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What is a business description?

A business description provides an


overview of key aspects about your
business, like what you do and what makes
your business original. Anyone reading your
company description should have no
problem understanding the scope of your
business idea.
Lenders and investors should see how your
business has a place in the market, as well
as its benefits to future customers.
Your business description should be
regularly updated as your business
expands or changes.
Describe your business
You need to know how to pitch to
investors and lenders to captivate their
interest. Your information should answer
who, what, where, when, why, and how
right off the bat.
1. Who?
Who are you? What is the name of your business?
You want to verify that the name of your business is clear
in the business description of your business plan. And,
include your name because lenders and investors want to
know the entrepreneur who started the business.
Who is your target customer? When you describe your
business, make sure you know who you appeal to. If you
don’t know your target customer, there’s a chance that
nobody will have interest.
2. What?
What is your product or service? If lenders and
investors can’t understand what you’re selling or how it’s
significant, they might pass on your concept. Be clear
when you tell lenders and investors about your business.
What are your goals for your business? Set realistic short-
term and long-term goals. If you plan on selling $20,000
worth of products by the end of the second month after
opening, include the goal.
3. Where?
Where is your business located? If you are currently
operating your business, you need to say its location.
Likewise, if you are opening a new business, make sure
you state where you want it to be located.
4. When?
When will you implement your business plan and see
results? Say when you want to open your business (or
when you opened it). And, include when you plan to
achieve your goals. Once your goals are achieved, what is
your exit strategy for small business? Do you know how to
turn your growing business into a profitable venture?

5. Why?
Why would potential customers want to buy from you?
Explain why you are set apart from the competition. This is
where you can describe your business’s originality.
Lenders want to know why consumers would want to
make a purchase at your small business instead of a
competitor’s.
You also need to include your business’s mission
statement. A mission statement helps set you apart from
competition and explain why your business is unique.

6. How?
What type of business structure will you form? Will you
function as a sole proprietorship, limited liability
corporation, partnership, or corporation? Explain why you
chose your business structure. Mention the small business
advisor help you have enlisted, like a business attorney,
since each structure has different registration
requirements, regulations, and liabilities.
Do you know how to interview and hire employees?