A strong executive summary is key to enticing a potential lender or investor to read your entire business plan. As its name suggests, this section should summarize, not simply list the main points and strengths of your business plan. While the exact content will vary according to the audience and whether you’re writing the summary for a new or existing business, information such as what your business is about, what you sell or provide, what distinguishes your business from the competition and plans for the future are common inclusions. Though it prefaces the plan, it should be the last section you write.
The process of writing an executive summary is different from writing other sections of your business plan. Although there are best practice guidelines you should follow, there is no set format or organizational structure. In addition, unlike other aspects of a business plan, the organization of the summary and the information you emphasize can change according to the audience. For example, an executive summary for a start-up might focus on background experience and describe how the new business will fill a presently unmet need. In contrast, an executive summary for an existing business might highlight company growth prospects and financial information.
Use language that readers can relate to, which depending on your audience may mean eliminating technical jargon and instead writing the summary in everyday language. In an Inc.com article, Akira Hirai, a business consultant, recommended writing the summary using first-person pronouns such as “we” and “our” instead of a phrase such as “our company.” Avoid cliches and over-used phrases such as "groundbreaking" and "world class" that readers commonly see.
The opening paragraph is where you’ll either hook or lose the reader. The U.S. Small Business Administration suggests that you treat the opening paragraph like a long-version elevator pitch. To help the reader understand your company:
- Describe the nature of your business and its target market
- Identify the needs of the target market
- Explain how your business meets -- or plans to meet -- these needs.
- Describe the competitive advantages that will distinguish your business from the competition
Use the remaining sections to tell the rest of your story in about two pages. Regardless of your focus, each remaining section should identify problems, explain your solutions and create a sense of urgency that encourages action. For example, a discussion about growth plans should pinpoint specific needs and explain why “right now” is the right time. In a discussion about financing, be specific about how much money you need and how you will use it.