CHAPTER 2

HOW TO WRITE AN EFFECTIVE

EXECUTIVE SUMMARY

Gehana D. Lamug, DBA

Associate Professor I
 Course Objectives

• Explain what is meant by executive summary

• Describe importance of executive summary

• Discuss components of executive summary

• Make a feasible executive summary

 What is an executive summary?
An executive summary is a brief section at the
beginning of a long report, article, recommendation,
or proposal that summarizes the document.
It is not background and not an introduction.
People who read only the executive summary should
get the essence of the document without fine details.
 What is an executive summary?
Pitch First: Your business plan will be a pitch,
create your presentation first. Your executive
summary is a concise write-up of your presentation.
It should truly summarize your entire business plan.
Assume it is all the investor will read.
The business plan will be the document to be
presented to potential investors and the executive
summar y shows the salient parts or a summar y
needed to justify its viability. Its should be presented
accurately.
 What is an executive summary?
"The most important reason to include an
executive summary is that in many cases, it is the
only thing the reader will read," says Pablo Bonjour,
founder and CEO of Katy, Texas-based SMG Business
P l a n s , a c o m pa n y t h a t of f e r s e n t r e p r e n e u r s
assistance in writing business plans.
Investors will read the executive summary to
decide if they will even bother reading the rest of the
business plan. It's rare for an investor or lender to
read an entire business plan, at least in the initial
stages of analysis and consideration for funding, so
having a strong executive summary is key.
 COMPONENTS OF EXECUTIVE SUMMARY
1.Business Name
Naming your business can be a stressful
process. You want to choose a name that will last and,
if possible, will embody both your values and your
company's distinguishing characteristics.
Alternatively, a naming firm will ask questions
to learn more about your culture and what's unique
about you--things you'll want to communicate to
consumers. Do you want to fit in or stand out?
 COMPONENTS OF EXECUTIVE SUMMARY

1.Business Name
Your brand name can make a lot of difference
when it comes to gaining attention. A catchy
business name that is easy to remember, whether
b e c a u s e i t i s f u n n y, u n u s u a l , a r e f e r e n c e t o
something or someone popular, or simply quirky, can
go a long way in establishing your business and
earning you visibility without putting extra work into
it.
 COMPONENTS OF EXECUTIVE SUMMARY

2.Location
Before you start looking for a business location,
you should have a clear picture of what you have and
what you want to have in future.
Here are some other factors that you should
consider when choosing the best business location:
Style of Operation
Your location needs to be consistent with a
particular image or style. If you own a retail business,
do you want a traditional store or an online store?
 COMPONENTS OF EXECUTIVE SUMMARY

2.Location (cont)
Demographics
When considering demographics, you should
think about two important angles. You should think
about who your customers are and how close they
are to your location.
Foot Traffic
For many businesses, foot traffic is ver y
important. Nobody wants to be tucked away in a
corner where potential customers will pass him/her
by. On the other hand, if your business needs
confidentiality, you should opt for a low-traffic area.
 COMPONENTS OF EXECUTIVE SUMMARY

2.Location (cont)
Parking and Accessibility
Consider the accessibility of the location for
every person who will be coming there. If you are on
a busy street, is it easy for cars to get in and out of
your parking lot? Your facility also needs to be
accessible to people with disabilities. Which sort of
deliveries are you likely to receive, and will your
suppliers be able to access the facility easily?
 COMPONENTS OF EXECUTIVE SUMMARY

2.Location (cont)

Competition
Are competing companies close by? In some
instances, this can be advantageous if comparison
shopping is popular. You might end up catching the
excess from nearby businesses if you are situated
near an entertainment area or restaurant. When
consumers are looking for very specific products,
they understand that their choices may be limited, so
they will probably only visit one location.
 COMPONENTS OF EXECUTIVE SUMMARY

2.Location (cont)

Site’s Image and History

W h a t d o e s t h e a d d re s s s a y a b o u t y o u r
business? If you are targeting a local market, you
should ensure that your location reflects the picture
that you want to project.
 COMPONENTS OF EXECUTIVE SUMMARY

2.Location (cont)

Site’s Image and History

W h a t d o e s t h e a d d re s s s a y a b o u t y o u r
business? If you are targeting a local market, you
should ensure that your location reflects the picture
that you want to project.

3. Name of Proponents
This presents the proponents of the business
plan/proposal.
 COMPONENTS OF EXECUTIVE SUMMARY

4.Form of Business Organization

One of the first decisions you’ll make as business
owners is how your business will be structured. You need
to know the advantages and disadvantages of each of
the different forms of business organization to make sure
you make the right decision for your new business.

5.Total Project Cost

Project cost is the total funds needed to complete
the project. The project costs are any expenditures made
or estimated to be made, or monetar y obligations
incurred or estimated to be incurred to complete the
project which are listed in a project baseline.
 COMPONENTS OF EXECUTIVE SUMMARY

6.Return on Investment
Return on investment measures the gain or
loss generated on an investment relative to the amount
of money invested. The ROI is usually expressed as a
percentage and is typically used for personal financial
decisions, to compare a company's profitability or to
compare the efficiency of different investments.
7.Source of funds
On the basis of ownership, the sources can be
c l a s s i f i e d i n t o o w n e r ’s f u n d s a n d b o r r o w e d
funds. Owner’s funds mean funds which are procured by
t h e o w n e r s of a b u s i n e s s , w h i c h m a y b e a s o l e
entrepreneur or partners or shareholders of a business.
 COMPONENTS OF EXECUTIVE SUMMARY

8.Payback Period
The payback period refers to the amount of time it
t a ke s to re c o ve r t h e c o s t of a n i n ve s t m e n t . T h e
desirability of an investment is directly related to its
payback period. Shorter paybacks mean more attractive
investments.

9.Project Target Implementation

There are key elements of any implementation that
primarily include planning: planning the work, planning
the tasks and sub-tasks, planning the time, and planning
the people and resources.
SAMPLE EXECUTIVE SUMMARY
 REFERENCES

The Art of the Start by Guy Kawasaki

“Executive Summary Guide” on the PACE website
https://businessnamegenerator.com/cool-catchy-business-name-
ideas-idea-generator-tool/

https://businesstown.com/factors-consider-choosing-business-
location/

https://www.kcsourcelink.com/guides/start-a-business/register-
and-license-your-business/forms-of-business-organization

Business Plan Format of CNSC CBPA