The written business plan is an important part of building a new venture. While all businesses can benefit from some type of written plan, entrepreneurs seeking financing through formal funding programs will have their plan scrutinized by readers as bankers and panellists work to make their funding decisions.
At the Halton Region Small Business Centre, we regularly review business plans for entrepreneurs as they prepare to submit their final copies to formal programs.
Here are some key points from three big sections we look at when we are determining if a business plan is ready for presentation:
The Marketing Section:
- Does the plan show how the business will go from no customers to the first organic (non-family or friend) customer?
- Are marketing tactics supported with details – specifically does the plan provide timelines, budgets, assignments, and a way measure results? This section is a good spot to make sure you haven’t resorted to generic statements like “we will use social media channels”, or “the business will grow by word-of-mouth”.
- Do the budgeted amounts seem realistic or made up? Early in the business planning process many writers will estimate expenses and include their estimate as a placeholder. These estimates are a great way to help the financial model take shape quickly, but the amounts should be replaced with real values based on research or a quote before the plan in finalized. For example, $100 per month for insurance is usually my telltale sign that the numbers aren’t confirmed.
- Is profit, or at least positive cash-flow, being projected? After projecting the finances for the business, it is important to ensure the businesses potential meets the needs of the entrepreneur and the funder.
- Is it clear how the product our service comes to be available to sell? Many business plan templates refer to manufacturing or production, so there is a tendency for service-based businesses to delete the section entirely. Service-based businesses can still benefit from a defined process for engaging with their customers and getting work done. Repurposing the manufacturing section to instead be a service delivery section will allow the writer to plan for how it will create a valuable service for customers.
The business plan can be an overwhelming undertaking. It can be helpful to take it bit-by-bit, specifically by seeing it as a series of shorter plans. Remember, the Small Business Centre is here to help by reviewing and commenting on written business plans. Fresh eyes reading your plan from the perspective of someone not in your business could make the difference between a clear and complete plan, and one that falls short of convincing a funder that your business idea is viable and worthy of funding.
For more information about Halton Region’s Small Business Centre resources, services, business events and seminars, contact us by dialing 311, 1-866-442-5866, visiting us online at www.haltonsmallbusiness.ca, by email at email@example.com or visit us at 1151 Bronte Road, Oakville. You can also follow us on Twitter and find us on Facebook.