This form details the amount of money you will need to procure the equipment and resources used to start up and continue operations of the enterprise. Capital Requirements also includes the depreciation details of all purchased equipment. To determine your capital requirements, think about anything in your business that will require money to procure. Cost of Goods For a manufacturing company, the cost of goods is the cost incurred in the manufacturing of the product. For a retail or wholesale business, the cost of goods (sometimes called the cost of sales) is the purchase of inventory. To generate a Cost of Goods table, you need to know the total number of units you will sell for a period as well as what other inventory may be on hand, and at what stage of production these units exist. For a manufacturing company, the cost of goods table will include materials, labor, and overhead related specifically to product manufacturing. Cost of waste and byproduct disposal must also be included. For example a company which makes picture frames would be mistaken to calculate the costs of the product based on it containing only 9/10ths of a board foot, if it requires 1 and Â˝ board feet trimmed down to obtain it. V. SALES AND MARKETING This section of a business plan describes both the strategy and tactics one will use to get customers to buy their products or services. The three components of the sales and marketing section include: 1) Sales and Marketing Strategy 2) Method of Sales 3) Advertising and Promotion Sales and Marketing Strategy Think of this statement as an action plan for how a business will get customers to buy their products. It will support the tactics described later on in this section. How will the customers be targeted for the company's products and services? Method of Sales Describe available distribution channels and how one will use them. In this section the writer demonstrate her ability and knowledge to get the company's products into the hands of the targeted customers. It also details transaction methods, such as terms for financing the sale, credit card acceptance, check handling, cash transactions, and method of product or service delivery. Advertising and Promotion This section should include a description of all advertising vehicles the enterprise plans to use. This includes flyers, newspapers, magazines, radio & TV, Yellow Pages, Internet, etc. It should also include the public relations program, sales/promotional materials (such as brochures and product sheets), package design, trade show efforts, videos, and any other methods. VI. MANAGEMENT
How to write a business plan.