HOW DO I WRITE A SMALL SCALE BUSINESS PLAN
HOW DO I WRITE A SMALL SCALE BUSINESS PLAN
As a business owner, you might not be able to raise all the capital needed for your business, thus, a need for investors! It is pertinent to know that for you to increase your chance of being considered for the said or required capital, you need to prepare to meet your investors through your business plan. Your business plan is a platform where you can communicate your ideas to investors and if they consider it worthy, they will provide the capital. It then means that your business plan must rise to the taste or standard of investors, such that if any investor sees your business plan, they would be willing to be part of your business.
In your quest of getting investor’s attention through your business plan, you have to spend time thinking about your target market, marketing strategy, your competitors, your financial forecast, the problem your goods/services will solve, how you want to spend money to grow your business and more. In all, you must prepare a business plan that will attract investors. To do this, you must identify the investors’ needs required rate of return on investment, demonstrate evidence of the focus on a limited number of products or services, and have a proprietary market position through patents, copyrights, and trademarks.
There are two critical issues in preparing a business plan for investors
- The basic format and the effectiveness of the written presentation
- Clear writing that presents the concept in an accurate, comprehensible, and enthusiastic way; when preparing your business plan for investors, make sure your business plan comprises of necessary factors that will attract the investors to your business. These factors are your goals, target market, how you want to use the resources, your competitor, and what is the different thing you are bringing into the industry or market, e.t.c.
- The content of the plan
- Factual support for the concept in the form of strong supporting evidence: For each of the concepts stated in your business plan, there must be instances and evidence to back them up and this must be factual!
- The people: this includes those that will be involved in starting and running the business. This is so important because it will enable investors to known the quality of the people you tend to employ.
- The Opportunity: this refers to the business profile-products/services, customers, expected growth, profitability, and anticipated challenges and problems.
- The Context: This involves the firm’s competitive environment. That is, analyzing your competition and how you want to enter the market.
- Risk and Reward: this means identifying and assessment of potential problems and responses.
What is expected from you by investors?
It is good to know that there is no such thing as a perfect business plan! Why? Because so many businesses with a good business plan failed eventually, and investors have seen many businesses that have succeeded. This is because the most important thing is the planning process and not the final plan. Thus, investors will always want to know whether you thought of your ideas very well before documenting them and how well you’ve analyzed your risk.
Business with vision
Investors investing in the early stage of your business want to the vision you have for your business. Like, where do you see your business in the nearest future? Who are potential customers? How do you want to satisfy their need? The bottom line here is that investors want to know you are thinking far beyond the present.
How much do you need and how are you spending the money
In preparing your business plan, this section is called source and uses of investment. In the section, you need to be specific on how much you need and how you intend to spend the money. This section for the financial forecast will help you figure this out.
Quality Management Team
It is important for you to know that having plans and ideas is not only enough, but having people to execute them is a good stand for your business. Investors will pay attention to your management team section because they want to how you can transform your ideas into a successful business through human resources (quality personnel).
How fit is your product/ service to meet consumer’s needs
Investors are interested in how your product or service wants to satisfy customers’ needs. Because customers have to want you are selling to eventually build a successful business and your business plan must provide proof of what you’ve found out that will enable you to sell your products and services to customers.
Read Also: SAMPLE OF BUSINESS PROPOSAL IN NIGERIA
WHAT TO INCLUDE IN YOUR BUSINESS PLAN FOR INVESTORS
A good business plan must help investors understand and gain confidence on how you will meet your customers’ needs. When you are writing a business plan for investors, feel free to design your plan suit your business needs. Note that your business plan is all about the planning process that helps you thinks through and develop your business strategy.
There are seven aspects of what investors’ business plan should include:
- Executive Summary
- Business Concept
- Market Analysis
- Management Team
- Marketing Plan
- Financial Plan
- Operations and Management Plan
The Executive Summary of a business plan is a 3-5 page introduction to your Business plan. The executive summary is critical, because many individuals (including venture capitalists) read the summary.
- The executive summary section includes:
- A first paragraph that introduces your business.
- Your business name and location
- A brief explanation of customers’ needs and your product and services
- The ways that the product or service meets or exceeds customer needs
- An introduction of the team that will execute the business plan.
- Subsequent paragraphs that provide key details about your business, including projected sales and profits, unit sales, profitability, and key to success.
- Visual that helps the reader see important information, including highlight charts, market share projections and customer demand charts.
THE BUSINESS CONCEPT
- The business concept shows evidence that a product or service is viable and capable of fulfilling an organisation’s particular needs.
- The Business Concept section:
- Articulates the vision of the business, how you plan to meet the unique needs of your customer, and how you plan to make money doing that.
- Discusses feasibility studies that you have conducted for your products
- Discusses diagnostic sessions you had conducted for with prospective customers for your services.
- Captures and highlights the value proposition in your product or service offerin
- A market analysis defines the target market so that you can position your business to get its share of sales.
- A market Analysis section:
- Defines your market
- Segment your customers
- Project your market share
- Position your products and services
- Discuss pricing and promotion
- Identifies communication, sales and distribution channels.
THE MANAGEMENT TEAM
The management team section outlines:
- Organizational structure: highlights the hierarchy and outlines the responsibilities and decision making powers.
- Management Team: highlight the track record of the company’s managers you may also offer details about key employee including qualifications, experiences or outstanding skills, which could add a competitive edge to the image of the business.
- Working structure: Highlights how your management team will operate within your defined organizational structure.
- Expertise: Highlights the business expertise of your management and senior team. You may also include special knowledge of budget control, personnel management, public relations and strategic planning.
- Skills Gap: Highlights plans to improve your business’s overall skills or expertise. In this section, you should discuss opportunity and plans to acquire new information and knowledge that will add value.
- Personnel plan: Highlights current and future staffing requirements and related cost.
THE MARKETING PLAN
- The marketing plan section details what you proposed to accomplish, and is critical in obtaining funding to pursue new initiatives
- The marketing plan section
- Explains (from an internal perspective) the impacts and results of past marketing decisions
- Explain the external market in which the business is competing
- Set goals to direct future marketing efforts
- Set clear, realistic and measurable targets
- Provides a budget for all marketing activities
- The financial plan translates your business goal into specific financial targets
- The Financial plan section:
- Clearly defines what a successful outcome entails: the plan is not merely a prediction; it implies a commitment to making the targeted results happen and establishes milestones for measuring progress.
- Provides you with a vital feedback and control tool: variances from projections provide early warning of problems. When variances occur, the plan can provide a framework for determining the financial impact and effects of various corrective actions
- Anticipate problems: if rapid growth creates a cash shortage due to investment in receivables and inventory, the forecast should show this. If next year’s projections depend on certain milestones this year, the assumption should spell this out.
The financial plan is the most essential part of your business plan. It shows investors the timeframe you have scheduled to make profits.
- Some elements of financial plan include:
- Important assumptions
- Key financial indicators
- Break-even Analysis
- Projected profit and loss
- Projected cash flow
- Projected balance sheet
- Business ratios
- Long- term plan
If you need a service of a Professional Business plan writer, then Dayo Adetiloye Business Hub is the place to go Call or WhatsApp us now on 081 0563 6015, 080 7635 9735 or send an email to firstname.lastname@example.org and we will solve any of your business plan problems.
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