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Polishing Business Plans

Developing business plans takes time, effort and patience. It is a plan for success, no matter how you define success. The business plan can be used to find funding for a start-up or expansion, or to guide an existing business. Some people think the business plan is only needed when searching for financing, but that is faulty thinking. The business plan forces business owners and managers to define goals and then make plans to meet them within a set of circumstances that include competition.

Following are some tips for refining your business plan. The business plan template is the best guide available to ensure that all elements are completed. These tips will simply add a bit of polish to the plan.

 

  1. Do the Executive Summary last and not first. The summary needs to concisely state the nature of your business. The best way to ensure the important information is included despite the brevity of the summary is to develop the plan details first. In that way, the Executive Summary is much easier to develop.
  2. Market strategies are more than just numbers and some statements defining the market. It should also define what makes your selling proposition different from that of your competitors.  What does your business bring to the marketplace that is different in terms of products or services, customer services, selling approach and so on? A polished business plan emphasizes uniqueness.
  3. In the competitive analysis, don’t simply describe the competition. You need to explain the distinct advantage your business has over the competition. Once again, the polished business plan makes differences and not sameness clear.
  4. In the operations plan, don’t forget to discuss the benefits that your business will bring to the community. This has become especially important in light of the current economic condition. Will your business opportunity create new jobs or support economic growth?

 

In the final analysis, polishing business plans means adding the information that turns a paper business into a real business for the readers.

More detailed information and useful advice can be found at www.funded.com Created by Mark Favre, it offers expertise and assistance with developing and funding your concept, including a private forum for queries and discussions. If you need access to investors and funding providers, please do check our website.

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When Opportunity Knocks, the Business Plan Can Answer

Business plans can be viewed in a lot of ways, but in some cases they represent a plan to answer an opportunity. A business opportunity is basically a packaged business that you can start but is not necessarily a franchise. Unlike a franchise, a packaged business is fully controlled by you, and the seller has no say in how you operate your business. Once the business sale is completed, the buyer is on his or her own. The business purchase includes buying equipment or specialized materials and then establishing whatever type of operations you want.

When a business opportunity comes along, it is important to thoroughly evaluate it, of course. There are unfortunately a lot of scam artists who promise big returns if you will only make the initial investment. A good example is a cabinet company that promised business owners enormous returns for redoing cabinet faces. An investment basically bought you a manual and a half day of training. That may be enough for some people, but for others it was a plan for failure. The company was taking advantage of people desperate to get a side business started.

Review From All Angles

The business plan template can be used to ensure you evaluate the business opportunity from every angle. Naturally, you want to ensure the business is legitimate, follows state laws and regulations, and can support its claims with a list of others who have bought the opportunity. If it passes the first review, then use the business plan template as a guide for further evaluation.

For example, in the market strategies section you would be guided towards doing research on the niche market the business opportunity would target, the type of strategies that would be most successful, and the competition. The template can help you make sure that you consider all the important business factors before investing.

Evaluating a business opportunity after it has been purchased is not a good idea. The evaluation needs to be thorough before the opportunity is purchased. The business plan template is the best guide you can use.

Browse www.funded.com for more advice about getting your business funded.

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Business Plans Begin With a Mission to Thrive

Business plans are meant to be adaptable plans for thriving, not just surviving, as a company. Yet, according to famed Harvard professor John Kotter, 70 percent of business initiatives meant to bring organizational change will fail. That is an impressive number because it means efforts to adapt to a changing marketplace are failing. There is a disconnect between the business plan founded on a mission and the real world.

The problem is often one of losing sight of the company mission and failing to plan. The mission statement represents the starting point for the direction of the business plan and captures the essence of business purpose. It has a philosophy underlying it that does not change. Philosophies are encompassing, so the mission statement is a reflection of the nature of products or services sold, potential for growth, pricing strategy, customer service, role in the community, competition and much more.

On a Mission to Fulfill a Mission

The business plan needs to be developed so that each and every section drives the business towards fulfillment of the mission. A change initiative is merely a strategy for keeping the business on track to fulfill the mission. Leading change requires first turning to the mission statement and the business plan. A business that needs to change must be able to communicate a sense of urgency throughout the organization because staying true to the mission statement is necessary to thrive. If a change initiative is needed, it means the business has gotten off course from its mission and its vision.

The business plan goals and strategies may need to be revised, but that should always be a step in the change process. In fact, business plans can serve as the guide for change as each section, from the Executive Summary to the Financial Statements, are reviewed in light of the need for change. Leadership will identify specific strategies for incorporating change and then communicate the revisions on an organization-wide basis. The change process must be empowering and encompassing, meaning employees at all levels should be embraced as change agents.

Business plans begin with a mission statement and then serve as a living breathing document. Leading organizational change is not always easy, but it can be impossible unless there is buy-in to the mission and the business plan. The strategies used to get that buy-in can vary, but staying on message cannot.

More detailed information and useful advice can be found at www.funded.com Created by Mark Favre, it offers expertise and assistance with developing and funding your concept, including a private forum for queries and discussions. If you need access to investors and funding providers, please do check our website.

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Planning for Change in Business Plans

Business plans are not etched in stone; yet that is exactly how some businesses treat them. The business plans are written and then put into a proverbial drawer where they never see the light of day. One day the plan is dusted off, updated for the Board of Directors, and then put back into the drawer. This does not make sense after so much time and effort has been put into developing a plan that is supposed to establish a clear path to success.

Viable businesses never stand still. They are movers and shakers as they interact with customers, develop new products and services, and adapt to good and poor economies. When major changes happen that affect your business, it is like a time warp because everything changes from that point forward. Change is always imminent today and largely because of technology. Businesses can enter the marketplace faster and roll out a marketing program quickly on the internet.

The business plan can quickly become an anachronism if it does not plan for change. This doesn’t mean doing multiple business plans addressing all the what-if scenarios. However, change should be built in to the business plan process. First you develop a business plan based on the most sensible goals using current knowledge and expectations for the future. You can include a decision tree analysis section, if desired. However, you plan to change by simply doing an honest and regular review of the developed business plan.

It is important to have the same groups involved in the original plan development also participate in review sessions. The business plan may need to be revised, but you have identified where and how which is good strategic management.

The real issue is whether management can develop the discipline needed to make sure the business plan is regularly reviewed. Developing business plans should not merely be an academic exercise. It needs to be an important management function.

Browse www.funded.com for more advice about getting your business funded.

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Adding Internet Marketing to Your Business Plans

Incorporating internet marketing in business plans has become an imperative as opposed to an option. That probably became true when even the large storefront businesses began to do internet marketing. Judging by the number of websites, online accounts and emails sent with discounts for online shopping, the internet is playing a larger and larger role in all business models.

The implication is that internet marketing should not be a separate strategy. It needs to be integrated in the total marketing plan. It should not be a standalone subsection in the marketing plan. It needs to be weaved into the various marketing efforts, in addition to be being a unique effort.

For example, the business plan can include the development of a website and a discount campaign. However, the offline marketing efforts need to incorporate the website and the discount campaign also. For example, direct mailing of advertisements can be integrated with online marketing by developing the tactics the big department stores have successfully developed. The offline direct mail advertisements encourage online shopping by offering discounts, and the online emails encourage offline shopping with special discounts.

Of course, you can have a description in the business plan for specific internet only strategies. For example, you can discuss strategies for obtaining client leads and set goals for the lead-to-customer conversion rate, the number of transactions and the targeted average dollar sale. Yet there is still integration needed with offline marketing needed. Offline marketing will play a supporting role in driving people to the website to find the online-only discounts.

There are a number of online marketing strategies that can be addressed in business plans. They include developing the business website, participating in social media and blogging, and so on. The important point to keep in mind is that the marketing plan needs to be a cohesive integrated plan and not a disjointed set of offline and offline activities.

More detailed information and useful advice can be found at www.funded.com.  Created by Mark Favre, it offers expertise and assistance with developing and funding your concept, including a private forum for queries and discussions.  If you need to access a vast network of business people, entrepreneurs, partners and service providers to help you start, finance and run your business, check out our website.

 

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Brand Your Business to Attract Investors

Investors are going to be attracted to a business that has a strong and reputable brand. When a business is ready to expand and needs a capital injection, having an established brand adds value to the business proposal. A positive brand is a business asset because it differentiates the business. That is the kind of business characteristic investors will look for as part of their business plan analysis.

Investors are well aware that brand recognition gives a company a competitive edge.  A business already established in the marketplace creates a brand image either purposefully or by accident. A brand created purposefully should reflect the positive image and reputation of the business based on the product delivered and the customer service. A brand created by accident may or may not be positive.

Branding is a message sent to the marketplace, but it can also help you deliver a message to investors. Investors know that a good brand image, even if the company is young, is important to future success. Customers are more supportive, and marketing can be more effective when the business has a solid brand image.

Branding can also be the common theme that ties together the business plan, products and services, customers and employees. It is related to the business culture and thus has specific value. Investors considering funding a business will be more likely to do so when the brand image is well accepted in the marketplace and employees can take pride in what they offer customers.

Browse www.funded.com for more advice about getting your business funded.

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Attract Investors by Improving Cash Flow Before Cash is a Problem

One of the important factors investors consider when evaluating a business plan is the amount of expected cash flow. They scrutinize the assumptions that were made in order to make a determination as to their validity. One of the lessons to be learned from investors is that you can improve your cash flow before you even have cash flow to report.

What does this mean? It means that the steps that are taken to improve cash flow for an ongoing business are the same steps that should be incorporated in the cash flow statement included in a business plan. Sound business practices can and should be used to prepare the cash flow projections. In fact, one of the first rules of cash flow is to prepare a realistic projection. Investors evaluating a business plan will carefully review the assumptions made in view of the marketplace conditions. Sometimes businesses are tempted to overstate cash flow in the belief this increases the chances of funding. However, investors have a lot of experience evaluating cash flow statements and overstatements will be spotted.

When preparing a cash flow projection, you need to consider the factors that influence cash flow during operations. The projection should assume reasonable customer terms and collection policies. The business plan should also reflect market segmentation based on products. For example, the timing of inventory purchases is influenced by the type of products sold. Cash left in the bank will earn interest that can be included in the cash flow statement, while cash invested in inventory is tied up until the inventory is sold.

These are the types of detailed analysis the entrepreneur needs to do long before a business plan is presented to investors. In other words, you want to be able to prove you know how to maximize cash flow based on realistic assumptions and best practices.

Browse www.funded.com for more advice about getting your business funded.

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Turning a Good Idea into a Prototype Can Attract Investors

When you are looking for investors to fund the manufacturing of a new product, it’s a good idea to have a prototype ready. A prototype by definition is a preliminary model or early sample of a product. It can be used to test a particular concept to make sure it can be turned into reality or can serve as the first sample of something that will be copied once funding is obtained.

Investors like prototypes because it brings a concept to life and proves that the concept is doable. It serves as proof that the business idea can be turned into a practical product that can be sold to customers. A prototype also proves that the entrepreneur or business has fully developed a concept and that the investors are not being asked to fund a pie-in-the-sky

A prototype should be market tested to prove that the product fulfills a customer need. That is like gold to a business and a business plan. Presenting a product that has been tried and accepted by potential customers greatly reduces the level of risk associated with a startup operation. However, small startups should not make the mistake of only testing the product on family and friends and need to introduce the prototype to the real target market. The business plan can include a report on the market testing to accompany the prototype itself. By validating a prototype, the business has tangible proof that the product can be manufactured, the materials are available, and the product design is workable.

Given the competition for investors, developing a prototype can give a business a competitive edge. Prototypes don’t just apply to manufactured products either. Startup software companies and websites develop prototypes to attract investors too. The key is to develop the product to the stage where the investors can easily see its potential success in the marketplace.

More detailed information and useful advice can be found at www.funded.com Created by Mark Favre, it offers expertise and assistance with developing and funding your concept, including a private forum for queries and discussions. If you need access to investors and funding providers, please do check our website.

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Think Twice Before Choosing Crowdfunding When Looking for an Investor

Finding investors often consumes the attention of small business owners. Money is always an issue when businesses are ready to expand. Given the proven power of networking and the power of the internet, it should not be surprising that a new form of equity funding has been developed. Crowdfunding is the new investor kid on the block, and it’s generating a lot of excitement because it seems to cut out the middleman, so to speak.

Crowdfunding was approved by the JOBS Act in April 2012 and allows small business enterprises and startups to directly solicit investors for equity investments. It sounds great at first glance, but for many companies it would be more strategically advantageous to go through a professional fund locator company rather than try to raise equity funding on their own. The details of crowdfunding are still being worked out, but there are already indications that small businesses are viewing this as ‘easy money’. That’s far from the truth.

Crowdfunding will still require the business to prepare a business plan that proves the investment is wise. Crowdfunding involves investors pooling their money. Businesses can then solicit as a maximum $1 million investment. However, each investor will get equity ownership in the business. If the business expands in the future and needs a larger capital amount, success may be hampered by the fact the company now has dozens or hundreds of equity owners. Venture capitalists may not be anxious to get involved in that kind of arrangement.

The best plan is to consult with a professional experienced in raising capital for businesses. Understanding all the ins and outs of new sources of funding is critical before deciding to jump in.

Browse www.funded.com for more advice about getting your business funded.

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Social Responsibility and Investors

The relationship of corporate social responsibility and investors was studied by Ioannis Ioannou of the London Business School and George Serafeim of the Harvard Business School. The 2010 study was titled, The Impact of Corporate Social Responsibility on Investment Recommendations. As the title suggests, the social responsibility strategies were analyzed from the perspective of their influence on security analyst decisions concerning investing in companies.

The results were clear. The value of socially responsible strategies has risen in the minds of investors. The study also reported that firms seen as socially responsible are viewed more favorably by analysts and the more visibility the better. Social responsibility is value creating.

We tend to think of large corporations as being the only firms that need to be concerned about social responsibility. Unfortunately, many also view social responsibility with a bit of cynicism, believing that it’s a ploy to sell products and services. However, if that were true businesses would only do or spend just enough to attract investors and never go beyond the minimum. Yet even small businesses are found in the community as their employees volunteer time and money to local nonprofit efforts in a variety of areas. They help clean up the environment, raise money for hospitals and special causes and sponsor programs in childhood education and adult job training, to name just a few activities.

Social responsibility is a broad concept that addresses ethical business behavior and sensitivity to community issues. Those issues include economic, social and environmental aspects. All companies can increase their value by addressing the needs of its community stakeholders and by following ethical business practices. When businesses increase value, it’s easier to attract investors. Social responsibility is a win-win proposition.

Browse www.funded.com for more advice about getting your business funded.