Business Plan Template

The following business plan template can be customized for your company. This plan can also be found in

Appendix B of the NASCLA Contractors Guide to Business Law and Project Management, South Carolina

Commercial Contractors, 8th Edition. You may want to work through this plan as you review each chapter, as

some of the business plan section topics are covered in more depth.

Business Plan Outline

Section 1: Cover Sheet

1a. Name of Business

1b. Contact Information

Section 2: Executive Summary

2a. Plan Highlights

2b. Keys to Success

Section 3: Company Summary

3a. Vision

3b. Mission

3c. Legal Structure

3d. Management and Personnel Plan

3e. Proposed Location

3f. Facilities Requirements

3g. Operational Hours

Section 4: Products and/or Service

4a. Product and/or Service Description

4b. Vendors

4c. Technology

4d. Expansion Opportunities

Section 5: Market Analysis

5a. Target Market Deﬁ nition

5b. Market Needs

5c. Market Trends

5d. Market Growth

5e. Competitive Comparison

Section 6: Marketing Strategy

6a. Value Proposition

6b. Competitive Edge

6c. Pricing Strategy

6d. Promotion Strategy

6e. Marketing Programs

Section 7: Financial Plan

7a. Sales Forecast and Assumptions

7b. Proﬁ t and Loss Pro Forma

7c. Source of Financing

Note: You may also refer to the Financial Management chapter of the NASCLA Contractors Guide to Business Law

and Project Management, South Carolina Commercial Contractors, 8th Edition, for additional ﬁ nancial documents

such as a balance sheet, income statement, and statement of cash ﬂ ows. The proﬁ t and loss pro forma is a good

tool for newly-established businesses to determine how much revenue is needed to break even.

Business Plan Template

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Section 1: Cover Sheet

The cover sheet should contain the name of the business, address, phone number, fax number, email address, and

contact name. Some cover sheets also contain a conﬁ dentiality statement.

Section 2: Executive Summary

A business plan normally starts with an executive summary, which should be concise and interesting. This

summary includes the highlights of your plan and serves as an introduction to the rest of your plan. Topics in your

executive summary should include, but not be limited to, the following:

9 Business name

9 Business location

9 Product or service o ered

9 Purpose of the plan

9 Projected sales

9 Proﬁ tability

9 Keys to success

The executive summary should only be a page or two long. Although the executive summary appears ﬁ rst in the

printed document, most business plan developers do not write it until after the plan is complete.

Section 3: Company Summary

1. Vision and Mission: Include a vision and mission statement for your company. The vision should be a short

statement about the company’s aspirations for the future. The mission describes the company’s primary

business purpose or goal. These statements outline the business concept and provide a concise deﬁ nition of

where your company ﬁ ts in the market.

2. Legal Structure: Deﬁ ne the legal structure of your company (i.e., sole proprietorship, partnership,

corporation, or limited liability company). Explain why you chose this structure and the beneﬁ ts it will provide

to you and your company. Legal structure is covered in Chapter 2.

3. Management: Outline the key management personnel needed to run your business. Can you run

the business yourself or do you need to hire managers to help run the operations? What are the job

responsibilities of these managers?

4. Employees: How many employees do you require? What are the job responsibilities of the employees?

5. Location: Describe the location of your business. You do not need to provide a speciﬁ c address if you do not

have one, but identify the area (e.g., downtown location, at home, in a rural area). Explain why this location

will provide you with the best opportunity for success.

6. Facility Requirements: Identify your facility requirements. Do you need o ce space, a production area,

storage space, or mobile storage? You may want to draw a diagram of the space.

7. Hours of Operation: What are your hours of operation? Explain how these hours will provide the maximum

beneﬁ t to your customer. How will you handle emergency situations that arise outside of normal working

hours?

Section 4: Product or Service Description

Deﬁ ning your product or service (or both) may seem simple. You must describe not only your product or service

but how you will provide it to your customers. For example, you may be a general contractor, but without reliable

subcontractors and suppliers, you may not be able to complete your projects in the time frame promised to the

customer.

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1. Product or Service Description: Write a summary explaining your specialty. For example, are you a general

contractor, plumbing contractor, etc.?

2. Legal Requirements: Do you have any licensing or registration requirements? Are there any legal

requirements for practicing your trade or running your business?

3. Subcontractors and Suppliers: Who will be your primary subcontractors and suppliers? What process will

you use to evaluate subcontractors and suppliers?

4. Technology Trends: Summarize how technology will a ect your business. Are there e ciencies that can

be gained through technology? For example, can you integrate scheduling or estimating systems into your

business processes?

5. Growth Opportunities: What expansion opportunities exist in the future after your company is established?

Can you o er additional products or services, or expand your customer base to other locations?

Section 5: Market Analysis

A market analysis is often performed as one of the ﬁ rst tasks in researching and formulating a business plan.

Understanding your customers, the demand for your work, and your competition is important to the future success

of your business.

1. Target Market: Deﬁ ne the target market for your product or service. Describe the key characteristics of your

customers. For example, do your primary customers include families, retired adults, or businesses?

2. Product or Service Description: Describe the need your product or service will be ﬁ lling for your customers.

If you will provide both products and services, describe how these will beneﬁ t your customers.

3. Trends: Describe how your product or service aligns with the consumer trends of your customers. What are

the construction trends for your trade and how do these ﬁ t your customer’s needs?

4. Growth Opportunities: Outline growth opportunities that exist within your target market. For example, if you

are a pool builder and your target market is young families, you may want to concentrate on single-family

homes rather than commercial projects.

5. Competition: List your major competitors. Are they local, regional, or national?

Section 6: Marketing Strategy

A marketing strategy is easily formulated by using the “4 P’s:” Product, Price, Promotion, and Place. Product is not

just your product or service, but how it will beneﬁ t your customer. Price refers to your pricing strategy, which can

vary based on the market, your goals, and your competition. Promotion deals with marketing in a traditional sense.

Your customers will ﬁ nd out about your business through your promotional e orts. Place deﬁ nes your distribution

strategy. In the construction industry, distribution deﬁ nes the type of customers you want to target. For example,

you may decide to di erentiate yourself by specializing in certain types of construction.

1. Value Proposition: Describe the value that your company will provide your customers. What beneﬁ ts of

using your company will you promote to your customers? For example, you may promote your level of quality

or service.

2. Competitive Edge: Describe what makes your product or service unique and how you have di erentiated

yourself from your competitors.

3. Pricing Strategy: What pricing strategy will you use? Some options include:

9 Cost-plus pricing, where you determine a markup percentage and add it to the cost of the job.

9 Consistency with competition, where your pricing reﬂ ects what the competition is charging.

9 Value pricing, where you try to undercut your competition with lower prices.

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4. Promotion: How will you familiarize potential customers with your business? Will you promote your product

in special venues (i.e., trade shows or special events)? Are there any businesses you can build a co-op

relationship with so you can cross-promote each other? For example, you might partner with another trade

or supplier to promote each other.

5. Advertising: How will you advertise? Will you use media such as radio, TV, newspapers, and the Internet?

How often will you advertise?

6. Sales: Will you hire sales representatives to promote your company? If so, how many? How will the sales

force be divided up? By area or region?

Section 7: Financial Plan

A ﬁ nancial plan can include several aspects of the potential ﬁ nancial health of the company. At a minimum, it

should include projected proﬁ ts over a speciﬁ c period. This template, for example, shows the ﬁ rst three years of

operation. The ﬁ nancial plan should also explain projected cash ﬂ ow and identify any additional capital required

from outside investors or loans.

The proﬁ t-and-loss statement is a tabulation of the gross sales income for the company from which all attributed

costs must be deducted. A pro forma is a “best guess” at these sales numbers and the associated costs. From this

pro forma, you can see your proﬁ t or loss based on the numbers you projected and adjust your budget accordingly.

A blank proﬁ t-and-loss form is located at the end of this section, if you are unable to use the form on the

NASCLAforms.org website. If you use the spreadsheet located on the website, it will automatically calculate gross

proﬁ t and net income.These calculations were derived from the following formulas:

Income – Cost of Goods Sold = Gross Proﬁ t

Gross Proﬁ t – Expenses = Net Income

You learn about ﬁ nancial calculations in the ﬁ nancial management chapter (Chapter 14).

Sales/Income

Use the following points to help you make your sales and expense projections.

You need to determine the average price of the jobs you perform and the number of customers you are projecting

for the year. This is your “best guess,” but if you have any historical sales data, you may want to use this

information in your calculations to determine how your business sales will grow over time.

However you determine your sales, you must list your assumptions so the person reviewing your business plan will

understand the numbers presented in your plan.

Projected sales numbers

Sales (in dollars)

Year 1

Year 2

Year 3

Transfer sales numbers into the proﬁ t-and-loss worksheet.

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Cost of Goods Sold (COGS)

Cost of goods sold shows the cost of materials and production of the goods a business sells. For each year, enter

your inventory cost and the cost to produce the ﬁ nal product for the customer and add together to show the totals.

This total represents the cost of goods sold.

Year 1 Year 2 Year 3

Inventory

Production Payroll

Total

Transfer COGS numbers into the proﬁ t-and-loss worksheet.

Management Salaries

Determine how many managers or supervisors you will need to operate your business. A published salary survey

will help you estimate what they earn in your type of business and in your region. Determine if you will need to add

managers or supervisors in years two and three if you have an increase in business.

Number of

Managers

Manager Annual

Salary

Total Management

Salaries

Year 1

Year 2

Year 3

Enter the total management salaries in the respective boxes on your spreadsheet.

Payroll Taxes

Payroll taxes are calculated at approximately 13% of the salaries listed on your spreadsheet. A formula has been

entered to calculate that amount automatically.

Payroll taxes include the following items:

9 Social Security, also known as FICA (a set percentage deducted from an employee’s check and EMPLOYER

MATCHED)

9 Medicare, also called FICA Medicare (a set percentage deducted from an employee’s check and EMPLOYER

MATCHED)

9 FUTA - Federal Unemployment Tax Act, authorizes the IRS to use monies for job service and training funded

through the federal employment agency; EMPLOYER PAID ONLY

9 SUTA - State Unemployment Tax Act, authorizes the state to use monies for job service/training and retraining

of displacedworkers;EMPLOYER-PAID ONLY

9 FUI - Federal Unemployment Insurance; EMPLOYER-PAID ONLY

9 SUI - State Unemployment Insurance; EMPLOYER-PAID ONLY

More details on payroll taxes are provided in Chapter 15.

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Outside Services

These services apply to people or businesses who provide services to your company not directly related to the

sales or income of the company. They would not appear on your payroll. Estimate your annual expenses for the

following outside services. Keep in mind that the cost may be higher in the ﬁ rst year due to start-up needs. The

cost may drop in the second year and then level o in the third year.

Year 1 Year 2 Year 3

Lawyer

Accountant

Technology

Consultant

Total

Enter the year totals into the spreadsheet.

Advertising and Promotion

Consider the type of marketing you will need. If you are creating a radio, print media, online, social media, or TV

ad, get an estimate on what that would cost. Don’t forget to calculate the frequency of advertising you will do.

For example, let’s say a magazine ad costs $1,000 for a quarter-page ad and the magazine comes out monthly.

Your advertising cost would be $12,000 a year. You may want to advertise by printing ﬂ yers and mailing them out.

Calculate the printing costs as well as the postage to send out the ﬂ yers.

Year 1 Year 2 Year 3

Radio

Newspaper

Magazine

Flyers

Direct Mail

Special Events

Online Ads

Other (i.e., social

media)

Please Specify:

Total

Enter the year totals into the spreadsheet.

Rent

If you rent a facility, determine the rental costs per year. If you have not decided on a location, you may want to

look at a few locations and calculate an average rent cost to determine a ﬁ gure for this category. Keep in mind the

square footage requirements that you have set out.

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Annual Rent

Location #1

Location #2

Location #3

Average of all three

locations

If you are going to stay in one location, your rent should remain ﬁ xed over three years. If you plan on expanding in

years two and three, you may want to increase rent accordingly.

Enter the average of all three locations in the rent column on your spreadsheet.

O ce Supplies

O ce supplies include items such as paper, pens, printer cartridges, tape, and other materials as well as cleaning

supplies. As your business increases, the consumption of these supplies may increase accordingly.

Year 1 Year 2 Year 3

O ce Supplies

Cleaning Supplies

Total

Enter the year totals into the spreadsheet.

Dues, Subscriptions, and Licenses

You may want to join a Chamber of Commerce or trade group or subscribe to trade publications. Your business

may also need a license to operate. For example, if you are starting a plumbing company, you may be required to

get a contractor’s license.

Year 1 Year 2 Year 3

Chamber of Commerce

Membership

Business Organization

Membership (i.e., National

Homebuilders Association)

Magazine/Newspaper

Subscriptions

Business License Fees

Total

Enter the year totals into the spreadsheet.

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Travel

Does your business require you to travel to meet with customers? Will you travel locally, regionally, or nationally?

What are the air travel, rental car, and hotel costs for this travel requirement? Note that the spreadsheet has a

separate section for automobile expenses, where you enter costs such as gasoline or repairs. Use the automobile

expense section for trips that will be taken in a company or personal vehicle.

Year 1 Year 2 Year 3

Air Travel

Rental Cars

Hotel

Other

Please Specify:

Total

Enter the year totals into the spreadsheet.

Meals and Entertainment

Determine if you will be providing meals or taking your clients and vendors out for entertainment.

Keep in mind that the IRS allows you to take only a 50 percent deduction on meals and entertainment. It is not

considered a 100 percent business expense. Although you enter the full amount on your proﬁ t-and-loss statement,

your tax accountant will make the proper adjustments on your tax return at the end of the year.

Year 1 Year 2 Year 3

Meals

Entertainment

Total

Enter the year totals into the spreadsheet.

Automobile Expense

Determine if you will need one or more automobiles or trucks to operate your business. The cost to purchase

each vehicle appears under “Assets” on your balance sheet, and the cost to operate the vehicles appears under

automobile expense on the proﬁ t-and-loss statement.

Year 1 Year 2 Year 3

Gasoline

Oil Changes

Car Washes

Other

(Repairs)

Please Specify:

Total

Enter the annual totals into the spreadsheet.

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Utilities and Telephone

Determine what your utilities and telephone costs will be for the ﬁ rst three years your business is operational. To

arrive at this estimate, you will need to determine how many telephone lines and cell phones you need. You should

also itemize Internet service and record these totals under this line item.

Year 1 Year 2 Year 3

Electric

Water

Garbage

Telephone

Internet Service

Other

Please Specify:

Total

Enter the annual totals into the spreadsheet.

Auto Insurance

If you have business vehicles, you will need to carry insurance on them. If you increase the number of vehicles in

years two and three, insurance expenses will increase as well. Certain vehicles may also cost more to insure than

others. For example, if you have delivery trucks, the insurance will probably be more expensive than a mid-size car.

Year 1 Year 2 Year 3

Vehicle #1

Vehicle #2

Vehicle #3

Total

Enter the annual totals into the spreadsheet.

Group Medical Insurance

You may want to carry medical, dental, or life insurance for your employees as a beneﬁ t and to increase employee

retention.

Year 1 Year 2 Year 3

Medical

Dental

Life

Total

Enter the annual totals into the spreadsheet.

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Business Insurance

By law, businesses are required to carry workers’ compensation insurance. Business liability insurance protects

your business against accidents such as ﬁ re, ﬂ ooding, burglary, etc. Business liability insurance is not required by

law but by contract. For example, most landlords require you to carry business liability insurance, as do banks and

governmental agencies with which you have a contract. Insurance and risk management are covered in more detail

in the managing risk chapter (Chapter 4).

Year 1 Year 2 Year 3

Workers’

Compensation

Business Liability

Total

Enter the annual totals into the spreadsheet.

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Worksheet

This is a scratch sheet for entering estimates and data that can then be entered in the spreadsheet.

Year 1 Year 2 Year 3

Income

Sales

Total Income 0.00 0.00 0.00

Cost of Goods Sold

Inventory Cost

Production Payroll Cost

Total COGS 0.00 0.00 0.00

Gross Proﬁ t 0.00 0.00 0.00

Expense

Management Salaries

Payroll Taxes 0.00 0.00 0.00

Outside Services

Advertising and Promotion

Rent

O ce Supplies

Dues, Subscriptions, and Licenses

Travel

Meals and Entertainment

Automobile Expense

Utilities/Telephone

Insurance Auto

Insurance Group Medical

Business Insurance

Total Expense 0.00 0.00 0.00

Net Income 0.00 0.00 0.00

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