The Product or Service Overview

In the Product or Service Overview section of your business plan, you describe the features and benefits of the product or service you plan to offer in the most succinct and clear terms you can muster. In this section of the plan, you begin to convince your potential investor that you are offering something that customers will actually purchase, that you understand how the industry works, and that you've done the homework required to substantiate your claims. Writing a good Product or Service Overview entails walking a bit of a tightrope. You want to give your reader a clear understanding of what you're offering, and how it differs from other offerings, yet you don't want to get bogged down with technical details.

For example, an entrepreneur  selling a new kind of cellular phone would need to include a summary of:

• What drives customers' decisions to purchase a cell phone?

• How the entrepreneur's cell phone product is different from cell phones offered by competitors.

• Why customers would prefer to purchase the new cell phone.

• Why competitors won't be able to offer a similar cell phone with the same features or for the same price.

In this section, you must articulate your "competitive advantage." Put simply, competitive advantage is what allows a company to earn more profits than its competitors. (Why would a customer buy your product or service over those of your competitors?) You should start thinking about how your product or service can offer a long-term competitive advantage. Types of competitive advantages include:

• Cost advantage – when your product or service gives your customers the same main benefits as competitors' products, but at a lower cost.

• Speed advantage – when you are able to be more nimble than your competitors and quickly take advantage of opportunities.

• Product differentiation – when your product or service gives your customers different or better benefits than competitors' products.

An Investor's Perspective "I want the very beginning of your Product or Service Overview to give me a crystal clear picture of what you're offering."