Archive for June, 2011
A Strong Business Plan Will Help Attract Lenders And Investors
No business can effectively operate nor attract the funds needed to survive prosper and grow without a good business plan. A good plan is a management tool that shows where your business is going, and just how you plan to get there, and is a necessity for attracting lenders, investors, partners and key personnel, plan outlines vary but they all must cover certain key areas, such as: Executive Summary, Business Description, Marketing Plan, Financial Plan, Management Team, and Appendix.
Moreover, there are many kinds of software on the market that can help you write you write a good plan, but you must still input the data needed to write your plan into the software. The output of the software can never be any better than the data you put into it and you must manually put that in yourself. Here are four steps to help you write a strong business plan:
1. Put all of your plan data and information into several good old fashion file folders and label each folder so that you know what is in it. This data and information will include such materials as marketing methods you will use, market research, management team bio’s, financial statements, profit projects and other similar items.
2. Get a good outline or use the outline in the software you will be using to help draft your plan. And write a 250 to 500 word summary for each section of your business plan using the materials that you have in your plan data and information file folders.
3. Expand upon your brief summary descriptions for each section of your plan to write your actual plan, or let the software write this for you. Be sure to give extra attention to the marketing section of your plan because this section gets the more attention than any other part of your plan from lenders and investors, since this tells how your profits will be obtained.
4. Keep your plan to between eight to 12 pages, because when it comes to business plans more it not better, and anything longer than that quite simply won’t get read, then put a list of other information you have available in your appendix to be requested if wanted. You want your business plan to be a clear concise document that is easy to read and understand, because a confused mind will usually say no to what is being proposed.
A good business plan will help you to effectively and profitably operate your business, and is a clear road map that shows where you business is going, how you plan to get there, the people you will need to get there, and the profits your business will produce when you get there. And it will help you to get the money you need from lenders and investors to get where you want to go with your business. So do not underestimate the power of a good well written business plan, and by all means prepare you one getting started today.
Six Steps to Avoiding a Failed Business Plan
If you have worked hard to prepare a great business plan make it work hard for you in return with these six steps to avoiding silly mistakes.
1: Death of a Plan
All of your careful planning and analysis will come to nothing, if you work hard on your ‘business plan’ in order to present it to your bank manager for instance and then take it home and file it under ‘F’ for ‘forgotten’. Only by up-dating your plan regularly and reassessing its contents can you prevent it from becoming obsolete.
2: Be Realistic
Far too many businesses let over-optimism skew predicted sales or turn-over and focus only on the strengths and opportunities during their SWOT analysis, rather than truly considering all of the Threats and Weaknesses too. It is important to be honest with yourself and keep a check on over-optimistic predictions.
3: Remember your Competitors
A common planning error often made is that of ignoring any competition; making a careful study of your competitors will allow you to adjust your strategies according to any new initiatives they may have. This is another important reason to review the plan regularly.
4: Smarter not Harder
If your business plan relies too heavily on ‘new’ proposals, consider first if what is actually needed is a better way of executing the existing strategies.
5: Assess all Risk
It is vital to accept the potential for failure and not to ignore the risk involved; your business plan should thoroughly examine the risk and should take into account the cost of any failure.
6: Vane or Sane?
Turnover is vanity, but profit is sanity? Any planned expansion of your business should result in increased profit not just a higher turnover; your business plan should have taken into account all extra recourses needed for development. A successful business plan means a winning strategy for your business, and it is only through such a strong approach that you can move forward into a successful business future.