Writing a Business Plan for Investors
Despite what you may have heard, writing a business plan doesn’t have to be difficult. All it takes is some common sense. Every business plan is based on numbers, and the purpose of a plan is to explain how the business will achieve those numbers.
Of course, writing a business plan for a start-up can seem more complex, as there are no comprehensive records to give insight about future activities. Those businesses already in place can use past data to formulate future plans. However, this fact should not scare new businesses.
Concise is Best
Truth be told, no investor, whether it’s a bank or someone else needs to see a plan that is seemingly without end. It can sometimes be difficult to keep things short. Where this is the case, it’s best to first complete the plan, and then compose a summary which can then be placed at the beginning of the plan.
If graphics like charts are responsible for your plan being longer than you’d like it to be, you have the option of removing them from the main part of your business plan, and include them as appendices instead, making reference to them when needed. This way, potential investors can refer to them when and if they please, rather than being forced to sift through them as they read your plan.
Part of being concise is a professional presentation. This not only includes a professional look, but also proper attention paid to grammar and spelling, as well as numbered pages and a new page to begin each new section.
Common Main Business Plan Sections
The title page will be the first page the potential investor sees. It will tell them what’s inside the rest of the document, so be sure to include a brief description if you deem it necessary, as well as common entries like your name, the date, and any circulation and confidentiality details.
The next page should contain your contents page, which lists all of sections of your business plan.
Following the contents page is the introduction. Here is where you will introduce yourself and tell the potential investor about the purpose of your plan. If you are creating a formal business plan for a large project, you may also include a purpose for your plan and terms of reference here.
The executive summary is the next section in the list. While it is optional, the executive summary can provide a very important purpose, as it presents potential investors with the key points of your plan such as actions, conclusions, returns on investment and so on without them having to spend more than a few minutes. This section should be no longer than a page in length.
Your business plan will follow the executive summary, and the appendices will follow your plan.
Within Your Plan
The summary section of the document that contains your business plan is where an investor will either buy into your idea or they won’t. Your business objectives will be next, and should focus on the first year of trading. Following this, a concise business description should explain in plain language what your business will provide,. A detailed description of your business operations will be next. You’ll also want to include a section about the key people involved with your business, as well as an analysis of training needs and your management position in the business.
A detailed section about your market, and then about costing and pricing, forecasting and the cost to run your business will round out the plan.
Invest in a thorough business plan, and you’ll have a better chance of being taken seriously by potential investors.