Before we begin, let's take a look at what a 'summary' is supposed to be. It is a short version of the main report that essentially eases the trouble of reading the entire report. The same goes for an executive summary, which is perhaps the most important aspect of a business plan.
Not all people can start-up a business solely with their own money. People need financial support from lenders to leverage their businesses. And while you may be convinced about the feasibility of your business plans and be confident in your ability to run the business well enough. It is understandable that a lender, who doesn't know much about either, will be a little wary in parting with his money.
The format of the business summary is a document briefly explaining the purpose of the business, the business model - the way the businessman intends to run it, the sales and the revenue he expects to generate, and more importantly from the point of view of the lender, the ability and the plan of the businessman as to how he intends to return all the cash given to him.
While a detailed business plan gives you the exact details about the way the business is going to be run and the expected inflow of revenue, the executive summary only gives the basics about the business model. If the lender believes that business model as given in the summary is a sound business model, then he can choose to go on to the detailed plan. If at the outset, the plan looks ludicrous and unfeasible, then the lender is saved of having to read a more complex and detailed fact book that is your business plan.
The executive format ought to include all the details given below in that particular order. Writing the format this way looks a lot more logical to the reader and hence is also easy to understand.
The introduction includes the name of the business and in brief the activities it has to carry out. If you're writing a summary for an existing company, list out its best known, best reviewed products, the awards the company has won and a bit about the history of the company.
The next thing you need to include in your summary is what you intend to sell. Whether it is a product or a service that you're looking to sell in the market, you need to justify why you think this product will do well, and what makes you think that a relatively new product will be able to beat out its competitors.
This section will tell the reader who the products/services are targeted at. The explanation also needs to be given as to why the businessman feels that this is the correct targeted market for his offering and how he intends to make it a hit with his targeted group.
The X Factor
Why will someone buy your product? What does your product have that similar products of other companies don't? What makes you think that your product will survive the competition given to it by the existing players? In short, what's your 'X' factor?
Goals and Objectives
The goals and objectives lay down the short and long-term expectations of this business plan. This part of the format lays down the revenues you expect through the sale of these products/services in the short-term and the long-term.
Is there anyone else who is with you on this project? The lender would also like to know who else is on your team and their exact functions. So at the end of it, you need to write down the names of all those senior management personnel attached to this project.
First, the summary should not be too long, 4 pages is said to be the ideal length. Second, at every point it has to be persuasive and enticing from the point of view of the reader. The reader should be able to get a glimpse of what you do, in order to finance the project. And third, format it well. Do not sensationalize it since it is a formal document!