business finance loans for established businesses & startups £5000 -£1m

DELIVERED BY:BSS Management Consultancy– www.businessservicessupport.com Sheila Elliott Bsc Econ Hons, MBA, FCCA,

BUSINESS PLAN / STRATEGY TO ACCESS FINANCE SUCCESSFULLY- TASTER FOR START-UP & SMES

http://www.businessservicessupport.com/

COPYRIGHT© TO BUSINESS SERVICES SUPPORT LIMITED 2011

ABOUT THE PRESENTER Sheila is a business management trainer and a consultant mainly assisting

businesses with access to finance, organisational development through her consultancy and training services.

Through her work with banks, as well as micro finance institutions and grant funding organisations, she has gained experience appraising business plans and grant applications for successful funding. Her course is designed for learners to gain skills to better prepare their business plans for funding.

Some Key Highlights Of Her Career

2008- Coached by Mark Victor Hansen, New York Times Best Selling Author Of Chicken Soup For The Soul who endorsed her book ‘My Business Is My Business’

2010 -spoke at the ‘House of Lords’ on Women’s issue and micro finance http://www.womeninpublicpolicy.org.uk/wp-content/uploads/2013/09/Invitation-18-Nov-10.pdf

2013 -voted one of UKs Best Ethnic Women In Business for IWW - https://www.youtube.com/watch?v=f--9wzoA5BQ

2014- spoke alongside top political figures at City Hall on finance for BEM

2015- Became Amazon Best Selling Author http://www.amazon.co.uk/gp/bestsellers/software/3308301/ref=zg_b_bs_3308301_1#2


WHAT YOU WILL LEARN Learn why a business plan is important and how to create one to access finance successfully

Learn how to ensure your business plan addresses important issues for lenders and investors

Learn the techniques used by lenders and investors to evaluate your business plan for funding

Brief questions and answers

Copyright ©Business Services Support Ltd 2007


WHAT IS A BUSINESS PLAN AND WHY DO FUNDERS ASK FOR ONE?

A management plan for accomplishing core corporate strategy

A management tool communicating the process and plans that will be used to meet its business objectives or how business ideas will be turned into a profitable venture.

Objectives are the specific goals set by a business to accomplish its mission

For instance, a goal to increase sales by 20% within 12 months, to increase customer retention by 50%, to increase market share by 30% over 24 months

Funders investing their funds in a business are taking risks doing so, they want to be assured they will not be exposed and a business plan is fundamental in their decision making:

- A business plan is a tool for evaluating risks and rewards as part of their due diligence.

.


TOP REASONS WHY BUSINESSES FAIL TO RAISE FINANCE

Lack of a sound management team- poor skills or lack experience

Incoherent business plan – unclear business strategy to gain competitive advantage and unclear vision

Lack of a robust business plan- lots of unanswered questions

Business plan model is suspect and demonstrates lots of challenges with potential risks to funders

Products offered are not superior to the rivals in the market & lacks understanding of the operating market and competition

Poor marketing plan to support the business model

Failed the minimum requirement for financial viability test


BUSINESS PLANS- THE FUNDAMENTAL TOOL FOR RAISING FINANCE

Executive summary Description of the business What finance is required and for what Vision and mission statement Target market analysis Products and pricing strategies Analysis of resources required and what is currently available Analysis of external environment (PEST Analysis & Porters 5 forces) including competition analysis SWOT Analysis Marketing and sales strategies for competitive advantage Milestones and timeline Risk analysis and management systems Financial forecastsprofit and loss , cash-flow and balance sheet

Copyright ©Business Services Support Ltd 2007


DESCRIPTION OF THE BUSINESSBriefly describe your business covering:

What is the name of the business? What are the products? What are the benefits of the products to the target market? How long has the business been trading? What is the track record of the business? How many staff are employed by the business? Where does the business operates from?


Finance Required & PurposeAmount required

What is it required for

Historic financial performance:

- Tabular format

-Graph or pie chart

Some quotation from suppliers

WHAT IS THE FINANCE NEEDED & FOR WHAT


SCOPE AND CONTENTS OF A BUSINESS PLAN

Vision and mission statement Vision is critical for business success

Vision is the end state of your business

Vision paints a picture of what your business wants to achieve

Mission is the purpose for which your business is established

Mission - To provide high quality healthy meals in a restaurant settings for a specific target market. To enhance the potentials of individuals through high

quality training and education.

Vision - To become the number one restaurant in a particular niche market. To be the number one provider of business training across the world.



Target Market Analysis List who the target market is - who you want to sell to

Describe their profile- sex, age, income profile, location, business size, location, age, type, life style and so forth.

What does the market need & how do they make purchasing decisions

Size of the market – is it growing, declining, plateau (critical mass)

Purchasing power of the market- Market must be able to pay other wise your business is not viable.

E.G

The target market of ABC Limited (cleaning company) are:

Commercial business- offices, supermarkets, social care homes, pubs,

Public sector businesses- hospitals, government offices etc

Residential homes- across the south east of London



Core Products and Pricing Strategy

Details of the products and

services provided currently

Details of new

products and services

Pricing strategy – low end, mid end

& top end

Elasticity of demand



Analysis of resources required and what is currently available

Management Team - who are the key people that are involved in the business or that will be involved in the business and how many/ roles- Organisation Chart

Management Team - what are the credentials of the core people involved- CV summary (staff, associates, partners, consortium etc)

Supply Chain- who will be the key suppliers of the resources required to produce products and services- credential and reputation

What premises will be used and how appropriate is it. What other resources are required

Are there gaps



Analysis of external environment (PEST Analysis & Porters 5 forces) including competition analysis

Political impact- legislations affecting the industry (minimum wages, no smoking, sales tax, health & safety, environmental, anti-discrimination, and more)

Economic – state of the operating economy – booming, receding or stable- Inflation, exchange rate, interest rates, GDP, unemployment rate,……

Social- life style, population growth of your market, size and needs etc

Technological – impact of technology on your industry and impact on your business

Keynotes, Mintel etc



Market Competition Analysis:

Demonstrate knowledge and awareness of alternative suppliers- do not imitate

Describe the core competitors- ensure you define them correctly

Location

Size

Strengths

Weaknesses



Market Competition Analysis:

Unique Selling Point- differentiating factors

Benefits you offer that are different or better than competition

Benefits you offer that are similar to the competition

- Features of your products or services and their unique benefits.



Marketing and sales strategies

What is the business model you will use to compete.

Think 7 P- Product, Price, Promotion, Place, Process, People & Policies



Milestones What are the gaps identified in the business plans

List actions you will take to close gaps

Who will be responsible for each action

What is the deadline date for accomplishing the actions


SWOT ANALYSIS.


Risk Analysis and Management SystemsWhat are the risks and how will you managed them?

Demand risk


Competition risk

Operating risk

Financial risk

Strategic risk

Political risk


SCOPE AND CONTENTS OF A BUSINESS PLANFinancial forecastsprofit and loss, cashflow and balance sheet Is the business model financially viable

What are the projected sales- linked to the size of the market and demand for your services and products x price

What is the cost of providing the products and services- linked to inflation of market delivering the resources or broad market).

What is the cost of capital- linked to interest rates and the general economic conditions….


SOURCES OF FINANCE V PROS AND CONS

Grants- not paid back but not widely available

Loans- repayable with interest (with exposure to interest rates movement)

Equity- not repayable but dividend expected as well as capital growth; also loss of control.

Where to go:

Mainstream banks; Government Sponsored Loan Programmes; Private Investors Such As Angels; Venture Capitalist Firms (money management firms investing institutional funds and high net-worth individual funds); Crowd-funding (generic platform used to receive smaller funds into one large pool) .

The right balance for financing depends on your current financial needs and financial capacity.


FUNDERS’ APPRAISAL METHODOLOGY

Alignment of funders needs with your needs- policy on who to finance or not, what is in it for us

Management capacity- can they be trusted- credit scoring, experience, character, track record, accomplishment

Products viability- target market, market size, profit potential

Marketing strategy and plan-market penetration

Financial viability- financial ratios, forecast profit and net-worth

Sensitivity analysis- changes in factors and impact on projection

Risks Reward Ratio- Pay Back Period, Net Present Values, Internal Rate Of Returns


CONCLUSION

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