Business Plan & Cash Flow Writing
Business Plan Preparation & Cash Flow Forecasts
Your business plan is one of the most important documents you have when trying to raise finance, and it should show potential investors that you will provide them with an excellent opportunity to make a large return. As well as looking at the market needs and competition, the plan should review your business' strengths and weaknesses and identify critical success factors, as well as what needs to be done to achieve profitable growth, and what your financial needs are.
The Business Plan Writer
No-one but you and your team will be able to write the business plan, because it's essential that you 'own' it, but once you've managed to gather the relevant information our expert team of trained accountants, financial experts, business planning specialists and copywriters can assist with structuring it appropriately. We can collate the plan and produce integrated financial projections like profit & loss, cash flow and balance sheets, and can also guide you on the content and what investors will be looking for. We can then help you to formulate and then align the plan to your team's goals, can assist with strategic planning, market planning and competitive analysis, and provide ongoing implementation assistance. Contact us to find out more.
If you're confident that you have the expertise to put your plan together, or to appropriately amend it yourself, then we've provided some tips to assist. Your plan should include the following:
Statement of Intent
How are you going to develop the business? Who will do what? How will you manage the money? This section is especially important if you're looking for finance or investment.
Executive Summary
This is an overview of the business, and because it is a summary could well be written at the end. If you're looking for investment this could be all that is read by the likes of venture capitalists and banks before your plan is put on the 'discard' pile. It should include a synopsis of the key points of the plan including highlights from the rest of the document, and should explain the basics in a succinct way. And when we say succinct we mean a 15 second 'elevator pitch' kind of succinct, giving the reader a solid idea about your business and not a complex description, or an expanded contents table. A good tip is to state what you conclude rather than the section headers, and avoid too much unnecessary jargon or 'PR'; it should excite the reader but should also be realistic and too much 'spin' will instantly turn off experienced business people.
Short Description about the Business Opportunity
Answer the questions: who, what, why and whom? Outline your vision for the business. It's easier if you start with an overview including when you plan to – or actually did – start trading, progressing to current day, and detailing the type and sector of your business, its history, its legal structure, and your aims for the future. Then describe your product or service including what's unique or special, as well as benefits, and note any patents, trademarks, and the like, as well as any key features of your sector. Avoid jargon and assume that the person reading it may not be familiar with the area. Then, define your market and competitors – include your market research here to show that you're fully-aware and understand current and predicted trends – and show how you plan to attract customers. Cover your market, current customer base, competitors, share of market – again, think who and what –as well as predicting future changes and detailing how you and your competitors will react. A SWOT analysis which details the strengths, weaknesses, opportunities and threats for both yourself and your competitors will also fit well in here, as will detailed scenarios covering your changing customer base or market.
Marketing and Sales Strategy
In essence, why will people buy your product or service, and how will you sell it to them? Detail here how you plan to promote and sell, but do be realistic and ensure it's all achievable. Beware though, this can often be the weak section! Make sure that you cover how you will position your business in the marketplace, who your customers are including details, and how you plan to attract new customers. Also think about your pricing policy, which sales methods you will employ – direct mail, PR, e-sales, etc – and how you will reach your customers via which channels, which partners you will need for the distribution of your goods and services, and how you will sell. What is your sales plan? Will you focus on the phone, web, or face-to-face?
Management Team and Personnel
This section includes your credentials and details of the people you plan to recruit. Cover skills, strengths and plans for addressing any weaknesses. If you're seeking funding ,the quality and experience of the management team can be very important so include a detailed paragraph on each: who are they, what is their role, how do they fit into the organisation, what is their background, experience and qualifications? Also include details of any specialist advisors you will be using, such as lawyers, accountants and business planners. Show both the balance and commitment of your team, and if any of them have invested in the business, detail who and what, as well as salaries and benefits. Cover specifics about your work force – what you have done or will do internally, and what will be outsourced. You could also include details of sales and profit per employee, employee retention rates, productivity, and recruitment plans / training with associated costs and timings.
Operations
This focuses on your premises, facilities, management information systems and IT so cover your location and whether you own the property or have long-term commitments to it. Perhaps detail the advantages and disadvantages of your location, and any plans you have in the future to move. Production facilities should also be covered: do you need your own or could they be outsourced? How modern are they? What is the capacity against existing and forecast demand, and is any investment needed? In terms of management information systems, do you have established procedures for stock control, quality and management accounts and IT? What are the strengths and weaknesses of these systems and how reliable are they?
Financial & Cash Flow Forecasts
Now you have to translate all of this information into numbers...It's essential that this is 100% accurate, as it helps you avoid problems and manage the business more effectively. Include a sales forecast which is a month-by-month forecast of sales expected that should be completed once per year, then look at the projections – how much capital do you need? What security can you offer? How will you repay any finance? How successful is your revenue and income? It may also be appropriate to include details of your personal finances. Financial planning should also form a part of this section, and should be forecast for three to five years ahead. Include any assumptions behind the projections, essentially to show your thinking behind the numbers, and include cash flow statements for the first 12 to 18 months to show that you can survive. Also include profit and loss with details of your trading position, the level of profit you expect, the costs of goods, services and overheads, preparing a cash flow statement can also be useful.
And once you have all of this information together, make sure that you present your business plan as well as possible. We recommend that you keep it succinct and include a cover, contents page and section numbers, and that the whole plan is in a font size 10 or above. Make sure it's email-friendly, write it as if for an external audience avoiding all jargon, and run it in a logical order, starting with the Executive Summary. Finally, make sure it's realistic, edit it carefully and proof read it to make sure there are no mistakes, then show the plan to experts and ask for their feedback. And then of course, update it regularly.
You will also need to get to grips with how the finacial ratios are revied, so please use this link explanation of ratios for assistance
If all of this makes you want to lie down in a dark room, then don't worry, the expert team at BWG will be happy to assist, and in many cases can help you access funding to pay all or part of the cost. Just call us to find out more on cash flow manaement systems.
