What you need to get funding
YOUR SMALL BUSINESS TOOLKIT – FROM BUSINESS PARTNERS LTD
This is the most vital part – it must sell your strategy for success to investors.this overview must contain the highlights and summaries of each section.
So, although it’s at the beginning of the document, write it last to capture the essence. The summary stands alone and should not refer to other parts of your document. (in monetary and physical terms) with a comprehensive analysis of the lead time expected to reach sales targets and milestones (eg breakeven point).
Elaborate on your pricing strategy and how it compares with your competition.
Where the business is a franchise, include the full marketing strategy of the franchisor.
4 Financial statements and projections:
Include only a summary of the financial statements and projections in the body of the business plan – attach detailed analysis as an appendix.
Include operating budgets, cash flow projections, income statements and pro forma balance sheets for at least three years (recommended five years).
Provide monthly projected figures for the first and second year, quarterly figures for years three and four and annual projections thereafter.
Where applicable, provide: Historical financial performance as shown by at least the last three sets of audited annual financial statements and up to date management accounts comprising income statements, balance sheets, debtors and creditors age analysis.
Costing methodology and detailed costings giving a full analysis of cost of sales.
Pricing policies with a full analysis of theoretical and real markup and gross profit percentages.
Rebates, discount structures and terms offered to and received from costumers and suppliers respectively.
Break-even and sensitivity analysis.
Details of overdraft and factoring facilities (bank, limit, security and interest rate) and medium and long term loans.
Ensure that your financial projections agree with any other statements in the business plan (for example, costs involved in your proposed marketing strategy).
Formulate and motivate your capital requirements.
Legal and regulatory environment – include:
Details of any licences, copyrights, trademarks and patents registered (or in the process of being registered).
Details of any legislation and regulations governing the industry, product and production processes
Proof of compliance with tax and labour legislation (VAT, PAYE, RSC, UIF, Coida, Employment Equity Act, Skills Development Act etc) where applicable.
Details of duties and tariffs to which inputs or products are subject if the business is a regular importer or exporter.
Swot analysis and risk-reward assessment:
Discuss definite and possible strengths, weaknesses, opportunities and threats.
Give an honest assessment of the risks faced by the business, entrepreneurs and investors in relation to the potential for growth, profitability, and capital appreciation.
Discuss strategies that can be implemented to address the risk factors highlighted.
Appendices and supporting documentation.
The following supporting documentation should be included where applicable:
Newspaper clippings, promotional literature, product brochures, market research, trade and industry publications.
Partnership, association or shareholders’ agreements.
Offers to purchase, purchase and sale agreements, contracts, orders, letters of intent, memoranda of understanding, lease, franchise, agency or distribution agreements.
Documentation relating to licences, copyrights, trademarks and patents, quotations or pro-forma invoices for capital items to be purchased.
Detailed personal balance sheets of the entrepreneurs ,copies of identity documents and marriage certificates of the entrepreneurs, schedules of life insurance and the endowment policies of the entrepreneurs.
Copies of company or close corporation certificates and registration documents, drawings, work flow charts, plans, factory layouts, and maps.
Also necessary is a list of references for creditworthiness, product and service quality, and the skills, abilities and integrity of the entrepreneurs.