Small Business Management - Chapter 8

Informational Plans

Give potential customers or suppliers information about the company and its product or service

The Elevator Pitch

Leads with the hook, follows up with purpose of the service, ends with where business is now

Tagline

Memorable catchphrase that captures the key idea of a business, its service, product, or customer - also known as a slogan

Company Background

Overall description of the company, the firm's current status, and the history of the business

Vision Statement

a very simple 5-10 word sentence or tagline that expresses the fundamental idea or goal of the firm

Proof-of-Concept WebSite

an Internet-based type of business plan providing information or demonstration of a product or service designed to solicit information on customer interest

Operational Plan

business plans designed to be used internally for management purposes

Internal Understanding

extent to which employees, investors, and family members in the business know the business's purposes and operations

Screening Plan

gives the basic overview of the firm and a detailed look at the financials - also called a mini-plan

Preselling

involves introducing your product to potential customers and taking orders for later delivery

Key Employee/Partner plan

provides information on the company, product/service, market, and critical risks to prospective business or marketing partners or to prospective key employees

Test Marketing

selling your product or service in a limited area, for a limited time

Executive Summary

A one- to two-page (250-500 words) overview of the business, its business model, market, expectations, and immediate goals - typically put at the start of a business plan and is most popular

Elevator Pitch

a 30-second action-oriented description of a business designed to sell the idea of the business to another

Invention Plan

a business plan that provides information to potential licensees. focuses on the details of an invention, including intellectual property rights

Business Plan

a document designed to detail the major characteristics of a firm— its product or service, its industry, its market, its manner of operating (production, marketing, management), and its financial outcomes with an emphasis on the firm's present and future

New Entrant Business

a firm whose product or service is established elsewhere, but is new to this market

Pioneering Business

a firm whose product or service is new to the industry or is itself creating a new industry

Cover Letter

a one-page document on business stationery that introduces the business plan and the business owner to the recipient and indicates why the recipient is being asked to read the plan - also called letterhead

Mission Statement

a paragraph that describes the firm's goals and competitive advantages Talks in terms of how it will make a difference in for the customer or the industry

Private Placement Memorandum

a specialized legal form of business plan crafted by lawyers for the purpose of soliciting formal investments

Industry

tells the reader about the other firms producing this product or service—the competition. goal is to position your firm so that it looks like a potentially solid competitor in an industry with potential

External Legitimacy

the extent to which a small business is taken for granted, accepted, or treated as viable by organizations or people outside the small business or the owner's family

Research and Development

the part of a business that is focused on creating new products or services and preparing new technologies, ideas, products, or services for the firm's market

Risks

the parts of a business or business plan that expose the firm to any kind of loss—profits, sales, reputation, assets, customers, and so on