A New Restaurant

While it’s important to pay attention to the details in all of the separate parts of the business plan, I also think it’s important to see how it all fits together. Sometimes looking at the big picture can help you visualize how those details fit in. Over the next two days I’ll give you an overview of what is inside a business plan.

There are a lot of different structures for business plans. The order I’ve list these parts isn’t written in stone, but you should make sure they’re all covered in the final version. Make sure the information flows from one section to the next in a way that will make sense to the investors. You don’t want to jump around from Company Analysis, to the Management Team, over to Financials, and then back to Industry Analysis. If you’re doing analysis, do all of the analysis before moving on to the next area.

So here are the different parts, and a brief explanation of what they are.

Executive Summary

Although this is the first section in any business plan, it should be the last thing you write. This is where you give a brief overview of your business plan. Although it’s brief, don’t think that it’s not important. The Executive Summary has to capture the attention of potential investors, and convince them that the business plan is worth further investigation. It has to have enough information to lead them further into the plan. This is where investors get their first glimpse of your restaurant, and the need you are trying to fulfill.

Company Analysis

In the Executive Summary investors start to learn about your restaurant. In the Company Analysis you give them the details. This is where you lay out what your company is, why you are entering the marketplace. You also need to show why your restaurant is uniquely qualified to be successful in an industry that has such a high mortality rate.

You should let investors know about the company’s profile. You should address things like the restaurant’s business structure, concept, and how far along in development you are.

Industry Analysis

Industry Analysis is important in educating investors about your specific industry, and it shows them that you really understand the industry. While it’s important to talk about the industry as a whole, you also need to spend some time discussing your specific niche. If you are thinking about opening a 4-star fine dining restaurant, talk about that, don’t waste time by including information about fast food or pizza shops.

You should also show what the trends are in your market, and how your company is positioned to take advantage of those trends. You should address how the market size has changed in the past 5 years, and expected changes over the next 5 years. Touch on anything that is happening in the industry that will affect your restaurant, and has the potential to impact your growth.

Customer Analysis

This is where you get to talk about who is going to be spending money at your restaurant. Understanding your company and your industry are only part of the picture. A company alone doesn’t make money. It needs people who are willing to spend money to purchase what the company has to offer. In this section you need to be able to show what the customers in your market want and need, and how you are going to fulfill that need. You need to show not only that you can meet the customer’s needs, but also that there are enough customers in the area to support your venture and make it profitable. You may be the highest rated business in the neighborhood, but if you’ve only got 100 people in the neighborhood, they probably won’t be able to support you for very long.

Check back tomorrow for the completion of this list.