THE BUSINESS PLAN The business plan

THE BUSINESS PLAN
The business plan is a document that spells out a company ’ s
expected course of action for a specified period, usually including
a detailed listing and analysis of risks and uncertainties.
For the small business, it examines the proposed products, the
market, the industry, the management policies, the marketing
policies, production needs and fi nancial needs. It is worth noting
that often there is confusion between a restaurant feasibility
study and the business plan, this may be so because a number
of information that become apparent in the feasibility study will
then be used in the development of the business plan. In the
business plan the manager addresses signifi cant issues that have
been identified in the feasibility study and states how he/she is
going to address them.
Who will be reading the business plan can have an effect on
how it is written, although the key information remains the
same, there is emphasis in different sections of the plan if the
operator goes for bank financing (debt finance) as opposed to
investors (equity finance). A bank may be looking for a solid plan
and assets that will ensure repayments of the loan whilst potential
investors may be looking for high returns on investment.
A well-developed business plan makes all the difference when
approaching potential investors (Figure 4.3) . Investors and lenders
will request a copy of the business plan and it is often one of
the key tools that helps them make a decision as to whether they
will invest or not. The heart of a good business plan is the unique
differentiation point. The key innovation that makes the business
stand out and ensures potential investors will consider fi nancing
the business. The following sections illustrate the main parts of a
business plan.