What makes a business plan bankable?

A number of existing and potential entrepreneurs have asked me what makes some business plans get funded while many are rejected.  Interestingly, at a seminar we facilitated last December, we asked the Head of Credit at CABS this same question. Before giving the reasons, she advised that it was unfortunate that the vast majority of business plans submitted seeking funds from the CABSs schemes, for SMEs and Youths, were not professionally done and were not bankable. Some gave patently false or unrealistic information. Finance people deal with lots of businesses daily and can easily tell cooked up financial projections from realistic ones.

Here are five tips to make your business proposal bankable. These are summarized from my book Business Planning Simplified (which is available at Innov8 bookshop, 23 G. Silundika as well as directly from BusinessLink)

Is your idea viable?

Can the project be executed, legally, the resources available or being sought, within the time frames stated? Some business plan writers oversimplify the proposal, probably by copying and pasting from free samples and templates available on the internet. These samples were not written in Zimbabwe and therefore do not take into account current Zimbabwean circumstances. The business idea will look more like a gambling project and it will be hard to get anyone to bet on it.

Do you have at least one customer?

Entrepreneurs are enthusiastic about their own products. But is there anyone out there wants and is able to pay for your product?  Solid proof will do a lot to support your case. This can be in the form of previous customers who have bought your initial samples and have expressed the wish to continue buying more. I would advise you to start focusing more on getting customers before seeking funding.  Traceable written orders or commitments to buy your products or a clear gap in the market will make your business plan more bankable.

Is there a market for the products or services?

How bit is the potential market? If a few families express a desire to buy a couple of chickens from you a week, that does not justify your 2,000 chickens a month business. Find out the market size and what share you are most likely to garner. Simple market research will help you come up with realistic figures.

Do you have a competent team?

Businesses succeed or fail on the strength of the leader and the management team. Are you skilled in the essential areas necessary to the success of your business? For example, if you want to start a computer repair business, have your done the course or had the working experience in this field?  You don’t have to be skilled in everything. You just need to ensure that your management team posses the essentials skills: technical, marketing, people management, financial etc that will be needed in your business.

Don’t forget the competition

There is no business without competition, except maybe a parastatal. A bankable business plan analyzes the competition, both local and foreign, and how you will succeed in the midst of it. You need to clearly define your competitive business strategy that will lead to your success despite the competition. Me-too businesses are very unlikely to get financial support; rather try to differentiate your offering so as to have a competitive advantage.


Phillip Chichoni

chichonip@smebusinesslink.com Cell 0777 774 007

To subscribe to my free weekly newsletter, please send me an email with SUBSCRIBE on the subject line.


8 Responses to “What makes a business plan bankable?”

  1. Excellent sound, core advice Phillip. Basics are often not understood. For example, I am aware of a project right now where a sports marketing company is approaching very large corporates for sponsorship on a big scale. To me this is the worst charity-type “cap in hand” approach without illuminating the real value that would unfold for the sponsor – a few logos here and there, flags, banners, maybe some quick TV exposure…..just give us the $200,000. There is no substantive PR or marketing plan to support and drive this. Here;s where my core business of social media marketing kicks in to powerfully spread the word on several worthy platforms and actually “benefit” the sponsor quite significantly. A sponsor wants a real commercial benefit, not an emotional appeal. It should be if you give me “x” I’ll give you “y” – and WOW will that be good for you! It’s a bankable business plan in its own way. Look at my http://www.hatchconsulting.biz and maybe we can have a chat.

  2. Zondwayo Ngwane Says:

    A good and informative article. It articulates the challenges I have faced so far in setting up my accounting practice.

  3. Magalo Bugalo Nleya Says:

    Would like to subscribe

  4. Magalo Bugalo Nleya Says:

    Venue & time for the Breakfast Meeting?

    • chichonip Says:

      Venue: Zim Cafe, No. 124 Nkwameh Nkrumah (Union Avenue) btwn 4th and 5th Street
      Time: 0815-0945
      MONTH’s BusinessLink Networking Breakfast Meeting Friday 30 March 2012
      So you can learn
      “Why most SMEs never grow: Using The Results Megashift Solution To Grow Yours Without Fail”, a presentation by Simon Bere.
      Fee: $10 for BusinessLink Gold Club subscribers, $20 for non subscribers.
      To book, please call Christine on 0772 854 301, or email marketing@smebusinesslink.com

  5. samson dandira Says:

    Tks for the tips. I am into management and training consultancy and at times you get to organisations where executives at first create an impression that they know it all yet as you open up your consultancy tool kit they start realising that simple but focused reality is the way as opposed to using teminology which does not bring results.



  6. Zondwayo Ngwane Says:

    To which department at CABS do I have to submit my application for funding. I have been doing poultry on a small scale for the past two years. I now want to increase the flock to 1000 per every six weeks.

    I need USD10,000 funding.

    In addition I have started an accounting practice.

    I am a Registered Public Accountant.

    • chichonip Says:

      Hie Zondwayo

      I am sure if you go to any CABS branch, the customers service person there will direct you to the right department, who will give you full information about their loans package.
      Are you coming to the BusinessLink Networking Breakfast on Friday?

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