Watch First

Watch: How to Write a Business Plan: Company Description

Run time: 50:37Covers: legal structure, mission, products, and competitive edgeTaught by: Dr. Paul Borosky, DBA, MBA

The Short Answer

What Is a Company Description in a Business Plan?

Answer

The company description is the section right after the executive summary that explains what your business is: its legal structure, location, mission, products or services, competitive edge, and the customers it serves. It gives the reader the facts they need before the market and financial sections.

The problem: owners either write two vague sentences or three pages of history. Neither works. The fix is a set list of facts, written plainly, in the same order every time.

Want the Sections Already Laid Out?

Business Plan WritingA complete plan with financial projections that lenders and investors can follow.See business plan prices → Business Plan TemplatesAn editable Word plan and Excel financial model for your industry, each with a video tutorial. Not a blank AI file.Browse templates → Small Business EducationFree guides on business plans, management, money, and marketing.Start learning free →

What to Include

What Should a Company Description Include?

  1. 1

    Business name and legal structure

    LLC, S corporation, sole proprietorship, or partnership. Include the state where it is registered and who owns it.

  2. 2

    Location

    Where you operate and why that spot works: traffic, zoning, access to customers, or service area.

  3. 3

    Mission statement

    One or two sentences on what you do and for whom. Skip the buzzwords.

  4. 4

    Products and services

    What you sell and how you charge for it. Name your main revenue streams.

  5. 5

    Competitive edge

    Why a customer picks you over the business down the street. Be specific: hours, specialty, speed, credentials.

  6. 6

    Target market preview

    A short line on who buys. Save the detail for the market analysis section.

Dr. Paul's Insight

Write the competitive edge as a fact a lender can check, not an opinion. "Great customer service" means nothing. "The only shop in town open on Sundays" is a reason to buy.

Worked Example

What Does a Good Company Description Look Like?

Here is a complete example for a fictional business. Notice each paragraph covers one item from the list above.

Example: Saltmarsh Paddle Tours LLC

Legal structure and ownership. Saltmarsh Paddle Tours LLC is a Florida limited liability company owned by its two founding guides.

Location. The business launches from a leased dock on a protected tidal creek, a short drive from beach hotels and vacation rentals.

Mission. Saltmarsh gives visitors a safe, guided way to see wildlife on the water, with no paddling experience needed.

Products and services. Guided two-hour kayak tours, sunset tours, and private group bookings. The fleet of 14 kayaks supports up to 18 scheduled tours a week.

Competitive edge. Both guides hold first aid and paddling instructor certifications, and Saltmarsh is the only outfitter on the creek offering sunset tours.

Target market. Tourists staying in nearby hotels, local families, and corporate groups booking team outings.

Six short paragraphs. Every one answers a question a lender would ask. That is the whole job.

Avoid These

What Are the Most Common Company Description Mistakes?

  • Telling your life story. One line on your background is plenty here. Save the resume for the management section.
  • Skipping the legal structure. Lenders need to know who signs and who is liable.
  • A mission statement full of buzzwords. "Synergistic solutions" says nothing. Say what you do and for whom.
  • A vague competitive edge. "Quality" and "service" are what every competitor claims. Name something specific.
  • Repeating the market analysis. Preview the target market in one or two lines. The detail belongs later in the plan.

Want the structure already built? An industry business plan template is $100 and includes a Word plan with every section laid out plus an Excel financial model.

Wisconsin forms LLCs and corporations through the Department of Financial Institutions, not the Secretary of State. Cite that filing in your company description. The Wisconsin business plan writer page shows where it goes.

Real World Use

How an Owner Uses a Company Description

Rewrite Before a Loan

A landscaping company proving it is stable

Say you own a landscaping company with $640,000 in yearly revenue and 3 crews. Your old description said "a full-service landscaping company dedicated to quality." Nothing a lender can use.

You rewrite it with facts. 72% of revenue comes from maintenance contracts: $640,000 × 0.72 = $460,800 in recurring work. The other $179,200 comes from one-time installs. Revenue per crew: $640,000 ÷ 3 = $213,333.33.

Now the competitive edge is a number: most of your revenue renews every year. The lender sees a stable business before reaching the financials.

Alaska requires a state business license for nearly every business, issued by the Division of Corporations, Business and Professional Licensing. Get it before opening, and use Alaska business plan help for the rest of the launch steps.

Keep Going

More Videos in This Series

Company Summary for a Trucking Company Business Plan

Dr. Paul writes the company summary for a trucking plan, line by line. (6:48)

Plumbing Company Business Plan: Company Description

How the company description changes for a licensed trade business. (7:56)

How to Customize the Company Description in a Business Plan Template

Dr. Paul shows how to edit each part of the company description in a template. (16:27)

Questions

Company Description Questions Owners Ask

What is included in a company description?
A company description covers your business name, legal structure, location, mission, products or services, competitive edge, and a short preview of your target market. It gives the reader the basic facts about the business.
How long should a company description be?
Usually one page or less. Short paragraphs, one per topic, are easier to read than a long block of history. If it runs past a page, move detail to the market or management sections.
What is the difference between a company description and an executive summary?
The executive summary condenses the entire plan, including the market, financials, and funding request. The company description only explains the business itself: what it is, where it operates, and what it sells.
Should a startup include a company description?
Yes. A startup describes the business it is building: planned structure, location, services, and edge. Use clear, confident language about what will happen and when.
How do I write a competitive advantage in a business plan?
Name something specific and checkable: a location, a license, a service no competitor offers, faster turnaround, or a cost advantage. Avoid general claims like quality or great service that every business makes.
How to Write a Business Plan in Ten Steps, Fifth Edition book cover

Every section in order, from description to funding.

Dr. Paul's How to Write a Business Plan in Ten Steps walks through the company description and every other section, the same ten steps he uses on client plans.

Get the Book →

Written by Dr. Paul Borosky, DBA, MBA, current college professor, business consultant, and author with 14+ years and 1,000+ businesses served.

This page is for general educational purposes only. It is not financial, investment, legal, or tax advice.