business plan

4 Steps To Take Before You Turn Your Idea Into a Product

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Have you been dreaming of becoming an entrepreneur for a while? You have numerous ideas yet you don’t quite know how to get started and turn your idea into a product?

In March 2020 there were 800 000 companies in the US that were less than 1 year old, according to Statista. So if others can do it, why can’t you? With a great idea, a can-do attitude, and commitment, you can achieve anything.

In this article, you will find information on how to take the first steps to make your dream a reality, to draft up a viable business plan, and create a sustainable product out of it.

Source:pexels

Chasing a dream

Most likely you have come up with an idea that will solve one problem or another. And this is the very core of every product and service – you are not just providing a solution, you are solving a problem.

And this is exactly how success stories begin. Let’s take AirBnB’s journey to success for an example:

  1. The problem: Not being able to pay rent in San Francisco.
  2. The opportunity: Big design conference held in the city, hotel rooms being booked out months in advance.
  3. The solution: Offering a place in their apartment for overnight stay and earning a few extra bucks.

Just like that, an idea for a multi billion company started to take shape. And the rest is history.

The road of problem solving via innovation

Once one problem is solved with a new and innovative idea, it can create a fertile ground for new ideas to grow.

E-commerce used to be expensive and inconvenient. Then Amazon came and changed our attitude towards e-commerce and today, there’s hardly anyone who hasn’t made an online purchase at least once.

When e-commerce became a new trend, it made merchants face many new problems that required solutions. In fact, as everything is becoming digitised then no matter which business you are in, the following aspects that came up with e-commerce will be relevant for your business too:

  • How to ensure people find the information they need and make a purchase? What is required for providing a great customer service online? Click here to find out about providing good customer service without ever meeting your customers.
  • How will products be delivered to customers? Should your products/services be available overseas?
  • How to stay in personal contact with customers?

As you can see, the road of innovation can be endless. Where one solution is offered, another problem or question arises. There’s always a way to streamline the process and perhaps you are the one who has got the solution for it.

But of course, an idea by itself will not be fruitful. Polishing your product or service and getting it ready to be out on the market, requires a lot of creative thinking and persistent efforts over a long period of time.

So without further ado, let’s get started and turn your idea into a product.

Source:pexels

1.   Understand the demand

Inspiration can strike because we have been faced with a problem and feel that our idea could change the world. No matter how great the idea is, conducting thorough research is necessary to understand who your competitors are and where you would fit in the market.

It’s quite likely that someone is already providing a similar solution. This, however, doesn’t eliminate you from the game.

In the world of innovation, success is defined by getting the timing right. Seeing that other people are thinking along the same lines should give you reassurance that this is the perfect time for taking your product from concept to market.

  • Who are your competitors who they are targeting?
  • Are they successful? Why or why not?
  • How does your product differ from theirs? What additional value does it bring?

However, if you cannot find anything similar to your invention, it might indicate that the market is not yet ready for it. This doesn’t mean that your product is inevitably on the road to failure, you will just have to take into account that it might take more effort to get your product out there.

  • What current demand is there for your idea?
  • If your innovation is a product, who will buy it?
  • If your innovation is a service, who will use it?

One of the simplest ways to answer all these questions and figure out what it will take to get your product out there is to perform a SWOT analysis. This way you will clearly see what are the strengths, weaknesses, opportunities, and threats associated with launching your idea.

Source:pexels

2.   Research the market

So naturally, the next step is to figure out if your product has a market. Will people be willing to pay for your product or service?

Some steps you can take to understand if your idea is what people are looking for:

  • Consult your family and friends. However, keep in mind that their opinion might be biased because they want the best for you. They might not even be the right target group for your product, yet it will still be good to know what they’re thinking.
  • Have informal interviews with stores and customers. You could try conducting a survey to further understand the need for your product/service.
  • Talk to people with expertise in your product market. Find out what are the newest innovations in the area and what struggles you might face.

Even in the early steps of product invention, marketing should always be in the back of your mind. Without having a marketing plan that can be executed, the public will never be aware of your product.

Thinking of marketing along the way will help you save a lot of time and headache in the future.

Source:pexels

3.   Don’t try to go solo

You might have come up with something extraordinary and are afraid to share it with anyone. What if someone steals your idea? This you can avoid by filing a patent. But trying to achieve everything on your will be a struggle.

Even if you are a multi-tasker, having someone else on board with a different set of skills than you will give you an advantage. So find someone who is passionate about turning your idea into a product.

Benefits of having a business partner:

  • Opportunity for brainstorming. Sharing ideas and perfecting together will have more results.
  • Possibility to work on multiple things at once. Even doing market research will be more thorough with a second view on everything.
  • Motivational support. Everyone feels like giving up at some point. Having someone by your side won’t let you give in to that feeling so easily.
  • Financial support. Starting a business will have its costs and it’s always good to have a little backup.

You should also consider joining an accelerator or incubator to get your idea forward. You will get valuable information on funding, start building an entrepreneur network, have a mentor and receive many more benefits.

Source:pexels

4.   Write a business plan

Drafting up your business plan will take you through each step of starting and running a business as well as help you attract investors. You can think of a business plan as a useful way for considering all the key elements necessary for getting your business off the ground.

According to SBA.gov, a business plan should include:

  1. Executive summary. An overview of what your business is and why it will be successful.
  2. Company description. Detailed description of what you do and what problems your business solves.
  3. Market analysis. Outline what other businesses are doing and what are their strengths and weaknesses. How can you outperform them?
  4. Organization and management. Show the team behind your business and everyone’s unique experience that contributes to your venture.
  5. Service or product line. Describe in detail what service or product your company offers and how it benefits your customer.
  6. Marketing and sales. Show how you will be able to attract and retain customers and nudge them to make a purchase.
  7. Funding request. This is important when you are looking for investors and funding. Cover how much funding is needed over the next 5 years and what it will be used for.
  8. Financial projections. Convince the reader that your business is stable and sustainable. Explain your projections and make sure they align with your funding request.

Once you have completed your business plan you are a one big step closer to turning your idea into a product.

A summary: taking a product from concept to market

These 4 steps covered in this article are only the very beginning that will help your idea to take shape in the form of a real life product. Building a sustainable business is a long road with no guarantee for success.

The best you can do is to adapt your idea on the go and see what works and what doesn’t. And don’t forget to remind yourself from time to time:

  • Don’t be afraid to make mistakes
  • Mistakes are part of the process
  • Just dive in and keep going
  • Fail often and fail early

It’s all a learning point and with persistence you will gain invaluable experience that one day will bring your idea to life.

Composing a Mushroom Growing Business Plan

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An individual who has an idea and knowledge in the science and innovation of mushroom growing and has their structure for having the home-based mushroom business will be the ideal choice for them to begin. The growing of mushrooms is an art and requires both study and experience.

Mushroom is significant not just from a dietary and therapeutic perspective but also from selling out. It requires little space or land, and subsequently, it is vital for landless and minimal landholders. Mushroom production has massive potential as an income-generating strategy. It develops independent of daylight, feeds on the natural matter, and doesn’t need fruitful soil. Notwithstanding the floor, air space is additionally used, bringing about higher efficiency. Mushroom growing can turn out extra revenue to farmers who wish to take up this cultivation, particularly in their lean season.

Source:abc.net.au

The beneficial thing with developing mushrooms is the reality they grow so fast, and if you are capable of selling your production when they are gathered, you are en route to making huge loads of cash.

The activity of growing mushrooms as a business came from how mushrooms are the most needed vegetables for veggie lovers who wish to burn-through protein in a considerable amount. Mushroom production began in Europe and other Asian nations because of its interest in the food business.

Mushroom growing organizations represent considerable authority in developing mushrooms. Clients utilize these mushrooms for either nutrition or culinary purposes, depends upon the kind of mushroom cultivated. Moreover, they might be offered a discount to customers or retail costs.

Food things have added mushrooms to their dishes, making them more famous and a critical ingredient in cooking. With this, the extension for mushroom cultivating business has expanded. All you require is a healthy mushroom growing business plan with ogscapital.com and venture to begin your mushroom growing business.

This informative guideline brings you a mushroom growing business plan template as follows:

Executive summary:

Your executive summary will include a vision and mission statement. The mission statement must clarify the reason behind this start-up and the main goal your organization will achieve through it. For a cultivating business of mushrooms, you need to define why you chose this business and which type of mushrooms to grow for the industry. And how these products will help or serve the target market. Include a concise description of what you will do and how to do it. The decided budget and costs for selling these mushrooms.

Registration and license details:

Source:capitalcurrent.ca

Registering your business is an absolute necessity if somebody intends to run a legally registered and licensed organization. Each country and state offers diverse business structures. Select the one type of ownership that suits you the most.

For example, in the United States, there are three constructions well known for private companies. They are proprietorship, partnership, and limited liability companies. Framing an LLC ensures you secure your resources on the off chance that the organization is issued for financial questions.

Clarify products and services:

Since the growing of mushrooms is a vast field, you should clarify what you will produce and sell because the quality is a critical factor of the main factors that make a business grow, gather your thoughts and information about the type of mushrooms, and clarify each product you will be offering in the means of your target market.

Some of the example products or services you can offer:

  • New mushrooms, for example, standard button Agaricus, criminis, portabellas, shiitake, oysters, medicinal reishi, lions mane, wood ear, enoki, and maitake
  • Prepared mushrooms (dried, canned, frozen)
  • Offer consultancy and advice
  • Sell eBooks for expecting new farmers
  • Give training

Target market:

Source:canadianfoodfocus.org

There is a massive market for mushrooms, which has impressively expanded mushroom farmers’ possibilities, as there are many mushroom requests to fill. Your objective business sectors will include family units, inns, eateries, and farming produce markets, food stores among different business sectors comprising of the two customers and retailers.

Competitive advantage:

It would help if you embraced your business methodologies to give you an edge over your competition. Due to your expectation to contend well with other grounded organizations offering comparable services, you will enlist a labor force that will comprise very experienced experts. Their long stretches of involvement will be attractive to outline the route for your business.

Marketing plan:

A good business plan of mushrooms growing is a beneficial template where all things considered in great interest both in the domestic and foreign markets. You can go to the nearby market entrance by making your item accessible to the retailer and vegetable shop. Likewise, you can go for a fare alternative. The fare market is mostly the USA, for specific amounts going to the UAE, Russia, Germany, Switzerland, UK, and different nations.

Swot analysis:

Since you can realize that it takes genuine work before a business can turn into an innovator in the business, you can have led a SWOT such as Strength, Weakness, Opportunities, Threat analysis so you could successfully draft a plan that won’t just permit us to contend well with your competitors in the commercial center yet additionally guarantee that your business sticks out and is one of a kind from that of our competitors.

In completing a SWOT analysis on our mushroom business, you should expect to look at your qualities and weaknesses and remotely at the chances and dangers accessible to your area.

Source:inquirer.com

Conclusion:

The template mentioned above will help you achieve mushrooms growing business, which will be a great success. Decide a mission statement and essential factors in the executive summary. Clarify the type of product, for example, New mushrooms, standard button Agaricus, criminis, portabellas, shiitake, oysters, medicinal reishi, lion’s mane, wood ear, enoki, and maitake. You have discovered the ideal business plan, and now you are prepared to make the following guide. There is something else entirely to beginning a business than merely enlisting it with the state. We have assembled this basic manual for beginning your mushroom business. These means will guarantee that your new business is very much arranged out, registered legally, and adequately compliant.

How to Get a Business Loan

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You have a great startup idea, but ambition alone is not going to make it a reality. You will need cash to bring your idea into a reality. There are different options, you can choose to borrow from friends and family or look for investors. You can also get a loan from a lender.

One mistake many people make is going to the bank before they are properly prepared. To make it even worse, most people don’t know the right amount of money they should borrow for their business. You need to avoid such mistakes. The tips below will go a long way helping you secure a business loan and make your ideas come to life.

Source:tweakyourbiz.com

Having a good business plan

Your business plan is going to be your road map according to Singapore lenders to Katong Credit. This is what defines the business, its goals, and a plan for meeting those goals. For the business owner, it offers a cohesive vision and helps them in overseeing the business. It is also important for bankers because they are able to know more about the business and how it is going to make a profit.

The banker will be able to know more about the stability of the business, which will help them determine whether to give you the loan or not.

You don’t have to worry if you don’t know how to write a business plan. There are a lot of resources online that can help you learn more about writing business plans. There are business plan templates online that will make things easy for you.

Once you have the business plan ready, double-check it to make sure it answers three very important questions.

Does the business plan have measurable objectives and clear goals?

Are there strategies to be used in meeting the goals (have you explained the strategies)?

Does the business plan cover the competitive landscape?

When applying for a small business loan, you must consider a variety of factors before deciding on a loan. You also need the ability to assess whether or not you actually need the loan, your working capital and the financial situation of your business. According to working-capital.com, this affects not only your application process, but also your decision as to what you need and when you should apply for the loan if you commit to it.

Source:entrepreneur.com

Identifying the long-term business goals

Just saying “making money” is not going to be goal enough. You need to have a vision for the future.

The banker is interested in knowing the plans the business has for its growth. For example, are you looking to double the size of the business in five years? Are you looking to expand the product line of your company?

The banker will have a look at your long-term goals and see whether you can reach the goals, and also recommend the best products for the business.

Bringing the right documents

You will also need to bring bank statements, tax returns, proof of business and personal insurance, registration or trademarks, letter of incorporation, and applicable business licenses.

Be ready to talk about numbers

You should know your expected revenue and current cash flow. The banker is interested in knowing whether you have a revenue stream and how you track it. Be prepared to talk about your business costs such as rent, payroll, utilities, equipment, and supplies. For a seasonal business, you have to talk about what you do about the slow months.

Another thing you have to talk about is financial contributions. Banks feel comfortable lending business owners who have skin in the game. They will ask what you have invested in the business, and how much you are ready to contribute in the future.

The information the banker gets from this discussion will help them decide whether you have the ability to pay back the loan. You need to try your best so you can be seen as a great investment.

Credit score

Source:nytimes.com

Your credit rating will have a significant impact on whether you will receive a loan and what amount will be granted to you. All lenders pay a lot of attention to this and it affects how they view a particular business. So first make sure your credit scores are good. You will do this by regularly repaying all your installments and other things. Because remember that lenders also check your personal credit rating, as the owner of the company, and do not view the business as something separate from you. It will depend on each individual lender what your score must be to get a loan, but you will not get money from anyone if you have a bunch of unpaid installments, bills and the like.

Cash flow

Source:thebalancesmb.com

Cash flow is a guarantee that you will be able to pay installments regularly. Cash flow shows if your business is doing well and that customers are paying regularly. Landers will also check whether you regularly pay salaries and other financial obligations, because all this speaks of the company’s solvency. Take care that you do not have any debts in at least the last six months, otherwise they can cause you a problem due to only one unpaid salary, for example. And it’s best that you haven’t had any late payments in the last year. Then you can count on a bigger loan.

Collateral

If you are asking for a larger amount, it is very likely that they will ask you for collateral. It would be best if your business has enough things that it can use for collateral, like equipment, real estate and everything else. In case the value of everything the company owns is small, then you will have to put personal belongings as collateral. It’s even riskier, so be careful. It’s better to have things like jewelry or a car than your house. Be prepared that you can potentially lose every thing that is collateral.

Conclusion:

Now all you have to do is wait for approval. If you have done everything right from the beginning and listened to our advice, your chances of success are great. Don’t worry if you don’t get any response for weeks or even months, the higher the amount you ask for, the longer the approval process will take. And once you get a loan, use it wisely and pay the installments regularly. Only in this way you will make most from the loan, instead of making it an unnecessary burden.

Can You Earn Bitcoin without Mining and Investing

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Doing a job that you do not like is truly a tough thing. You probably have a good salary. However, in most cases, the salary you have can’t cover all the costs that you have. Lack of money is not the only problem that people have. Let’s say that you like to travel a lot. Even if your salary is above average, will you have time to do what you like?

All these problems convinced people that they have to look for alternatives to make money. Fortunately, advanced technology brought many opportunities to our lives. This especially counts when we talk about finding ways to make more money.

Despite that, the Internet also brought some new industries to the world. For instance, traditional gambling is not as popular as before. Many people now support online gambling because of the benefits it brings. However, the online gambling industry is not the place where you should look for more money. We do not want to say you can’t earn it. Yet, only a small group of people manage to get rich from this entertaining activity.

Source:smartassets.one

On the other hand, the cryptocurrency industry is experiencing popularity growth. Indeed, this industry has a turbulent past that distracts people from investing. Fortunately, more and more people understand that certainty in the business world does not exist. The Coronavirus pandemic showed that neither of the industries is perfectly safe.

As you know, Bitcoin is the most popular digital currency in the world. People that have never participated in this industry heard about it. The two most popular ways to earn Bitcoin are mining and investing.

Should I Start Mining and Investing Now?

If you have enough money for investing, why not? You can now get BTCs for a relatively fair price. The pandemic also harmed the market cup of this industry. The consequences of the crisis are visible in the value of Bitcoin as well.

The price reduction is not something that should scare you. As we said, all industries were turbulent and this especially counts when we talk about cryptocurrency.

If you do not have enough money and knowledge, this could be a problem. Fortunately for all of us, the two most popular ways of earning Bitcoin are not the only ones.

How to Earn Bitcoin without Investing and Mining?

We do not want to say that alternatives are equally profitable as investing and mining. However, when lack of money is the problem, you can’t expect to earn a lot. The good thing is to start participating in this industry. How are you going to start investing if you have never met with any cryptocurrency? Our solutions are multi-practical. You will get some experience and Bitcoins to start. Let’s find them out together.

Entrepreneurs Should Accept BTC-based Payments

We know very well that this piece of advice is not suitable for everyone. It can be useful for entrepreneurs and people that plan to start a private business. Let’s imagine that you are preparing yourself to become a business owner for the first time. Logically, you created a business plan that covers all the aspects of your business.

Well, our recommendation is to add different payment methods to your business plan. More precisely, accepting Bitcoin-based payments will allow you to earn Btc without investing or mining. This is a message to all the people that run a private business.

Source:hackernoon.com

Work for Bitcoin

Some people are not just big fans of Bitcoin and other cryptocurrencies. They invest a lot of effort to make them more popular among people. Achieving that in today’s world is tough. Because of that, these people use different methods to change the way of thinking of people. Some of them invest in education and they strive to teach the world more about them. However, some companies accept to pay their workers in Bitcoins.

First of all, you can visit websites where you can do some simple tasks. These websites a perfect place for people that look for easy money. Fortunately for you, some of them will pay you in Bitcoin in exchange. We do not want to be too optimistic here. As you know, simple tasks are not profitable at all. The amount of BTC you will get is not going to be impressive. Still, this is a good way to make mini-steps in this industry.

If you want to make more, there is a good alternative you should know about. Some companies like to collaborate with freelancers on certain projects. Hiring a new employee for a couple of months would be unnecessary. If the owner of that company is a BTC supporter, be sure he will accept to pay you in BTCs. This is a good opportunity for people that possess certain skills. For instance, you can start working as a freelance content writer, graphic designer, etc.

Online Gambling

Source:casinosfactory.com

The online gambling industry is experiencing popularity growth in the entire world. Because of that, online casinos need to follow the latest trends including those associated with payment methods. Some casinos will pay you off in Bitcoins.

Still, there is one thing that we have to say about this method of earning Bitcoin. It is the riskest way of earning Bitcoins of all. Indeed, you need to take certain risks when investing and mining. However, gambling is not going to be profitable for you if you do not possess the necessary gambling skills. Some people managed to earn Bitcoins in that way, but be careful if you choose this method.

Bonus Tip: Trading

In the end, we would like to talk about one of the most effective ways to earn Bitcoins. Indeed, small investments of money will be necessary here if you plan to start. Despite that, you will have to create an account by using a reliable provider.

Still, this type of earning Bitcoins is not good for everyone. The entire cryptocurrency industry is complex. You will need to spend months or years to understand how the industry’s system functions. Because of that, education to become a successful BTC trader is education.

Research this subject in theory before you even start. After that, you can find a reliable broker/mentor that will share his knowledge and experience with you. If this seems like a good option for you, we recommend you visit cfds-trader.com. Here you can find a mentor that will teach you everything you should know about online trading. When you possess those skills, you will easily manage to trade with BTC successfully.

The Importance And Purposes Of A Business Plan

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Most of the times when you go through articles underscoring the importance of having a business plan. The usual norm is for people to only draft them when they intend to use them for sourcing funding. However, it is more than just a tool for sourcing funding. It also carries with it so many uses for you as an entrepreneur. In this article we discuss why it’s important to have a business plan plus the purposes for which it’s drafted.

The Importance Of A Business Plan

Source:blog.nationwide.com

Disciplined Thinking

Many times we are told that failing to plan is planning to fail. It’s quite true and even the bible points out one must count the cost before embarking on venture. According to Startupbiz Global, Drafting and subsequently adhering to a business plan forces you to think objectively and critically. The components are interconnected and feed into each other. For example, your market segmentation informs your marketing strategy and in turn feeds into your cash flow projections.

So, neglecting one area ignites a chain reaction to results in failure. Therefore, having a proper action plan is important in that it causes you to employ disciplined thinking in planning and executing your operations. You’re essentially seeing the end from the beginning when coming up with a business plan and that obviously requires extreme discipline in your thinking. It helps do away with assumptions by testing your hypotheses so as to establish facts.

Refining Your Idea

Source:excelldesign.co.uk

Usually, when an idea strikes your mind you get excited. This is actually good because all great ideas start out as just mere thoughts. However, thoughts aren’t always in sync with the material world and this can usually be revealed once you start refining the idea. For instance, your idea might seem potent in your mind but as you work out your marketing plan (which is a component of the plan), you might realize that there’s no market for it.

So going through the paces of drafting a plan helps you refine your idea by subjecting it to rigorous real-life scenarios. In the process, you might even realize that you’ve to reimagine your whole approach. In a sense a plan gives meaning and structure to your idea. Once you’re through with it, you would have refined your business into something that wields substantial prospects.

Gets You Started

The late Dr. Myles Munroe once said that the richest place on this earth is the cemetery. The point he was expressing was that many people end up dying without doing what they were called or meant to do. I believe one of the causes of this sad scenario is procrastination. Most people have excellent ideas locked up in their minds and are either hesitant or reluctant to get started. Several surveys have shown that people who write business plans are about 3 times more likely to start off than those who don’t draft plans. So it’s quite apparent the effort one puts into drafting will gear them up into action. It’s usually the case that when you commit something to paper along with the thought processes that occur as you do that you increasingly get hyped to act.

Purposes Of A Business Plan

Source:entrepreneur.com

Sourcing Funds

That was alluded to in the opening remarks how that most people write plans to source funds. Most prospective financiers require a comprehensive blueprint so as to make an informed decision on whether to fund your idea or not. Most financiers will have a keen interest in your product(s) or services offered, value proposition, marketing strategy and financial projections. The plan broadly addresses 2 issues namely, what you intend to achieve and how you’ll achieve it. So since financiers are mainly interested in those aspects they will need to see your plan which comprehensively covers those details. It’s almost impossible to get funding if you don’t have a good sketch. This is something every company must go through.

Detailing The Model

One of the most crucially important components of a business is its model. It lays out how material and immaterial resources will be used to generate revenue and earn ROIs (returns on investment). This is central to informing the financials which are usually very key in assessing viability. Issues such as scalability and sustainability can be easily judged by looking at a business model. So the plan is drafted in such a way that it goes at length to explain the model.

Reference Document

Let’s suppose you’ve done your plan and you’ve gotten the necessary funding to start working. It will serve as a reference point for key decision-making and operational issues that might pop up along the way. Remember that your plan stipulates your intended results and how you’ll attain them. So the process of monitoring and evaluation will be very easy to conduct because you’ve goals, activities, responsibilities and KPIs (key performance indicators), amongst several other variables. Especially in cases where you would have shared your finished product with stakeholders and shareholders you’ll definitely have to stick to it to achieve promised outcomes. In a way, you can say a business plan is your compass as you navigate your way in materialising your ideas.

So the word of advice is that you must come up with a plan before starting out. Most people just venture into businesses based on assumptions or simply because others are doing them. Based on that background they then think it’s unnecessary to have a written way of doing things. Just as unique as fingerprints are so it is with businesses; no two businesses are exactly the same. So it’s important to have a  plan to help you define, make sense and structure your own pathway.

5 Elements of a Business Plan to Secure Bank Loan

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According to Mark Abell, the Senior Vice President and SBA Division director at the NBH Bank, “About 75% of the business plans that come with application-based projections lack at least one or more key areas. Most of the plans that I come across consist of very few pages of half-written points. And those points lack the most important business details, which is just what banks need to know to decide to make a loan.”

Business plans are critical for high-growth companies and startups as well as for those seeking to finance a business acquisition.

Source:chooseyakimavalley.com

Reputable companies that are looking to take things to the next level usually need capital to work. For this, they must have a concrete business plan that identifies how they will achieve growth and demonstrates that their strategies will generate an adequate flow of money to guarantee repayment.

Businesses that are looking to acquire other companies or people seeking to buyout an organization requires a detailed plan that describes the new owners and how they will manage it successfully, as well as what they perceive as opportunities. Here are a few elements to keep in mind that can significantly increase your chances of securing a bank loan for the first time. 

FastCapital360.com can help you find and compare loan options and be a great help, especially for first-time loan applicants.

Business plans are for your team and the bank

Creating a detailed business plan is not only to check-off a bureaucratic formality to get a bank loan. It works as a guideline for the company – one that disseminates essential ideas and facts to administrative teams and employees. Creating the plan is a crucial exercise to help founders think about the details while devising the future of their business.

Detailed projections

Getting a “yes,” i.e. a go-ahead for your loan application, banks need to have enough details to ensure your business will generate enough cash flow to pay off its debt. Your plan must detail the exact way in which the company will achieve its financial objectives and estimated expenses. It should also state how you expect to make long-term succeed. The statement “our service’s market potential is $100 million, and we estimate that we will earn 7 percent of this” is inadequate. 

You should state the exact way you are planning to achieve those earnings and how you seek to capture the market. Your plan should also include an in-depth analysis of your estimated operating costs, and it should also take into account market and economic trends. If the local market is limited, it should state as it is most likely, the banker is already aware of this. Other than this, declare your hiring strategy and how it will affect costs. The purpose of the plan is to categorize all essential ideas and explain them. 

Source:parkerhartley.co.uk

Marketing strategy

Your plan must also summarize the marketing strategy that you have contemplated for your company. Before giving a loan, banks make sure that they know how the business will design and execute its marketing strategy. The plan must answer this question in detail: Why is our product needed, and how can we communicate our message?

Previous experience in business

Before they approve any loans, banks make sure if the owners have enough prior knowledge to run a business. It helps banks to be sure that the estimates are realistic and that they can be successful. 

All businesses require a different skill set. A founder with a great CV as a director in a large company may not be the ideal candidate to set up a restaurant. In the case of acquisitions, it is necessary to provide all details about the administrative transition.

Source:tweakyourbiz.com

Location, location, location

The site of the business can be a surprisingly important detail that contributes to the success. If you want to set up a coffee shop, you must be in a place where people travel every morning. If your success is going to depend on the drivers who pass by, then you need to have parking. If you want to set up a hair salon per se, you do not want to be in a poorly located mall. The business plan must state the exact location and the reason why you think it is ideal for your success.

People in business who do not have the time or experience to put together a detailed plan can hire people who offer assistance at a little cost, and it is worth asking for their help.

Remember that, contrary to investors, the leading precedence for banks is to make sure the return of capital rather than a return on equity. If you have the right plan and proven financial ability to pay the debt, your probability of securing the loan becomes high.

How To Write A Business Plan

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Writing a business plan is one of the most if not the most important part of starting a small business. You need to know where you are starting and set yourself goals and milestones to grow into a successful business. Businesses can take years to become truly profitable. To get to that important moment in a small businesses life you need to plan and account for the next few years, yes you heard me, years.

We are going to breakdown the important moments of planning and writing your business plan.

Step One: The Business Overview

Now that you have settled on the idea and are sticking with it, you need to know that idea like the back of your hand. You need to decide on important things such as

  • Name
  • Slogan
  • Logo
  • Executive Summary (Like a contents page)
  • Company Description
  • Owners

Get info here to know more on brand identity for small businesses.

Step Two: The Market Analysis

Img source: ingeniouszone.com

So, you have spoken about who you are as a company, and the small details and now you need to develop them further. In the Market Analysis, you discuss in depth, the industry in which you operate. For example, if you run a movie theatre, you operate in the entertainment industry and therefore you speak for that industry as a whole. Find out who your market will be and refine that. Furthermore, look into the competition and learn all you can about who they are, how they do it, what they do and how you can compete with them.

Step Three: The Service or Product

What are you offering? You need to nail down all the aspects of the service or product that you will be supplying. In order to gain confidence from investors or partners, you need to know these small details to show your idea has been well thought out.

Step Four: Marketing

Img source: myoffice.com

How will you be marketing this business given its existence in the grand scheme of the industry as a whole? It is also important to take into account things such as;

  • Location – where you are is a big indication of how you will market. You won’t spend money on something that doesn’t work in the given location.
  • Demographics – who are you targeting. Men? Women? Kids? Adults? How you speak to each of these demographics will be different and knowing that voice is important.
  • Competition – who is the competition and how do you plan to challenge them? Fast Food restaurants are the perfect examples of competing brands Burger King vs. McDonald’s, Wendy’s Vs. Everyone. They use these feuds to benefit their own brands by targeting their competitors and stating why they are superior. People enjoy seeing the comedic value of these feuds and rebel in the satirical humor. At the same time, they actively discuss both brands creating word of mouth marketing one of the most powerful forms of marketing around.

Knowing the competition is a vital part of developing your business. You need to ascertain if the business is a viable option. Is there too much competition? Is the market oversaturated with this business model?

Step 5: Money, Money, Money

Img source: diymarketers.com

In order for you to be able to execute your business what will you need to start? Beyond that what will you need for the next three to five years? Investors and partners are generally how small business are started. Owners put in the starting capital but beyond that might need more funding. Big or small, never devalue the business plan. Map out your immediate expenses, consider monthly expenses and consider what the business needs to make to breakeven. While the goal is to make a profit, it should also be to breakeven anything below that, is dangerous.

Project earnings for the next few years and supply balance sheets with supporting evidence backing up your claims.

There you have it, some of the tips to writing an award-winning business plan. You can practically smell the profits.

Beyond the statistics, it is important to set goals for yourself and your business. Work towards a set of goals that apply to your business. It can be sales related, reaching targets, customer satisfaction, all of the above. Do not, however, set unrealistic goals that are unachievable. Be realistic in setting goals and work hard to make the business a success.