Potential funders and investors will need to see the following key points answered:
- Evidence that the needs of the customers have been recognised. Current customer base and confirmed orders will help your chances of success.
- What are your key products and the cost of sales? It is key to know your cost of goods and your supply chain. What is your pricing strategy and what are your gross margins?
- How will your products reach the marketplace. Entrepreneurs need to demonstrate that they Know how and to whom their product or service will be sold and that the target margins can be generated.
- Realistic forecasts. It is key to underpin your forecast with high quality market research and analysis. You will need to have a clear sales and marketing plan which identifies your target market, lead generation techniques and sales processes and resources. I
The plan’s purpose is to convince potential investors or funders that the business proposition is sound and that any loans can be repaid comfortably on time. Also that dividends will be attractive and paid on time and that any investment in this business will increase in value.
Funders see hundreds of proposals every year and have or know of investments in many different sectors of the economy. They will check out your past financial history and track record. You must be well prepared and be able to defend your business concept and model, know your numbers, the product and market and why you and your business and the right team to invest in.