Businessman in office mulling over paperwork.
Factors to Consider for Your Business Plan
Important factors to consider for your business plan.
If you are seeking financing to start or grow your business, a business plan will help you build support for your company by providing vital information about your products and services. It will serve as a résumé for your business by outlining objectives, your business model, the competition, marketing strategies, your management team and financial projections. The key elements of any business plan that will help your banker provide a defined plan for achieving your goals and preparing for growth include:
1. Your company’s “wow” factor.To succeed, your business should show it offers clear advantages over what is available elsewhere. Your business plan should explain the challenges your products and services can solve and how they will help customers save time or money or improve their lives.
2. Your management team’s experience.Your product or service may have great potential, but can you deliver on your promises? Banks want to work with people they can trust. Go beyond typical résumé information and show how each team member’s background and accomplishments contribute to your company’s success. Explain the value and resources each one brings to the business and demonstrate their good character, fiscal responsibility and strong drive to succeed.
3. Your financial projections.Bankers review your projected income and cash flow statements for clues about how well you have done your homework. If your revenue and profit growth projections seem unreasonable, you could lose credibility. Bankers also like to see that your projections are supported by reliable industry data and sound assumptions rather than guesswork.
Last, talk with your banker. If you share your plans with them, they may be able to help with business functions like accepting payment, recommend tools for improving cash flow and other processes, or even come up with strategies to help you reach your goals.