Laying out your bankable business plan

August 14, 2015 Courtesy of

WE continue from last week where we covered the layout of the first four chapters of a bankable business plan document. Today we deal with the last four chapters, remembering always that the business plan is as much about form, structure and presentation as it is about content and substance.
by Clive Mphambela
The remaining chapters of your plan must cover the following:-
What is your Management Structure and who are the Key Personnel for the Business?
In this section you should include the legal structure of your business along with all pertinent ownership information it relates to. Financial experts generally agree that one of the strongest factors for success in any new and growing business is the ability and track record of its owners and management. It is therefore important to let your readers know about the key people that will be involved your business and their distinct backgrounds. You must therefore provide brief CVs or profiles that includes the following important information on them:
Their names and their position in the company. Take care to include brief position descriptions along with primary duties the person will handle and their level of authority. Their educational background and any unique experience and skills that they possess; prior employment and achievements track record and so forth are all crucial selling points. How well they are recognised in their particular industry and what has been their community involvement? And so on.
Also highlight how the people that will surround you will complement your own skills as an entrepreneur. Show how each person’s unique experience will contribute to the success of your business. Be insistent on clarifying their backgrounds and why you are bringing them into the business as employees and/or if they are co-owners. Detail their responsibilities and their salaries and other benefits that will be payable to them.
What are your marketing and sales strategies?
Marketing is the process of creating customers, your marketing strategy should bring out clearly:-
l How you will focus on specific target markets.
l Your promotions/advertising/public relations activities
l Sales appeals.
l Your sales strategy. Describe carefully and in depth how you plan to actually sell your product.
Provide a clear description of the products or services that you will be offering.
Describe your services or products, emphasising the benefits to potential and current customers. Focus on those areas where you have a distinct or unique advantage. Clearly identify the problem in your target market for which your service or product provides the solution. Give the reader very hard tangible evidence that people are, or will be, willing to pay for your services or products. List your business’s various services and products and attach any marketing/promotional materials that you will use.
Provide details regarding suppliers, availability of products/services, and service or product costs. Also include information addressing new services or products which will soon be added to the company’s line.
What are the funding requirements for the business?
This is the section in which you will lay out your requests for funding, the amount of funding you will need to start or expand your business, the type of funding whether it is debt or equity financing or a mix. The following must be very clear:-
l Your current funding requirements.
l Your future funding requirements, especially over the next three and if possible five years.
l How you will use the funds you receive.
l Any long-range financial strategies that you are planning that would have any type of impact on your current funding request.
l How you will use your funds is very important to your bankers and creditors. Lay out the funding request for capital expenditures, working capital, any acquisitions that you will make and so on.
Whatever it is that will require money, list it in this section.
Give a careful analysis of your financial data
This is very important. You must write a brief analysis of each of these three financial statements:
l The profit and loss projections,
l The cash flow projections, and
l The pro-forma balance sheet.
When you are writing the analysis paragraphs, you should keep them short and cover only the highlights, rather than writing an in-depth analysis. The financial statements themselves should be included in your business plan Appendices Section at the end of your business plan. You normally would prepare these schedules in Excel or some other spreadsheet software.

Typically, for the first 2 years of projected trading, you should supply monthly projections. Thereafter, quarterly, or yearly projections for the years 3 through 5 should be ok. Also write down a brief synopsis of the financial controls that you will use in your business. Remember that good disciplined recordkeeping, and maintaining a bank account with your bank, are good practices that will help you in your quest to succeed.
Always include an appendices section:
The appendices section should contain all the additional important material that is referred to, but not included in the main body of your business plan. These could be copies of your bank statements and past trading records, contracts and orders that you may have secured and so forth, letters of support from key stakeholders among others.
This proposed layout, however, remains only a guide and there can be need sometimes to re-organise the chapters, change a few things around, add and delete some of the information, depending on the peculiarities of a particular business proposal. It is not a one-size-fits-all or a simple copy-and-paste exercise. Nonetheless, a business plan should take a basic acceptable but attractive format for it to be bankable. It should be as much be about substance and value, as it should be about presentation and structure.
It is also useful to point out that bankers are adept at analysing your business plan. It is good practice therefore to keep a good relationship with your bank, and to call on them for advice during the entire process of coming up with a sound bankable business proposal.

l Clive Mphambela is a Banker. He writes in his capacity as Advocacy Officer for the Bankers’ Association of Zimbabwe. BAZ expressly invites players in the MSME sector and all other stakeholders to give their valuable comments and feedback related to this article to him on or on numbers 04-744686, 0772206913

What do you think? What strategies do you, or your company, use to manage the risk of fraud and error in your organisation? Are you primarily proactive or reactive in your approach to risk management? Share your experience in the Comment box below.

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