"Making your Business Plans work" by Steve Marsten

Recently a client who was preparing a business plan for his new business, as requested by his bank manager, made the statement …”A Business Plan is all good and well but how does it actually deliver?” Now this is the question often least asked or understood. It is a VERY good question.

The most successful Business Plans deliver because the preparers are true believers in their product or service. They have clarity with a number of issues that are part and parcel of a successful plan.

1.    They know exactly who their client is. Who they are targeting and why.
2.  They know what problem can be solved by their service or product and how it saves the customer in time and /or money. They know the value of that saving and can articulate it easy enough to all stakeholders.
3. They pretty much know their Executive Summary off by heart. This is what opens the door to potential investors and their bankers.
4. They understand and know the numbers. Many business owners or start ups can be excited over the concept but not understand how it actually makes money. Investors and bankers NEED this information. You need to prove that there is a high likelihood of a return on the investment to investors and it generates enough to repay the debts.
5.  Make sure you and your partners are completely “in” on the idea. You must buy this product first and foremost before trying to sell it to anyone else. That way if you get a couple of knock backs you won’t get too downhearted over the whole thing and can learn from any unsuccessful pitch.
6.   There needs to be something exciting about the concept, the numbers and the complete plan. It’s important that investors and even your bank, feel that they are going to miss out if they don’t get on board. Make sure time is spent on addressing “what could go wrong.” What are some strategies that minimise the possibility of something going wrong.
7.  Finally when pitching your plan to investors, keep your message very specific. The pitch has a purpose. Don’t bury your potential investor in the detail. Be ready to understand what a good offer looks like without attaching too many conditions.

At Sothertons we help business owners preparing business plans understand their value. Call us on 4972 1300 for more information.