Business Plan

Business plans should never appear to be produced to a standardised format and should be sure to include the unique selling propositions of the business. For this reason no checklist can be comprehensive and the following list should be used primarily as an aide-memoire to ensure that no material subjects have been omitted.

The plan should project a balanced view and should include both strengths and weaknesses, with suggested actions to overcome deficiencies. Whilst it should not be over optimistic, it should not lose the opportunity to sell to the potential investor or lender the opportunities which an investment would offer.

• Introduction and summary
  Reasons for the approach for funds. Brief synopsis of distinguishing features. Strategy for company. Outline why the opportunity is above average.
  
• History and current position of business
  Relevant history from commencement. Current products and position in the market. Competitive advantage.
  
• Market competition
  Total market for relevant products/services. Expectation for increases in market (include independent evidence). Competitors. Threats from potential new technologies. Marketing strategy. Barriers to entry.
  
• Sales and customers
  Rationale for increasing sales. Major customers and percentage of sales with comparatives. Investment and staff required to accommodate projected sales. Distribution.
  
• Facilities, premises and production
  Details of premises and plant (including freehold or leasehold) Relevant aspects of production process. Suppliers and raw materials. Comparison of costs compared to competitors. Plans for production in the future. Environmental issues. Compliance with standards (e.g., BS 5750/ISO 9000)
  
• Directors, management and staff
  Details of directors and senior management with roles, ages, length of service and salaries. Organisation chart. Share option schemes and other incentives. Pensions. Training/Investors in People. Industrial relations.
  
• Financials (profit & loss, balance sheet & cash flow)
  Two years' audited accounts. Current management accounts. Projected results for three to five years and assumptions. Sensitivity analysis for those assumptions (or risk factors) which have the greatest effect on the projections, remembering that if sales exceed target more working capital is likely to be required. Consider both internal factors (e.g. timing of sales) and external factors (e.g. interest rates and exchange rates). Break even levels. Key ratios. Comparison to competitors. Taxation.
  
• Proposed financing structure
  Existing shareholding structure. Existing debt facilities. Proposed financing structure. Management investment. Exit strategy and equity returns. Gearing ratios and interest cover on debt.
  
• Systems
  Current accounting systems (manual and computing).
  
• Other
  Intellectual property and patents. Litigation.

Appendices:

• Copies of latest audited accounts.
• Projections Year 1 Monthly Years 2 & 3 Quarterly Years 4 & 5 Annually
• Curriculum vitae for senior executives.
• Copies of sales literature.

Once you have prepared your first draft, contact Graham Wintle (01727 885 573) to take your plans to the next stage.

Graham is one of our partners who has been instrumental in obtaining bank financing and venture capital for a number of start up and fast track businesses. He has the skills and experience to know exactly what potential investors are looking for and can save you a lot of time and trouble by critiquing your profit and loss, cash flow forecasts and balance sheet forecasts.
Once the numbers are right then we can review your business strategy and help you choose the best course for success.