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How To Write An Attractive Business Plan For Investors

An attractive business plan for investors could make a good first impression of you and your business. A business plan is a summary of everything about a business, from the company’s description to financial implication. Business plans do not just show how much you understand your business, it also appeals to investors as one very important criteria for investment. Thus, making one of the most important steps in starting a business to be, how to write an attractive business plan for investors.

There is hardly an article on business that doesn’t refer to the importance of or contain information about a business plan. This is why every business owner must know how to write a business plan because investors pay extra attention to these basics that are going to be outlined. 

What Is A Business Plan?

A business plan is a step-by-step outline of the process with information that would be accessed by either business owners or other readers. It contains details needed for the successful execution and operation of a business idea; business description, market analysis for breaking into the market, cash flow, and other vital information. It comes with details of the feasibility of the business for the owner and prospective investors. In simpler terms, a business plan is a well-drafted map for the business.

The importance of a business plan cannot be over-emphasized as every business needs a guide. It is the next thing every entrepreneur should schedule after his or her business idea. The business plan can be segmented to provide details for the various components needed for a business to succeed. 

Steps To Writing Your Business Plan

1) Executive Summary

This section contains a summary of the business idea; describing the company, its product, a brief marketing analysis, how much it costs to start the business, and many other important features. This is the first thing an investor looks out for. So your summary must be briefly detailed and straight to the point. 

Executive summary.

2) Business Description

As every business provides goods and/or services, this is where you let us know what category of business it is, including business name, product description, and what problems your business aims to solve. A list of affiliate customers, organizations, and businesses could be included. This section could also contain information on your strengths and competitive advantage, as well as the location for operations. This area gives you the chance to convince the reader about the business and its product. Subsequently, this part should get the investor interested in the Market Analysis.

Business description.

3) Market Analysis

This is a breakdown of the situation of things. A lot of research is needed for this section to understand the old and new state of the industry, outlook, and market shape. Read endlessly about other companies in your line of business. Know their strengths and weaknesses, and then build on them. The keyword here is the SWOT analysis. SWOT (Strength, Weakness, Opportunity, and Threat). Every business is tied to a SWOT, so learn from your top competitors, and draft your market analysis.

Market Analysis.

4) Structure of Management

This is the hierarchy/information on the management style and delegation of responsibilities. Here you describe the legal structure of the business. The type of business needs to be stated, partnership, limited liability, public liability, etc. 

This could include the CVs of key team members while showing the organizational layout of the positions and tasks of each member of staff.

Structure of management.

5) Marketing Strategy

This contains information on how you intend to break into the market while seeing off competitors. This area is important not just to the successful execution, but also to the survival of the business. Investors are eager to see what your strategy would be and how viable it is. 

Strategies change and may evolve due to the needs of the business. For example, a foam company comes into the market with high quality but very affordable products. These products happen to be cheaper than products of others in the same business line. Consumers like to get more for less, so sales may skyrocket for the firm. However, with time the company may decide to take the prices a little higher. Pricing may have been used to get customers but quality management may be the new approach to retaining them. This section would appear often during pitch sessions or explanations, so it must be clearly stated.

Marketing strategy.

6) Funding Request

Every detail on your business plan is directed to this point. This is where you state how much is needed to finance this project. Therefore, you would also need to vividly explain what you would be using the money for. This is a breakdown of assets, raw materials, labour, and every other startup cost involved in the setup/running of the business.

The business owner is also allowed to state what funding style would be preferable for the business. A funding style needs a maturity date for payback, which should be included. These are all based on the business owners’ analyses of their businesses. 

Funding request?

7) Futuristic Financial Projections

This projection is a speculated/predicted financial situation of the next five years for the business. Hence, the use of graphs and charts is needed to relate financial projections for funding requests. Forecast income statements, balance sheets, budgets, and cash flow statements should be referenced. Always relate your projections to your funding request. This section allows you to explain your use of the funds you’re requesting to show how long it would take to start making a profit.

Financial projections.

8) Appendix

This includes supporting documents that could be requested. So it is advisable to include them: pictures of products, legal documents, letters of reference, copyright, etc. could be included here.

A business plan is a great chance to make a good first impression on investors. And knowing how to write an attractive business plan makes an even better first impression.

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