Having covered the key pillars of a bankable business plan, we get to the critical steps where we actually begin to put pen to paper. In writing a bankable business plan, form and structure are as important as the content and substance of the plan.
BY CLIVE MPHAMBELA
It is, therefore, important to discuss the basic formation or layout of a business plan that will make a reasonably good impression on your bankers or financiers. Generally, a well-written business plan will show the reader that you are serious if it looks good, is catchy to the eye as well and generally professionally presented. Mindful of ensuring that the business plan covers aspects discussed in the last two articles, we go a little further to suggest the content and structure of the plan.
lExecutive summary: This is the most important section of your business plan. It summarises everything that is in the rest of the business plan in a compelling and interesting way. It should be the first thing your readers will see; the executive summary will either grab your readers’ interest and make them want to read the rest of the business plan or it will put them off, get them to put it down and forget about it. More than anything else, this section is important because it tells the reader why you think your business idea will be successful, in high level terms.
This means that the executive summary should be the last section you write, but it should be positioned at the beginning of your business plan. You, however, write this last after you have worked out all the details of your plan, and you are in a better position to summarise it. Yes, it must be a summary! Short and sweet, to arouse sufficient interest in the readers! Generally it should be no more than two pages.
Contents page: Sets out the various chapters and their headings in their order of appearance in the business plan. The contents page will tell the reader where to find what information and help them in locating specific sections in your business plan. It must be included directly following the executive summary. You are advised to keep the content titles short and broad; i.e. avoid detailed descriptions or whole sentences in your table of contents.
Company description: This section should include a high level look at how all of the different elements of your business fit together. This section should include information about the purpose of your business as well as list the primary factors that you believe will make your business a success.
When defining the purpose of your business, be sure to list the marketplace needs that you are trying to satisfy; include the ways in which you plan to satisfy these needs using your products or services. Finally, list the specific individuals and/or organisations that you have identified as having these needs. For example, some primary success factors might include a superior ability to satisfy your customers’ needs, highly-efficient methods of delivering your product or service, outstanding personnel, or a key location. Each of these may give your business a competitive advantage.
Market analysis: This section should illustrate your knowledge about the particular industry your business is in. It should also present general highlights and conclusions of the marketing research data you collected when you were conceiving the business idea; however, the specific details of your market research studies should be moved to the appendices section at the end of your business plan.
This section should also include a clear description of the industry and its outlook. You must show an understanding of the industry size, number and variety of customers, etc. Include your target market information, an evaluation of your competition. You must describe who they are and how you compare to them, especially in the eyes of customers. Make it clear how your business offering be different?
Share the promotions and tools you intend to use in order to meet your target market expectations.
Explain your pricing and other elements of your marketing plan.
lManagement and ownership and key personnel: This section should include the legal structure of your business along with the subsequent ownership information it relates to. Financial experts generally agree that one of the strongest factors for success in any growth business is the ability and track record of its owners and or management. It is, therefore, important to let your readers know about the key people that will be involved your business and their backgrounds. Provide brief CV’s or profiles that include the following important information:
The person’s name, their position (include brief position description along with primary duties), primary responsibilities and level of authority. Their education and any unique experience and skills; prior employment and achievements track record should also be included. How well they are recognised in that particular industry and what has been their community involvement?
Also highlight how the people that will surround you will complement your own skills. Show how each person’s unique experience will contribute to the success of your business. Be insistent on including their backgrounds and why you are bringing them into the business as employees. Detail their responsibilities and their salaries.
For limitations of space, we will stop here for this week, but we are not done just yet. In the next installment, we cover the last part of this series on the drafting a bankable business plan.