher Shop. That's great. But if you can get an exclusive deal, that's better. Because if you're just using pepperoni from Johnny's Butcher Shop, that's not something that the person across the street can't do. Also, what you want to try to get is an exclusive agreement so that Johnny's Butcher Shop is not going to sell pepperoni to the place across the street. So they can't do that, too. This is Remember that the person across the street so we want to give ourselves the best advantage. What can we do that they can't do? Another thing to get in here is, uh, any kind of licensing agreements that is not particularly relevant in our pizza shop. Although it could be, um, licensing agreement would be like, if I had Can I use somebody else's intellectual property? Ah, can I sell someone else's intellectual property? Here's a good example. Ah, in our pizza thing. What if I made a Mickey Mouse shaped pizza? Right. Um, that's going to get me in trouble with the Disney Corporation if the Disney Corporation hears about it but assumed they, they will, um, they're gonna they're gonna make me not do that. But if I have a licensing agreement from the Disney Corporation that lets me use the Mickey Mouse image ah, in the shape of pizza, then that's a great licensing agreement. And that's something that the person across street can't do. Um, you don't have to have licensing agreements, but if it's relevant to your business, try to get them finalized and into your business plan. Side note. There's no way Disney will let you do that. Disney is notorious for being really strict about their licensing agreement, especially the Mickey Mouse related stuff. But, um, you can try something better would be like your local sports team. I came like, Ah, this is actually really good example in my city here, there's a company. There's a pizza shop, actually that banks football shaped pizzas. Um, and it's like their thing. And I don't think they have a licensing deal with the Vikings, our football team. But if they did, that would be brilliant. Um, because then they could make Vikings. She ah, you know, themed pizzas. They might do it anyway, and just without a license. But, um, that's a little dangerous, but you think they're small shopping, probably away with it. I wouldn't recommend that, though. Um, okay, one more thing that goes in this section 21. Pricing: Okay. Last thing that you should get into this section is pricing. In other words, how are you gonna price your thing? Um, a couple things Think about do a little bit of research in here, Um, and figure out what similar stuff is being priced at and make sure that you can be competitive with it. Competitive just means that maybe a little more like maybe you're a little less, but you're in the same ballpark. Um, so just outlined in this section, how you're going to charge people. Is it just going to be in? In my case, it's going to be pizza by the slice. So I'm gonna sell pizza. But if you have a company where you're doing fees or subscriptions or leasing, um, anything like that outlined that, and I will mention that subscriptions subscription services are really popular right now. Ah, everybody's going to a subscription model. Not everybody, but a lot of people is going to a subscription model, and investors love it. I think it's probably what's driving a lot of companies to switch over to subscription models. There's a lot of software that used to be, you know, 300 bucks for the software, and now it's $80 a year, you know, so it's cheaper, but it's an annual subscription. I think that reason is that to investors, they see that as recurring money, money coming in every year. So, um, that hedges their bets a little bit, that they're gonna get their investment back and they're gonna make a little bit of money off. It looks good. It looks really attractive to investors. That being said, if it doesn't make any sense for your company, I wouldn't do it for our pizza shop. We could come up with something where we said the cost of a slice of pizza is actually, you know, $35 a month and it's a subscription, and then you get as match pizza as you want. That could work, but that's pretty weird. Um, I I don't think I would do that. That sounds, ah, way too dangerous because that sounds like some people are going to stop buying groceries. They're going to stop doing anything, and they're just going to go there 24 7 for three meals a day, and that's going to drive you out of business really, really fast. So, um, in our case, I don't think a subscription model works. But if you do have a subscription model in mind, talk about it Here, explain how that's gonna work and then talk about, um, similar stuff and say, OK, you know, my pizza is a little more expensive. It's gonna be a little more expensive than you know, the pizza shop in the next, you know, a couple miles down the street. But, um, we think that the market can support it because it's a higher end product. It's healthy. It's all this stuff. So you could you can justify something that's a little higher, a little more, but be specific, given numbers down the street. It costs $2.50 for a slice of pizza. My pizza is gonna cost $3 even for a slice. It's a little more than down the street, but I think people will pay it for the higher end product. Say stuff like that, Um, or say I think I can do it cheaper. Um, and mine is only gonna cost $2 under what the place up the street is selling it for whatever. Ah, to say what's accurate and then talk a little bit about, um, how having that price will attract customers. If it will, you could make an argument for a higher price, attracting customers. People do it all the time. You could say, at $3 my pizza is a little more expensive than the one down the street. But that will help show people that it's a superior product. Um, the psychology behind having something cost a little bit more is, um, Rial. Ah, you know, I know that if I go out and buy a $1000 car, it's not as good as a $10,000 car. Like, I know that, um, and the same goes true on a much smaller scale. People will realize that the question is, what will they act on it when it comes to the pizza they're gonna buy? So that's the argument you need to make So last thing in the pricing section talk also about, ah, what's your profit margin? That means if you're going to sell a slice of pizza at $3 what does it cost you to actually make that slice of pizza? And how much will you keep the amount that you keep is your profit margin. So if you sell it for $3 it costs you, Ah, $1 to make a slice of pizza and you keep $2 for every slice that you sell. Ah, that's that's pretty good margin. Um, it's 2/3 its That's really good. Actually, that could be okay. And with that, when you calculate that you have to kind of calculate that assuming a certain volume because you're well, it depends on what business you're in. But you have but makes some assumptions about the volume that you'll be working at, um, to come up with this number. If it's not spot on, that's okay. Just have a good estimate. Um, and talk about how you came up with that estimate. What you're assumed numbers were cool. So, uh, hopefully this chart will help you work through some of that. But mostly, um, be sure you had all of these things and these things, this could be more than a page. Let's find. I think I said make it a page long. But, um, if it's two pages long, that's fine as well. Okay. Ah, great. Let's move on to our marketing and sales plan. 22. Research Tips: all right. Going into our marketing in sales section of our business plan, this is probably the biggest section. Most meatiest section, Um, meaning it's gonna have a lot of info. It's probably gonna take up a lot of pages. One of the biggest things that we're gonna be looking at in this section is research. Um, that's what people want to see here. So what you want to do is provide as much hard data as possible. Really? Numbers, um, Riel research and in kind of typical academic paper fashion. Ah, you want to cite your research? So what that means is be sure to talk about, Let's just say really numbers rial stuff. Where? Where did you find these numbers? Ah, if a source tell us what it is like a journal or something like that. So if you're using, like, a trade journal and they say, you know, x amount of revenue in this field, you know can be expected or something like that. Then tell us what journal you've got that out of. Um, don't try to pull anything over on this section because people will see through it. So don't try to say, um, I can expect, you know, half a 1,000,000 in revenue in the first year. Ah, people are going to say or especially an investor is going to say Why. Where did you get that number? How do you expect that? So if you got that number from a journal or something like that, um, tell us. What journal? If you found that number yourself, tell us how. Tell us how you got that number. And a very good way to do that is canvassing interviews with those two things. What we can learn is so canvassing basically means, um in my pizza joint, what I could do is go around all the other pizza joints and look at what their prices are, right? This is very easy data for me to collect. Um, all I have to do is go in there and buy a slice. Pizza. You know, like I I like pizza. So that's just fine with me. That's canvassing, walking around and figuring out what you can figure out just based on available information . So I'm gonna keep a chart of every the cost of every slice of pizza, and that's going to give me some good information. about that I'm gonna need in this section, interviews would be like, Can you talk to the owner of a similar business? Ah, in my case, it might be the owner of another pizza joint in another neighborhood. Um, that might be tricky if they think you're gonna take up some of their revenue. Ah, if you're going to steal some customers from it might not work. Great, because they might be not willing to talk to you. Um, but another thing I could do is I could talk to other businesses in my neighborhood to get some useful information that I'm not going to be directly competing with. In fact, I might be helping, um if there is a bar that doesn't serve food just down the street from where I want to open my pizza shop, that's great. They might be real happy that a pizza by the slice places opening up a couple doors down so I could go talk to that bar. I could get some good information because they're gonna want to help me. They're gonna want my business in their neighborhood. So non competing businesses are probably willing to talk to you. So you might be able to get some data that way. So, um, for this whole section and this goes true for the whole business plan. But it's especially important in, ah, the marketing and sales section of our business plan. Make sure your researches, riel, don't try to pull a fast one. Don't fluff numbers give real numbers even if they don't support you. Even if the numbers don't give you the exact thing you want them to say, Um, you can always leave off that data if you have to. But better is to say, these numbers don't show exactly a huge potential for growth in this market. However, my niche will, you know. So in my case, I might say the market for our pizza by the slice in my neighborhood is not huge. However, the market for health food in my neighborhood is. And that's evident by, uh, you know, I talked to someone who runs a gym in my neighborhood, and he says, revenues going through the roof. So that gives me another round of data that is useful to me. Um, because the if a gym is doing really well, that might tell me that my neighborhood has a lot of health conscious people and good health food might be welcomed in my neighborhood, uh, stands to stands to reason. So with your research, be sure that if you got it from somewhere else, tell us where you got it. And if you got it yourself, tell us how you got it. Cool. Okay, let's go into the swat. Um, not special weapons. Not the military swat like SWAT team, but the S W o t. Let's do that in a new video. 23. SWOT!: Okay, let's talk about this SWAT analysis. This is another table, and I've included it here, and I'm gonna just bump this down so that we get it all on one page. Um, so this is another table, and this is not something that we necessarily need to include in a business plan. Although I've seen people do it. Ah, but it's something that, like, one of the other tables we had that filling it out and doing this thinking through it can really help us to, um right, this whole section, it's going to kind of formulate a lot of our ideas into good ideas, and we can talk about it. So, uh, do this and then we'll it will help us when we get into talking about barriers to entry threats and opportunities and all that stuff. So here's what it is. SWAT stands for, um, strengths, weaknesses, opportunities and threats. So we're gonna look at what our strengths in the market when our weaknesses, what are the opportunities and what are the threats Now? There's another way that people do this. There's some logic. Some people that say it should actually be swatter, which is the same thing plus allies. So when we started Slam Academy, one of the first things I did once we had the idea. And, you know, I sat down with the people that were going to become my partners on it, and we said, How do we do this? How do we figure this out? One of the first things I did was I went Teoh, a friend of mine who had started a number of successful companies. And I said, What what do I do here? Um, how do I start this? And one of the things he said, the first thing he said was Do a swap plus a analysis. Um, this will tell you if this is a good idea for you to do or not, and it will help you organize some your thoughts. So ah, me and my business partner sat down. We did it and ah, it's now a somewhat historic document. But I found it. Um, we haven't here in a Google doc. So this is it. This is the actual thing that we came up with. So the way we did it is we just said, Strengths, weaknesses, opportunities, threats and allies across the top, and then we just listed out, um, everything that fit in that category. So the bold things are kind of big statements. And then the not bold things are sub statements of the nearest bold thing. So, for example, a strength were unique in the market. There's nothing like us in town. And then we said, No school in the Twin Cities area that specializes in just Elektronik music. Um, all others have rock pop as a large element could target students with interest in specific genres of electronic music that are relevant today. So it's popular is kind of what we're saying here. Um, and no one in town is doing it. It's great, um, connection to establish student communities. What we're saying here is that me and my partners had jobs at the time at some of the big schools in the area. We were professors at those colleges. We've all kind of left those jobs now, but, um, it was an interesting strength for us added legitimacy to what we were doing. Um, other strengths, you know, things we had weakness is, um, target markets kind of spread out. Ah, and then kind of ideas for addressing that our target markets might not be very big. We didn't know. Ah, if our market was gonna be big or small, we don't have any equipment. That was kind of a big thing. Um, and it would be a lot of start up costs. However, we solved this by if you watch the previous class on funding, you know how we solved it. Um, weakness was we had a space called the slam factory that we could use. Um, but it had some problems. Let's just leave it at that. Um opportunities, threats for allies. What we listed here is, you know, we had a connection to the hip hop scene. Ah, and all of these exes were just names. We just listed out names of people who we thought could help us that we should talk to. Um, that would be good allies for us. And I just just a minute ago replaced them with exes because I don't want to give up these people's names, um, on the internet. But these were people that we just thought so and so could help us so and so could help us and just listed off a bunch of names. Um, so this was a good document. What I'm giving you here is a little bit more of a formal way to do it. And if you want to add the Allies ah, column you can. Or you can just list allies later at the bottom or whatever. So what we're saying here is for the products that we're offering, what our strengths, weaknesses, opportunities and threats for the brand and the marketing. What's the swat for our staff for finances, operations in our market, on a couple questions at the end. So fill this out. Do it as much as you can, you know, just put in a whole bunch of information, and then, uh, that will help you format the next bunch of questions that we have to ask to get through this big marketing and sales section of our business plan. So fill that out, think about it, think through it, um, ad allies to the end and then come back and we'll jump into the barriers to entry section 24. Barriers To Entry: Okay, So in your marketing and sales plan, what I want you to do is creating Ah, the next couple things as subheadings. So let's just say subheading barriers to entry. So make that ah, heading in your marketing and sales plan. So first, let's do a subheading. That's overview of marketing and sales plan. Um, so talk about your general marketing and sales plan. Some of this you've already said, But again, we're gonna drill a little bit deeper in that overview. Now, barriers to entry we want to basically talk about here is things that are gonna be hard things like start up costs. So anything that you say here in the barriers to entry, propose a solution. If this is a problem, propose a solution for everything. So if you say ah, it's going to be expensive to get this off the ground. But ah, here's how I'm going to solve that. That's what we want to do in this section. Talk about things that are gonna be tricky and how to solve it. Another thing might be production costs. Production costs are going to be really Hi. How are we gonna deal with that? I think about, um, your allies think about your things you discovered in the SWAT. Um, What could be your solution? Brand awareness is a big thing for me that I'm always thinking about. Um, you're starting a new brand. Nobody knows who you are. How are you gonna overcome that? Experience? Might be something that you encounter, and you don't have to list all of these. If it's not relevant, don't list it. But like if you don't have start high start up costs, then you know it's not a barrier to entry. I'm just giving you a couple ideas. Experience is one that comes up a lot. That would be like in my pizzas place. Ah, experience would be something I want to talk about because nowhere on my resume does it say I have significant experience. Ah, starting or running anything having to do with food at all. So anyone who is potentially going to invest is going to say this guy might be good at some stuff. This guy's good. It's a music stuff, but he doesn't know anything about running a restaurant. So why am I gonna trust him? So ah, if that's gonna be an issue I want to tell them how I'm gonna solve it. It might be that I'm gonna hire a general manager. That's probably the easiest way to solve that. So someone who can really be the day to day boots on the ground person to deal with all the foodstuff or, you know, a chef? I don't know. Um I don't know how we do that, but on that same note, another thing we have is finding employees. Um, if this is a technical field, finding employees might be hard finding good employees who will work for a relatively cheap because that's you probably don't have a ton of money to pay the top employees right now. How are you gonna find good employees who will work for you? Um, a solution there might be partnering with or doing some kind of career fair at Ah, if you have a good college in your field, that might work. So if you're in, like, a technology field, go to the engineering school. Ah, get involved in their career fair so that you get some straight out of college people who are really eager to get involved in a start up in my case. Maybe I go to one of the culinary schools and see if anyone's interested. I don't know. Um, in this particular pizza case, unionization. If that's something that is relevant to your field, that's something you need to you might want to address. Um, that would be like if there is a professional union that you, um, have to interface with making sure that your in line with what they need. Um, I don't know if that would come up in the pizza situation at all. I don't think it would. Um, but in music, he does come up because we have a music musician's union, and it's pretty strict. So, um, if you're dealing with union musicians, there's, ah, certain things you have to comply with in terms of our hours. Pay rates, breaks all kinds of stuff. So if you are working within a union ah, you have a lot of issues to deal with. So if that's a barrier to entry, um, which it can be because if you like, in my case, if I'm working with union musicians, I have to pay him a certain amount. And when I'm a startup, I might not be able to pay that high of a rate, so I might have to either see if there's a way around that or see if I can strike some special deal with the union. Luckily, it's time Academy. I'm not usually hiring musicians to be musicians. Um, I'm hiring them to be teachers. So there's some special considerations there. Um, and the union, the musicians union and at least in my town usually only focuses on classical musicians. So it's not super relevant. But but think about that could be, ah, barrier to entry. Um, and let's put that there. So that's just a couple of ideas, but anything that could be a barrier you want to list here. What an investor is going to do is it's going to read this section, and it's going to say, Ah, they're going to say, Ah, they didn't think about this or that. They want you to think about an address, every possible thing that could be a barrier to entry. And if you leave something out and investors probably going to say no. Ah, I don't think they thought through this enough. So don't be shy about your potential problems here. List everything you got 25. Threats And Opportunities: Okay, The next subheading I want you to put in here is threats and opportunities. So this you can pull straight out of your SWAT analysis, the threats and opportunities section He owned the teak. Um, so if you have good data there, ah, put it into a nicely readable form and that's pretty much what you want in this section. Here's a couple of ideas. Let's just say regulations. Um, if there are rules either government rules, maybe union rules. We were just talking about that, Um, maybe state rules that affect your business directly and they might change. Ah, this could be something good to talk about here because a change in that rule is could be a threat. And it could be an opportunity, right? Um, depending on how it's changed. So if you have, it's a threat. If you've heard that it might be changing because of a recent election or something like that, Ah, for the negative, it's an opportunity. If you've heard it might be changing. Ah, in your benefit, um, technology is a big one in this section. Two, um, new technologies coming can be great opportunities for you. Um, the cost of technology is almost always going down. So that could be a great opportunity to discuss here, um, economic concerns which way the markets go in. Um, that's hard to bet anything on. But if there are really concrete trends that you can talk about, then that's good to discuss. And then anything unique to your industry that is a threat or an opportunity that's coming one way you can think about this section is we've gotten over. Our barriers we've addressed are barriers. What else could happen? Um, that could go up or down. Good. Or it could go bad. Could be a threat. Or it could be an opportunity. Um, so it's kind of an extension of the barriers in a way. 26. Target Customers: Okay. And now we're going to get back to more of our data. Uh, target customer. If you're looking around for this online, this is also sometimes called ideal customer. Or if you want to get fancy, um, is sometimes also called buyer groups. Butter buyer persona, the personality of the buyer. Um, So what we want to do here is this is where we're gonna get heavy as possible into our data , and we want to identify the perfect customer. And we really want to draw a picture of this customer in this section. Um, and so for customer, don't forget that this customer could be it could be a person could be a company or a group . So if you sell director companies, your customer could be a company. Um, if you sell director people, it's a person. It could be both if it's both do these, as separate headings say, like the ideal consumer and the ideal business or whatever. Um, but some of the things we want to outline here and as much detail as possible and remember , you want to use evidence for this if you've got it. But you want to talk about age gender location, income level, education level, occupation, anything you confined about these people. Um, that was some of this. You're gonna have to make some wild assumptions, but if you look around hard enough, you should be able to find some data. Um, for example, with Slam Academy, What we always say is that the age of person that comes a slam academy is really 8 to 80. You know, we have young kids, we have retired folks. We have everything. But while that's a great thing to say, when the rubber hits the road, the actual, like business plan answer is 20 to 25 because that's where most of our students are. Um, so when we advertise were always advertising 8 to 80 is what we like. Um, it's available for everyone. But when I buy a commercial on TV, I'm looking to target 20 to 25. That's the low hanging fruit. As we like to say, that's the most People that come into slam are in that age range. Um, gender. Now gender is a tricky one, because ah, for slam academy. It's tricky, I should say, because the low hanging fruit is male. Um, the majority of people are male, however, um, going back to our social objective. One of the things that we want to do a slam academy is to help level that playing field. So we want to see more women involved in Elektronik music so we don't advertise on anything to do with gender. Um, we we just don't deal with that as an advertising requirement because we want to advertise to men because they are more likely to buy our stuff. But we also want to advertise to women because we want them to get involved to help ah, grow the field. And then we also want to see, you know, transgender people in all kinds of different people involved in what we do. So we don't advertise on any specific gender. But for this section, if we were talking about the most typical person in that comes into Slam academy, I would talk about male location. I would say they are within Ah, I think 50 miles of my area, which is commonly considered the Twin Cities metro. What is their income bracket? My typical customers are fairly poor. So, um, I would say the typical income bracket for me. That same academy is probably between 20 and 40,000 dollars a year. Um, they're not rich, but they're also young. Um, relatively. So education. My typical person, um, has either no college degree. Um, but does have a high school diploma or some college. Is my average person an occupation? I would say, Ah, the most average person is blue collar, um, service industry or something like that. But that's not necessarily how I advertise. So Ah, these are all ways things I'm going to use to kind of paint a picture of what my most typical customer is or what I expect them to be. So what? I'm talking about advertising here. I'm kind of talking about two different things at once. But what we're really focusing on here is what's our most what's are easiest to capture customer. That's what we're really looking for. And just remember, it might be different than how you're actually going to advertise 27. Direct And Indirect Competitors: okay up next. We're going to another subheading, and we're gonna talk about our come pet adores. Now, here's rule number one. When you're talking about competitors, you enable. That's bold. You do not have no competitors. So if you think to yourself I'm really unique. I don't have any competitors. It's amazing. Uh, you're wrong. Ah, you do have competitors. Everyone's competing for the same amount of money, so ah, widen your scope a little bit of what a competitors A is. For example, with Slam Academy, we don't have any one that does exactly what we do in our state. I don't even think in the Midwest, at least not when we started. We're totally unique in that realm. However, we have one. Well, we have many competitors. If you think about it a little harder than that, Um, but we have one really big one, and that's YouTube. YouTube is a huge competitive us because every person that we're trying to get to come and take a class with us could learn a lot of the same stuff at home for free on YouTube. And that is a huge competition. So think about what your ideal customer that we identified up here is doing instead of buying your thing. Um, that's kind of the key answer here. So what we want to see in this section is you've identified your competitors, you know how to stand out from them. So let's talk about these key competitors. Um, list them by name. Just say McDonald's is a competitors. Um, say whether or talk about whether they are direct or indirect competitors. The example I gave a minute ago direct competitors with Slam Academy would not necessarily be YouTube would be more indirect. Ah, in the case of my pizza joint, a direct competitors er would be the other pizza joint. So things that I'm directly taking money away from if my company is successful, indirect would be, um, the neighborhood health food store. Maybe, um so I'm not directly competing with them. However, someone might buy my thing instead of buying their thing. I might also call any restaurant, an indirect competitors and some of them a direct competitors. Um, because what I'm doing is I'm banking on people spending their extra cash with me, and so anyone else that requires extra cash to be spent. Someone's you know discretionary money. Non essential money is an indirect competitors, if not a direct competitors. So think about both direct and indirect. Um, and it's not always region specific, right? If if you're doing something that can be done over the internet, then like what? Like my example of YouTube, then it matters. Okay, so talk about your competitors and how we're gonna beat him. That's basically what we're gonna ah, focus on in the section. And when I say how you're gonna beat him, what we're really talking about is how you're gonna stand out, how you're gonna differentiate yourself from them. How is everyone gonna know your company and what they do? So to figure this out, this is gonna be a little bit of that research we talked about earlier. So we need to do a little bit of traffic to maybe do some interviews of average customers. Um, just people, maybe a survey Surveys are not great data, but, um, it's better than nothing. And that should give us a good starting point for some good data. Another thing you might want to dio, um, when it comes to, how are you going to stand out from them go all the way back to that first class where we talked about our objectives again. You know, look at some of those and see if we have some ah, language there that will really help us do something that our competitors are not doing. 28. Your Niche: Okay, Next, let's do a setting on our niche. Also also known as positioning. So what we're going to say here, this doesn't need to be a long section. This is a bit of a summary of everything we've covered so far in our marketing and sales section. So what we're going to say here is what is our section of the market? In other words, are niche. Let's put that there. Um, our niche, How how are we gonna capture it? That's pretty much it. Um, so we're just going to kind of summarize everything and say, because of all the data that you've just read, our company is positioned as and then explain what you're niches. Maybe don't use the word niche. Niche is an okay word to use, but positioning is a little more. Ah, business E, um, my appeal a little bit better auto. Um, so that is our niche. And then we're going to say were lined were inland to capture that niche because of X, y and Z. And a lot of that is going to be how you're gonna, um, stand out from your competitors. Some of it's gonna come from this other information to. But this is really just a summary of what we've said so far in this section. So relatively easy one but ah, next we get into a little bit harder one. 29. Marketing Plan: Okay. Finally, after all that, we're going to talk about our actual marketing plan. And now here. What we're going to focus on is, what are we going to do to get people to know about us? What is our plan for product awareness? I like this. This term product awareness is not like a business term. It's kind of just a me term, but I like that term. Um, we need to let people know about our product or our products. Um, it's to a parentheses s product or products. So talk about, um, how you're gonna let people know about these things. Um, specifically, do not forget to mention show social media what you plan, what you plan for. Social media are gonna get some young kids that really no social media. Well, to be doing cool and clever and mildly funny things online. That's great strategy. Um, or are you going to just, you know, start a Facebook page and be kind of chill on it and focus on the free? Are you gonna do stuff in print? Are you gonna do posters? Postcards? Are you gonna put discount things on those postcards? Coupons? Um, are you going, Teoh, put an ad in your local newspaper. Um, maybe your local music scene paper. If there is one for us, we have a kind of separate paper that's more geared towards younger and hipper people. Um, that would be where you want to be. Maybe there's newsletters that your local food coop puts out That you could buy an advertising advertisement in all of those air. Good ideas, but talk about what you're gonna do. Uh, print radio, um, radio. Surprisingly, um, relevant in my world. Um, a lot of people still listen to the radio. Who knew? Um, mostly for me. It's NPR, Um, because NPR is a really big deal. In the Twin Cities area, everybody listens to NPR, and there are three different stations. Um, there's the news station. There's classical. And there's this one called the current, which is kind of, um, alternative. Younger. I've got to say younger alternative. That's not exactly true, but it's close enough. Um, so for us, advertising on the current is a big deal. Um, we also have hip hop stations, um, other radio stations that hit different markets. So radio's been pretty useful to us cable television. talk about if you if you're planning on doing that, um, we've already talked a little bit about average housing on cable. In my experience is doing it, um, can be good or bad. Ah, it's a lot cheaper than you expect. Um, at least a little cheaper than I expected. And cable can be targeted fairly well. Regionally, they can't target cable in the way that you can. Social media, social media. You could make a post and target it at people that are that typically buy things online are a certain age, are a certain gender. Um, you can really target it on specifics. Cable television. You can really only target based on where somebody is, um so a city or a state, or they have, like a grid of the state so you can go with in different markets of the state. Ah, if you want to get information on that, call your local cable company Ah, and ask about rates and data. Don't forget to ask about data. If you're interested in doing cable, say what? Show me the statistics for who my ad would be hitting. That's what you want to know. And then anything else that is unique to your company that you might be advertising for us . We do, Ah, street team stuff. So that means getting group kids to go to the biggest college campus in the area and walk around and talk to people That's important to us. That may or may not work for you, but think about it. So anything that's unique to you, um, other marketing assets assets include things like a website. Gotta have one. Um, what? It doesn't need to be expensive. Um, don't spend a ton of money on a website. I'm going to make a class sooner or later that focuses on making a business website super cheap and fast. Um, you can have a website up and running for under $100. Um, and it doesn't take a lot of technical knowledge. Anyone can do it. It's super super easy. Um, so one of these entrepreneurship classes will be on that sooner or later. Don't worry. Um, talk about email lists. If that's something you're gonna do, that can be a really huge asset. If you have one or can build one, um, mobile, uh, things you can do on your cell phone are more importantly, things your customers can do on their cell phone. Can someone order a slice of my pizza with a text message? Um, is my website going to be friendly to their mobile phone and let them order Ah, through a mobile friendly website? Things like that that you want to do trade shows could be important to yours. Ah, product. Certain networking events could be important to your product. Um, word of mouth. You can talk about word of mouth a little bit if that's gonna be important to slam Academy . That's huge. Word of mouth is probably a very large and very difficult to track portion of where we get customers from on. That same note referrals is something that you might want to talk about if that's relevant to you. So talk about all these things. Everything you want to do. Every good idea. This might be where we can finally creep in this. Um, this is totally where we can creep that in. So somewhere in here maybe, um, the mobile thing. Ah, maybe up here promotion plan here, I might say, offered discounts to people who show up on a bike or foot basically without a car. Um, that helps my health food persona. It's just the idea I had. Ah, it might work. It might not, but this is an opportunity to kind of explore that idea a little bit more, Um, and see if it will work and to talk about it in the business plan. 30. Marketing Budget: Okay. Last subheading for this section is going to be marketing budget. Um, actually, that's not Call it expend our ah budget. Let's call it expenses, because our budget is our budget. Um, so we're gonna talk about our marketing expenses in two different ways. Here. First, we're gonna talk about our start up marketing expenses, and these should be basically what we're talking about here is what we've identified in our budget as our start up marketing expenses. We're gonna elaborate on how we're going to spend that money, Um, and incorporating all this stuff. So we're going to say I'm going to spend X amount on social media X amount on print, X amount on radio If that's relevant, Um, and you could do it as a percentage of your startup budget Probably makes good sense. Let's put that here percent of budget is a good idea. And then the other thing we're gonna talk about is oops, ongoing marketing expenses. So, um, after start up monthly costs. So what's gonna be your monthly budget for social media? Print, radio, etcetera? If you say I'm going to devote $1000 a month to marketing stuff, um and approximately 50% of that is going to go into social media. That says kind of a lot, right about what you're planning on doing that majority of your marketing money every month is going to go into social media. Um, that means that you're going after young people. More or less means you're trying to be hip and fun and have a lot of content costs because it's fairly hard to do really active, engaging social media all the time. But, uh, totally can be done. So talk about that a little bit more about what you're going to do with the money as it relates to all of these things. Is that money going to be regenerated every month? Like, are we expecting to make that money back every month for this one? You totally should. Um, if that money isn't, if that $1000 or so isn't generating $1000 back then we've got problems. So we want that money to be regenerating itself every month, plus obviously a whole bunch, um, to go into our profits. Um, this one. We don't really need to talk about how it's going to get ah returned necessarily because It's a start up expense. This should be significantly higher than this, Right? Because we want to start off with the bank. Um, are we gonna do a big party related to start up where we do a big, um, grand opening kind of thing or something like that? You talk about that here? 31. 12-Month Sales Plan: Okay. We've actually got one more thing to do here. We want to include a 12 month sales forecast. So what? This is if this is going to say what we expect our sales toe look like over 12 months, and we're actually going to try to do this twice, we're going to say, best case and worst case, Um, and we want our worst case scenario to show that we're still alive. We're still in business. Um, after a worst case scenario. So this is a forecast. So this is a lot of guessing. This is kind of what we think is gonna happen we wanna be is realistic as possible. So bases much of this as you can on that research we did. And don't worry if your best case doesn't show you with a profit at the end. That's kind of okay. Um, meaning you might have this startup budget, and it's and it leaves you. Ah, you know, 30,000 in the hole. Right? And you might not get yourself out of the hole after you figure out. Do you pay your monthly expenses? You might not have paid off that 30,000 yet. After one year. That's okay. Ah, lot of companies don't turn a profit for a few years. Um, if you can turn a profit in the first year, it's much better, though. So here's how. Ah, you could do this. The easiest way is I found this nice template online, and I'm gonna give you the link to this the next video. So what this is is just, ah, one year sales forecast chart for you to do so. Category number one. So whatever category, this basically outlines seven categories of stuff you don't have to use all of them. You don't want to. So for me, I'm just gonna say, a slice of pizza. So in June Ah, this is set up as june 16th 2 May 17th Um, or June of 2016 to May of 2017. Um, you can update those numbers, those dates for yourself. So let's say I opened in June of 16. It was my first month. I don't expect to do tons of sales, right? Nobody knows about me, so I'm going to say, ah, 100 slices of pizza. I'm gonna sell there the next month. I'm gonna hope that increases 250 next month. 200. Now, let's say on September I'm gonna do a big marketing campaign. That's my grand opening. That's Ah, I'm putting a lot of advertising dollars behind this event that I'm doing in September. Let's just say so. I'm gonna expect a big bump there, and then I'm going to try to sustain that and then grow from it. So then the next month, I'm going to be here. Gonna keep growing. Ah, by 250 or so, Um, and maybe there's another big event in March. Well, actually, let's consider this December. I'm in Minnesota. December things get cold, and I'm asking people to walk around to buy stuff. So let's not assume the same amount of growth here in December. Let's try to maintain what we have through the cold months. And then in March, more people are going to start to come outside, but not a lot more. April's when people really start coming outside. May everyone wants to be outside. Okay, what's my price of one slice of pizza? Say it's going to be $3. Okay, all the way across. Not $300 for a slice. That would be great I guess I could just do three all the way across. Okay, So if all I'm selling is a slice of pizza for $3 and I'm not gonna change the price at all , then over 12 months, I'm gonna have 36,750. Now, that doesn't factor. And all my expenses, right? This is just sales is just straight up sales. Um, so that's my probably best case. Without thinking too hard about it, you could do worst case where things are rougher, right are more rough. So, um, put that in. Put this exact chart in you can do so just say over so that they can see that you're factoring in things like the weather in the winter and things like that. Um, So fill this out and put this chart in do this section or something similar. You don't use this chart, but basically show every month, if you can. In the best case, in a worst case scenario, that's the 12 month sales forecast. So in the next little chunk, I'm gonna give you a link to download this. It's not mine. A template. So, um, I can't just include it, but I could just give you a link because it's free. Um, I just went to this website and downloaded. It was neat, so check it out and then we'll move on to talking about operations. 32. Production: Okay, let's talk about Ah, the operations section. Next. So ah, bunch of things we're going to cover in the Operation section first production. How are we going to make our thing that we're going to sell? Um, notably in this production. So the operation section, we don't need to make it. Ah, as big as the marketing section. But it should still have a lot of weight. So each of these ah, bulleted items that I'm going to go through for this section, I'd say they need to be a couple paragraphs. The production one being probably the most important. Um, so maybe two or three paragraphs on this, but be sure that you cover, um, who will make your thing? Who will deliver your thing? I'll go over this more in just a second. Um, methods, equipment costs to produce. Okay, So who's going to make your thing? Are you going to make it in house? If you are gonna make it in house, Who specifically is going to make it in house? Um, do you have a production manager? Is that a person? And if that is a person you're hiring, tell us about that person. Give us some confidence that that person is going to be really good. Have making your thing. If you're outsourcing this and having it made in India or China or doing one of those kind of things, tell us about the factory. Tell us about your relationship with the factory. Uh, tell us whatever you can, Um, who's going to deliver your thing? That could mean who's going to get it back to you To your warehouse. And it could also mean who's gonna get it from your warehouse to the customer. Um, if this is ah, in my case of the pizza store, um, I don't really need to spend a lot of detail on who's going to deliver it, because it's gonna be a walk up thing. Maybe eventually, I'll get into having people deliver by bike or something clever like that. Um, but I could talk about how I'm gonna get my ingredients. That's probably the most important thing. What distributor am I gonna use? How am I gonna if I am going to manage working with all these local farms to get on my produce? How am I gonna do that? How are they gonna get to me. Am I gonna have a truck that goes around to all of them and brings it back, or I'm gonna expect them to deliver it to me. How am I gonna do that? Um, production methods, things that you need to do in order to make your product, If that's relevant. Um, in my pizza store situation, that would be things like prep work and then assembling the pizza and then baking it. Boxing it The boxing might be something that needs to be discussed. If they're going to go into boxes. What are the costs of those boxes and things like that? That will go in the cost to produce section equipment that I'm gonna need? In my case, I'm gonna need ovens. I'm gonna need knives. Gonna need Ah. Prep stands, things like that. But what do you need in order to ah, make your thing? So if you're making it yourself, what equipment do you need? And how are you gonna get that equipment and then the overall cost of all of this stuff? What is all this going to cost the end of the day? What we want to be able to do is say um, the cost per unit, which is the one thing that you're selling to make one of them. I want to know what it costs all in. So with pizza, I would need to list the ingredients the time it takes my staff to make and that one slice of pizza and then the box that I'm gonna put it in any waste that happens. Ah, and then if there's any cost associated with getting it to the customer factor, that all in and then we say the cost to produce one slice of pizza is about a dollar. So if I sell it for $2 then I make a good profit. So we need to figure out all that in this production section. 33. Quality Control and Location: Okay, Next, let's talk about quality control. Ah, this is a pretty easy one. What we want to do here is talk about how we're gonna maintain consistency. Ah, and you should describe the process. So talking about, um, one of things that people look for in a good product is that it's consistent all the way around. If they buy one here and there by one there, it's gonna be the same product. So we need to make sure that all products are created equal, essentially, literally. That's what we need to make sure. So, um, how are you gonna do that? Uh, you could have a quality assurance person. You could have a quality control person, or you could just have a system of checks and balances that really help to, uh, maintain consistency throughout the manufacturing process. Um, so in my pizza store restaurant, it's gonna be something like every 10 slices of pizza or every 100 slices of pizza get evaluated for you know how much toppings and all the stuff I don't know. You could come up with ways of doing it just to reassure the potential investor that your consistency is being checked and quality is being assured. Basically. Okay, let's jump and just talk to location, which is the next paragraph I'd like to see in here. Um, where is your business? We talked about this a little bit in the initial company overview, but let's expand on it a little bit. Let's talk about the physical size of our space. Talk about the type of the building and the zoning issues. Um, handicap accessibility. Ah. Which can be really, really important. Um, and costs ren maintenance utilities, um, room modeling, build out, etcetera and then include in that section any deals you have with the landlord. Ah, often you can rent a space with a certain build out allowance, uh, in it, which will get rolled into your rent over a long period of time. But that can help you really customize the space to do what you needed to do. I think they don't teach you in music School is how to spell. So location nitty gritty details about the location 34. Legal Stuff: All right, Next up, let's talk about some legal stuff again. We've touched on some of their legal issues earlier, but let's drill down to some find details here. We're gonna talk about any legal hurdles we have and how we plan on surmounting them. So speak. This would include things like a licenses. If, ah, you want to sell alcohol, you need a liquor license, right? Ah, how are you gonna get that? What's that's gonna cost? And what are the regulations you have to follow? Um, the cost of selling alcohol is not on lee. The cost to get a license and stock the alcohol. There is also a price in how How much time your staff is spending on carting people checking I. D. S dealing with drunk people. That's not that shouldn't be too big of a cost if you're a restaurant. But, um, there's also the potential for fines. The potential for additional training for your staff hiring bartenders. How how you want to work with tips even could be a factor. Um, things like that. So any kind of licenses and legal stuff that you have to deal with if any trademarks and copyrights and let's put in patents. So discuss in detail what trademarks, copyrights and patents you have, which I think we've already talked about. But, um, in particular in this section, we might talk about things. We need things we don't have that we need. Like, you haven't done a trademark of your business yet. Uh, you should do that. Do that right away. Um, copyrights have now become compulsory in the US, so that means that any intellectual property you created automatically copy written, but you have to find ways of proving it. So filing some paperwork with anything you want copy written, uh, it's still good to do. Oops. And patents we've talked about. Um, let's go back to trademarks really quick, because I want to tell you a story about trademarks. So, um, oppression admit this. But so my company slam Academy, one of my one of my companies. Ah, So we started Slam Academy and I went after a trademark, and I spent kind of a lot of money going through the legal process of making sure I had the trademark nailed down so that nobody could take slam academy away for me. Since then, four other companies have started called Slam Academy and doing kind of similar stuff. And in two of the cases, I wrote them a nice letter, right When I saw that they popped up, um, and said, Hey, you're doing kind of the same thing we are and we have. And when you have the same name and we have the trademark, probably not a good idea for you to do this. And they changed their name. So I didn't just say like, I'm gonna sue you because you're using my name. That's not the way to do it. Consuming someone's expensive. I just sent them a letter saying, You're just getting started. So now is the time to know, Um, I own that trademark. So if you continue to use it and become a really big company, I'm gonna come after you. So I just politely asked him to not use it, and they did. 1/3 company never responded, but, um, disappeared after not that long off. The fourth company is a thorn in my side, and it still exists, and it's getting much, much bigger. Um, it doesn't directly compete with us yet. Um, it's a school, but they don't do music stuff, Um, and they're not in our area, but as we do more, um, online stuff, we get in their area and they haven't knocked on our door yet. And I know they know about us because we own all the social media assets, which means the Facebook, the Twitter, all the handles, all that stuff. So they definitely know about us. And I've checked with my lawyer on it a bunch of times, and they're crazy because we have the trademark locked down. We could shut them down any minute. The problem. The only reason we haven't is because based on what I can tell about their company, they have a ton of money so they could fight the trademark and we would win. But they could bankrupt us to fight it, so it's not worth it to me yet until they directly compete. But, ah, I'm in a good position in that I will win when we do that, because I have the trademark lock down because early on in the company spent the time and the money to do it, and by the way, when I did it, I did it all myself. Initially um, And then I went back and had a lawyer look it over, and we filed some amendments just to make sure I got everything right. But before we had any money, I did it myself. Once we had money, I double checked it, um, to make sure that it was super secure. So all of that stuff, um, other things to include here. Insurance coverage info. What insurance do you need? Um, what do you already have? Workplace regulations. This is an issue for a lot of actually, it's an issue for all companies where you have to, like post this sign that says, You know, Ah, a certain amount of stuff. You'll get one in the mail, Don't worry. But other places have other regulations. If you work in food, there's other regulations that you need everyone to know about. If you work in construction, there are things. So whatever is relevant to you there and let's just say special rules for your industry, Norex Okay, so legal stuff 35. Personnel: Okay, Uh, next personnel. So I would first start with a description of who you need to hire. Um, that would include how many people back their backgrounds and their skills. And then what I would do is, um, include jobs description. This is a good use of our appendix. So remember, we have, at the very end of this huge document, our appendix, and we can put in all kinds of documents down there. So I would talk about the different job descriptions you need. And then I would write out the full job description like a full page, um, and put it in the appendix for each different job that you need. Um, also including this section pay. What? Are you gonna pay them? Ah, at least starting. And how so? Let's put hourly salary, etcetera. Let's talk about any specialized training. This would be stuff that you're not gonna expect your employees toe have. But you might need to provide If you're doing something highly technical or something like that. You want you to train your employees on how to do that thing. So talk about that in this section and in last, Um, how will you do a job search. Ah, where you gonna find these employees is another way to say that, Um, you could just advertise on the Internet. You can hire a firm to find people for you. You can you can do, Ah, a temp agency. There's a lot of different ways you can find jobs, but talk a little bit about how you're going to find these people, especially if it's a highly skilled thing. It's like a pizza joint. We just need people to sit at the register, and I can get you know, somebody to do it for minimum wage. Then I don't need to go in a ton of detail about how I'm gonna find him, But if it's ah, technical thing, be sure it include that. 36. Inventory: Okay, let's talk about inventory in general, if you can avoid having a lot of inventory better. Um, but if you're selling stuff, you might need to have inventory. The reason that it's better to not have a ton of inventory on hand is because there are some weird tax things about inventory you have on hand. And there's also costs in the space it takes two. Just keep that inventory. You need a bigger space if you're gonna have a lot of inventory. So, um, talk about that. Talk about what kind of inventory you're gonna have. You have what kind of inventory we have on hand. That would be like supplies, uhm, for stuff or finished stuff. Finished products. Um, the value of your inventory. How much is it worth? Um, talk about turnover. Meaning How often will you need to replace your inventory? So if you have, um ah, 100 things in inventory at any given time, how often until all 100 of those air go are gone and you need to replace those 100 obviously doesn't work like that, right? Like they'll sell 20 you'll replace 20. But if you imagine you have 100 things, and they're numbered one through 100. And the number they get is when they arrived. So when you first start, you have one through 100 and number 100. The last one that shows up is gonna be the last one that sells. How long does it take you to sell that one? That one. Number 100 till the entire inventory turns over. Um, these are good things that can kind of give Ah, good idea of what's gonna go on in the company. Um, on that note, talk about seasonal effects I wanted right. Seasonal effective disorder. But I'm just gonna get seasonal effects. Um, do you need to stock mawr on the holidays? Less in the summer? More in the summer. Are there any seasonal things that will affect your inventory? Um, how long does it take to get inventory? So if you need to reload, reload if you need to restock. Ah, quickly. How long does it take you to get inventory? If you're ordering from a factory in China, Uh, it could be like two months. That's how long it took for me when I was doing that, um, to get inventory back from China. Um, because it has two. If it has to go on a ship, there's different ways you can do this products from China thing. Um, if it's certain size and weight, it can just get put on a plane, and you could have it pretty fast. But if it has toe literally go on a ship, um, which a lot of stuff does then it could be like two months because ships don't leave every day. You have to wait for a ship and then you have to It has to go to a spot and get through customs, and then it has to get put on a truck, and then it has to get to you. And each one of those steps takes quite a quite a while. Um, so that's something you can figure out if you're doing any shipping, Uh, any inventory stuff from China or India or anywhere from overseas, then you're the easiest way to do it is to hire a shipping firm, someone who does this professionally, and then you just pay them. Ah, and signed some contracts with them, and then they take care of all of it. Even the customs stuff. And if you're going to do that, I'm going to give you a protest you're importing internationally. Use this company called Shapiro. Google It, um, that's who I used, and it's been really painless and really great. Um, you pay for it. You pay a price for not having to deal with all that stuff, but really easy. Ah, really? I actually kind of enjoyable people to work with, So check out Shapiro, if you're doing any international importing. Okay. Uh, speaking of, let's move on and talk about suppliers. 37. Suppliers: okay in this section, let's talk about our suppliers, um, in as much detail as we possibly can. Um, website, obviously we want name, address, phone number, everything we could give for them but list their website. If you can talk about their credit and delivery options, so credit would be like, Do you need Teoh? Is it like a Net 10 thing? Like, when do you need to pay the bill for them? Some of them you can wait a little bit until you sell it. Some of them you have to pay it right away. Some of them have various things in between. It's always nice to get a little bit of a history of the company of the supplier just for peace of mind. For your investors. Let them know that they've been in business for 75 years, supplying all kinds of stuff to all kinds people. They're very reliable. Talk about backup suppliers. If your main supplier has an issue, do you have another way to get your supplies? This could be important. Ah, because you imagine you've got a supplier who's in I don't know. Just has an easy example. Puerto Rico, right. Ah, all of your supplies come from Puerto Rico and Puerto Rico. Just recently got hit by hurricane. So you're you don't have any supplies? Um, because nothing's coming out of Puerto Rico right now. So do you have another supplier? Preferably on a different continent that might not be susceptible to that. So a backup supplier really good tohave. 38. Credit Policies: Okay. Selling on. Read it. We're gonna talk about that here, too. So what this means is are you gonna have, like, a layaway policy? Are you gonna have some kind of payment plan policy? Ah, the first thing we want to talk about is, um, expectations. Is this expected in your industry? Ah, that you will be able to offer some kind of credit or financing for your product if it's a car. Yeah. Um, if you're selling cars, you're selling slices of pizza. Probably not after that. Let's talk about what is our policy gonna be? What are our safety nets? Like what if someone? What if we offer someone a credit? Ah, to pay for our product over time, and then they don't do it? How are we gonna enforce that? Maybe safety. That says two words. Um, this offering credit is something that really turned slam academy around. We were not, you know, because our classes, you know, they're relatively cheap if you compare them to college classes. But if you compare him to just like something you want to do on a Saturday night there Somewhat expensive. So we started offering payment plans that went six months. Some of them go to a year. Um, so you pay off the class over a year, and honestly, we do it with primarily a handshake when people split and don't pay. We don't really have a good way to enforce that, but the rate at which they do it is small enough for it Still to be worth it for us, um is about 15% of the payment plans that we have in progress. Don't make it all the way to the end. That's pretty good. Um, the amount of money we lose is not worth the amount of money we would spend to track him down. You got to be over, like, 25 or 30% that it probably would be. But we just use the PayPal payment plans so it automatically charges their credit card every month. And if it gets declined, we try to work with them to get it fixed. But if they just disappear and start declining our payments or they cancel that credit card on disappear, then we don't really have a recourse. But, um, we've done just fine with that. As online classes grow, we might ah, push that harder and really emphasize that. But for now, it's kind of fine. So talk about how you're gonna deal with that. If you're gonna deal with that at all, you're not gonna deal with that at all. That's just fine. Okay, let's talk about the company organization. The next big section. 39. Biographies: okay. Company organization. Um, here, we want to talk about the people. Ah, and we want to kind of humanized this as much as possible. We want people to really see who they're gonna be working with and who they're supporting. If, ah, this is being run by an investor. So the first section biographies. So what we're gonna do here is the kind of easiest way to do this so that it doesn't get too huge is to do a brief biography like a single paragraph for each of the key people involved in the company. So I bu your partners and employees you already have that are going to be, you know, kind of senior level people, Not necessarily like the person washing the dishes. But people will really have input over the company. So just a paragraph about each one and then in the appendix will throw the full biography. So kind of. Here's what that looks like. Um, let me do if I go to the slam academy website, it's kind of the same thing. So if I go to let's go to instructors. No, actually, let's go. Staff in conduct. So here's staff The key staff. And here's kind of a long bio for me. The short bio would be probably just up to here. So that's how I usually do it. I have these first couple of sentences, and then this is long Bio. This is actually short bio. Um, but it's long enough my full bio if I go here, you hear? This is the long bio. I think this is maybe the same one. There's a longer one. If I go to this full bio. Pdf um, let's look at it just for the fun of it. Yeah, that's significantly longer. This is plenty, right? This is plenty of plenty of stuff. So So don't do the long, long bio just to a paragraph or so and then include the full bios in the back in the appendix 40. Advisors: Okay. More name dropping advisors. Always good. If you can tow list advisers, Anyone who you're going to seek counsel from, um, and not in just the legal sense. In the just asking for advice. Sense. Create a board of advisers. This is an unofficial board. Um, this is mine. These are These are great, great people who know a lot of stuff about a lot of things. And there my advisers there, people that I talked to all the time that I like having their name associated with my company, and they're willing to do it. You can't just list anyone. Be sure you ask people in addition to this board of advisers, um, you can list again here. You know, your attorney, your accountant, um, insurance people, any consultants and the other mentors that you will be leaning on for advice. Any bank people, maybe if they can kind of speak to your loan stuff, if if need be. But basically, name drop as many people as you can. Um, make sure those people know that they're being included in your business plan. Don't just put people in here and they don't know it. But people who an investor can look at and say OK, you know, they're working with people who have started other companies who know their way around this field so they're in good, good hands, right? It's confidence builder. 41. Org Charts: Okay, Uh, last thing in this section is in order chart. So in order chart is a chart. It's literally a chart that just shows all the positions and where they fall within the company. Ah, it's really handy. People are used to seeing it. So include, in this any all actually, even include all positions that you're gonna have to hire everything, even contractors, even the dishwasher, even low level stuff. Everything could be included in here if you want it to be. And include, if you have names associated with those jobs, if you already have the people put those names in there, if you don't have the people, that's okay. Still list the position, Um, and maybe listed as unfilled, whatever. So, for slam Academy, this is it, Um, so we have the way. We're kind of set up as we have me. We have a C C. O. This is essentially my main partner and the he's in charge of our quality control and are essentially our product, our classes. So we call him chief content officer. That's kind of a term we stole from Netflix. Um, he's in charge of all the content we put out. We have director of student affairs. She's amazing. Ah, Then the cco is in charge of studio manager and all the instructors and the director of student affairs is in charge of recruitment specialists and the affiliate team and somewhat the studio manager. So dotted line there. She has some, um, things to do with the studio manager. Ah, And in this social media, this is a person that we outsourced. I just x their name out. So I didn't publicize a random person's name to you all. Um, so we contract with them to do our social media, and they're not directly connected to anyone, but they're kind of indirectly connected to everyone. So I didn't put a line on them to anyone. And you don't have to have these big red boxes like I have the reason I have. These is we had some issues about, ah titles a while ago where kind of everyone was calling themselves an owner or and executive, and I just kind of band both of those words. I said, I don't want to hear anyone refer to themselves as an owner or an executive. I just think those air bad words and they don't fit in with the kind of mission of our company to, like, put people up on executive pedestals. You can totally do it if you want to. It's just a pet peeve. So I said anyone in this block you can refer to yourself as senior staff this block, your staff and this block your contractor. If you must refer to yourself in a general term like that, those are the terms I want to see. I don't want to see anyone in this block calling themselves and executive. Ah, that's the main reason I did this block thing. So, uh, that's the order chart for Sam Academy. There's not a ton of people here, right? Um, it's fairly simple, but ah, in each of these boxes, like here, there's about 10 people in this box, right? Um, there's about seven people in this box. There's actually three in this box. These are all individual people, though, so I just kind of said instructors as needed. But that works. That's totally fine for a Nordic chart 42. Profit And Loss Projection: okay. Your financial plan. So this, while not necessarily the biggest section of your business plan, it might be the most important. Um, this I've seen some of those pitch meetings where the investors just flipped straight to the financial plan. They said, Let's cut to the chase. Show me the numbers. So this is the numbers, right? This is the details. So we're gonna have kind of seven main sections here. The 1st 1 is probably the most nitty gritty of all of them. This is gonna be our profit and loss projection. So this is going to say what we plan on making and what we plan on spending, and we're going to do it on a 12 month basis. So we're gonna say for the next 12 months now, you might be thinking, Didn't we already do this? Uh, didn't really do this in section four. Way above, we kind of did. But we really only focused on profits. Um, what we planned on selling. So this is that combined with what? We plan on spending in a bunch of different ways. So So make sure that those match that's a big red flag. If if in the earlier section, you say, You know, I plan on selling ah 100 units in the first year, but in this section, you plan on selling 1000 units in the first year that makes you look disorganized. So be sure that they're they're both the same. Um, and you know what you're doing. So in order to help simplify calculating all of us for you, I'm gonna give you another worksheet. So in the next little blurb, there's a download link to the same places before where we got a worksheet. Um, and it'll get you to download this. So this is a profit loss projection. You can put this grid right into your business plan. Ah, once you fill it out, get rid of the blue stuff and make it look like your own. But, um, that's okay. So this has four main sections. Revenue that your sales, the cost of your sales and then gross profit. That's just how much you made And then expenses. Okay, Everything you had to pay. And at the bottom, we have some calculations that happen. So fill this out and this is for each month. So the one extra thing that this chart has on it, which is great. Ah, and it's good for you to include Is these columns? Uh, this is industry percent. So industry average is a better way to look at it. So what is the expected average sales in your industry for this kind of thing? So taken estimate. And this will tell us if we're in line with our industry and where we're sitting in the industry. 43. Big Income Statement: okay up next, we're gonna dio, um, the same thing. But over three years, this is You don't have to have this in here, but, um, if it looks good, you could put it in may be good to have. And you would just do the same calculation you could use the same worksheet just extended out over three years. And you can do this one even in a narrative if you want. So this one shows the whole chart. Um, do the chart. If you want to keep it simple, do the chart three times. One assuming this year the next assuming next year and the third assuming in three years and then in here in this section, you can say we expect our projections or our projections indicate that over three years are profits and losses will look like this and you can walk through it. Ah, income statement is another word for P and l statement. Profit and loss statement. So piano profit loss, income statement, menacing thing 44. Cash Flow Projection: Okay, I'm next. Is our cash flow statement of cash flows similar to a P and L statement? Except that, um it basically tells us how much cash we have on time at any given moment, and it kind of looks into the future. So this is especially important if you're doing anything with credit. So, like, to your customers. So let's say you are going to sell something to somebody. Um, and but you're not gonna get paid for it for until next month, or you'll get paid a little bit next month and a little bit the month after that. A little bit the month after that. Um, the cash flow statement tells us what we should, How much cash we should have on hand at any given time. So it'll it would account for those bumps each each of those payment's going into the future. So another great little worksheet from that same website I'll give you in the next segment . So this just talks about calculating out for the year. I remember We're doing an estimate here, so we're gonna estimate what are cash sales? Are cash paid out? Ah, and then we're gonna look at that a couple different ways and are essential operating data . Um, non casual information. So just general stuff. Sales volume, accounts receivable, bad debt, an inventory on hand. So things like that. So mostly we care about cash sales per month. Okay. How much cash? We had it at our start up and stuff like that. So relatively easy one. But we want to include this also, this is a very important document. 45. Balance Sheet Projection: All right. Up next is a balance sheet projection. So we want to look at our general balance sheet. Balance sheet is relatively simple compared to the other two that we've looked at so far. And what a balance sheet essentially is. It's kind of like a simplified budget. So another worksheet for us, Teoh Hammer through. What this is gonna tell us is, you know, we're just gonna list our main expenses here in terms of what we have on a current date and then what we project having. So we're gonna go through our assets. Ah, and our liabilities. So money that we owe to people long term debt owners equity That would be like invested capital money you put into the business to get it started. Things like that. Ah, and that'll get us off the ground. So fill that out and put this in just like this into your business plan. In the section, this is another. Another important document. This section is all about important charts and graphs, but people are really used to seeing them as charts and graphs. So it's good to have him laid out just right 46. Break Even Calculation: Okay, One more important chart. Um, this is gonna be our break even projection. So we are our last chart. I think this is gonna tell us what we need to do in order to break even, get out of debt. Everything kind of worked out evenly. So another worksheet for you. So it's gonna put in info about what we're selling, what we owe, and then it's going to tell us. Ah, at what point we break even this is good for an investor to see because they want to know that well, they already know that they're not making any money until you get out of debt and not only get rid of debt, but also ah, that you're selling things in a way that you're going to make profit on eventually. So it's great for an investor to see so fill out this worksheet, and then we're done with worksheets. 47. Use Of Capital: Okay, One more thing, and that is going to be a statement about the use of capital. That means that we want to talk about, um, how we're gonna use money coming in, especially from lenders or investors in this section. I would say something like, um, you know, with the $10,000 that were seeking and investments, we will be improving manufacturing equipment that will let us produce more. Ah, and faster. And that will lower our sales. Just show here how, ah, the investor money that you're looking for will impact your company in a positive way. So, basically, why do you need that money? Because if you don't need that money, don't get that money. Um, don't invest or don't sell off part of your company for it, right? But if you're searching for an investor, uh, tell them why you need investor in this section. So just say I need money to grow inventory. I need a bunch of cash so I can grow inventory so I can fill orders, and then I'll have things moving in a more ah kind of snowball effect kind of way. But show them that their money will lead to growth. And it's not gonna be a situation where you're going to take their money. And then you're gonna always be needing more money. You need to show them that their money gets you over this hurdle, which in that which after that, you will be making money on your own, and then they will be making money on their investment. That's what you want to talk about in this use of capital section. 48. Supporting Documents: Okay, let's talk about the appendix. Um, relatively easy. We've talked about it a little bit. Um, this is where we're gonna is gonna dump a whole bunch of documents that, um that we've referenced elsewhere. So anything that backs up what you've said in the other parts is good to put in here. This is not something that someone reading and evaluating your business plan is gonna read from beginning to end. This is a reference section. This is like the glossary. Kind of where If they're reading your business plan and you say I've secured, at least for $100 for this giant factory, then someone who's reading it might say, That's crazy. I want to see the lease and then they'll flip back and see it if they don't believe it. So some things to include here would be any lease. You have any intellectual property resumes bios of the owners of, Let's say, the owners. That's a of key staff. Um, any advertising materials that you already have developed, including logos, flyers, etcetera, anything like that. So that in there so I can get a good picture of what's going on. Um, blueprints. If you're building something out. If you're building out of space, show them what it's gonna look like. Um, you can include list of equipment and then include needed and already acquired. You can talk about any market research that you've referenced above. So if you referenced some numbers and said the market says this with a lot from such and such study, this goes way back to the beginning that we were talking about with studies. Ah, reference are tell us how to find that study here. You don't have to reprint the whole study. Um, but tell us where you found it. The name the publisher of the day. Delicate stuff. Just like old school bibliography. Um, and then sometimes you might want a list. Um, any assets that can be used for cool lateral quitter? Not about idea to list. If you are going into a loan situation, you can list that, and that's it. The appendix is just a bunch of documents. Okay. Ah, last thing that we need to do is jump all the way back up and look at our our our executive summary. Right? Remember we skipped that. Let's go all the way back up. there now that we have a big picture of what this whole thing is gonna look like and let's talk about the executive summary. 49. Overview Of The Plan: Okay, now that we've done everything we've gone through our whole business plan. And if that was long and tedious, then you did it right. These things are not fun to make. Um, but we've done it. We've gone through everything. Now we're gonna go back up to our executive summary. So this is Ah, one or two page thing. So I'm just gonna write one or two pages, but ah, aim for one shorter is better here. Ah, Shorter says that you know how to edit and right? Well, and it also says that you respect the time of the person reading it. Don't go on and on and on, I would say at maximum two pages, but if you can get it into one page Ah, it's better. I think this is ah, very opinionated thing, but try to aim for one page. So what do we cover? Ah, devote about a paragraph to each of the following things First. Just a general business overview. What's the plan? What do you doing? Um, next paragraph. The product. What do you selling? Tell him. Tell him a little bit more about the product. Next paragraph Goals. What are the goals of the company. Talk about Ah, in six months, we will above a block. In three years, we will, of a blah right. Um, all of this is supported later in the document. Right? So for this, you can reference those charts we just made and said and say in three years, we will be doing this. And there's a chart that backs that up. Next, your target market. What are you entering? What field are you entering? What do we know about it? What is your ideal customer next? Uniqueness. That's probably not a word. That is uniqueness. What makes you unique? What is going to make you stand out from the crowd? Next, your team, uh, talk about who you have on your team that's gonna make you win, right? Think of it like a sports thing. We've got this awesome team, and we're gonna be awesome. And last financial summary financial summary Talk about, uh, in brief narrative terms. Don't put any charts here. Just say, um we've got this much money. We need this much money. We're gonna make this much money kind of a big ah summary of what everything looks like and that is the executive summary. You could do all that. Get it on one page. You'll be in great shape. Remember, the key here is excitement. I know that this is business Plans in general are phenomenally boring. I mean, just the most boring stuff you could possibly read. And I don't think making the rest of the business plan exciting is a great idea. But in this executive summary, if you can give it a feeling of this is an exciting opportunity. This is an exciting time. This is an exciting market. That's that's what you want. You really want to get these investors excited about it, Excited enough to read on, right, cause because this is a big document now. So the goal of this should be to not only get them the kind of basic facts of the company, but get them excited and inspired so that they want to be part of it. Um, so try to use a tone that gets people excited about what you're doing. Don't lie. Don't say anything. That's not true in this because you're going to get called out for it right away. Um, Onley do things that you only say things you support later the document. But all told, make sure that it has a very uplifting and inspiring tone to it, to the way that you describe different stuff. Cool. That is our executive summary. And we're done. We've written a whole business plan. Sucks, right? Nobody likes writing business plans. Ah, but so it goes, Ah, In many cases, you have to have him. So now you have one. Great, Let's go on to a couple more things and then we'll finish up this class. 50. What Next?: Okay, So what next? Ah, you've been with me for up to three classes. Now I hope you've watched all three. I hope you're having a good time. I'm gonna keep going. Um, I really like making these classes. So what comes next is the next big part of this class is going to be about running a small business. So we're going to go through the day to day operations were going to really work on, uh, everything you need to know to keep your company in business and things operating at in tip top shape everything from management to marketing to social media, all that good stuff we're gonna cover in the next chunk of it. After that, we're going to go into business ethics. We're going to talk about on later classes. We're going talk about specifically about marketing specifically about growth. Um, specifically about accounting. There's a whole bunch of great stuff. I have plans, so I hope you're having fun. I hope you stick with it. Um, keep hanging out in these classes and you'll keep learning more. So one more thing I want to leave you with Ah, kind of. Ah, thanks and goodbye. and, ah, little bit of a present. So head on with me over to the next video and I'll give you a little present. 51. SkillshareFinalLectureV2: Hey, everyone want to learn more about what I'm up to? You can sign up for my email list here, and if you do that, I'll let you know about when new courses are released and when I make additions or changes to courses you're already enrolled in. Also check out on this site. I post a lot of stuff there and I check into it every day. So please come hang out with me and one of those two places or both, and we'll see you there.