The dos and don’ts of writing a business plan

Jun 20 2007 by Tony McDonough, Liverpool Daily Post

DON’T assume the banker will know everything about the specific kind of business you’re in. He may, he may not. There are thousands of types of businesses, from airlines to zoos. He can’t possibly have a detailed knowledge and understanding of them all. Remember he’s a generalist.

Describe what your business does and how it makes a profit. Use straightforward language as far as possible. Tell him what market you’re in – who your customers are, who your competitors are. If possible, give reliable, impartial information about your market – local, national, worldwide.

DO ORGANISE your business plan into sections so it’s easy to refer to the information. Use headings and sub-headings. No-one likes ploughing through pages of print, trying to find the relevant parts.

DO SUPPORT your request for funding with solid facts and figures. You should supply previous year’s audited/ certified accounts, up-to-date management accounts and forward projections. Projections must make sense and be achievable and, ideally, backed by firm orders.

DO BE precise and concise. If your funder likes reading fiction, he’ll know where to buy a good book.

STICK to a clear, reasoned outline of your objectives and the exact purpose of the funding. Vague phrases like “contribution to the expense of the marketing effort’’ are likely to switch him off. Make the plan as short, compressed and readable as possible.

DON’T forget to include how you see the borrowing being repaid. The banker likes to know as it helps him to sleep at night.

DO INCLUDE a section on the man- agement of the business. The people involved in the business are more impor- tant than anything else.