Staff Positions and Management

For starters, you will need a project manager, a technical staff and a management team. The management team can make the difference between success and failure of the business plan. The team should have good experience in marketing, finance and operations.

Minimum Staff Positions
The staff you'll need to run your business will depend on the type and size of your business, and the programs and services you are offering. As a general guideline you'll need:

• Technical staff to develop and build your product or service
• Staff who can manage your finances
• Staff who can market your product
• Staff who can oversee your operations
• Administrative staff

Write your overall management philosophy. Identify your company owners and board of directors. Answer the obvious questions such as how many employees you will have over given periods of time, how many of those will be directors, managers, coordinators, supervisors, support staff and what their experience and credentials need to be.

For the key players you already have in place, provide summaries of their resumes highlighting pertinent experience and achievements, salary levels, and their areas of responsibility. For positions you are still trying to fill, summarize your minimum requirements for likely candidates along with the responsibilities of those positions. You may elect to contract those positions out to professionals who specialize in the areas you need. You may find that contracting work out is the best solution initially. Be sure you include the credentials and track records of your contracted help and the time tables for hiring additional staff.  Include a section on outside support, such as your CPA, your attorney, your banker, and your insurance broker. Also include any other outside resources such as your board of directors or management consultants.

Look at your management plan critically and search for weaknesses in your organization Spell those weaknesses out and identify your plans to address them. Even if you don't see the weaknesses, it is very likely that your potential investors, partners, and clients will.

Organizational Chart, Staffing Costs & Facilities

The Organizational Chart
Set up an organizational chart. Having a visual illustration makes it easier for both you and your readers to understand the organization and see any possible gaps.

Staffing Costs
Include either a table or a description identifying your personnel costs. These costs will be used in your profit and loss (P&L) statement. You can break it down by individual, or department. Include the title, department or group salary level and then in a separate line add 25% to 30% to cover employee benefits, taxes, etc. (also referred to as your Payroll Burden.) Extend this table to cover the next 2-3 years showing an approximate 3% per year increase on the salary line.  

Facilities
List your facility information in this section. Describe the type of space your business requires, the costs and lease length and terms, your time table for expansion or moving to larger facilities, and any other pertinent information.

Miscellaneous
If a part of your strategy is to gain market share based on excellent customer service, then you will want to include a section about your Customer Service plan. You may also want to include your human resources and benefits plan to layout your strategy for getting and keeping top talent.

• Do any of your staff members have non-compete agreements they are bound to?
• Are there any other limitations that should be considered?
• Do your outside resources have experience in your particular industry?
• Do your outside resources or your existing management staff have experience with startups?
• Do you have stockholders or partners, and if so will they have any say so in management decisions?
• What role will your investors play?

Financials

Financial Plan

If you're seeking funding for your business venture, you have some options. You can go to banks and other lending institutions and seek a business loan, or you can go in search of venture capitalists. Which source you choose, will depend on the amount of funding you need. The type of funding you need dictates how your plan (especially the financial section) is written. In other words, investors will want to know how they are going to profit from this investment down the road, while lenders will want to see how you will be repaying their loan.

Regardless of the source of funding, you'll need solid financial projections that cover all of the bases. Your business plan's Financial Plan is critical. For many, the financial portion of your business plan is its heart. If you think about it, why else are you going into business? You will fulfill a NEED you identified in the market and you WANT to make money doing it.  Your potential investors, lenders, partners, will read your plan to see if and when you're going to make money.

What constitutes the heart of your business plan is the profit and loss (or income) statement, the balance sheet, and a cash-flow statement. If your business is a startup, these will all be projections, or pro forma statements. If you're writing for an existing business, then these statements will reflect your past business history and current financial situation. Break your financials down into monthly projections for the first two years and then move to annual projections. Since this is a very critical part of your business plan, make sure you follow Generally Accepted Accounting Standards and that your financial statements are all prepared correctly. It is well worth the expense to hire an accountant to review or prepare them.  If you have an accountant prepare the financials, make sure you completely understand the process and what the terms and figures mean. Potential investors will feel more comfortable investing in a company whose owners have a good understanding of the financial aspects of the business.

Financial Needs Summary
Before you “throw” numbers and spread sheets at your prospects, summarize your financial needs. If you are seeking investors, this is where you will indicate how much cash you need to begin operations and how the funds will be used. How much will have to be spent on computer equipment, office furniture, etc? You can break these down into "operating projections" or "capital needs" or whatever meets your needs. Have as much documentation as possible to back up this information

Revenue Model, Assumptions and Comments
Revenue model: This describes the various programs you will be putting in place and how each program will generate revenue. If you've come up with a unique program be sure to describe it clearly. (You may also want to make sure you have confidentiality forms signed.)

Assumptions: Explain the techniques you used to arrive at the information in your financial statements. For instance, you may want to state that all services and program fees are assumed to be cash based. If a retail aspect is included state that certain inventory levels are maintained and paid for on specific terms and that the sales commissions are based on x% of sales totals. You can also include information about the general outlook in your business. This can be a bulleted list of short statements, or written in paragraph form.

For your own internal use, it is helpful to put together an assumptions spreadsheet that lists individual salaries (including costs of benefits), marketing expenses, other known budgeted business expenses, as well as revenue projections. This spreadsheet can help you identify when your expenses are going to peak due to marketing activity and planned hiring schedules.