Contingency plans are methods you will implement to prevent or minimize the risks discussed in the Description of Risks section.  It is a good idea to include this section in your business plan because it tells the reader that you have a plan in the event that a potential problem arises.

A good contingency plan minimizes risks by addressing the following issues:

*  Trigger Points: Establishing monitoring operations so that the discovery time for problems is short.  This involves carefully monitoring market and financial conditions, as well as analyzing the implications of any changes.

*  Action Plans: Creating plans of action in advance so that minimal time and effort is required to decide on a course of action after a problem is recognized.  Action plans are proactive solutions to business problems rather than reactive solutions.

*  Follow Through: Possessing the courage to execute the action plan quickly and decisively.