Writing Your Business Plan

Want to write a business plan that doesn't give the bank any reasons not to back you? A business plan that's bankable? Keep these things in mind... Don't just tell them what your business does; tell them what your business does better than anyone else. Tell them WHAT you do and HOW you do it. Concentrate on what is unique about your business and WHY that will make you successful. Don't just talk about the history of your business. Tell them about your future - WHERE is the business going? Include goals that are measurable, achievable and that have a deadline - WHEN will you do it by? Sell yourself. Include your resume. Writing a business plan does have an element of a job interview about it. WHO are you and why are you "the best person for the job"? If there are other key people involved in your business, give them a plug as well. People buy people first, before they buy business ideas. And yes, business bankers are people, contrary to popular belief. Sell the opportunity. Hopefully, you're looking to borrow money for a reason. That reason will usually be directly tied to an opportunity you've recognised. An opportunity to grow your sales, increase your efficiency, or buy out a competitor; explain the opportunity that exists and sell it to the people you're asking to finance it. Let them know what they stand to lose by not backing your business! Include an assessment of the key risks that your business will face and explain what you are doing to mitigate those risks. Pretending there are no risks involved in your business venture by not addressing them is foolish and it will make any banker think you don't know what you're doing. wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 wp55 You'll need to include a detailed section on the numbers - financial statements for the last 2-3 years and forward projections for at least one year. Talk about the numbers in your business plan, don't just leave them sitting there on their own for the banker to analyse. Point out the trends, the one-off items, and explain the key drivers of your business as you understand them. Draw their attention to the positive aspects of the results and explain what you're doing to make an impact on the not so positive aspects. Show them that you know what you're doing when it comes to managing your business based on the financial data your accountant prepares for you. Throw in some charts and tables - break down the raw data visually to make an impact. Write the business plan as much for yourself as for anyone else. Your business plan is part of your loan application, but it isn't the loan application itself. Business plans that are written to allow the owners to use them on a day to day basis to manage their progress are always more complete (and realistic) than business plans that are written for the express purpose of applying for a loan. If you can't refer to your business plan on at least a monthly basis to see if you're on track with your goals, budget, vision - something, what is it really worth? Include a detailed marketing plan. No business idea is any good to anyone if you can't sell it to someone. How will you get the customers that are willing to part with their hard-earned cash to buy your product or service? Do you know how much it costs to "buy" a new customer by advertising in a newspaper, on the radio, on television, over the internet, using Google AdWords, establishing a word of mouth referral system? If not, you need to find out. Also important is figuring out how many units of your goods or services you need to sell each week, month or year just to break even. If you don't know these things, the bank is a lot less likely to back you. Make your business plan complete. Don't focus on adhering to any particular business plan "template" - focus on giving an honest, thorough assessment of your business including its strengths, weaknesses, opportunities and threats. Anticipate the questions the bank will ask you (even the difficult ones) and answer them before they have to ask them. This will show that you've done your homework, help avoid costly delays and let them know that you're confident enough to present a balanced, accurate picture of your business. Get help. Even if you take immense pleasure in writing business plans and consider yourself an expert, it's always best to get someone to have a look at yours before handing it over to the bank. Make sure it makes sense to anyone and everyone. You won't always be there in person to fill in any gaps when your plan is being read by the bank. Gaps = reasons for the bank not to back you. If writing business plans isn't your thing (relax, you're in the majority), get some expert advice from a trusted adviser that knows business, and preferably, banking. Remember, the goal is to prepare a document that not only gives you an operations manual for the management of your business, but one that makes your business bankable.