CHAPTER SEVEN – A good executive summary is the holy grail of good business plan writing. Even though it comes after you have written and thought through every other facet of your business, it is arguably the most important part of the puzzle.
As its name implies, the executive summary is a brief overview of your business plan. Call it an introduction to your business and you would be very right. The executive summary gives time-crunched executives or VCs that high-level overview that will either persuade them to read your plan further or toss it in a trashcan without a second thought.
Even though the executive summary is the first thing that the readers of your business plan will go through, you should write it last because it summarizes everything from that start to the end of your business plan. Also, it is usually the first and probably the most important thing that busy investors consider before deciding if your business plan is worth spending a minute on.
Secondly, since it’s a summary, you will only be highlighting the main facets of what you have uncovered over the course of writing your business plan. Below is a list of what your executive summary should include:
Components of a Business Plan Executive Summary
- Business concept (what you do or what you intend to do)
- Business goals and vision (what you want to achieve)
- Product/service description and differentiation (what you offer and what makes it different)
- Target market (who you want to sell to)
- Marketing plan (how you plan to reach your customers)
- Current financial state (what you currently make in revenue—for existing business looking at expansion, or how much you already have on ground—for startups)
- Projected financial state (what you foresee making in revenue)
- The request (how much funds you are asking for)
- The team (who runs your business)
Writing a Business Plan Executive Summary – Sample Template
Your business plan executive summary must provide brief information on the following areas of your business;
- The target market: it has to describe the type of customers you will be targeting.
- Business model: it should describe your products or services and what will make them appealing to the target market.
- Marketing and sales strategy: it should touch briefly your plans for marketing your products or services.
- The competition: since competition is a major part of business, so it has to describe how you plan on dealing with the completion and gaining market share. It should equally state your competitive advantage.
- Financial analysis: it should summarize your financial plan
- Owners/Staff: it should describe the owners and the key staff members and the expertise they bring to the venture.
- Implementation plan: it should briefly outline the schedule for taking your business from the planning stage to opening your doors.
- An overview of funding requirements: you need to state the amount of funding you need, and what the money would be used for.
- Growth highlights: it should give any instances of growth and, if possible, illustrate that growth with graphs or charts.
- Future Plans: This doesn’t have to be too detailed, but it should give anyone reading your summary an idea of where your business is heading and how you intend to get there.
Writing a business plan executive summary is not that difficult, you only need to include the summary of the details that were listed above. You executive summary should be arranged this way;
- The intro
You can start by describing your company, your mission and vision statements. Include your business name and address. If you are lost for words on how to describe your company, think about how you want your employees, customers and the business community to view your company.
This intro paragraph should be attention-getting from the start. It is wise to bring in impressive attributes of your company, but be specific here. Potential investors will want to see real evidence of demonstrated skills and unique abilities. Use this section to highlight company or employee accolades, albeit briefly. Describe the organizational structure and name key employees.
The names and titles of key employees are sufficient; however, include a brief description of executive team members’ responsibilities and duties. Include a list of satellite offices, contact information for each location and how many employees would work in each location.
2. Your business offering
Write a description of what your business aims to offer to its target market. Here, you should give a description of the product or service the business expects to offer. Highlight the products or services in a way that sounds appealing and sets you apart from the competition. The aim of the executive summary is to intrigue the reader enough to read what the rest of the business plan holds.
3. Your finances
This section is where you now talk about the financial aspects of your business. Disclose all business partners, investors and banks you have business relationships with. Explain the role of each entity or individual, the amounts invested or financed, and fiduciary terms and responsibilities.
If you are proposing your business plan to additional lending institutions or investors, this information can strengthen your plan by illustrating confidence others have in your ability to operate a successful business. This section should also include sales and profit projections for the business. You are free to use charts or graphs to reflect this information if it would provide more insight than texts.
Construct the final section of your executive summary by drafting comments about your organization’s accomplishments, accolades or remarkable growth. In this section, briefly describe your plan for achieving your company’s future goals.
Having discussed how an executive plan is written, let’s go further by looking at tips on how to ensure that your executive summary is perfectly written.
8 Tips for Writing a Perfect Business Plan Executive Summary
a. You must ensure that your first paragraph is strong enough to attract the reader’s attention and compel them to read the rest of the summary. For example, you can start by stating a market problem that your business promises to fix.
b. Remember, it’s all a summary. So, keep it short. The business plan itself will provide the details. So, don’t waste the reader’s time or irritate them by adding unnecessary details in your executive summary.
c. Use strong and positive language. Don’t weaken or dilute your statements with inappropriate words. For example, instead of writing “Our business might just become the market winner in the next five years”, write “Our business is poised to become the market winner in the next five years.”
d. Although there is no standard page length for executive summaries, it is better to keep it within two pages. Always resist the temptation to stuff your business plan’s executive summary with details that are already covered in the rest of the plan. Remember, the summary is meant to present facts about your business and entice the reader to read the rest of the plan.
e. Fine-tune your executive summary after writing it. Read it aloud to yourself. Does it sound great to you? Does it sound clear and brief, but detailed? If you are satisfied with it, let someone else who knows nothing about your business read it and give suggestions on how you can improve it.
f. Customize the executive summary for your target audience. If your motive is to entice investors, for instance, your summary should hammer on the benefits that investors stand to gain from the opportunity you are presenting to them. Also, use formal or informal language depending on what’s more appropriate for your target audience.
g. Read the executive summary aloud once again, putting yourself in place of the reader this time. Does the summary trigger your interest in the business or put you off instantly? Does the summary sound too good to be true, due to the choice of words? After reading it thoroughly, make necessary adjustments.
h. Clear your vocabularies of any self-glorifying superlatives, clichés, and overused expressions that you may not be able to back up. Avoid words like “best”, “ground-breaking”, “cutting-edge”, “world class”, etc. Investors and other readers see those words almost every day and they tend to overlook their real meanings.
When writing your executive summary, even though it comes first, but aim to write it last after you have written the rest of your plan. This is the only way to know what exactly you should include when writing it. You have already done the research, so use that when pulling together the salient points of the executive summary.
Also, ensure that you check, double-check and triple-check your executive summary for any errors. Grammatical and spelling errors should be eradicated. But more importantly, your financial projections should contain absolutely no errors. Just one slight financial error will make you an amateur to any savvy investor.
Again, don’t be afraid to let your passion or excitement for your business come through in your executive summary. Investors typically believe that it takes a certain kind of entrepreneur to make a successful business, so capitalize on your commitment to get the backing you need.