Write Your Business Plan | Part 5 Overview Video In this section, you'll learn how to organize your business.
By David James
How does your business work?
That's the question you want to answer for investors — and yourself — in the operations section of your business plan.
The basic goal of this section is to provide investors with an overview without going too deep in the weeds. You'll want to cover just the major areas — labor, materials, facilities, equipment, and processes — and also provide the major details of things that are critical to operations or that give you a competitive advantage.
You want to answer investor questions about operations without overwhelming them. Here are some of the main points you're going to want to hit:
- Facilities: Where you will run your business — from home? A brick-and-mortar shop? A warehouse? — and the associated real estate costs.
- Income statement: This is your business's bottom line: your total revenue from sales minus all of your costs.
- Balance sheet: This shows your total assets, essentially what your business is worth.
- Cash flow statement: This shows the sources of your funds and the use of those funds.
- Break-even point: This is the point at which your gross profits cover all your fixed expenses.
- Operations: This is essentially a list of tasks that need to be done daily, weekly, or monthly.
- Personnel: Who will you need to run this business and how much will you need to pay them.
These are just some of the main aspects of your business plan's operations section. Read on for details on getting yourself organized or order a copy of Write Your Business Plan from the Entrepreneur.com Bookstore.
