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Article: "The Best Laid Plans"
How to Draft a Successful Business Plan
By Jeffrey A. Helewitz

Any paralegal who assists an attorney engaged in the practice of business or corporate law should, at some point, become familiar with putting together a business plan on behalf of the business client. The most frequently used tool to attract potential investors in a business enterprise is the business plan. The ability to draft an initial plan greatly increases the legal assistant’s value to the law office.

There’s a basic format that’s used to create business plans. Although the plans themselves will vary depending upon the nature of the business enterprise, the format will remain the same regardless of whether the business is seeking investors, creditors or additional owners to participate in the operation of the entity.

This article will focus on the format to be employed in putting all of the parts of the plan together in a cohesive package for the client.

Overview of the Plan

This first section of the business plan should include a short (no more than three or four pages) survey of the business and its financial objectives in formulating the plan. This section includes a statement of the nature of the business — sole proprietorship, general or limited partnership, corporation or limited liability company — including its date of organization and a precis of its operations to date. As an exhibit to the plan, copies of any existing documents of creation should be included in this section.

The overview should then recite a brief history of the owners and primary managers of the business, including relevant education and employment experience. Actual resumes for each of these individuals will be included in another section of the plan later on.

Next the overview must state the financial objectives of the company with respect to the plan indicating how much capital the owners are seeking and the methods by which they hope to achieve this objective. This is the reason for which the plan has been created and is of most interest to potential investors or creditors.

Finally, the overview might include a brief recitation of potential risk factors for the investors. The risk factors will be its own section of the plan but it’s important that the owners indicate to investors that they are aware of possible risks involved in such investments. No rational investor would believe that a business investment lacks any degree of risk.

This overview section is extremely important because it provides the potential investor with a brief summary of the business and its objectives. It’s after a review of this summary that the investor decides whether to look at the rest of the document.

Description of the Business and the Industry

This section of the plan indicates exactly how the subject business sees itself in relation to other businesses in its industry: Who are its potential or current competitors, the size and potential growth of the industry, its projected share of the market, and whether the business is attempting to compete in the overall marketplace or sees itself as a niche supplier. A niche supplier is one that meets a perceived need that isn’t generally met by the larger companies because the market is too small for larger companies to make it profitable, even though an actual need exists.

In this section of the business plan, the plan must address how the business will have an advantage over other businesses in the field. It should include a detailed explanation of the company’s products and services, with any advertisements or impartial reviews that exist with respect to such products or services. The information appearing in this section should be documented with publicly available statistics from financial institutions such as Value Line, Dun & Bradstreet, Standard and Poor’s, The Wall Street Journal, etc. These statistics provide the factual basis for a realistic comparison among the subject business and its competitors in the field.

Market Research

As a general rule, this section of the business plan isn’t prepared by the law office, but rather by a professional in the field of market research. The law office may assist the client in selecting an appropriate and cost efficient professional to prepare this information.

The Management Team

Investors and creditors are particularly interested in the people who will be managing the business and making use of the funds received. As a consequence it’s imperative that the business plan include resumes for all of the key figures in the business.

Finance, like law, is a very conservative field, and so the most appropriate form of resume is the “tombstone,” in which all pertinent information is highlighted and objectively placed. The legal assistant may be the person in the law office who will gather together the resumes from the clients and then redo them in a similar format, or may have to create the resumes from the information gathered from the clients. The resumes appearing in the business plan should all be consistent, and should include a list of any pertinent publications by the people so listed as well as any articles or reviews about them.

Operations Plan

The operational plan discusses the actual method the business intends to employ to create its product or service. This section must include appropriate demographics of the area of operation, why such location was chosen, and the demographics of the potential customer. Cost estimates with respect to starting up and maintaining the business should be included where appropriate, although a detailed financial analysis for this aspect will appear later in the plan as well.

Risk Factors, Problems

Every well-drafted business plan must include a section on potential risk factors involved in making an investment in the business. Significant risk factors that must be identified and briefly addressed include:

  • lack of history of the business
  • specific risks incident to the industry as a whole
  • dependence upon the specific key personnel for potential success or failure of the business
  • potential cash flow problems due to the nature of the business
  • potential tax risks depending upon the nature of the venture and the individual tax concerns of the interested investors
  • potential disallowance of certain deductions and expenses
  • allocation of income and losses, depending upon the nature of the entity
  • potential audit problems
  • the limited transferability and illiquidity of the investment for both closely held and non-publicly traded entities
  • potential conflicts of interest between the managers, investors and the business entity itself
  • compensation agreements, especially the effect of any “golden parachute” provisions
  • potential securities law control or regulation depending upon the nature and size of the business and the number of investors
  • potential or current lawsuits filed on behalf of or against the companyand its officers.

The Financial Plan

The financial section of the business plan is key to achieving an effective tool for the client to use to obtain loans and investments. In creating the financial section, the preparer should attempt to anticipate the questions the investor or creditor will have with respect to the financial aspects of the business. In this context, the legal assistant should attempt to become familiar with the idiosyncrasies of the particular business for which the plan is being created. The actual details of the financial documents needed to be included in the business plan have been discussed in earlier articles appearing in the July/August 1998 issue of Legal Assistant Today and should be reviewed.

At minimum, the business plan should include a financial projection, a consolidated profit and loss statement and a cash flow statement.


To support and flush out all the statements made in the body of the business plan, the following exhibits should be attached to the plan:

  • the creating document for the actual business (the Certificate of Incorporation, the Articles of Organization, the Partnership Agreement, etc.)
  • any contracts between the business and its personnel, as well as any business contracts entered into on behalf of the business
  • list of current investors
  • any agreements existing between or among the current investors
  • key man life insurance policies
  • tax returns of the business if it has a history of operations
  • all rights acquired or sold by the company, such as patents, copyrights, marks and franchises
  • the opinion of a certified public accountant with respect to the accuracy of all of the financial documents
  • opinion of legal counsel with respect to any legal representations made within the plan
  • all other documents supporting statements or inferences appearing in the body of the plan.

The paralegal may be responsible for gathering all of the above information and preparing the initial draft of the plan for consideration by the attorney and the client, and may also assist with marketing the plan to investors and financial institutions. Creating a business plan is both challenging and rewarding for legal assistants involved in business or commercial law.

JEFFREY A. HELEWITZ currently teaches at several paralegal institutions in the New York City area and is an adjunct professor of law at C.U.N.Y. School of Law and Touro College Law Center. Helewitz has also authored numerous legal texts designed for legal assistants.

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Updated 08/23/00
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