Show Business - Money Hunt TV show - includes information on business plans

Kiplinger's Personal Finance Magazine, June, 2000 by Ronaleen R. Roha

Karl and the Morans are listening. Business plan number 101 is on the way. --Reporters: COURTNEY McGRATH and SEAN O'NEILL

BUSINESS PLANS THAT WORK

Aggressive networking can help grab the attention of potential investors in a business. But what will win their confidence, and their money, is a good business plan--a blueprint for running and developing your business.

Your plan should be "short, concise and businesslike--don't show off," says Tim Berry, creator of Business Plan Pro software (Pale Alto Software, $89.95; www .paloaltosoftware.com). All told, 20 to 30 pages, plus financial tables and appendices, is just fine, he says.

Include the following:

* Executive summary. This section comes first, but you should write it last. The goal of this distillation is to hook a potential investor in about three pages.

When co-hosts Miles Spencer and Cliff Ennico choose businesses to appear on PBS's Money Hunt, they're looking for "a killer executive summary that leaves no questions unanswered," says Spencer.

* Description of the business, Explain the company's history, legal structure and what it will actually do. Spell out how you expect to achieve your goals.

* Products and/or services. Itemize your products and services, expenses for and profits from each, and sources of supply. Discuss patents and other legal protections. Focus on what makes you unique. "For 2,000 years we survived without your product," says Spencer. "Why should we buy or use it now?"

* Market analysis and strategy. This will probably be the longest part of your business plan and the toughest to write, because for new businesses it's based on educated guesses. Use your market research to identify your likely customers and how much they will buy.

* Competition. Every business has competitors. Identify yours, their share of the market and their strengths and weaknesses. How might they respond to you, and how can you fight back? Emphasize your competitive advantage-how are you different and better?

* Management. Potential investors always focus on who's running the show. How will you fill any gaps in skills?

* Risks. Spell out contingency plans if things don't go as expected.

* Financial statements and projections. You'll need profit-and-loss and cash-flow projections and a balance sheet showing total assets and liabilities for the next five years, plus a break-even analysis. Show investors how much the company is worth, how much of it they will get and, vitally important, what they will get out of the deal, and when.

* Appendix. Attach such items as resumes and any contracts or leases you've signed.

Where to get help.

Here are some resources to help you produce a compelling business plan. Remember, it's Four business and the plan should be yours, too. "If it becomes a consultant's plan, everybody loses," says Berry.

For a clear guide to the subject, check out The Business Planning Guide, by David H. Bangs Jr. (Upstart, $24.95).

The CCH Business Owners Toolkit site (www. toolkit.cch.com) has "how-to's" and sample plans. Click on "Planning Your Business" on the home page.