Executive Summary

Anyone looking at your business plan will first want to knowwhat kind of business you’re starting or already have. So theexecutive summary, or statement of purpose, should succinctlyencapsulate your reason for writing the business plan. It needs totell the reader what you want and why, right up front.

Because it’s the first thing the reader of your business plansees, it must make an immediate impact by clearly stating thenature of the business and, if you’re seeking capital, the type offinancing you want. Are you looking for a $10,000 loan to remodeland refurbish your factory? A loan of $25,000 to expand yourproduct line or buy new equipment? Would you like to find a partnerto whom you’d sell 25 percent of the business? What’s in it for himor her? The questions that pertain to your situation should beaddressed here clearly and succinctly.

Your executive summary should be short andbusinesslike–generally between half a page and one page, dependingon how complicated the business or use of funds is. It should touchon the following key elements:

• Your business, its product, the market it serves and itscompetitive advantage
• Your business’s legal form of operation (sole proprietorship,partnership, corporation or limited liability company), when it wasfounded, the principal owners and key personnel
• Major achievements, which would be anything noteworthy, such aspatents, prototypes, important contracts regarding productdevelopment, or results from test marketing that have beenconducted
• If you’re looking for funding, include the amount and purposeof the loan requested, the repayment schedule, the borrower’sequity share, and the debt-to-equity ratio after the loan, securityor collateral is offered.
• The company’s current market value, estimated value or pricequotes for any equipment you plan to purchase with the loanproceeds.