The “Executive Summary” is supposed to make the reader interested in your project. It contains a brief outline of all important aspects (elements) of your business plan. Mainly, it is supposed to give information about:
Your product(s) and/or service(s) and the use (benefit) for your customers,
Your competence and the competence of the management,
The market potential and the competition,
The capital requirements and the expected profitability
A lender is always looking at the “Executive Summary” first. The quality of the “Executive Summary” alone will not be enough to convince the lender to finance your project. But it will be enough to convince the lender not to do it!
A clear and sound presentation of your project is one way of proving your competence. Therefore, pay attention to details and be careful and thorough because your “Executive Summary” will be the decisive factor in whether the lender will read your whole business plan or not.
The “Executive Summary” is an independent element of your business plan. It represents the essence of all other chapters and should not contain any information that are not presented in more detail in other parts of the business plan.
It is recommended to write the “Executive Summary” last even though it is the first part of your business plan. Design the “Executive Summary” in a way that the lender is able to read and understand it in 5 to 10 minutes. Make a test yourself before you give the business plan to the lender. Have a friend without any special knowledge of your project read it.
- What is the core of your business idea (description of your product(s) and/or service(s))?
- Do the business founders have the necessary qualification for a success of the business?
- What use do your customers have from you product(s) and/or service(s)?
- What makes your product(s) and/or service(s) innovative and different?
- Who are your targeted customers and how big is the market potential?
- What are the current and medium-term trends within your industrial sector?
- What are your advantages compared to your competitors?
- How much money do you need and what do you need it for?
- How long will it take for you to become profitable and how big will your profit be?
- What (is and) will be your rate of return (sales p.a. / profit p.a. before taxes)?