When you are trying to secure financing to purchase an existing business, having a business plan in hand is important. Many people get nervous when they hear they have to write a business plan. I get it, it can be overwhelming when you have to step back, analyze something and figure out how you are going to make things work…then put it on paper. But the truth is, writing a business plan shouldn’t be viewed as a bad thing. It is actually a great way to access the strengths and weaknesses of a company and create a proactive plan to address them rather than acting in a reactionary way.
On top of that, yes, writing a business plan may take a while to do, but so what! It’s not really all that hard and mapping out the future of a company you want to buy and profit from, should be a top priority for any Entrepreneur. With that, here are a few tips on how to write a business plan so you can get started!
Understand why you are writing a Business Plan – It’s Not Just to Secure Financing
Before you even sit down to put your ideas on paper you should understand that the sole purpose of writing a business plan is not just to get financing for an existing business and this should not be a “one time deal.” A business plan is meant to be a working document. It is meant to be updated as the needs of the business change and it is meant to help you evaluate the business so you can best plan how to manage it successfully.
For the purpose of this post, we are talking about using a business plan to secure financing for an existing business so it is important to understand who your audience is and tailor your message accordingly. You want to write your plan in a way that is going to make the reader want to get involved with your ideas. Following the proper format and including all the necessary sections is of course important, but “speaking” to your reader and engaging them in your business is what will get your loan approved. Show them on paper that you know what you are doing and how you are going to make them money!
Get Help If You Need It
If this is your first business plan you may not know where to begin. If you Google, “how to write a business plan” you get a TON of results, some may be helpful and some may be a waste of your time. Writing a business plan doesn’t have to be a DIY project. There are many resources that can help you with this process. The SBA online offers a step by step tool where you can plug in information and generate a business plan. I wouldn’t recommend using that solely but it would be a good foundation to build from. Other resources like score.org have a free online seminar to help you. Consulting with a professional business broker can also help.
Cover Your Bases
As I mentioned before following the proper format is important. Be sure to include all of the standard components of a business plan, they include:
Marketing Plan and Analysis
Strategy and Implementation
Other sections may be required by the financial institution you are seeking financing from so check with your loan officer to see if they require anything specific.
Don’t be afraid of a business plan. It’s a good thing. It’s guide to help you navigate your business and be successful. Take the fact that you have to write one to secure financing and use it to your advantage!