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What is an elevator speech? How can developing an elevator speech help a firm write a more effective business plan?

An elevator speech (or pitch) is a brief 1-2 minute long, carefully constructed statement that outlines the merits of a business opportunity. A good elevator speech can assist the founders in developing a sharpy and concise description of their business.

What is a business plan? What are the advantages to preparing a business plan for a new venture?

An important tool that helps people who intend to start a new business. A written document that carefully explains every aspect of a new business venture. Inside the firm, the plan helps the company develop a roadmap to follow in executing strategies. Outside the firm, it introduces potential investors and other stakeholders to the business opportunity the firm is pursuing and how it plans to pursue it.

Why is it important for the founders of a firm to continually measure whether the type of company they are envisioning, as described by their business plan, is consistent with their personal goals and aspirations?

Because one of the worst things that can happen to an entrepreneur is to write a business plan, raise money and launch the business. Then realize the business is inconsistent with his or her personal aspirations and preferred lifestyles and wish the firm had not come to fruition

It is often argued that the process of writing a business plan is as important as the plan itself. How is this so?

Because you must be sensitive to structure, style and content of the actual plan. To write it so it's well summarized, concise and provide a story that is coherent and attractive.

What are the hazards involved with using a software package to help write a business plan or hiring consultants to write the business plan for you?

For software packages, using them can be helpful, but may lead to the plan looking "canned" and not very well tailored to your specific business. Hiring a consultant to write a plan is bad because it takes out of the excitement and anticipation that is best displayed by the creators of the venture. It also denies the experience of writing the business plan, which may be useful.

What are the two most common reasons that entrepreneurs write business plans?

Internal: forces the founding team to work together to hammer out the details of a business venture. External: communicates the merits of a new venture to outsiders, such as investors and bankers.

Describe the general rules of thumb for the length and appearance of a business plan.

The length of the plan should be between 25-35 pages in length. The plan must appear carefully thought out. It should look sharp but not give the impression a ton of money was used to produce it.

Why is it important for entrepreneurs who are writing business plans to "get out of the building" and ask potential customers and others for feedback on all elements of a business proposal?

This helps when the founders realize that elements of a plan may change, and then when they do have to make revisions they are based on real life feedback, and the process starts all over again

Why is it important for a firm to test the feasibility of its business idea prior to writing a business plan?

This is important because there is no reason to write a business plan that has little chance of succeeding. This helps in avoiding falling into the "everything about my opportunity is wonderful" mode. This helps also investigate the merits of a business idea, and binding the founders into an idea that is too risky or overly positive

Who are the primary consumers of business plans? In what ways do the people who read business plans differ in the information they are looking for?

•Internal: A firm's employees: management team, plus rank and file employees. •External: stakeholders, investors, potential business partners, customers, private and government funded grant programs and key employees being recruited. •For the management team it helps create a bond and a strong cohesive team, for employees it helps them move in sync with the company's mission and values. Investors and the like want clear, concise, information and for it to plainly explain the business without a lot of exaggeration.