If you are a businessman or a business student, then you must have had the need of creating a business plan, either for your own startup or as a university assignment.
In either case, it is mandatory that your business plan reaches the top mark and impresses your prospective investors or teachers. You might already know what a business plan is, so in this article, we will be highlighting some expert tips to ace your business plan.
Stay tuned to this article to get to know some professional tips on how to write an impressive business plan.
What is a Business Plan?
I am sure most of you must be familiar with the term ‘business plan,’ but for those of you who are new to the line of business, we will briefly describe what one is.
A business plan is an official document, in writing, which highlights the core aspects of a business. It states the aims and objectives of a business and proposed measures on how it aims to achieve its objectives and targets.
Importance of a Business Plan:
A business plan is held utmost importance amongst all the official documents of a business, apart from the registration certificate, of course. Following are some of the points in which a business plan is important to a business owner:
- The foremost importance of a business plan is that it helps the business owner in attracting investors to fund his business activities
- A well-drafted business plan also helps in positing a newly established business in the marketplace
- It also helps to determine the future financial needs of a business, for example in taking loans from private funders or other funding organizations
- A good business plan helps in creating an effective strategy of a business by chalking out the goals and targets of the business at the initial stage.
Professional tips to write an impressive business plan:-
Now that you know of the basics of a business plan, it is now time to give you some professional tips from the industry experts, as promised.
So, without ado, let’s quickly jump on to the top 8 Pro tips for writing an impactful business plan:
- Conduct extensive market research:-
The foremost thing to keep in mind while drafting a business plan is to know the market that you are going to be functioning in. The potential that a product holds in its particular market and its estimated profit margin is what attracts investors more, rather than its physical and technical features.
- Choose a low competition product in the beginning:-
A major mistake that many business owners make is investing in a product that is widely accepted. Even though it seems to them that since the product is so in demand, it will attract a greater audience, subsequently increasing their profit margins.
However, what they tend to neglect is that those in-demand products are already being produced by some huge companies, which is why they gained popularity in the first place. And those companies want to enjoy a monopoly in their business operations.
So, it is suggested that you start off with a low competition product with advanced features for attracting genuine customers.
- Show your products’ worth to the users:-
People want to invest their money in things (goods and services) that are useful to them in one way or another.
In your business plan, depict the vitality of your product and how it can make the users’ life easier. If the payback period of a product is less than 2 years, only then is it considered a useful purchase and a probable investment opportunity for investors and lenders.
- Avoid documenting unrealistic claims:-
A major mistake that business owners make while drafting their business plans is that they envision their potential growth rate far beyond what the reality holds.
This happens because of, again, a lack of research. Investors are aware of the fact that newly established enterprises take some time in setting their feet to the grounds. And they still invest in recently established businesses on the basis of their potential.
Thus, to really impress your investors, don’t document unrealistic claims of progress in your business plan, rather conduct proper research and show the real picture to your prospective lenders.
- Address your investors’ doubts:-
Another great tip is to give your investors a point of interest in your business; and what better interest to show to the investors than the surety of growth?
Show them that you are prepared to face all the possible hurdles that your business faces and list a few methods that you aim at applying to overcome those obstacles.
Strategize every stage of your business. By doing so, you will surely win their trust in your managerial abilities.
- Mention long term plans of cashing out your business:-
What really attracts investors is the amount of appreciation they receive when signing out of a venture.
Tell them about your long-term plans of how you plan at cashing out your business (by going public, selling your interests, or getting into a partnership) and the estimated cost that they will receive upon the liquidation of your business through your business plan.
- Don’t be intimidated:-
Another point is to avoid being overwhelmed. Businessmen are always on the lookout for ways in which they can mechanize their businesses by using tools and resources to quicken the processes.
But not in this case!
To create a remarkable business plan, you need not automate but do it by yourself. You know what’s best for your upcoming business and how it needs to be jot down.
Start off slow and make amendments as you go, and remember… you are the expert in this case.
- Keep it short:-
The last tip on our list is to keep it concise.
Investors generally have a short attention span. You need to adapt your business plan according to this situation. The more you add to your business plan, the more you lose in terms of good investors.
So, in order to retain potential investors, cut the details short and keep only what is really valuable for the investors.
This was all for this Business Talk article.
Now is high time for you to start preparing for your business plan. Remember to keep these tips in your mind as you go. Good luck.
If you have any queries, let us know of them in the comments section below and we would love to help.