Business planning workshop participants often ask what sort of attachments should be included with their business plans.
From a high level perspective, a business plan is made up of three main parts: narrative, financials and supporting information. Supporting documents are best attached as appendices to your business plan.
The appendix is where you will place any detailed or complex information that supports all those amazing claims made in the narrative and financial parts of your business plan. The narrative or body of your plan is where you’ll tell your story, and it must be easy to read. Any back-up documents or items that would disrupt the body of your plan should be tucked instead into the appendices.
Here are a few of the most likely documents you should attach to your business plan.
1. Resume. A resumé is a concise inventory of your personal experiences, your educational background, and any personal information that adds credibility to you as manager or owner of the proposed business. It’s an opportunity to highlight your strengths and show how your work experience increases your chances of success.
2. Certificates and Accreditation. Provide any certificates and accreditations that will build your credibility as owner and manager of your proposed business. In doing this, you’re best not to overdo it, just include the certificates most relevant to the business you’re planning.
3. Historical Financial Statements. If your business plan is for an existing business or if you’re planning to buy a business, you’ll want to attach enough financial history to show whether the business has been earning or losing money.
4. References. If you’re starting a new business, and particularly if you’re looking for financing, a list of references or a few reference letters will add strength to your case. Be sure any letters are up-to-date and that those providing the letters are aware of what you’re using them for. A supporter forewarned will be better primed to give you a rollicking good reference, if she gets a call from the lender.
5. Validation of Sales. For a going concern, a list of paying customers enables the reader of a business plan to evaluate the strength and quality of the customer base, and therefore the enterprise’s sustainability. Start-ups with no sales to tout will use other types of validation, such as letters of intent, expressions of interest, or comparisons to similar businesses.
6. Market Research. If you’ve gone to the effort to survey potential customers, you will want to summarize your findings and attach them to the business plan. This is also a place to include items like demographic tables or articles that add credibility to your business case.
7. Legal Documents. If you’re getting into a partnership, you might wish to attach a copy of your partnership agreement. This appendix might also include contracts, lease agreements or any other relevant legal documentation.
When deciding what to include as supporting information for your business plan, keep the target audience in mind. If the plan is for a banker, ask what he or she needs in order to do the due diligence on your plan. While most professionals will want to see the items above, it’s equally true that each person or group to whom you submit your business plan may request a slightly different mix of supporting information.
The key to successful business planning is to do your own due diligence, to ask each person you submit the plan to what supporting information they need, and then include the documents they want.