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How
to write a business plan
The
best way to show bankers, venture capitalists, and angel
investors that you are worthy of financial support is to
show them a great business plan. Make sure that your plan
is clear, focused and realistic. Then show them that you
have the tools, talent and team to make it happen. Your
business plan is like your calling card, it will get you
in the door where you'll have to convince investors and
loan officers that you can put your plan into action.
Once
you have raised the money to start or expand your business,
your plan will serve as a road map for your business. It
is not a static document that you write once and put away.
You will reference it often, making sure you stay focused
and on track, and meet milestones. It will change and develop
as your business evolves.
Do
I need a business plan?
Not everyone who starts and runs a business begins with
a business plan, but it certainly helps to have one. If
you are seeking funding from a venture capitalist, you will
certainly need a comprehensive business plan that is well
thought out and contains sound business reasoning.
If
you are approaching a banker for a loan for a start-up business,
your loan officer may suggest a Small Business Administration
(SBA) loan, which will require a business plan. If you have
an existing business and are approaching a bank for capital
to expand the business, they often will not require a business
plan, but they may look more favorably on your application
if you have one.
Reasons
for writing a business plan include:
- Support
a loan application
- Raise
equity funding
- Define
and fix objectives and programs to achieve those objectives
- Create
regular business review and course correction
- Define
a new business
- Define
agreements between partners
- Set
a value on a business for sale or legal purposes
- Evaluate
a new product line, promotion, or expansion
What's
in a business plan?
A business plan should prove that your business will generate
enough revenue to cover your expenses and make a satisfactory
return for bankers or investors.
- Executive
Summary--features the highlights of your plan and sells
your idea in two pages or less.
- Company
Summary--a factual description of your company, ownership,
and history.
- Products
(or Services or both)--describes your products and/or
services and how they stand out from competitive products
and services.
- Market
Analysis-provides a summary of your typical customers,
competitive landscape, market size, and expected market
growth.
- Strategy
and Implementation-describes how you will sell your product,
how you will put your plan into action, and establishes
milestones.
- Management
Summary-provides background on the management team, their
experiences, and key accomplishments.
- Financial
Plan-contains key financials including sales, cash flow,
and profits.
What
makes a successful business plan?
- A
well thought out idea
- Clear
and concise writing
- A
clear and logical structure
- Illustrates
management's ability to make the business a success
- Shows
profitability
How
do you write a business plan?
Sitting down looking at a blank computer screen as you prepare
to start your business plan can be daunting. You may want
to look at some alternatives that will make the process
a bit easier.
Hire
a Professional
A professional consultant will create the business plan
for you, but you still have to be prepared to think through
your business and understand the underlying concepts in
your business idea. You will have to work closely with the
consultant to ensure that he or she develops a good plan
that accurately represents your business or business idea.
You can find a list of business planning consultants at
www.planconsultants.com.
Buy
a Book
There are many good books on the market that will help you
to understand what needs to go into a good business plan.
Use
our Business Planning Software
A good business planning software package will provide you
with an outline for a well-developed, objective-based and
professional business plan. Software packages will remove
the problem of starting from scratch by structuring your
plan for you. The software should ask you the right questions
that will pull out the most important underlying concepts
within your business idea. In association with PaloAlto
Software, the leading software package on the market, we
can provide you with sample business plans FREE or a customised
business plan for your business at a very competitive price.
To view
the sample business plans and customised business plans
on offer, click here
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