Part 1: The Operating Plan Section of The Business Plan

The Operating Plan Section in your business plan will describe the physical necessities of your business’ operation. This will include:

  • Physical Location
  • Facilities
  • Equipment
  • Inventory Requirements
  • Suppliers
  • Manufacturing Process

The Operating Plan should be an outline of your capital and expense requirements your business will need to operate on a day to day basis.

There are 2 things you need to do for the people reading your operating section of the business plan:

  • Show the readers that you have made your business successful and off the ground
  • Show the readers that you know what has to be done to keep succeeding
  • Demonstrate that you understand the manufacturing or delivery process of producing your products or services

You need to divide the operating section of the business plan into 2 parts.

  1. Stage of Development Section
  2. Production Process

Today we will talk about the Stage of Development Section. In this section you will describe how you develop your product. You will also explain any problems and difficulties that may occur while producing your product or service.

You will also need to show that you know your industry’s standards and regulations. You can do this by explaining which organizations you are a member of already and which organizations you plan on joining later. List steps you’ve taken to comply with all the laws and regulations that apply to the industry you are in.

In the Stage of Development section of your Operating Plan you will want to explain who your suppliers are and what their prices, terms, and conditions are. Make sure you have a backup plan and describe what you’ll do if your suppliers don’t come through for you.

When writing the Stage and Development section of the Operating Plan, you will need to explain what you have done up to now (recently) to get your business up and running. Next you will want to explain what still needs to be done—there are always rooms for improvement, whether it be with customer service, marketing, or management. Follow this by subsection titled “Risks” that will outline all the potential risks that may occur while in productions, and explain how you will minimize these risks to keep your business flowing.

The rest of the Stage and Development section of the operating plan will be divided into subsections such as:

  • Industry Association
  • Membership
  • Suppliers
  • Quality Control

Tomorrow we will discuss the second section of the Operating Plan part of The Business Plan is the Production Process.

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