A business plan is essential if you are planning on running a successful business. It is a road map of how you are going to get from one point to another in your business. Your business plan will also tell you where you hope to be at any given point in time. Your business plan is an outline for your future. Unfortunately, not all business can be started for little or no money. At some point in time you may need to approach a financial institution about borrowing money to get your business off the ground and they will require you have a business plan.
Follow these simple suggestions for putting your business plan for a loan together:
State the purpose of your business. This something you should be able to do in 25 words or less. If you had to tell someone in elevator what you do, what would you say?
Give an explanation of what your business is going to do. Is it going to offer a serve? Are you going to sell a product? Give an explanation of why your business will be successful. Go into detail. Provide a list of all the owners involved in the business.
Give the details of your business. Explain your products or services from top to bottom. Describe your target market in detail. Give a complete explanation of both your marketing plan and the competition that is in your market. Give a comprehensive list of all your managers and their qualifications.
You will need to provide three years of projected financial statements. You will also need projections for income and losses during the first three years along with cash flow projections. The bank will want to see that you have a plan that will make you and them money.
The bank will require supporting documents to prove that you can make a profit. References from creditors will be needed, along with references from potential clients and suppliers. Proof of insurance and workers compensation will also be needed. There may be additional documents required, depending on the type of business you are going to be starting.
Starting a new business can be a big responsibility, but it will also be very challenging and rewarding. Writing a good business plan is part of being well prepared to undertake your new business endeavor. This business plan will be your step by step guide to getting you through the first 3 years of your business. These five steps will get you started down the road to becoming an entrepreneur and a business owner.