For those that would love to learn the rudiments of writing a good and comprehensive business plan; here are the steps

BUSINESS PLAN –

Executive Summary

▪Vision and Strategy

▪ Business Description

▪ Your Customers

▪ The Market Place

▪ Marketing and Sales

▪ The Team

▪ Operations and Infrastructure

▪ Legal

▪ Financial and Funding

▪ Action Planning

Let’s get into this details and discuss, before I would elaborate the various steps, application and use.

How many of us have wondered why the banks and notable investors in Nigeria have refused to deal with startups, and why it has remained a myth for the MSMEs to grow beyond the one man-business status, and to really to get into big time businesses.

Banks and any notable investor is into serious business and has several options for their funds; so they are not guided by hearsay, opinions, sentiments or emotions when putting they money into any venture or business activity. The gronium or standard rule is to be well guided and follow well tested principles and data. If you have no facts to substantiate your requests and claims, then your application will be relegated to the bin. This could be why all those your proposals and requests to the banks, etcetera, have refused to yield fruit, even those your requests to uncles and the likes.

Ask yourself, if someone should come to you and demand to see your business records, what have you got to present? What if an investor shows up with an interest in your business, or a big time supplier or an associate comes along, what transactional story of your business or the road map of your enterprise have you got to show?

There are things we need to understand and get right before getting into the art of business writing – because they are predicated upon those things. You must understand the enormity of the importance of business writing , especially a business plan and feasibility studies to know why you must have it first sorted out before getting into that business of yours, and if you are already operating the business, you need to understand why a well written and mapped out plan for that business is needed, and why you have to quickly prepare one immediately in order to get your bearings right (you can contact me for the writing of your business plan, feasibility studies, etcetera)

You must understand that your credit worthiness, investment adequacy and credit supplies are based on how much your business is well structured and working a planned rope.

Here is a model of credit worthiness measurement: The Three Cs of Credit:

Character: refers to how a person has handled past debt obligations: From the credit history and personal background, honesty and reliability of the borrower to pay credit debts is determined.

Capacity: refers to how much debt a borrower can comfortably handle. Income streams are analysed and any legal obligations looked into, which could interfere in repayment.

Capital: refers to current available assets of the borrower, such as real estate, savings or investment that could be used to repay debt if income should be unavailable.

CAMEL is a tool sometimes used for assessing credit-worthiness of a borrower. CAMEL refers to:

▪ Capital ▪ Assets ▪Management ▪Equity ▪Liquidity.

Must one have a business plan and conduct a feasibility studies before getting into any business? My sincere answer is YES, because no matter how sure you are of yourself, your experiences and competence, nobody will follow you if you are not certain of your destination and the road leading to that point.

Don’t expect any investment or credit from anybody without a clear display of your business journey, a good structuring and a lay out of its processes.

This idea of SME businesses having the CEO as the COO, the Chief Financial Officer, the HR Manager and the only signatory, to company accounts must stop if we want to compete favourably with the Indians, Chinese and the South Africans in this economy, before our ignorance leads us to being colonised again.

Have you noticed that the whole beverage industry in Nigeria is occupied by the Indians and Lebanese (Chi vita, Chi drinks, Fulman drinks, 7up, La Casera, etc)? Same goes for banking, telecommunications, hospitality and hotel, retail, cable television, the industrial generators business, etc (where the South Africans have taken foothold). Wherever you look it’s these guys; it’s the Chinese, Indians, Lebanese, and South Africans. Not that anybody structurally is promoting this, but our lack of basic business skills and principles have negatively affected our competitiveness, more-so we are weak at recognising opportunities and creating mega structures.

TO THE BUSINESS PLAN – details:

1. Vision and Strategy – The VIISION is a goal. It is not the same as a STRATEGY. Business STRATEGY tells you how a company is going to achieve (or maintain) its .VISION. There is a plan, the tactics are how the plans will be executed and the VISION is the end-result.

Developing Strategy – Knowing why you’re doing what you’re doing (your mission), where you’re trying to go (your vision), and how you’re going to go about it (your values) are the glue that holds an organisation together. It is an essential part to building your strategic foundation and developing a strategy. You preserve these elements while your strategies and goals change and flex with the market. You may modify your mission, vision, or values over time, but the intent stays unchanged and you will have complete clarity when making critical business decisions that impact your future.

Your mission, vision and values can sound abstract, esoteric, and downright fluffy to a lot of people, especially those who are burning to move forward with a real-world project. These people don’t want to hang back conceptualising about people’s wishes and dreams. Don’t let being pragmatic get in the way of this important stage of building a strong foundation of consensus for your organisation. If you don’t take the time to articulate mission, values, and vision on the front end as you develop a strategy, you’ll pay for it later when writing goals and objectives without a crystal clear strategic direction.

With your planning team established and your schedule set, you’re ready to move into establishing, or reviewing (if you already have these statements), your mission, vision and values. To efficiently move through this phase, don’t confuse mission and vision. Mission is a statement about your core purpose, why you exist, and is best stated in the present tense. Vision is a statement about your desired state, where you want to go, and is best stated in the future tense. While you might find values interspersed throughout both your mission and vision, an effective values statement clearly delineates the guiding principles of your organisation, how you want your staff to behave and interact. Because these three statements are foundational to an effective strategic plan, take the time you and your team need to get them right. However, don’t get stuck on wordsmithing and lose momentum in your strategy development and planning process; rather focus on intent and allow them to be drafts until everyone is comfortable stamping them final.

We would continue with this article next week as we discuss further, however you can contact me for business advisory services and training – send me a message via WhatsApp or SMS.

•Lawrence Nwaodu is a small business expert and enterprise consultant, trained in the United Kingdom and the Netherlands, with an MBA in Entrepreneurship from The Management School, University of Liverpool, United Kingdom, and MSc in Finance and Financial Management Services from Rotterdam School of Management, Erasmus University Netherlands. Mr. Nwaodu is the Lead Consultant at IDEAS Exchange Consulting, Lagos. He can be reached via nwaodu.lawrence@hotmail.co.uk (07066375847).

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