Guidelines for Writing an Effective Business Plan

All reputable lenders, including Meredith Village Savings Bank, want to help you ensure the success of your business. One of the best ways to communicate your goals and plans is to share your business plan with us.

Your business plan has two major functions:

  1. It explains the nature of your business and the reason you need to borrow funds
  2. It substantiates your ability to repay the borrowed funds from future profits

The elements of a comprehensive business plan are:

Executive Summary—a summary of the key points detailed within the plan, including:

  • Your name and address
  • Your business name, address and phone number(s)
  • The name, Social Security number and address for each principal of the business
  • The amount and purpose of the loan
  • The anticipated benefits of the loan and plans for repayment

While the executive summary appears first in your business plan, it is often helpful to write this section last, after you have worked out all of the details.

Description of the Business—a detailed description of the nature of your business, including:

  • The type of business and its history
  • The ownership structure, including proportions of ownership if several principals are involved
  • A complete description of your product or service
  • Number of employees
  • Location and description of the site

Your Market—an explanation of how your product/service is positioned in the marketplace, specifically:

  • Describe your product/service and the market it serves
  • Identify and evaluate your competition
  • Explain how your business competes
  • Describe your promotional and marketing plans

Your Experience—an analysis of the skills and experience contained within the business, namely:

  • Describe your experience and the experience of the principals involved in the business; attach a current resume for each person profiled
  • Describe the experience of other key personnel; attach a current resume for each person profiled

Financial Information—you may want to seek assistance from finance books or a financial advisor for this section, in which you:

  • Describe the sources and uses of current funds—the amount of your investment and any outside investments
  • Describe the use of the loan requested, including all cost estimates
  • Include personal financial statements and tax returns for each owner/partner
  • Provide cash flow projections by month, for at least two years; if the business is already established, provide cash flow reports for at least three years
  • Include your most recent tax return; if the business is already established, include the three most recent tax returns of the business
  • Provide your balance sheet and income statements for the previous year (for exisiting businesses only) and a list of your accounts receivable/payable for the most recent quarter
  • Include any explanatory information that would help banks and investors understand your policies with your customers and vendors

Other Important Support Material

  • Letter of reference—a letter from someone who knows you and has worked with you, detailing your management ability (a list of professional references that we may call is sufficient if you do not have a letter of this kind on file)
  • Legal documents—price quotations, leases, contracts, letters of intent
  • General documents—trade press/general media articles, research relevant to your business, any other information that supports your loan request

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