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How to Write the Company Summary in a Business Plan

Company Overviews Show How the Pieces of a Business Work

What to Include in Your Company Summary

Getting started on your company summary, examples of a company summary, tips for writing a company summary, frequently asked questions (faqs).

Image by Theresa Chiechi © The Balance 2019

The company summary in a business plan—also known as the company description or overview—is a high-level look at what you are as a company and how all the elements of the business fit together.

An effective company summary should give readers, such as potential investors, a quick and easy way to understand your business, its products and services, its mission and goals, how it meets the needs of its target market, and how it stands out from competitors.

Remember to stick to the big picture before you begin writing your company summary. Other sections of your business plan will provide the specific details of your business. The summary synthesizes all of that information into one page.

Key Takeaways

• The company summary in a business plan provides an overview with a high-level description of your company.
• A company summary might include your mission statement, goals, target market, products, and services, as well as how it stands out from competitors.
• The company summary can also be customized for a specific objective or audience, such as to secure financing from investors or banks.

The company summary section of a business plan should include:

• Business name
• Legal structure (i.e., sole proprietorship ,  LLC ,  S Corporation , or  partnership )
• Management team
• Mission statement
• Company history (when it started and important milestones)
• Description of products and services and how they meet the needs of the marketplace
• Target market (who will buy your product or services)
• Competitive advantage (what sets you apart in the marketplace to allow you to succeed)
• Objectives and goals (plans for growth)

The U.S. Small Business Administration (SBA) website has a lot of information available if you've never written a business plan before. The SBA provides examples of business plans for different types of companies.

Before you begin, you should decide whether you want to go with a traditional business plan format or a lean startup format. The traditional format is appropriate if you want to have a comprehensive, detail-oriented plan or if you are requesting financing. The lean startup format is best for those who have a relatively simple business and want to start it quickly or as a starting point for those who plan to refine and change the plan regularly.

No matter which type of business plan you choose, you'll need to include a company summary.

Although there are many blueprints for writing a company summary, below are a couple of examples to get you started.

Consulting Firm

You can opt for a concise opening paragraph such as this one:

XYZ Consulting is a new company that provides expertise in search marketing solutions for businesses worldwide, including website promotion, online advertising, and search engine optimization techniques to improve its clients' positioning in search engines. We cater to the higher education market, including colleges, universities, and professional educational institutions.

Several elements of the company summary are covered here, including the name (XYZ Consulting), history (new company), description of services (web promotion, SEO, advertising) and why it's needed (improve positioning in search engines), and the target market (higher education).

Starbucks Coffee Company Overview

Starbucks breaks down the company overview on its website into the following sections:

"Our Heritage"

Here the company describes how long the company has been in business, citing its roots, the founder, Howard Schultz, and how he was inspired to open the first Starbucks in Seattle after visiting Italy. It briefly mentions the growth of millions of customers and how the company's heritage remains important to its long-term success.

"Coffee & Craft"

The overview describes the high-quality products and services being offered and why they stand out from the competition by describing the detailed process of choosing and growing coffee beans. You'll notice they don't suggest their product is a low-cost product but instead provide a high level of "experiences to savor."

"Our Partners"

Starbucks describes its employees as partners that work together in an inclusive manner to achieve success. It highlights how they are at the center of the experience.

"Pursuit of Doing Good"

The company describes its values and how it gives back to the community.

Tesla Inc. Business Overview

Below are excerpts of the business overview pages from the annual 10-K filing for Tesla Inc.

"We design, develop, manufacture, sell and lease high-performance fully electric vehicles and energy generation and storage systems, and offer services related to our products. We generally sell our products directly to customers, including through our website and retail locations.

We also continue to grow our customer-facing infrastructure through a global network of vehicle service centers, mobile service technicians, body shops, supercharger stations and destination chargers to accelerate the widespread adoption of our products.

We emphasize performance, attractive styling and the safety of our users and workforce in the design and manufacture of our products and are continuing to develop full self-driving technology for improved safety.

Our mission to accelerate the world’s transition to sustainable energy, engineering expertise, vertically integrated business model and focus on user experience differentiate us from other companies."

Competition

Tesla highlights the competitive automotive market and how the company differentiates itself from the larger, more established competitors.

"The worldwide automotive market is highly competitive and we expect it will become even more competitive in the future as we introduce additional vehicles in a broader cross-section of the passenger and commercial vehicle market and expand our vehicles’ capabilities. We believe that our vehicles compete in the market both based on their traditional segment classification as well as based on their propulsion technology.

Competing products typically include internal combustion vehicles from more established automobile manufacturers; however, many established and new automobile manufacturers have entered or have announced plans to enter the market for electric and other alternative fuel vehicles."

Intellectual Property

The company highlights its intellectual property, including trademarks and patents.

"We place a strong emphasis on our innovative approach and proprietary designs which bring intrinsic value and uniqueness to our product portfolio. As part of our business, we seek to protect the underlying intellectual property rights of these innovations and designs such as with respect to patents, trademarks, copyrights, trade secrets and other measures, including through employee and third-party nondisclosure agreements and other contractual arrangements."

Mission Statement

The company highlights its mission statement and its sustainability goals using environmental, social, and governance (ESG) and human capital resources.

"The very purpose of Tesla's existence is to accelerate the world's transition to sustainable energy. We believe the world cannot reduce carbon emissions without addressing both energy generation and consumption, and we are designing and manufacturing a complete energy and transportation ecosystem to achieve this goal. As we expand, we are building each new factory to be more efficient and sustainably designed than the previous one, including with respect to waste reduction and water usage, and we are focused on reducing the carbon footprint of our supply chain."

There are other items you can include in your company summary to expand on the areas that you'd like people to focus on, depending on your objective.

You might provide more information about the company's location, legal structure, and management team. You can also include more information about the:

• Company's history, such as a family business that's been in operation for multiple generations
• Business objectives, including short-term and long-term goals
• Business strengths, highlighting anything that might give your company a competitive advantage in the field

You can also customize the summary if you have a specific objective or a targeted audience. For example, if the goal of your business plan is to secure funding, you might focus on areas that appeal to investors and lending institutions, including:

• Why you're the best person to manage the business
• Your experience in your field, as well as the total years of experience of your management team
• Expertise or special talents of your team, including training, licenses, certifications
• How you plan to make the business a success
• Financial information, such as a high-level discussion of your track record of revenue growth and the financial opportunities that can be realized as a result of securing financing

You may also want to address any areas of perceived weakness by explaining how you'll overcome them or compensate.

How do you write a company overview?

You might describe the company, its location, legal structure, and management team. You can also highlight the company's business objectives, goals, and strengths. You can also customize the summary to a specific audience, such as a bank or lender, focusing on your competitive advantages and highlights of recent financial success.

What should an organizational overview include?

Some of the discussion points to include in a company overview might be:

• Company name and location
• Legal structure such as a sole proprietorship, LLC, or partnership
• Mission statement and management team
• Description of your products and services and how they are needed
• Target market or who are your customers
• Competitive advantage or what makes your company different

The Clute Institute. " Using Business Plans for Teaching Entrepreneurship ," Page 734.

U.S. Small Business Administration. " Write Your Business Plan ."

Starbucks Coffee Company. " Our Company ."

United States Securities and Exchange Commission. " Form 10-K, Annual Report Pursuant to Section 13 or 15(D) of the Securities Exchange Act of 1934 for the Fiscal Year Ended December 31, 2021, Tesla, Inc., " Pages 3-12.

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How to Write an Executive Summary

9 min. read

Updated December 13, 2023

An executive summary isn’t just the beginning of your business plan – it’s your opening act, your first chance to impress potential investors, banks, clients and other stakeholders.

An effective executive summary gives decision-makers critical information about your business instantly.

Creating an executive summary is more than just a writing exercise. It requires careful crafting and strategic thinking, as well as an ability to balance the needs to be both succinct and comprehensive.

• What is an executive summary?

The executive summary is a brief introduction and summary of your business plan. It introduces your business, the problem you solve, and what you’re asking from your readers. Anyone should be able to understand your business by simply reading this section of your plan.

While structurally it is the first chapter of your plan—you should write it last. Once you know the details of your business inside and out, you will be better prepared to write this section.

• Why write an executive summary?

The business plan executive summary provides quick access to critical information from your more detailed business plan.

It is essential for informing anyone outside of your business. Many people—including investors and bankers—will only read your summary. Others will use it to decide if they should read the rest. For you, it is a snapshot of your business to reference when planning or revising your strategy.

Now if you’re writing a business plan solely for internal use you may not need an executive summary. However, some internal plans may necessitate writing an executive summary for assignment—such as for an annual operations plan or a strategic plan .

It takes some effort to do a good summary, so if you don’t have a business use in mind, don’t do it.

• How long should it be?

Business plan executive summaries should be as short as possible. Your audience has limited time and attention and they want to quickly get the details of your business plan.

Try to keep your executive summary under two pages if possible, although it can be longer if absolutely necessary. If you have a one-page business plan, you can even use that as your executive summary.

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• Executive summary outline

Two pages isn’t a ton of space to capture the full scope of your vision for the business. That means every sentence of your executive summary counts.

You will want to immediately capture the reader’s attention with a compelling introduction. Without getting too lengthy, present who you are as an organization, the problem you are seeking to solve, your skills, and why you are the best entity to solve the problem you’ve outlined.

It’s crucial to establish the need or problem your business is solving in a clear manner, in order to convince your audience that it must be addressed. Following that, recommend the solution and show its value. Be clear and firm in your recommendation, making sure to justify your cause and highlighting key reasons why your organization is the perfect fit for the solution you’re proposing. Finally, a strong conclusion is needed to reiterate the main points and wrap up the executive summary.

What to include in your executive summary

1. business overview.

A one-sentence description that explains what you do, why you do it, and how you do it.

Summarize the problem you’re solving in the market and reference any data that solidifies that there is a need.

3. Solution

Describe your product or service and how it addresses the problem you identified.

4. Target market

Who is your ideal customer? Describe who they are, how they’ll benefit, and why they’re an attainable customer base.

5. Competition

Who are your competitors? List out any primary competition as well as alternatives that your customers may consider. Include key details about their current offerings, promotions, and business strategy.

6. Your team

In your executive summary, outline your organizational structure and current team. List out brief explanations of who you and your team are, your qualifications, and what your function will be within the business. It may be valuable to also highlight any gaps in your team and how you intend to fill them. If you have potential partners or candidates in mind, briefly mention them and expand on their qualifications within your full business plan.

7. Financial summary

Highlight key aspects of your financial plan that address sales, expenses, and profitability. Try to keep these in chart or graph form to ensure the information is easy to consume and resonates visually.

8. Funding requirements

This section is only necessary if you’re seeking out funding or pitching to investors. Be sure to throw out your financing number and reasoning upfront, rather than hiding it later on in your plan. It helps investors understand your position, what you’re asking for, and how you’ll use it.

9. Milestones and traction

Add initial sales, pre-sales, newsletter sign-ups, or anything else that showcases customer interest. Outline what steps you’ve already taken to launch your business, the milestones you’ve hit, and your goals and milestones for the next month, six months, year, etc.

Executive summary vs introduction

A common mistake some people make when starting an executive summary outline is thinking it performs the same function as the introduction to their business plan. In fact, the two serve different purposes and contain different types of information, even though they are both essential.

As we’ve discussed, the executive summary is a high-level overview of the entire business plan. The introduction, by contrast, dives deeper into your business, providing information about the nature of your business, the history of your company, your mission statement, products or services, and the specific problem that your business solves.

The introduction is more detailed, and usually comes right after the executive summary.

On the other hand, the introduction gives investors or lenders – anyone reading your business plan – a sense of why they should continue reading. Think of it more as the space to tell stakeholders why you are speaking to them. An executive summary can also serve this purpose, but the introduction is meant to speak more directly to your target audience, while an executive summary could give a larger audience a general overview of your business.

Tips for writing an effective executive summary

Here are a few best practices to make writing your executive summary easier, and ultimately more effective. 

1. Think of an executive summary as your pitch

The executive summary is like an elevator pitch. You’re selling someone on reading your full plan while quickly summarizing the key points. Readers will expect it to cover certain areas of your business—such as the product, market, and financial highlights, at the very least.

While you need to include what’s necessary, you should also highlight areas that you believe will spark the reader’s interest. Remember, you’re telling the brief but convincing story of your business with this summary. Just be sure that you’re able to back it up with the right details with the rest of your business plan. 

2. Write it last

Even though the executive summary is at the beginning of a finished business plan, many experienced entrepreneurs choose to write it after everything else. In theory, this makes it easier to write since all of the information is already written out and just needs to be condensed into a shorter format. 

Now, if you’ve started with a one-page plan, this process is even easier. Just use your one-page plan as a starting point and add additional details to any sections that need it. You may even find that no changes are necessary.  

3. Keep it short

Ideally, the executive summary is short—usually just a page or two, five at the outside—and highlights the points you’ve made elsewhere in your business plan. Whatever length you land on, just focus on being brief and concise. Keep it as short as you can without missing the essentials. 

4. Keep it simple

Form follows function, so don’t overcomplicate or over-explain things. The best executive summaries are a mixture of short text, broken up with bullets and subheadings, and illustrations, such as a bar chart showing financial highlights. 

Run through a legibility test after writing your summary. Is it easy to skim through? Are the right pieces of information jumping out? If the answer to either of those questions is no, then work back through and try breaking up information or adjusting the formatting.

5. Create an executive summary outline based on importance and strengths

Organize your executive summary outline so that the most important information appears first. While there are specific components to include, there is no set order of appearance. So, use the order to show emphasis.

Lead with what you want to get the most attention, and add the rest by order of importance. For example, you may start with the problem because that can add drama and urgency that tees up the solution you provide.

Additional resources to write a great executive summary

Need more information and guidance to craft a convincing executive summary? Check out these in-depth resources and templates.

Key mistakes to avoid when writing an executive summary

Here are the critical mistakes you should avoid when writing your executive summary.

How to write your executive summary for specific audiences

The executive summary should tell your audience exactly what your business is, what it does, and why it’s worth their time. Here’s how you can take it a step further and fine-tune it for specific people.

How to develop a mission statement

Learn to put a heart behind the business and create an easy-to-understand narrative by writing a mission statement.

Executive Summary FAQ

What is in an executive summary?

The executive summary of a business plan is a brief introduction and summary of your business strategy, operations, and goals.

What is the purpose of an executive summary?

An executive summary is typically written to convince someone to read your more detailed plan. For investors, it may be the only thing they look at when deciding if they’d like to hear your pitch. Loan officers may review it to determine if your business seems financially sound. And partners, mentors, or anyone else may use it to determine if they want to be involved with your business.

How do you start an executive summary?

While there is no required order for an executive summary, it’s often recommended that you lead with the problem you’re solving or the purpose of your business. This will help frame your intent for the reader, and ideally make them more interested in learning more.

How do you write a good executive summary?

A good executive summary is brief, convincing, and easy to read. Focus on keeping things short and concise, only including necessary information. Be sure to lead and highlight anything that is especially interesting or important about your business. And after writing, spend some time reviewing and reformatting to make your summary as attractive to read as possible.

Tim Berry is the founder and chairman of Palo Alto Software , a co-founder of Borland International, and a recognized expert in business planning. He has an MBA from Stanford and degrees with honors from the University of Oregon and the University of Notre Dame. Today, Tim dedicates most of his time to blogging, teaching and evangelizing for business planning.

Table of Contents

• What to include
• Writing tips
• Additional resources

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How To Write an Executive Summary for a Business Plan + Example

Written by Dave Lavinsky

Executive Summary of a Business Plan

The Executive Summary is the most important part of your entire business plan . This is because it’s the first section in your plan, and if it doesn’t excite readers, they won’t continue reviewing it. Importantly, there is a way to ensure your executive summary is compelling and includes the key information readers expect. In this article, you’ll learn how to craft the perfect executive summary for your business plan.

Download our Ultimate Business Plan Template here >

Table of Contents:

What is an Executive Summary?

Why do i need an executive summary.

• How Long Should an Executive Summary Be for a Business Plan?

How To Write an Executive Summary for a Business Plan + Template

• Sample Executive Summary

An executive summary of a business plan gives readers a high-level overview of your business plan and highlights its key points.

The executive summary should start with a brief overview of your business concept. Then it should briefly summarize each of the key elements of your business plan: your industry analysis , customer analysis , competitive analysis , marketing plan , operations plan , management team , financial plan and funding needs.

If presented for funding, the executive summary provides the lender or investor a quick snapshot which helps them determine their interest level and if they should continue reading the rest of the business plan.

An effective executive summary is a quick version of your complete business plan. You need to keep it simple and succinct in order to grab the reader’s attention and convince them it’s in their best interest to keep reading.

As mentioned above, your business plan is a detailed document that requires time to read. Capture the attention of your intended audience with a concise format that provides an compelling overview of your plan to save them time and indicate which parts of the business plan may be most important to read in detail. This increases the odds that your business plan will be read and your business idea understood. This is why you need a well-written executive summary.

How Long Should a Business Plan Executive Summary Be?

When structuring your business plan executive summary, the first thing to keep in mind is that it should be short and comprehensive. The length of your executive summary should never exceed 3 pages; the ideal length is one or two pages.

Finish Your Business Plan Today!

To write a compelling executive summary, follow the steps below and use this free executive summary template as a guide:

1. State the Problem and/or Business Opportunity

Generally there is a gap or a problem in the market which your business aims to solve. This is your problem statement and it must be included in the summary, as potential investors want to understand if the world truly needs your company’s products and/or services.

2. Briefly Describe Your Business Idea

The next thing a reader would want to know is how you plan to approach the problem and solve it. This is your business model and it should briefly describe how your product or service can help solve the problem.

3. Provide Key Information About Your Company History

The best indicator of future success is past success. Your company’s history helps the reader understand how your business has evolved and grown over the years and what you’ve been able to accomplish. Even startups have generally accomplished milestones like choosing a business name, conceiving products, finding a location, etc.

4. Conduct Market Research About Your Industry

Conducting thorough market research will help you detail the industry in which you are operating, it’s size and if any trends are positively or negatively influencing it. This gives readers a sense of the size of the opportunity you are pursuing.

5. Identify the Target Market or Ideal Customer

Every business has a target customer base or a target market on which they focus. Here you will detail your target customers including their demographic and psychographic profiles.

6. Explain Your Competitive Advantage

When you venture into a market or an industry, there are generally other players with which you compete. Knowing your competition is crucial to your success. Readers of your plan want to know who your competitors are, their strengths and in what areas you will have competitive advantage. Discussing the competitive landscape is a crucial component of a strong executive summary.

7. Establish Relevant Milestones For Your Business To Achieve

In addition to showing relevant milestones your company has achieved, you need to explain your timeline for milestones or essential points in the future. Include dates you hope to launch products, achieve sales milestones, hire key employees, etc.

8. Develop a Financial Plan

If you are requesting funding from investors or banks, they will want to know how you are going to their funds. Include key financial information regarding how and where you plan to allocate the funds should be included in the summary. For existing businesses, you should also provide a history/summary of past financial performance. Finally, for all businesses, you need to provide future financial projections so investors can determine whether they might get an adequate return from investing in you and lenders can ascertain whether or not you will be able to repay your debts.

9. Describe the Qualifications of Your Management Team

In this section, you will introduce the key members of your team. The success or failure of your company depends largely on the parties involved. So, any reader surely wants to know how well equipped your team is. Mention key staff members and the experience and skills they bring, in the executive summary.

Whether you’re a large or small business, your executive summary is the first thing someone reads that forms an opinion of your business. Whether they decide to read your detailed business plan or push it aside depends on how good your executive summary is. We hope this guide helps you craft an effective and impactful executive summary. That way, readers will be more likely to read your full plan, request an in-person meeting, and give you funding to pursue your business plans.

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Looking to get started on your business plan’s executive summary? Take a look at the great executive summary example below.

Business Plan Executive Summary Example

Shoutmouth.com executive summary, business overview.

Launched late last year, Shoutmouth.com is the most comprehensive music news website on the Internet.

Music is one of the most searched and accessed interests on the Internet. Top music artists like Taylor Swift receive over 5 million searches each month. In addition, over 500 music artists each receive over 25,000 searches a month.

However, music fans are largely unsatisfied when it comes to the news and information they seek on the artists they love. This is because most music websites (e.g., RollingStone.com, MTV.com, Billboard.com, etc.) cover only the top eight to ten music stories each day – the stories with mass appeal. This type of generic coverage does not satisfy the needs of serious music fans. Music fans generally listen to many different artists and genres of music. By publishing over 100 music stories each day, Shoutmouth enables these fans to read news on all their favorite artists.

In addition to publishing comprehensive music news on over 1200 music artists, Shoutmouth is a social network that allows fans to meet and effectively communicate with other fans about music, and allows them to:

• Create personal profiles
• Interact with other members
• Provide comments on news stories and music videos
• Submit news stories and videos
• Recommend new music artists to add to the community
• Receive customized news and email alerts on their favorite artists

Success Factors

Shoutmouth is uniquely qualified to succeed due to the following reasons:

• Entrepreneurial track record : Shoutmouth’s CEO and team have helped launch numerous successful ventures.
• Monetization track record : Over the past two years, Shoutmouth’s founders have run one of the most successful online affiliate marketing programs, having sold products to over 500,000 music customers online.
• Key milestones completed : Shoutmouth’s founders have invested $500,000 to-date to staff the company (we currently have an 11-person full-time team), build the core technology, and launch the site. We have succeeded in gaining initial customer traction with 50,000 unique visitors in March, 100,000 unique visitors in April, and 200,000 unique visitors in May.

Unique Investment Metrics

The Shoutmouth investment opportunity is very exciting due to the metrics of the business.

To begin, over the past five years, over twenty social networks have been acquired. The value in these networks is their relationships with large numbers of customers, which allow acquirers to effectively sell to this target audience.

The sales price of these social networks has ranged from $25 to $137 per member. Shoutmouth has the ability to enroll members at less than $1 each, thus providing an extraordinary return on marketing expenditures. In fact, during a recent test, we were able to sign-up 2,000 members to artist-specific Shoutmouth newsletters at a cost of only 43 cents per member.

While we are building Shoutmouth to last, potential acquirers include many types of companies that seek relationships with music fans such as music media/publishing (e.g., MTV, Rolling Stone), ticketing (e.g., Ticketmaster, LiveNation) and digital music sales firms (e.g., iTunes).

Financial Strategy, Needs and Exit Strategy

While Shoutmouth’s technological, marketing and operational infrastructure has been developed, we currently require $3 million to execute on our marketing and technology plan over the next 24 months until we hit profitability.

Shoutmouth will primarily generate revenues from selling advertising space. As technologies evolve that allow us to seamlessly integrate music sampling and purchasing on our site, sales of downloadable music are also expected to become a significant revenue source. To a lesser extent, we may sell other music-related items such as ringtones, concert tickets, and apparel.

Topline projections over the next three years are as follows:

Download our executive summary example business plan PDF .

By writing an executive summary that highlights your business’s potential and key strengths, you can entice your target audience to delve deeper into your full business plan. Remember, this is your chance to make a strong first impression and convince them your idea is worth their investment. Take the time to refine your summary, ensuring it’s concise and informative, and leaves the reader wanting more. With a well-written executive summary, you’ll be well on your way to securing the funding or support you need to turn your business dream into a reality.

Everything you need to write a killer executive summary for your business plan

What is Executive Summary—and Why Should You Care?

Executive Summary is the first and most important section of a business plan, providing a snapshot of the overall plan with the aim to compel the reader to continue reading the full document by highlighting its most important components and strengths .

Keep reading for insider tips from a professional business writer on how exactly to write a captivating executive summary that will maximize the impact and success of your business plan.

You’ll discover:

• Why: Critical importance of an executive summary
• What: The key elements you need to include
• How: The best structure—length, layout and components

Importance: Why is Executive Summary Important in a Business Plan?

Executive summary is the most important part of a business plan because it is the first and only opportunity to grab readers’ interest as they review this section prior to deciding whether or not to read the rest of the document.

No matter how excellent your business idea, it is the executive summary alone that persuades a reader to spend more time with the plan to find out more about your venture.

Some financiers receive hundreds of business plans every month. Understandably, they do not read them all . Instead, they can tell in a couple of paragraphs if it is something they may be interested in.

The Executive Summary is so important, in fact, that some investors and lenders prefer to receive just the summary and financials before requesting the full business plan. So if you can hook your readers here, they will ask for more.

Similarly, senior decision-makers on many company or bank boards and committees will often read nothing else than an executive summary when approving a decision to back a business.

In other words, your Executive Summary is the  first impression  many readers will get of your business. Make sure it is a great one. Only a  clear ,  concise , and  compelling  summary of your business right up front twill persuade readers to wade through the rest of the plan.

Contents: What Should an Executive Summary for a Business Plan Include?

Executive summary brings the separate parts of a business plan together to sum up what the business is, where it is going, why it will be successful – and why it is worthy of backing . Highlight the most important and impressive facts about the company , management , offering , market , strategy and financials .

When completed, your executive summary will answer these questions for your readers:

• What is your business all about ?
• What are the most compelling qualities?
• Is the business likely to succeed and why?

Executive summary is an introduction to your business, which provides a brief snapshot of your plan as a whole. To that end, concisely highlight the most important concepts and impressive features from each section of your completed plan, addressing the following areas:

Essentially, you should make it crystal clear to the that a compelling market opportunity exists for your product/service and demonstrate that your business is well-positioned to exploit it .

Remember to be brief and concise . Organize the information in a way that gives the best impression of your business to your target reader. Combine related topics if that improves the flow of the document.

If the readers of your executive summary conclude that the above elements exist in your business, they are likely to commit to reading the rest of your business plan.

So, let’s examine each of the key elements in more detail to make the reader excited about the potential of your business plan and interested to read further:

Mission Statement

Answer this question for your readers:

• What is your business on a mission to create and why?

Aim: Convince the reader that your basic business concept makes sense.

Give a concise overview of your business idea, purpose and goals. Summarize why you have created this company and what your business is all about in one or two sentences, but no more than a paragraph.

Products and Services

Answer these questions for your readers:

• What product(s) and/or service(s) does your business provide?
• What problems are you solving for your target customers and how?
• What makes your product/service different and compelling for the customers to buy?

Aim: Demonstrate to the reader that your product/service solves a real problem in the market and that the problem is worth solving.

Briefly describe the products and services your company provides and what problems you solve for your target customers, making the case for why your product will be successful:

Description:

List the products or services your company sells or plans to sell.

Problem & Solution:

Explain the need for the products or services:

• Problem: Summarize the problem your product/service solves and why it is worth solving. In other words, what is it that your customers need and cannot find elsewhere.
• Solution: Summarize how you will solve the problem that your customers face.

Value Proposition:

Outline why your product or service will be valuable to your customers and the advantages that will make it compelling enough for them to purchase.

Market Opportunity

• Who are your (ideal) target customers?
• Is there a real market demand for your product/service?
• What is the size of the market opportunity?

Aim: Convince the reader that large and compelling market demand opportunity exists for your product/service.

List the target market you intend to reach and explain why you chose it:

Target Market:

Provide a brief description of your ideal customers and how do they break down into recognizable types or segments.

Market Analysis:

Indicate that you have done thorough market analysis by providing a summary of your market research results, including:

• How many potential customers are there for your solution (target market)
• What proportion of the market your company can reasonably capture (market share)
• Forecast estimating what the future holds for the industry and market demand

Competitive Advantage

• Who are your competitors?
• How is the market currently divided?
• What advantages does your company have over the competition?

Aim: Convince the reader that your business has a significant competitive edge to succeed in your target market.

This section is where you describe the gap in your target market, how your solution can fill it, and the competitive advantages that will enable you to exploit this market gap.

Hence, include information about your competition and what differentiates your business:

Competitors and Market Distribution:

Who are you up against? What other options do your customers have to address their needs? Indicate the nature of your competition and how the market is currently divided.

Competitive Advantage:

What comparative advantage does your product/service have?

Show your conclusions on your company’s competitive position and why your company will be able to compete successfully. Remember to list any important distinctions, such as patents, major contracts, or letters-of-intent.

Unique Selling Proposition:

What unique selling proposition will help your business succeed?

What makes your solution better for your customers compared to the competition?

Is competition going to get tougher?

Summarize your conclusions on whether competition is going to intensify going forward.

Company Description

Company information:.

• Is the management team capable?
• What are the basic details of your business?
• What is the company’s current stage of development?
• What are some of the milestones you’ve met?

Aim: Convince the reader that your business has the right structure and capable management team in place to succeed.

Your goal is to demonstrate that you are well-positioned to exploit the market opportunity by highlighting the positive factors in your company’s management, structure and history.

Company Details:

Include a short statement that covers the basic company details, such as the company name, when your business was formed, the names of the founders and their roles, number of employees, business location(s), and legal status.

Stage of Development:

State whether your company is a startup or continuing business, when it was founded, how far along the product or service is in its creation, and if you’ve already made sales or started shipping.

Track Record:

• If you are an established business, provide a brief history of the company’s trading activity to date, including financial and market growth highlights.
• If you are just starting a business, you won’t have as much information as an established company. Instead, focus on your experience and background as well as the decisions that led you to start this particular enterprise.

Management:

Briefly describe the bios of the key members of your management team , particularly those of company founders/owners , as well as the key professional advisors .

What do they bring to the table that will position your company well to take advantage of the market opportunity and make the business a success?

Highlight management’s vision and passion , along with the relevant skills , experience , qualifications , subject-matter expertise , business acumen , industry connections and other capabilities as they relate to the venture.

Operations:

Showcase the key operational features that will give the business a competitive edge.

This could include anything from an advantageous location, through innovative manufacturing technology and processes, to preferential supplier and distribution agreements – and anything in between.

Outline the strategy to achieve the company’s goals and continuously strengthen its competitive position.

Next, indicate the keys to success that you intend to use in order to implement that strategy, such as:

• Marketing and Sales: Briefly describe the methods you will utilize to reach your target customers to market your offering and secure sales.
• Operations and Resources: Summarize the most important resources and operational features your company will deploy to implement its strategy.

Address your plans for where you would like to take your business in the future.

Spell out the objectives you have for the company, what you plan to do:

• Where do you expect the business to be in 1 year, 3 years, 5 years ?
• What are some of the key milestones you plan to meet?
• What are your long-term goals ?
• What is your potential exit strategy ?

Make an educated projection for the expected performance of your business, including:

• Sales volume and value
• Cash flow position
• Profitability
• Number of employees
• Number of locations
• Market share
• New products

Financial Forecast

Summarize the expected financial outlook and performance for your business, answering the following questions for your readers:

• How much do you expect to make in the first year of your business?
• What kind of growth do you expect to see in the following years?
• If you do not expect your business to be profitable , do you have a strategic reason for running at a loss?
• What are the key metrics that you need to watch?
• Will your backers (if any) be able to get their money back and when ?
• Are your financial projections realistic ?

In general, it is customary to indicate financial information for years one through three or five , depending on the requirements of the business plan reader. Typically, this includes Year 1 and Year 3 / 5 results; and Year 10 / long-term goals.

However, your readers can find the detail of the projected financials further on in the plan. In this section, only provide the highlights of your forecast and encourage the reader to keep reading to learn more about your company.

Funding Requirements

How will you fund your business to get it started and grow it to the next level?

• Is it already self-sufficient?
• Do you plan to invest your own money?
• Do you seek outside financing?

If the business does not require any outside financing, you can note that here or just remove this section from your plan altogether.

When you are using the business plan for financing purposes, explain how much money is needed, from whom, and how you will utilize it to grow your business, hinting at an exit opportunity:

• Existing Source of Funds: Include information about your current lenders and investors, if any.
• Funding Requirements: Indicate how much money you are seeking, from what sources, and perhaps even under what conditions.
• Use of Funds: Specify how the raised funds will be used.
• Exit Strategy: Hint at how the backers will get their money out, with the expected timing and returns.

Tips: How Do You Write an Executive Summary?

Writing an executive summary is arguably the most fun – and important – part of writing a business plan.

You have already completed all the research, thinking and writing about market demand, competition, strategy, operations and financials.

All that is left to do now is to summarize the key conclusions into a coherent narrative , answering the million-dollar question:

Why is your plan worthy of backing?

Here are 7 tried and tested tips to prepare a compelling summary of your business that will convince the readers to read through the rest of your plan:

Target Audience (Tip #1)

Ask yourself: “Who will be reading my business plan?”

Since the summary is what the reader reads first, and may be the only section read at all, you can significantly improve your chances of a positive reception if you know the answer to that question before you prepare your executive summary.

Remember, your reader is only going to spend a few minutes , or even seconds , on your executive summary. This is especially true if you are targeting busy investors or lenders for whom it is not unusual to review more than 1,000 each year.

Naturally, the readers are going to focus on the issues that interest and concern them most . If you understand their priorities, you will be better able to craft the summary to “push the right buttons”. For example:

• Bankers are likely to look for aspects of your business that minimize risk to make sure the loan is secure and they will get their money back.
• Investors are focused on aspects that maximize the potential of your company scaling significantly and rapidly, because they will receive a share of that success.
• Management may be interested in accessing new markets for the company.

Do your homework to discover the interests and concerns of your most likely business plan recipients, and then write and organize the summary in a way that most appeals to your target audience:

• Place the issues most important to the reader near the top of your summary.
• Order the sections in any way that gives the best impression of your business to your target reader.
• In the text itself, give more emphasis to those aspects that concern your reader most.

If you are not able to identify the specific person who will read your plan, just focus on the general type of a person that is most likely to receive it and their concerns. 

However, it is not a good idea to tailor the executive summary for just one specific person or organization, especially if your plan is likely to end up in the hands multiple and/or unknown recipients.

To be on the safe side, target your summary to address general institutional concerns rather than individual preferences.

Insider Tips: Writing a Winning Executive Summary

Convey your enthusiasm (tip #2).

The Executive Summary enables the readers to quickly understand the highlights of your business and decide whether to commit more of their time to reading the full plan.

To that end, you need to motivate and entice the readers by your own optimism about how well-positioned your business is to exploit a compelling market opportunity, conveyed in a dynamic , positive and confident tone.

Write Executive Summary Last (Tip #3)

Your executive summary will be the last chapter of the business plan that you prepare.

Even though the executive summary always appears first in the completed document, it is usually crafted last after you have had a chance to carefully consider all key aspects of your business throughout the rest of the plan.

The executive summary is the place where you bring all your planning together and sum up the separate parts of your business proposal to provide an overall outline and highlight the strengths of your entire plan.

Therefore, you will find it much easier and faster to come back and produce this section once you have completed the rest of your business plan.

That way, you will have thought through all the elements of your business, work out the details, and be prepared to summarize them. This approach will not only increase the consistency and accuracy of the plan, but also help make it more compelling .

So, if you have not yet finalized the other sections of your plan, proceed to the next section, and return to the executive summary when you have completed the rest of your plan.

Once finished, the executive summary will become “ Chapter 1 ” of your business plan document.

Summarize Highlights (Tip #4)

A good summary contains highlights from all of the subsequent sections of the business plan.

To achieve that, select the key points from each section of your completed plan by summarizing conclusions you have reached in each area. Remember to focus only on the most important and impressive features of your business.

What sets your business apart from the competition? Early on in your summary, showcase your distinguishing qualities and make sure you describe your winning concept in a way that any reader can easily grasp .

Use logical writing to tell a story, freely changing the order of sections and combining related topics if that helps to improve the flow and make a good impression.

Make Each Word Count (Tip #5)

The executive summary provides a brief snapshot of your business, casting a spotlight on the most important facts and concepts from your entire business plan.

As a result, this section should be clear , concise and to the point. Make each word should count.

Avoid Jargon (Tip #6)

In case the summary read by people unfamiliar with your industry, avoid any technical jargon or provide sufficient explanatory notes .

Edit, Edit, … And Edit Some More (Tip #7)

By the time you reach the executive summary, you may be tired from all the planning and writing. However, remember that this really is the most important section of the business plan.

The best investment you can make is to spend sufficient time to perfect the summary, including ruthless editing . There are professional editors who can help you make it flawless.

Design: How Do You Design an Executive Summary?

Looks matter. Your business plan will be well researched, analysed and written, but it must also be well presented. While your plan will ultimately be judged on the quality of your business concept and strategy, you also want to make sure it gives the best first impression possible.

And nowhere is presentation more important than in the executive summary, because for all readers it will be the first page(s) they read – and some will read nothing else.

The key advice here is: Break it Up . Large, dense blocks of text intimidate readers.

Dividing the Summary text with paragraph headings, bullet points and white space makes the information on a page more inviting and appealing:

• Paragraphs: Break up the Summary into paragraphs that roughly mirror the sections of your business plan
• Brief: Keep each topic as brief as possible
• Subheads: Insert informative topic headings at the beginning of each paragraph to help readers’ quick comprehension
• Bullets: Use bullet points to highlight the most compelling information
• Numbers: Use numbers instead of words where appropriate
• Visuals: Include a (small) chart or graph if it helps to clarify an important point
• Spacing: Use white space to break up the text to make the page look less intimidating. Single space text, but leave an extra line of space between paragraphs.

Because you are limited to so few pages, it may seem counterintuitive to give up space for visual considerations, but these effective techniques make your Summary much more accessible to the business plan readers.

The way you prepare and present the executive summary is an indicator of your professionalism. A polished Summary sheds a favourable light on your business. A sloppy one works against you.

Length: How long is an executive summary?

The executive summary in a business plan should be no more than 2-3 pages in length, with 1 page being perfectly acceptable and often preferable. The advantage to the busy business plan reader is that they are able to skim through this short summary in a few seconds and read it in full in less than 5 minutes .

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How to Write an Executive Summary (+ Examples)

• September 4, 2024

The executive summary is the cornerstone of any business plan, serving as a gateway for readers to understand the essence of your proposal.

It summarizes the plan’s key points into a digestible format, making it crucial for capturing the interest of investors, partners, and stakeholders.

In this comprehensive guide, we’ll explore what the executive summary is, why we use it, and also how you can create one for your business plan. Let’s dive in!

What is an Executive Summary?

An executive summary is a concise and compelling overview of a business plan (or simply a report), designed to provide readers, such as investors, partners, or upper management, with a quick and clear understanding of the document’s most critical aspects.

For a business plan, it summarizes the key points including the business overview , market analysis , strategy plan timeline and financial projections.

Typically, the executive summary is the first section of a business plan, but it should be written last to ensure it accurately reflects the content of the entire document.

The primary goal of an executive summary is to engage the reader’s interest and encourage them to read the full document.

It should be succinct, typically no more than one to two pages, and articulate enough to stand on its own, presenting the essence of the business proposal or report without requiring the reader to go through the entire document for basic understanding.

Why Do We Use It?

The executive summary plays a crucial role in whether a business plan opens doors to funding, partnerships, or other opportunities . It’s often the first (and sometimes the only) part of the plan that stakeholders read, making it essential for making a strong, positive first impression. As such, we use it in order to:

• Capture Attention: Given the volume of business plans investors, partners, and lenders might receive, an executive summary’s primary function is to grab the reader’s attention quickly. It highlights the most compelling aspects of the business to encourage further reading.
• Save Time: It provides a succinct overview of the business plan, allowing readers to understand the key points without going through the entire document. This is particularly beneficial for busy stakeholders who need to make informed decisions efficiently.
• Facilitate Understanding: An executive summary distills complex business concepts and strategies into a concise format. Therefore, it makes it easier for readers to grasp the business’s core mission, strategic direction, and potential for success.
• Driving Action: By summarizing the financial projections and funding requirements, an executive summary can effectively communicate the investment opportunity. Indeed the investment opportunity, whether to raise money from investors or a loan from a bank, is the most common reason why we prepare business plans.
• Setting the Tone: The executive summary sets the tone for the entire business plan. A well-written summary indicates a well-thought-out business plan, reflecting the professionalism and competence of the management team.

How to Write an Executive Summary in 4 Simple Steps

Here’s a streamlined approach to crafting an impactful executive summary:

1. Start with Your Business Overview

• Company Name: Begin with the name of your business.
• Location: Provide the location of your business operations.
• Business model: Briefly describe how you make money, the producfs and/or services your business offers.

2. Highlight the Market Opportunity

• Target Market : Identify your target market and its size.
• Market Trends : Highlight the key market trends that justify the need for your product or service.
• Competitive Landscape : Describe how your business is positioned to meet this need effectively.

3. Present Your Management Team

• Team Overview: Introduce the key members of your management team and their roles.
• Experience: Highlight relevant experience and skills that contribute to the business’s success.

4. Include Financial Projections

• Financial Summary: Provide a snapshot of key financial projections, including revenue, profits, and cash flow over the next three to five years.
• Funding Requirements: If seeking investment, specify the amount needed and how it will be used.

2 Executive Summary Examples

Here are 2 examples you can use as an inspiration to create yours. These are taken from our coffee shop and hair salon business plan templates.

Coffee Shop Executive Summary

Hair Salon Executive Summary

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Start » startup, a guide to writing an executive summary for your business plan.

An executive summary should include a concise overview of your business and pique the interest of readers.

The most crucial component of any business plan is the executive summary. It’s usually the first thing investors will read about your business, so it should thoroughly summarize your objectives and pique the reader’s interest in learning more.

Like all first impressions, you rarely get a second chance to make a great one. Here’s what you need to know about writing an executive summary that will leave a lasting impact on your readers.

What information is included in an executive summary?

The specific information you provide in your executive summary will vary depending on your industry, your goals and whether you own a startup or an established business. The summary should be one to two pages in length and sum up the more detailed content in the rest of your business plan, including:

• Who you are. Start with the basics. List your business name, location and contact information. For established businesses, give a brief history of your company and provide your mission statement . Include the names of the owners and the key players in your business, as well as the number of employees you have.
• The business opportunity. Describe the market need or problem for which your business has a solution.
• How you address that opportunity. Explain your business model and how your products or services will satisfy that market need or problem.
• Competition. Provide an overview of your competition and how your products or services differ from theirs.
• Target market. Describe the specific customer base you plan to attract to your business.
• M arketing strategy. Explain how you plan to reach your target market and entice them to your products or services.
• Financial summary. For established businesses, provide a financial summary and state whether you are seeking additional funding or not. For startups, list your financial plan and include your projections for the next few years.

Although it will be the first section of your business plan, most experts recommend writing your executive summary at the end of your drafting process.

How to write an executive summary

Writing an executive summary from scratch is a daunting process. Here are a few tips to help you create a strong executive summary:

• Write it last. Although it will be the first section of your business plan, most experts recommend writing your executive summary at the end of your drafting process. Doing so will ensure that you have all the detailed information you need to refer back to when writing the summary.
• Be brief, yet precise. An executive summary should be just that: a summary. You don’t need to go into great detail here as the business plan itself should provide all the details needed to attract investors, lenders, buyers or new business partners. Be brief and provide a high-level overview of your business plan.
• Know your audience. Just as you tailor a sales pitch to a specific audience, your executive summary should highlight the information your readers will find most interesting and valuable. If you are trying to attract investors or new partners, focus on how your business can be beneficial to their long-term success. If you’re applying for a business loan, focus on your financial reports and show that your business is reliable and that you present minimal risk.

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• Writing Tips

How to Write an Executive Summary for a Business Plan

• 3-minute read
• 19th November 2023

An executive summary is the part of a business plan that gives an outline of the main plan. So to write an executive summary, we first need to read the business plan carefully and understand its key points. These key points are what we will condense to form the executive summary. It’s important to ensure that the executive summary can stand alone because plenty of users will read only that and not the main business plan. We could say that the business plan is the original TL;DR (too long; didn’t read)!

But first, let’s take a quick look at what goes into a business plan so we can focus on the sections we need for our executive summary.

What Is a Business Plan?

A business plan is a document that sets out a business’s strategy and the means of achieving it. The business plan usually contains the following sections:

How to Write an Executive Summary

The executive summary covers the same headings as the main business plan but not in so much detail. This is where our editing skills come to the fore!

The following six steps explain how to approach writing the executive summary.

Consider the Audience

Who will be using the summary? The business plan might be issued only to a very specific group of people, in which case, their needs are paramount and specialized. If the business plan is going out on wider release, we need to think about what a general reader will want to know.

Check That It Makes Sense on Its Own

Make sure the summary can be read as a stand-alone document for users who won’t read the whole plan.

Use Formatting Effectively

Make good use of formatting, headings, numbering, and bullets to increase clarity and readability.

Keep It Brief

One page (or around ten percent of the total word count for a large document) is great.

Avoid Jargon

Try to avoid jargon and use straightforward language. Readers of the executive summary might not have business backgrounds (for instance, if they are friend and family investors in a small start-up business).

Find this useful?

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Proofread the Executive Summary

The executive summary will very likely be the first – and perhaps the only – part of the business plan some people will read, and it must be error-free to make a professional impression.

●  Consider the audience .

●  Ensure that the executive summary can stand alone.

●  Use formatting tools to good advantage.

●  Keep it brief.

●  Keep it simple.

●  Proofread it.

If you’d like an expert to proofread your business plan – or any of your writing – get in touch!

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How to Write a Business Plan Executive Summary

What is the Executive Summary?

A business plan executive summary is a short overview of your business plan for investors who are interested in learning more about your startup or existing business. It should be concise, engaging, and informative.

What is the Purpose of the Business Plan Executive Summary?

The purpose of an executive summary is to give potential investors insight into your goals and intentions as well as an understanding of the specifics surrounding your business. It includes all the information the reader needs to know in order to make an investment decision.

The executive summary is the first thing that your audience will read to get an idea about what your business is all about. You can make it easy for them by providing a concise explanation of what your business does, why it’s needed, how you plan on making money from it, and what customers you’re targeting. This means that the document needs to cover all these important points while being brief enough to not scare away readers who might want more information about your business venture.

How Long Should a Business Plan Executive Summary Be?

The executive summary for a business plan should generally be between one and three pages long; more than that may appear excessive to the reader, while less may not provide enough information to convince an investor to provide funding for your company.

Steps to Writing an Executive Summary

• Write the Executive Summary Last . Once you’ve completed writing your entire business plan, you’ll have learned the key points which set your business apart and which should convince readers to join you.
• Make a List of the Most Important Points . Write a sentence or bullet point for each argument you want to include in the executive summary. Include all the things you want to cover in your summary, including market research and analysis, management team, financial information, product development plans, and projected growth plans. You can also use headers to keep your thoughts organized.
• Describe Your Company’s Unique Background . Potential investors will want to know what makes you qualified to execute on your ideas, so here’s where you elaborate on all of your experience and insight into the business world. Include any other projects that your team members have been successful with in the past along with information regarding why you’re qualified to achieve the business’ goals.
• Identify Your Product or Service . You need to provide a description that gives potential investors a clear image of what you’re offering whether it’s something tangible, like a product, or something intangible, like software or a service.
• Explain the Benefits of Your Product or Service . This is a key part of your executive summary. Here you need to identify why your product or service is better than other options and how it appeals to your target audience.
• Address Issues or Concerns Head On . Your potential investors are going to want to know if there are any risks involved with working with their company so they can decide if they want to take them on. Here you need to talk about the problems that may arise from implementing your plan and how they can be addressed if or when they happen.
• Describe Your Management Team . Document the qualifications of your team and how your team has the experience and expertise to make your company a success.

Tips for a Great Executive Summary

Make it short but informative. If you can summarize the key points in just one page, do it. If you need up to 3 pages to detail the key information, that’s ok too.

Investors invest in people more than ideas. The most successful business plan summaries highlight the founders’ passion and enthusiasm for their project as well as their background and achievements. Investors want to know about the team members involved in the venture – who are they? Why do they matter? Who is managing whom? How experienced are the entrepreneurs?

Explain exactly what your product or service does. This includes how it will benefit customers and why there’s a need for it. You should also show how your business is different and why you’re better than the competition.

Make sure you proofread everything. It all comes down to attention to detail, so make sure there are no spelling mistakes or grammatical errors before you distribute the document. Not only will this make it look professional, but it’ll also show potential investors that you respect their time and don’t plan on wasting it by making careless mistakes during your business endeavors.

Business Plan Executive Summary Example

The executive summary is a brief overview of your business that serves as the first thing an investor will read when they consider investing in your business. It should be concise and informative without sounding like a marketing brochure. It includes all the information needed for them to make their decision about whether or not they want to invest in your business venture.

Below is an example of an executive summary:

Hosmer Sunglasses Executive Summary

Company & concept.

Hosmer Sunglasses (hereinafter referred to as “Hosmer” or “the Company”), is a California-based sunglass manufacturer offering the most cutting-edge sunglass frames in the world today. Along with a chic appearance, DNS frames have a unique characteristic that satisfies sport enthusiast consumers – silicon hinges. These hinges are exceptionally flexible and can be bent from a 90-degree angle to a 180-degree angle without breaking. This characteristic results in an intricate blend of comfort and durability heretofore unseen in the sunglass industry.

The Hosmer brand is poised for success in the U.S., and throughout North America, because it is a proven, unique product with meaningful consumer benefits. Consider the following:

• The Hosmer brand is currently distributed in France, Germany, Belgium, Spain, and England, where over the past two years, over 1 million pairs have been sold per year.
• The brand’s success in fashion-conscious France and western Europe should translate well to fashion-conscious Americans.
• Hosmer’s hinge differentiates the brand from every other sunglass company. It is a unique product difference that provides consumers with both fashion and performance, two key consumer needs.
• Hosmer recently launched U.S. operations and has already sold Hosmer sunglasses through nearly 15 retailers in four western states, and has established endorsements with over 20 sports celebrities.

Hosmer has a solid foundation from which to grow, great products with unique features, a superb management team, and an ideal climate to break into the $2.9 billion U.S. sunglass industry.

Industry Analysis

According to the Sunglass Association of America, retail sales of plano (non-prescription) sunglasses, clip-on sunglasses, and children’s sunglasses (hereinafter collectively referred to as “sunwear”) totaled $2.9 billion last year. Premium-priced sunglasses are driving the plano sunwear market. Plano sunglasses priced at $100 or more accounted for more than 49% of all sunwear sales among independent retail locations last year.

The Sunglass Association of America has projected that the dollar volume for retail sales of plano sunwear will grow 1.7% next year. Plano sunglass vendors are also bullish about sales in this year and beyond as a result of the growth of technology, particularly the growth of laser surgery and e-commerce.

Customers and Competition

Buyers of premium sports sunglasses are typically males aged 15-35 who participate in non-traditional outdoor sports referred to as “extreme sports” — i.e., skateboarding, snowboarding, surfing, mountain bike riding, and motorcycling. They also include participants of certain traditional sports, including skiing, volleyball, and golf.

Customer ratings show that a key need of extreme sports participants with regards to sunglasses is durability. While many participants are satisfied with the looks of sunglasses by manufacturers such as Oakley, they vigorously complain that such glasses tend to break easily. Since sunglasses are most prone to break at the hinge, and since Hosmer sunglasses have silicon hinges, they are unlikely to break. And, although several companies market premium sports sunglasses to this customer base, none manufactures sunglasses with silicon hinges or with the superior quality of DNS frames.

Within the premium sunglass market, it is projected that Hosmer’s primary competitors will be Smith, Dragon, Arnette (owned by Luxottica Group), Spy, Black Flys, Oakley, and Bolle.

Marketing Plan

Hosmer’s initial target market is males aged 15-35 who participate in the extreme and traditional sports noted above. This group consists primarily of “early adopters” who are most likely to be attracted to the unique Hosmer brand. Penetrating this segment will build a “buzz” around the brand, which will cause other customer groups to purchase the product soon thereafter.

Hosmer will initially offer the 8 DNS frames that have hinges. These frames will be available in a variety of colors and lens types, resulting in a selection of approximately 50 different SKUs. Hosmer controls the lenses it installs in the DNS frames. Currently, the Company uses Paletz Sulter lenses and is considering a switch to Sola lenses for some or all its frames. Both Paletz Sulter and Sola are top-notch brands, either of which would protect Hosmer wearers from the well-documented perils of excessive exposure to sunlight. By virtue of the superior design and quality of both its frames and lenses, Hosmer’s sunglasses command a premium price of $90 to $130.

Distribution will be developed through a network of representatives. At the outset, Hosmer will utilize the following outlets for distribution of the Hosmer brand: (1) independent sporting goods specialty stores; (2) sporting goods retail chains; (3) sunglass specialty stores; (4) specialty/trendy stores; and (5) optical retailers.

Hosmer has developed a comprehensive promotions strategy. It will market to retailers through advertisements in trade journals and trade show exhibitions, in addition to direct sales from representatives. Consumers will be targeted via grassroots marketing campaigns including attending and sponsoring various surfing events, biking events, and skateboard tournaments and exhibitions. The company will also advertise in the print and cable media that is most popular among the target audience. Hosmer will also continue to recruit celebrity endorsers and create strategic alliances. Dozens of professional and amateur athletes already wear the Hosmer brand. Finally, Hosmer is developing a comprehensive website that educates consumers about the Company and its products.

Management Team

The Company has not only assembled a top-notch management team but one with extremely strong marketing backgrounds. The team includes:

• Jane Smith , President, whose experience includes…
• Bob Smith , Vice President of Sales & Marketing, whose experience includes…
• Jen Smith , Sales Manager, whose experience includes…
• Mike Smith , Manager of Endorsements, whose experience includes…

Financial Plan

The average pair of Hosmer sunglasses wholesales for $55.39 and costs Hosmer approximately $15 landed (after shipping, etc.). The result is substantial gross margins of 72.9%. The Company expects sales and profitability over the next five years to be as follows:

Year 1 losses result from the substantial infrastructure (e.g., staffing, general and administrative expenses, etc.) and marketing expenditures needed to promote the Hosmer brand. The long-term increase of sales due to these efforts yield a nearly break-even Year 2, and increasing sales and net income thereafter.

Hosmer currently seeks $5 million, primarily for infrastructure, marketing, inventory, and working capital needs. The Company’s exit strategy is the most likely strategic acquisition or sales of distribution rights in the U.S. and/or other regions.

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