While you might have had a brilliant, entrepreneurial idea and have come up with an idea that is a stroke of genius, without investment or capital backing it is likely to remain gathering dust in a desk drawer. So how do you secure this all-important investment? Writing an effective business plan is one of the main factors that will help you win over potential investors. In much the same vein as a résumé, unless you grab your audience's attention on the first page, it is likely to find its way to the bin.
Every business, in fact, should put together a comprehensive business plan: to solidify its goals; cement how best to reach these goals; and keep track of change, amongst others.
The business plan doesn't need to be a huge, essay-style document to start with, but can even be on 'the back of a cigarette packet', according to Stuart Curtis, group managing director, Links Group.
"You should always have an idea of what your business is. Ask yourself: what are my aims, what are my targets, what are my goals and how do I achieve them short-term?" he said.
"Set yourself bite-size targets and chunks, like registering your domain name... getting yourself a telephone number all of those kind of things that you need to do that make sense logically.But when you put it together in a business plan, you need to understand that the most important thing most people don't realize is cash," he continued. "In your first three years of existence you are going to get very little support from the likes of the banks or the angel investors, start-up entrepreneurships or funds or ET [exchange-traded]... So you're best off making sure that you know your business plan does cover all contingencies;[including] being able to survive should your business or product not take off like you want," Curtis said.
Therefore, he continued, it is best not to "put all your eggs in one basket" as well as keep going.
"Persevere in everything that you do: don't give up. The bones of a good business plan are essentially; the idea, how we take that idea and make it into something that works," Curtis said.
Generally, business plans should consist of the following:
Executive/Business Plan Summary
- Vision
- Mission
- Keys to success
- Objectives
- Who are your personnel and what is your company about?
- Outline your products, services and who you serve
- Who are your customers?
- Who are your potential customers?
- Who is your competition?
- Is there room in the market for your business?
- How will you take your company to new heights?
- How will you implement your strategy?
- Do you have a website? If so, what will the site contain and why?
- Who, what and how will your company be managed?
- Outline how you're going to finance your operation.
- Any further information/explanations should be included in this section.
"It is always good to go back and reflect on what you said you were going to do," he said. However, "What is more important than looking back is actually looking forward.... Saying to yourself: 'where are we going this year?' 'Where am I going in the next three years?', 'what is our BHAG our Big Hairy Audacious Goal?' What do we want to be? Do we want to be the next Facebook and how do we get there? What are our stepping stones to success? To enable us to get from where we are right now after two or three years of business to where we want to be in 10 years from now? It is being able to put the right things in place and align your most valuable asset (you and your people) to make sure everyone is on the same page going forward."
Top business planning tips by Stuart Curtis, Group Managing Director, Links Group:
- Set your aims
- Identify your targets
- Cement your goals
- Identify how to achieve aims, targets and goals
- Cover all contingencies, including lack of funding and product/service launches that don't go as planned
- Set a budget - and stick to it
- Outline how to keep costs to a minimum - and don't go over-budget
- Persevere
