We often get asked by clients "how long" and "what level of detail" is required in a business plan. We generally give advice based on a number of factors including the target audience and the amount of funds being raised, but there are some equally important factors that you should consider.
In terms of length and detail there can be a significant difference between a SME business plan that seeks to raise £10,000 and a corporate business plan looking to raise £100m. The extent to which you need to provide detail on market and competitor research for a £100m plan may require a feasibility study that references current research that can in itself be costly. For a smaller business plan this level of detail, for example on competitor financial performance or data on your local market, simply may not be available in the public domain. Even if it were, the cost of procuring it may well outweigh the benefit that this analysis would bring. Remember, the main process of providing information is to reduce the risk profile of the investment.
But even the most detailed information on its own is not sufficient. In providing business plan services we come across many entrepreneurs who have invested considerable time and energy in developing the detail in the business plan, However, in many cases this adds up to little more than a collection of facts. Whatever level of funding you are seeking to start-up or expand your business, the business case for investment (either from a debt or equity perspective) needs to be made clearly. In other words, the argument for the business case is as important as the level of detail provided to support the business plan and needs to be made clearly in simple logical steps.
As important as the argument and detail is to provide a plan that acknowledges the interests of your target audience. Whether approaching angel investors, VCs or a bank, you need to show an appreciation for their investment or debt strategies and provide as much relevant information as possible to enable them to make a decision in your favour. Remember, these people get many plans across their desk on a daily basis. If they see one that simply lacks enough information to assess whether it has potential or not in terms of their own investment strategies the chances are that they will put it to one side where it will gather dust.
Finally, be concise. Irrespective of length and detail the reader should be able to grasp the key aspects of your business plan within 10 minutes . Only then are they likely to drill down into more detail.
Be concise, develop a sound argument and provide relevant supporting data. If only it was as easy as it sounds !
The Business Plan Team
Business Plan Services
- Jon Hunt is the Lead Consultant for The Business Plan Team which works with entrepreneurs, start-ups and growing businesses that need help developing a professional business plan to secure funding and guide internal management. It has developed business plans for a wide range of businesses and corporate clients looking to raise funding of between £50,000 and £200million in many different industry sectors including Social Media, Retail, Construction, Mining, Renewable Energy, Technology, Healthcare, Interior Design, Sport & Leisure, Investment Banking, Wealth Management and Trading. Testimonials from these clients illustrate the high levels of service TBPT provides.