How to Prepare A Company Description
This is a good thing because that means they're interested. Keep in mind that at this point they are not entirely sold - Yet. The reviewer simply wants to take a closer look at your business and what its about.
You have to understand that the reader is giving your plan just a little bit of attention. They have read over your executive summary and want to find out a little more about your product and/or service. You want to give the reader what they want - a quality written company description of you and your business.
Here's how to do it...
The body of the business plan begins with a general written company description. This description should take no more a few pages and is the introduction into the business plan. The written company description should present the fundamental activities and nature of the company.
The written company description section should begin with a statement of the business's goals and objectives, defining what the business does (or will do) and it's purpose.
This is the place to put background information about the founding of the business, its ownership and legal structure, the nature of the industry, and the role the business intends to play in it.
In the written company description, you should include data about changes in the market that will lead to an increased demand for what your business has to offer. Speaking from an investors point of view, this is a very important . Investors pay particular attention to industries that are growing.
The written company description of the business plan should answer the following questions:
- What is the name of the company?
- What product or service are you offering?
- Where is it located?
- Is this a start up or an existing business?
- How will it be organized?
- Will it be a sole proprietorship, partnership, or corporation?
- Is the company a manufacturer, retailer, or service business?
- What customers is it attempting to serve?
Some further insight should also be offered as to what stage the company has reached. Is it in the beginning stages without a fully developed product? Has it developed a product but not yet begun to market it? Or is it already marketing it's product and looking to expand to another market?
It is very important to state your business objective clearly. You don't want to leave any questions in your readers mind as to what you do and what you are trying to do. You don't want to be to general here . Explain what you're product and/or service is and explain what you want to do. Always be clear and organized.
Here's an outline for a written company description and overview:
Written Company Description
Describe the type of business you are in. You don't want to leave your reader not knowing or worse yet, having to flip through the rest of you business plan trying to find and figure out what it is you actually do. Be clear and up front about the kind of business you're in or what you want to get into.
Who will own the company? Will it be a sole proprietorship? Partnership? Corporation? Your reader wants to know who will own the company and who's involved.
Current Status And Business History
Outline the history and the current status of your company. Is it just starting up? Is it an existing business?
Markets And Products
What type of product(s) and/or services are you planning on selling? You need to identify what kind of products or services you are selling and explain why.
You will need to outline the market gap you are fulfilling. That is, what market(s) needs will your company address. For example, does your product solve a particular need that's not currently being serviced?
When completing the written company description, it is important to state your business objectives. Perhaps your company is seeking a certain level of sales or geographical distribution. Or perhaps it hopes to become a publicly traded company or an attractive acquisition candidate.
Stating your objectives is important to the reader since it will generate more interest.
The mission statement should be short (usually a couple of sentences) that states the vision and goals you have for your company.
A good mission statement should accurately explain why your organization exists, and what it hopes to achieve in the future. It articulates the organizations nature, it's values. The mission statement should excite your reader.
Remember to always be clear when you are completing the written company description. You want to leave no doubt in your reader's minds of what your company is all about.