Experts spell out the best business plan

Starting your own business is a major step, considered very daunting by even the brave.

But with careful financial planning, what seems like a long and winding road can become a short, straight forward path, according to the Association of Chartered Certified Accountants (ACCA).

The Association say all that’s needed is a little common sense and then early stage start-ups or entrepreneurs can compose a business plan, which should go further than simply being, “a sheet of numbers.”

The best business plans start with a summary – an introduction about you, your core business, product or service, alongside a financial overview of the company.

The plan should elaborate by including details of the management on-hand, effectively spelling out listed partners and their respective business experiences.

Then entrepreneurs should detail the key points about their product or service, followed by a marketing outline that estimates current and future sales, market rivals and perhaps customer profiles.

To unearth a feeling of optimism among the business, company owners should then list as many USPs – or unique selling points of their business, accompanied by a breakdown of prices and advertising.

This precedes an overview of the operational and financial aspects of the company, such as the business location, equipment, staff and current profit/loss ratios, as well as any cash flow forecasts.

Lastly - a look to the future: All business plans should conclude with a section of objectives that spells out challenging yet realistic aims for the enterprise.

Kemi Laniyan, an entrepreneur who recently launched her new business focusing on providing food for people with food allergies or intolerances - found her business plan essential to raising finance.

It also won her a national award and she was recently presented with the ACCA Award for the Best Financial Plan at the 2005 Barclays Business Plan Awards.

She said: "It was important that the financial element of my business plan was broken down into clear sections and - as well as winning this prestigious award - it also helped me to secure a grant from the London Development Agency. My business plan will be my bible for the next year as I start trading."

Professor Robin Jarvis, head of small business at the ACCA, who judged the business plan, said Laniyan’s proposal demonstrated detailed research and a clear insight into the structure for overseeing the financial management of her company.

“All the relevant financial statements had been embodied into the plan - most importantly the start up investment, cash flow forecasts for three years and details of employment costs and pricing,” said Jarvis.

“All these were also supported by a sound discussion about the assumptions underpinning the plan and other supporting information. For whichever reason [people start-up], the starting point for any budding entrepreneur should be a sound, well thought out and realistic business plan, incorporating a financial budget. This will indicate how much funding will be needed to start up the business and support it during the first year's trading.”

The ACCA added all new businesses need a “friendly helping hand” – to act almost as an unofficial partner who can unravel all the jargon and regulations intrinsic to running a small business.

As a result, once company formations are complete and start-ups feel capable of trading to clients, entrepreneurs are encouraged to locate a reputable accountant who is prepared to act as a business advisor.



 

31st October 2005

Related News

Latest News

                             

NEWSLETTER SIGN UP