There are thousands of business plans produced each year, but many of them fail to do the job. Entrepreneurs need documents that lay out a clear path for long-term success, and many are also used to raise necessary capital. The requirements for producing a fully developed document seem straight-forward, and yet a number of them fail to achieve either goal related to planning and raising money. All the “right” sections can be included and the plan declared finished, and yet it proves to be ineffective. These plans gather dust or potential investors will not read past the front page. A effective business plan is one that creates a vision for solving a market need or problem and then proceeds to lay out the entrepreneur’s ideas , methods, strategies, and plans for meeting that need.
Why effective business plan is important
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Unfortunately, inexperienced entrepreneurs often choose to laud themselves in their plans instead of addressing the business solution. Those are the submissions venture capitalists and equity partners will pass over because they are not interested in funding someone’s expertise. They want to fund a business that will achieve profitability in a reasonable amount of time and then follow a steady growth path. Investors want to know they have a high likelihood of getting their money back. Following are some points to keep in mind for effective business plan preparation:
• The information in the plan has to be presented in a convincing manner to overcome the natural wariness of investors, especially in a slow economy. Anyone who does not know what that means should consult with experts who have experience developing these types of documents
• The plan needs to leave readers with a positive first impression that the entrepreneur understands the problem being solved and has a solid solution.
• Many entrepreneurs are so convinced their new business idea is innovative and bound for success that they forget to include a description of the link between the specific solution and the specific problem in the Executive Summary. Without that link, the entrepreneur is displaying fuzzy thinking and investors will not be interested in the proposal.
• The details in the document need to be realistic and specific. A common mistake is failing to invest in in-depth market analysis, leading to uncertainties concerning factors like market size, market segment demographics, market share, and so on. If the entrepreneur does not fully understand the marketplace, how will the business know the right marketing strategies and distribution channels to use?
These are just a few of the nuances of a business plan written for long-term success and to raise capital. That is quite different from one written mostly because it is a required document for loan requests.
An effective business plan is one in which the entrepreneur has carefully defined the problem and provided a compelling explanation of how the business will solve the problem. Each section of the plan should build on the solution. The Business Description section describes the solution in terms of new products or services, or expanded capacity. The Marketing Plan showcases how the entrepreneur will reach the people in the market likely to be experiencing the problem. The Financial Statements should include realistic projections of revenues generated from sales to the market segment and include all essential costs to reach the point of being able to sell to the people described as likely customers.
OGS Capital has helped thousands of entrepreneurs write thoughtful, solid, and high quality business plans. There is no reason to struggle through business plan development when OGS Capital professionals can offer the expertise and insight that improves end results.
Illustrative business plan samples
OGSCapital’s team has assisted thousands of entrepreneurs with top-rate business plan development, consultancy and analysis. They’ve helped thousands of SME owners secure more than $1.5 billion in funding, and they can do the same for you.