In addition, I have a friend who is a small business consultant, and I can rely on her advice should I need it.

In short, I believe that I have addressed the major risks facing my business and have demonstrated that those risks are manageable.

I. Capital Spending Plan

Most items of equipment will be leased or rented, so there will be little need for capital beyond working capital and some fees and printing costs:

Other capital items and most of the furniture have already been paid for. The office building provides a receptionist and copy service as part of the rent.

Appendix 2: Business Plan for a Manufacturing Business

Overview

The business plan for DAY INTERNATIONAL, INC. that follows is roughly based on a real plan, although I have changed some details, including the financial projections. And because of space limitations, I have omitted a number of charts and exhibits contained in the appendix to the original plan.

Founders of the company asked for $75,000 to bring their product to market. They expected sales of nearly a million dollars by the end of the second year of operations. Here are some of the strengths and weaknesses of their business plan.

Sales Projections

The best part of the plan is the discussion of sales projections because it gives you a sense of the support youll have to provide if you plan to introduce a new product. Note the effort they put into developing a logical sales revenue forecast. Since most new products introduced into the marketplace do not sell well enough to produce a profit, investors and lenders want to see solid data to support a claim that your product will be different.

Also, they plan for two different products using the same technology. The first is aimed at the commercial market and is reasonably costly; the second targets the consumer market and carries a somewhat lower price.

The founders of DAY INTERNATIONAL, INC. believe that a successful business needs more than one product to survive. While there are some exceptions to that rule, diversification can achieve powerful benefits if one product meets resistance in the marketplace.

Items Excluded

This plan does not cover several important items I think should be included:

Marketing and advertising. DAY INTERNATIONAL, INC. plans to have their distributors and sales representatives handle a great deal of these activities. Were this my business, I would pay a little more attention to marketing. Ive learned that a new small business which leaves marketing to someone else often courts disaster. The reason for this is simple: When a product is new, no sales representatives, wholesale or retail outlets have much of a stake in its success. Until they do, they are unlikely to do much to push it.