You did some cash flow projections yesterday and with rocketing costs, you’re going to be short. You need those additional heifers, but you need your overdraft extended and quickly. No problem you think, when you spoke to your mate Jjacob at the bank two years ago, he arranged it in a week. So you call your local branch and an American comes on the line. “number has been changed. Please dial 086 123 4567.”
You assume you’ve dialled the wrong number and repeat it. You get the same voice again. You wonder how your local dialling code gets you through directly to the USus, but you dial the 086 number. This time a Ssouth African from the Ccape Fflats answers and asks what branch you’re trying to contact. You give them the branch name. Tthere’s a dial tone change and you’re through – but it’s not a voice, it’s music. Aa few minutes later a tired voice comes on the line. Aat last with a sigh of relief you ask for the manager, Jacob Reinders. “Mr Reinders no longer works here,” the voice says. Sso you ask for the new manager.
He’s charming, listens to your story and asks a few questions. This is going to be a cinch, you think. Then he says, “It should be no problem Mr Jones. Just bring in a copy of your business plan and we’ll do our best to arrange it.”
Welcome to the real world. The concept of a business plan has been around for many years. Iit’s reputed that in the 1970s, Intel, the computer giant, raised their start-up funds with a business plan on a single A4 page. Take something like that to your bank today and see how far you get! not the place to go into detail about the content of a business plan.
Rather just Google “how to write a business plan” and you’ll get all the help you need, or alternatively, get a template from your bank.here are some important do’s and don’ts learnt from the School of Hard Knocks: Make it a compelling document – attractive, legible, with a relevant picture on the cover.The most important section of the document is an executive summary on page one. Iif you can’t persuade the reader in the first few pages that you’ve got a viable proposal, you’re going to leave empty-handed.
All business starts in the market, so deal with this subject first.
You will experience set-backs. Make realistic provisions for them.•Include a high-quality SWOT analysis (strengths, weaknesses, opportunities, and threats) – it’s a great way of highlighting the essential features of the business.attach an opinion or opinions from acknowledged experts in the field that your assumptions are realistic.
Keep the body of the document as short as possible, but remember the bankers will not understand your business. You’ll need to educate them, but don’t clutter the document with detail – include annexures to which they can refer if they wish.
always include an exit strategy that sets out how you will quit if and when necessary.
a realistic, quality, updated business plan will get you the finance you need, but its primary value will be in the insight it provides you about your industry and business. Iif you don’t have one – start working on it today. – Peter Hughes ([email protected] or call (013) 745 7303). |fw