Writing a successful business plan is simply about creating a document that will easily pass the required information to the intended audience, i.e., the investors and bankers who are meant to provide you with a loan.
Regardless of the quantity of information that the final document will contain, the contents should be presented in an easy-to-read manner that will be a convenient read for these professionals who are short on time. A document characterized by large paragraphs of extra-worded information is more or less going to put-off the reading audience and your chances of getting a loan will really be dampened.
In general, the golden rule for writing a successful business plan is such that your final edited document should have 20-40 pages. It is preferable that portions of text that require a lot of wording be broken up using bullet points or charts and tables wherever applicable. As you write, pay attention to the fact that your document will be one among many being studied for viability. This means that an assessing team can only spare so much time to go through your document. Your best chance for success will therefore depend on your ability to produce a concise business plan, well researched, well written, precise and comprehensible.
There are various formats used to write business plans but regardless of your choice these topic-by-topic pointers will assist you to come up with a successful business plan that will give you a loan:
1Writing the Company Description
This is the first chapter of the business plan and it is here that you provide a description of the company, either an existent one or a proposed one. A successful business plan’s first chapter will include details describing the nature of the business, what the needs identified in the market are, a clarification of what the target market is irrespective of whether it comprises of individuals or organizations, and a break-down of those factors that you presume to be your mainstay above the competition and therefore the reasons for your anticipated success.
2Description of the Product or Service
This is a crucial part of a successful business plan and for good reason. There is no way you can hope to get a loan if you can’t lucidly explain what product or service your business offers or intends to offer. In addition to describing this product or service you will need to provide details about the exact benefits your customers hope to achieve after using the same. The investors will need to understand what need exists in the market and how your product/service will help in solving this. Also important is your obligation to explain what advantages your product/service holds above what your competitors are providing. You should also provide details to clarify whether you have secured a patent or a copyright for your product/service.
Just in case you have plans for additional products/services in the pipeline, provide some detail on these and explain what current industry research and development processes you have adopted for the purpose.
3Market Analysis
After you give a thorough description of your company as described above you will need to give the potential investors a similar detailing of the market and industry in which your business will be a part of. This chapter is an essential component of writing a successful business plan simply because the investors will want to be assured that you have an informed understanding of the market you are getting into or are already involved with.
In-depth research on your part is required to enable you to adeptly describe the industry’s size, rate of growth, and general trends. You should also provide details about your target market in terms of their distinguishing characteristics, the need your product/service will help them solve, the percentage of the target market you intend to capture in relation to your competitors, and what means you’ll use to capture this percentage in terms of marketing and advertising efforts. This section should also contain the results of your assessment of your competitors’ strengths and weaknesses.
4Marketing and Sales
It is in this chapter that you highlight the strategies you intend to employ in marketing and the achievement of sales. Summarily, you ought to describe what plans you have put in place for the marketing and distribution of your product/service, the type of sales force you intend to use and the activities that this team will use in achieving sales.
5Organization and Management
A successful business plan will always contain details about the human resources that will help achieve the set agenda. Potential investors will want to see that you associate importance to retaining a quality-minded and efficient workforce because this is a critical aspect in a business’ ambition to achieve long-term success.
In writing a successful business plan, therefore, this chapter should include profiles of the company owner/owners and the management team, an organizational chart to show how division of labor will be achieved, a description of the management hierarchy, and the incentives the employees will be entitled to in terms of salaries, bonuses and benefits.
6Financial Details
The financials chapter should be preceded by a formal funding request. This request describes the amount of funding required, what use the funds will be put to, and the period for which funding will be required. Next, you ought to provide an assortment of financial data. This data should include a 3-5 year track record (prior income statements, balance sheets, and cash flow statements) if the business is already in existence.
The business plan’s financial section should include 3-5 year's worth of forecasted income statements, i.e., profit & loss statements, balance sheets, and cash flow statements. Forecasts for the first year ought to be broken down into monthly columns. The best technique to provide financial data is with the use of a relevant program, e.g., MS-Excel. This will help you create graphs and other useful visuals.
7The Appendix
This is where you place all the allied data that the reader will need to refer to in the course of reading. Suitable referencing must be done within the main document to enable the reader to track the required data in the appendix.
Some of the information that is placed in the appendix includes letters of reference; details of your consultants including lawyers, accountants and auditors; resumes for top management; licenses and patents; copies of legal documents including lease and contract agreements, etc.
8The Executive Summary
This is the first ‘chapter’ of the business plan. It appears first although it is written last. The executive summary is ideally a summary of all contained in the main document and it even precedes the table of contents. In writing a successful business plan that will get you a loan, you ought to pay a lot of attention to this portion because the readers will be potentially attracted to or dismayed by the contents therein.
In this portion you must include your mission statement, a brief description of what your business is and what it intends to achieve. This statement should be as interesting as possible. The other details include a brief company background, current position, location, start date, a brief description of the product/service, and a brief detail about your goals and plans for the future. The executive summary should ideally never exceed two pages.
Your business plan should now be ready. Print it out and have it bound professionally; you really have to impress with everything but take care not to go overboard.
