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CREATING A REALISTIC GOOD BUSINESS PLAN3: THE SECRET OF SUCCESSFUL BUSINESS VENTURES 2

As I stated in the part one and two of this three-part series, a competitive business plan could give you an edge over many of your competitors.

 

  1. Executive Summary
  2. Company Description
  3. Definition of the Market
  4. Organization & Management
  5. Description of the Products and Services
  6. Marketing & Sales Strategy
  7. Funding Request
  8. Financial Projections/Management
  9. Appendix/Conclusion*

Having provided adequate and concise information about your products and services, you should now focus on the marketing and sales strategy of your company or enterprise.

Marketing & Sales Strategy

You have to keep in mind that your customers are the lifeblood of your business and as such defining a marketing strategy applicable to them is sine qua non for your business’ success. The following should be paid attention to:

  • Describe your market, your clients/customers, and why they want to patronise your products and services.
  • Channels of distribution strategy _ describe how you will sell your products and deliver to your customer the channels may include an internal sales force, distributors, or retailers.
  • Communication strategy. Creating awareness of your products and services has been identified by marketing researchers as one sure way of boosting and enlarging a company’s customer base. A combination of the following tactics usually helps: Internet, local newspapers, flyers, coupons, public relations, promotions, personal selling, and printed materials such as brochures, flyers, catalogues, etc.
  • A sales force strategy _ Explain your sales strategy, specific to pricing, promotion, products and place (4Ps).
  • Determine the average sales you are likely to make per day/week/month and of course over a long period of time
  • A research on what your competitors are doing will also help you do a good job here

Funding Request

If as part of your plan, you are seeking financing for your business, you would need to provide information about your financial plans/needs. This should include:

  • Your current funding requirement
  • Any future funding requirements over the next five years
  • How you intend to use the funds you receive: Is the funding request for capital expenditures? Working capital? Debt retirement? Acquisitions?
  • Any tactical financial situational plans for the future, such as: a buyout, acquisition, debt repayment plan, or selling your business. 
  • Your current tax return for previous year

Also, include the time period that each request will cover and the type of funding you would like to have (e.g., equity, debt) as well the terms of payment you would be comfortable with.

Financial Projections/Management

Again, you need to support your funding request with historical and prospective financial information.

Historical financial data:

The historical financial data comprises your company's income statements, balance sheets, and cash flow statements for each year you have been in business (usually for up to three to five years). You can include any collateral or asset that you may have that could be used to ensure your loan, regardless of whether your business is a start up or well established.

Prospective financial data

Creditors usually expect an assurance that your company will be able to do well over a certain period of time (usually two to five years). Each year's documents should include:

  • Balance sheets (last 3 years)
  • Income statements (last 3 years depending on years of operation)
  • Cash flow statement (12 months)
  • Tax return for prior year (existing/growing business)
  • Capital expenditure budgets

It is important to always ensure that your projections match your funding requests since creditors are particular about inconsistencies.

Conclusion

Next, you may include an Appendix to the business plan which includes the following elements:

  • Credit history (personal & business)
  • Resumes of key managers
  • Product pictures
  • Letters of reference
  • Details of market studies
  • Relevant magazine articles or book references
  • Licenses, permits or patents
  • Legal documents
  • Copies of leases
  • Building permits
  • Contracts
  • List of business consultants, including attorney and accountant

The information in the appendix should not be part of the main plan since you would make it available to certain specific individuals such as creditors who would want to know more about your business beyond what your plan entails.

Isaac NUNOO

(Communications and Marketing___ GCCI)

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All Rights Reseverved. GCCI ©, by johnkani05@yahoo.co.uk

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