Our suggested outline uses business planning language. It is the kind of language a banker expects to see in a business plan.
In this step-by-step Business Planning for Successful Expediters series, we have discussed the challenges and benefits of writing a business plan, and introduced a number of business planning concepts. Now we can start organizing those concepts and your business information into an outline. A suggested outline is presented below.
For people writing their first-ever business plan, there is an abundant array of books, articles and web sites that can be consulted. Many of those offer prototype business planning outlines for readers to use. The trouble is, the array is too abundant. There are so many different types of businesses and approaches to business planning that confusion can quickly rise.
The business plan outline presented below is for a one-truck, self-employed (owner-operator), husband-wife, expediting team. It can also be used by solo, owner-operator expediters. This outline is by no means cast in stone. Business planning is a highly-individualized process.
Business plan writers don’t agree on what should or should not be included, or to what degree something should be included in a plan, or where in the plan outline an item should go. There is no single-best way to write a business plan. In that spirit, the way suggested in this series is not the way. It is a way.
The point was made in part four of this series that you already know much of the information that would go into your own formal business plan. We showed how your own truck stop chatter can form the basis for your plan and then be developed into formal business planning language.
Our suggested outline uses business planning language. It is the kind of language a banker expects to see in a business plan. It is also the language you should use even if a banker will never see your plan. Formal business planning forces you to think your business through in ways you would not if you took a less formal approach.
In the words of one writer, “A business plan helps entrepreneurs and business managers think through their strategies, balance their enthusiasm with facts, and recognize their limitations.” [1] While formal business planning is rigorous work that requires most truck drivers to wrestle with new words and concepts, the benefits are worth the effort.
At ExpeditersOnline, we know that few of our readers have formal business plans. After presenting formal business planning language in an expediter-specific outline, we will not rush forward from there. We’ll take the time and space in this series to translate the terms back into common language. That will make it easy for you to plug your own business information into the outline and continue the step-by-step business planning process.
Expediter Business Plan Outline
Executive Summary
Table of Contents
Business Description
Business Name
Business Form
Business Owners/Managers
Business Type
Business Location
Business History
Mission Statement
Current Situation
Goals
Market Analysis
Industry Overview
Target Market
Value Proposition
Pricing
Competitive Analysis
Competitor Identification
Competitor Strengths and Weaknesses
Differentiation
Economic Analysis
Business Cycle
Industry Cycle
Freight Cycle
Operations
Management Talent and Tasking
Sales and Marketing
Truck and Equipment
Time Management
Load Strategy
Risk Management
Insurance
Operating practices
Risk Analysis
Financials
Balance Sheet
Profit and Loss Statement
Break-even Analysis
Ratio Analysis
Executive Summary
While it is the first item listed on the outline, the executive summary is the last piece of your business plan that you will write. An executive summary is nothing more than a brief summary of the multi-page document to which it is attached. By brief, we mean one to five paragraphs on a single page.
While it is the last piece of the plan you will write, your executive summary is perhaps the most important piece of them all, especially if your business plan is part of a loan application.
An executive summary is designed to be read by busy people. A well-written executive summary tells your banker that you are a professional who respect s his or her time. It is your best opportunity to convince your banker that your document is worth reading.
More importantly, it is your best opportunity to convince your banker that considering your loan application is likely to be approved. Of the loan applications your banker has to consider that day, some will be denied. You want yours to attract your banker’s positive attention the minute he or she starts reading it. A good executive summary will do exactly that.
An executive summary is much more than a summary of the larger document. It is first and foremost a sales tool that sells your banker on reading your plan. It captures your banker’s attention and draws him or her in.
When you are writing your plan, you are writing it for a number of readers. Consider your audience. In this case it is a banker or other loan officer of some sort. The banker arrives at his or her desk to begin another day at the office. Part of the day is dedicated to receiving, reviewing and responding to loan applications. There yours sits, in the pile to be gone through that day.
In the outline above, the term “differentiation” appears. Differentiation is the way a business owner stands out from the competition. It is the way you get noticed by your target market and the customers in it.
In this case, your target market and customer are one in the same. It is your banker. Your intent is to sell your banker on you. More specifically, you want your banker to take the time to consider your loan application and approve it.
Now consider your competition. Your application is sitting in a pile with a bunch of others. Two competitive forces are working against you at that moment. One is the other applications in the pile to which the banker will also devote some time and attention. The other is tugs on the banker’s time; such as meetings, reports that must be completed for the banker’s boss, conferences that must be attended, e-mail that must be read, random telephone calls that must be answered, and more.
How do you win in such a contest? How do you get the result you want? You do it by differentiating yourself from your competition. You do it by making sure your well-written executive summary is the first thing your banker sees when his or her eyes land on your document; and that what your banker then reads draws him or her further in.
The fact that you have an executive summary at all will set you apart from the applicants that do not. Bankers get good and bad loan applications every day. Making it easy for the banker to immediately understand who you are and what you want will make your application one of the good ones in your banker’s mind.
Your executive summary does more than summarize your document. It tells your banker that you have your act together and the rest of the document will be easier and more productive to read than most of the others in the pile.
Again, the executive summary is the last piece of your business plan that you will write. You need a document to summarize before you can write the summary. We’ll talk more about executive summaries after the rest of your business plan is completed.
Before moving on to the next outline item, the table of contents, consider the following.
There are two kinds of people who apply for loans; those who submit an application and hope for the best, and those who take charge of their circumstances and thereby gain greater control over the outcome. While all business people both plan and hope, which do you think are more likely to succeed; those who plan more than they hope, or those who hope more than they plan?
Several business planning dynamics appear in the loan application process. We have already talked about differentiation, competition, and target market. Sales and marketing is also part of your loan application process since your executive summary is designed to draw your banker deeper into your business plan.
Before you submit your loan application, you will select one or more banks over all others. A truck driver who hopes more than he or she plans, will likely fill out forms at a few lending institutions, selected for no particular reason, and hope for the best. Worse still, someone running a hope-based business will accept a truck loan from the first lender that will offer one at a higher interest rate and worse terms than could otherwise be had.
A business planner will turn the process around. The task is not to get a loan. It is to sell a banker on capitalizing your one-truck, owner-operator business so that you and your banker can both profit from the transaction. In other words, you are not going in begging for money and hoping for the best. You are instead going in to sell your banker on investing in your business.
How do you sell? You do it like all salespeople do. You identify your market, create a value proposition, develop your strategy and then do what it takes to close the sale. In this case, doing what it takes means writing a business plan that is so good that your banker knows the competitor down the street will give you a loan if he or she does not.
The thing to notice here is the way terms like strategy, target market, sales, marketing, differentiation and competition rise. These are words that appear in your business plan outline. They are also actions you take over and over again as an expediter and business person.
What is the best way to choose a carrier? Many drivers do so informally. They sit at truck stop lunch counters and ask strangers, “Are you making any money?” or “Are they keeping you busy?” Others take a more sophisticated and profitable approach. They do an industry analysis and compare the strengths and weaknesses of one carrier to another.
If you own a truck that is similarly equipped to thousands of other trucks out there, the economy slows down, and the freight slows down too; what is the best way to convince your carrier that you should be kept in the fleet while others are being cut? You do it by differentiating yourself from the others and selling your carrier on you.
When you hear other expediters worry out loud that slow times may be coming, how do you know if they are right? You figure it out not by taking their comments at face value, but by doing an economic and industry analysis, and then charting the course that is best for you.
A first look at the above outline can be intimidating at first. The first task is to learn exactly what the words in the outline mean. When that is done, the next task is to overcome the realization that writing a business plan means doing a whole lot of work.
We’ll do what we can to make it easy for you. At ExpeditersOnline, we know a fair amount about expediting carriers. We’ll make that information available when it comes time to write a competitive analysis for your carrier of choice.
An economic analysis is large in scope. One written for a single expediter will work for all other expediters too with slight modifications. The same is true for an industry analysis. As this Business Planning for Successful Expediters series continues, economic and industry analyses will be provided for readers to cut and paste into their plans.
From this point forward, the series will explain, step-by-step the concepts in the above business plan outline. We completed Executive Summary this time. Next up is Table of Contents.
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Phil Madsen is the Senior Field Editor with Expediters Online. He and his wife Diane are a straight-truck expediting team. In 2003 they left their white collar careers and became expediters to increase their income, simplify their lives, spend more time together, share a business project, and see the country. They are pleased to say, “It’s working!” Phil can be reached at [email protected] .
[1] Covello, Joseph and Hazlgren, Brian. Your First Business Plan, (Sourcebooks, Inc., 2002), p. 2.
