Small Business Week, which takes place the third week in October, gives entrepreneurs the opportunity to share stories, exchange ideas, meet experts, and participate in events held across the country. It’s also a great time for aspiring small business owners to get their feet wet and meet potential business partners or investors.
If your business is still all in your head, however, it might be hard to convince anyone that you have a credible company and that you'll use their funding well. And that's precisely where a business plan comes in. This highly recognized management tool is basically a written document that describes who you are, what you plan to achieve, how you plan to overcome the risks involved and provide the returns anticipated.
Many entrepreneurs may see putting a business plan together as a daunting task involving hundreds of pages. However, in reality, it should be a concise and structured document that gives readers everything they need to assess your company's project.
Here are the ten elements you should consider:
1. Your business proposal. Include a description of exactly what you're proposing. Ask yourself: who your customer is, what business are you in exactly, what do you sell, and what are your plans for growth?
2. Your unique selling point. Address how your goods or services will appeal to customers. How will your company or product/service make a difference in the lives of your customers?
3. Market analysis. Make sure you show your lender that you understand your customer needs so that you can offer a product or service that precisely fits those needs. You'll need to provide information such as your target market, customer demographics, competition and distribution methods.
4. Key competitive information. Provide information on competitor weaknesses and strengths and show how you intend to improve on what they're doing.
5. Organizational structure. Use organization charts to clearly spell out the roles of key management people and the proposed size of your organization.
6. HR requirements. You should include information on how you plan to recruit and maintain your employees or handle outsourced work.
7. Premises and capital goods. Do an assessment of the company's needs with regard to premises and capital goods (such as machinery, technological equipment).
8. Key financial data. Be sure to modify your information depending on your target audience. For example, your bank will be interested in how you intend to repay the loan or overdraft, what you intend to do with the money and how it will help your business grow. Potential investors will also want to see the expected return and sources of funding, while shareholders are looking for the prospect of the share price and what dividend they can expect on their shares.
9. Legal structure. Address issues such as taxes, liability concerns, information on proprietorships, partnerships, limited or incorporated companies. If you're buying an existing business, be sure to clarify buy-and-sell agreements. Keep in mind that you should have a lawyer look over all contracts and legal issues.
10. An executive summary. It helps to write this last; a page or two of highlights is sufficient. Be sure to clarify whether this is a new business venture, an expansion of an existing business or the purchase of a new business.
Canada’s business development bank, BDC, puts entrepreneurs first. With almost 1,900 employees and more than 100 business centres across the country, BDC offers financing, subordinate financing, venture capital and consulting services to 29,000 small and medium-sized companies. Their success is vital to Canada’s economic prosperity.