5 Common Market Research Mistakes when Writing a Bank Loan Business Plan

 

Market research is an important component for any business plan, but that can especially be said for a Bank Business Plan. Getting a bank loan is not easy, there are many requirements for getting a loan approved, one of them being a well composed business plan based on solid research. With such a huge emphasis on the research, it is important to do it right, so here are some common mistakes to avoid.

Not using all available information sources

The first step of any research is to gather all of the available and relevant information. In case of Market Research, this is done through surveys, questionnaires, test groups and interviews; in other words, data is collected directly from the customers themselves. This type of information would be considered primary data, and many make the mistake of using it as their only resource.

However, there is another way of collecting information, which is through secondary research. This includes all of the data and research collected and done prior to your own, such as news articles, government census, industry reports, studies, etc.

Overlooking the competition

Focusing on your brand is great, but you are not operating in a vacuum. There are other companies climbing the ladder of success, and you do not want to be at the bottom of it. Therefore, gather as much information as you can on your competition, so you can see how you are positioned on the market and how you can improve.

How you compare to your competition is an indicator of your business’s potential success. This is crucial information for loan officers, since it will give them an idea of your business’s value in the marketer and ability to repay your debt.

Thinking the market does not change

If you need market research for a bank business plan, don’t dust off your old research and use it again for a new document. The market is constantly changing and your Bank Business Plan will not benefit from outdated research. Doing regular research and keeping an eye on the market will show loan officers you are aware of any new market trends and are able to overcome or create opportunities from changes. This is valuable information for getting a loan approved since it shows you will be able to adjust to the market and keep producing a steady revenue.

Cherry picking information

The reason you are conducting market research may be for your bank business plan, with an overall goal to get a loan approved, but that should not be your research objective. The desire to make an impeccable business plan, can make people cherry pick information for their research, sometimes without even realizing it. The result of this may be a seemingly bulletproof business plan, but in reality it is flawed.

Therefore, you need to have a scientific approach to your research, which means that it needs to be:

systematic - following a clear plan and path; using good methods and research techniques

and objective - not being biased in your research is crucial. If you only make it your goal to get approved for a loan, you might lose your perspective. Your objective with market research is to present reality as it is.

Presenting an unreadable paper

Do not oversaturate your findings with charts and graphs. By all means, use them, you need to after all, but know that you should tell a story. Your research should be easy to follow, read and understand. Knowing how to present your findings is crucial. And keep in mind that your readers may not be as knowledgeable of your industry as you may think, so avoid using industry jargon as well.

The scope of market research can be intense, which leaves a lot of room for mistakes. So, avoid the mistakes others make and base your bank business plan on the most accurate research you can do. If you find the Market Research portion of business planning difficult, consult experts that can do it for you. This will mitigate the chance of being biased in your findings as well.

How to do Financial Modeling for a Pitch Deck

 

Financial Modeling may be the deciding factor in gaining investment for your business. It is certainly what investors are the most interested in when you are pitching your business idea to them. That is why having an outstanding pitch deck is so important. But, fitting your financial model on a few slides can be a challenge, so here is the best way to do it.

Financial modeling in 4 simple steps

Before you even make your Pitch Deck, first make sure your financial model is complete and accurate. It is a number crunching process, but to make the whole experience a bit easier, it can be broken down into four steps:

1. Collecting data - Start by gathering all of the necessary information you can find. Look into your business’s history in sales, get data from doing market research, anything and everything you can get your hands on. The more the better.

2. Making assumptions - After getting every piece of information you can find, proceed by making a list of assumptions. This step should be taken very seriously, since the rest of the model will be based on it.

3. Forecast the 3 statement model

The three statement model consists of income statement, cash flow statement and balance sheet.

4. Income statement will show your income and expenses for a certain period.

5. Cash flow statement shows how much money is entering and leaving your business, or how much money your business has at hand for a specific time frame.

6. Balance sheet shows how much your business owns in assets, liabilities and shareholder’s equities for a given period.

7. Risk assessment and sensitivity analysis - financial modeling is not complete without testing your model first. By doing assessments and analysis you are checking for any discrepancies in your model, checking to see if it will hold up, and understanding where you may fall within a realistic range.

Organizing your financial model on slides

After you’re done with financial modeling, the next challenge is trying to figure out how to present it in your Pitch Deck. This is by no means an easy task, and there are a few things to consider:

• Consider the number of slides

The whole pitch deck should not contain too many slides. Opinions on the slide number can vary. Some say no more than about 20 slides are necessary, but recently the trend is to keep your presentation down to only 10 slides. Keep in mind that only a fraction of those will be intended for your business’s finances, so your financial model may take up only about one or two slides.

• Consider the visuals

Having only a couple of slides for your financial model will force you to get creative when presenting your numbers. The best way is to use visuals to convey information such as graphs and charts. But think about their design as well. It is not just about having an aesthetically pleasing slide, but it should be easy to read. Think about using adequate font and font size, and do not forget about having enough negative space, meaning do not cram your slide with too much text and visuals.

Preparing a presentation is not easy, especially if you have a lot of material to work with. A challenge with pitch decks has always been how to present all of your business’s aspects in a limited number of slides, and having to incorporate Financial Modeling into them does not make things easier. Luckily, using the aid of compelling visuals will get the job done every time.

4 Common Financial Projection Mistakes when Writing an Information Memorandum

 

If you wish to sell your business or to do a merger, you – or an M&A advisor - might already be busy writing your Information Memorandum. By now, you might have noticed that it is not as easy to write it as initially seemed, especially when it came to making financial projections. Making projections is a long and complicated process and it is understandable that you are having trouble writing them. People usually make the same mistakes when projecting their finances for any business plan, and the same can be said for information memorandums. So here are a few common mistakes to avoid.

1. Making incomplete projections

When doing mergers and acquisitions it is logical to want to present your business in the best light possible. Information memorandum is a way to introduce your business to potential buyers, and it is therefore imperative to leave a good impression on them. However, for exactly this reason many people fall into a trap. They present only the good side of their business, while hiding the ugly. When presenting your projections it is imperative to be honest and show the whole picture, even if it is not favorable. But, fear not, a good strategy in this case, would be to include solutions to any future problem you may predict. After all, that is what Financial Projections are for anyway.

2. Not making enough assumptions

Another way people make incomplete financial projections is by making their list of assumptions too short. Making assumptions is a basic step in writing your projections, and maybe one of the most important ones. All of your projections will be based on these assumptions, therefore you should make as long a list as you can, in order to be able to make the most accurate projections.

3. Not doing market research

Entrepreneurs who underestimate market research, are missing out on all of the benefits it can bring to their business, especially when it comes to making financial projections. Having a good grasp of the market and its trends can be of great help when making your projections. All the data collected through Market Research can help you make your list of assumptions. Knowing all the changes the market is undergoing, or the ones that are about to happen, is a sure way to make the most precise financial predictions for your business.

4. Not basing your claims on data

Your Information Memorandum has to be based on facts about your business. So, when casting your projections, do not make your assumptions out of thin air, they have to come from somewhere. Just because you experienced a steady revenue growth for the past couple of years, does not mean it will continue into the next one. There are many contributing factors that can change the course of your business operations. That is why gathering all the information you can get your hands on and making your assumptions on actual data is what will make your financial projections credible, and consequently your information memorandum.

Avoiding these common mistakes will help you make the most realistic and accurate Financial Projections and a well formulated and well written information memorandum. Both of them are needed for a smooth merger and acquisition process, since they may be the biggest contributing factor for a successful transaction.

Why You Should Research your Market and Industry for an Information Memorandum

 

When doing mergers and acquisitions it is necessary to provide the most accurate information about your business, but also be persuasive and convincing. So if you're wondering what to include in your Information Memorandum, a first step would be to collect all the relevant data you can find. While gathering statistics and figures from your own busines’s archives is a good way to start, there is much more to consider. Namely, one of the most important aspects of your business is how it fares on the market, which is exactly what the buyers are looking for. So market research helps you paint the whole picture of your business in a few ways:

• It helps you estimate your potential sales volume

Understanding the market and it’s needs is key for running a successful business. Market Research can show you if there is a need for your products in the market, and how much do the customers value them. The math is simple, if there is a demand for your products or services and room for you in the market, your business is more likely to have higher sales. Knowing this in advance is of great benefit.

The merger and acquisition process will go smoothly if the buyers know that your business will be able to make a considerable profit. If the research is in your favour, it will be easy to convince potential buyers your business is a good investment. If not, well, at the very least you’ll know exactly which areas of your business need improving. Therefore, you’ll have a chance to work on them before you put everything in your information memorandum.

Additionally, data collected through market research is crucial for writing other documents included in an Information Memorandum like financial projections. They are of great interest to any potential buyer in mergers and acquisitions, since they predict your business future financial state.

• It helps you find your place in the industry

Another benefit of market research is getting to know your competition. It is not enough to just offer products that are desired in the market, because they will not fare well if you are outperformed by your competition. If your competitors cast a shadow on your business, you will not be able to stay afloat. Therefore, including in your information memorandum how your business compares to others in the industry is important. Potential buyers will want to know if your business will be able to outrank the competition. Moreover, having a watchful eye on your competitors will help you make business decisions that will keep you in the race.

• It helps you stay on top of the market trends

In the ever-changing market it is important to do regular market research. This way nothing will pass you by unnoticed. Regularly tracking market trends is crucial for running your business. This way you are making sure there are no surprises. Being prepared for any curve ball thrown your way is important for maintaining a successful business. By doing research repeatedly you are keeping a close eye on any new laws and regulation or changes in customer preferences that can affect your business. This way you are making sure you are not including outdated data in your information memorandum. Moreover, it reassures your buyers that you have done your homework, and are prepared for anything.

All in all, Market Research is a great asset to any information memorandum. It provides crucial and complete information to potential buyers. They will know just what is the value of your business in the market and how it is able to compete in it.

How to Start Market Research for a Business Plan

You are already busy with writing your business plan, you got the executive summary done, you have written your business description, and now you have to do Market Research, except you do not know where to begin. Do not worry, the key is to make a good plan, and you’ll be all set to go. You will see that with good preparation and a well formulated execution plan, your research will be done with ease. So here are a few things to help get you started.

Determine the purpose of your research

To start your market research, the very first thing you need to do is determine its purpose. Why exactly do you need it for? Well, since you need it for your business plan, the bigger question is what do you need your Business Plan for? Is it for managing your internal or external business operations?

The purpose of your research will determine its scope, whether it be for managing your business or gaining investments. If you are looking to gain investments you will need to do as detailed research as possible to convince investors you are familiar with the market. You are more likely to get investments if you show that you are making well informed decisions that will result in a successful business.

Make a strategy

After deciding the purpose of your research, it is time to make a plan. Having a well formulated strategy is winning half the battle. You simply cannot proceed with your market research without having set up a straightforward and clear path to follow. This means knowing exactly what questions you need answering, what type of research to conduct, who is your target demographic and where to get your information from.

• Choose the type of research

There are many types of Market Research for you to choose from, the most common ones being surveys, interviews, focus groups and observation. Consider your budget when making your decision, as some of these can be costly and time consuming. And of course, no matter the type of research you chose, prepare well for it. For example, think long and hard what questions you will be asking your customers in the interviews or surveys.

• Create your customer personas

Find out who your customers are. For the benefit of your business plan you will need to know your target customers. Who is buying your products/services and why? What is driving their spending? What is their age group, gender, income, education level ect. Knowing all of this will help you make adjustments and set the right price for your products and services, or even help you predict future sales.

• Choose your source of information

Collecting information directly from your customers is not the only way to learn about the market. Conducting interviews and getting first hand information from your customers would be considered primary information. On the other hand, secondary information is all of the data from public resources like libraries, government agencies, industry associations ets. The plus side of secondary information is that it is readily available and free, and very detailed specific information can be purchased from other sources as well.

Market research is definitely no walk in the park, there is a lot of work involved in gathering information and analysing it. You also have a lot to consider before you even begin your research. But if you have a good start the rest will fall into place. With a well conducted market research for your Business Plan, you will be one step closer to achieving your goals. 

How to Create a List of Assumptions for a Financial Projections in a Business Plan

If we had a crystal ball to see the future, writing Financial Projections would be so much easier. But, unfortunately we don’t. So, the next best thing is to make educated guesses. Financial forecasts require making a long list of assumptions about the future financial state of your business and all of the conditions and circumstances you may encounter along the way. These can be very difficult to predict, but here is how you can make your list of assumptions for the most accurate forecasts in your Business Plan.

Start by collecting (your) data

First thing’s first, gather your numbers. All of them. Look at your business records, it’s sales history, all of the bills and receipts, cost, expenses and losses you had in the past. But know that, searching through your own company archive is not the only way to collect data. You can either conduct market research, or you can get information from public records. Libraries, government records, and industry associations have plenty of free information available to the public. So, do not overlook these treasure troves of data, because the more information you manage to get your hands on the better. It will guarantee more accurate assumptions.

Asume your expenses and production costs

After getting all the information you need (or can get), the best way to start making assumptions for your financial projection is to predict your costs. Most of them will be recurring. But be aware that these expenses can change in the future. For example, the price of materials can go up, causing your production cost to rise. So be sure to make multiple assumptions, including the worst case scenario. This way you will not be blindsided by an unexpected event, which is excely what makes a good financial projection and business plan.

Assume your sales

For an accurate Financial Projection Business Plan, you will also need to predict sales, or how many units you will be able to sell for a given period of time. This will later be necessary for projecting your income statement and cash flow. Use market research to determine what the demand for your product is, or will be, and just how fierce your competition is.

Price your product

While making assumptions you will need to know the value of your product, the exact need of your product on the market and how much your customers are willing to pay for it. To set the price right you need to take into account not only production cost, but your competition and customer’s needs as well. That is why Market Research will be necessary in determining your products market value. So don't be hasty by setting your product price only according to its production cost, it will be detrimental to your bottom line.

Cash flow planning

Cash flow planning is about predicting how much money you will have at hand for a certain time period. It compares cash inflow and outflow, and helps you make sure you do not run out of money in the future. If you plan well, and have a good cash flow, you will not run out of money to pay your expenses. Predicting cash flow is important for making reliable business plans.

Making assumptions for Financial Projections can be tricky, but it helps if you are well prepared and have all the information you need to make the most accurate assumptions. A business plan cannot be completed if you cannot predict your business’s financial future.

Tips from Professional Business Plan Writers on How to Present a Pitch Deck

 

So, you would like to present your business to an investor. You will likely contact a Professional Business Plan Writer to compose a business plan for you. But what if a business plan is not your first choice? There is a document that is made just for presenting - a pitch deck.

A pitch deck is a visually oriented brief presentation, that overviews your business plan. The most common way of using a pitch deck is in a face – to face meetings with potential investors.

But, having an adequate document does not mean your business journey is over. There is one crucial thing when you are presenting a Pitch Deck – the way you present it.

Here are professional business plan writers’ tips on how to present a pitch deck.

Have a Strong Beginning

Potential investors are busy people who have seen hundreds or thousands of presentations. Likely, the investors will not even pay attention to your presentation if you do not captivate their attention right from the start. There are many ways on how you can grab their attention:

- Personal story

Everyone loves to hear a good business story, and that definitely includes potential investors. Talk about your business journey, how it all started and your ideas in order to form that emotional connection with the audience, in this case, investors

- Imagination

Ask them to imagine a what-if situation, or to think of something that relates to their personal lives, etc.

- Tell a joke

You do not need to be a professional stand-up comedian to crack the investors up and use a joke as your ice breaker. However, if you go this route, make sure to test this out on a few different types of audiences first to make sure it will land.

Maintain Eye Contact

Not only professional business writers but everyone who communicates and has a conversation with someone should pay attention to eye contact. Maintaining eye contact makes you seem confident, and respectful towards your audience.

Professional Business Plan Writers suggest that the easiest way to maintain eye contact during your pitch deck presentation is to find a fixed point in the room. In this case, you should choose a wall behind your audience, so that it may seem that you are looking directly towards them.

Do your Homework

Come prepared. Know your numbers and metrics. It can speak louder than words. To make your pitch deck presentation successful, it is crucial to know your numbers by heart and be prepared to answer any questions that may come up.

Speak freely, but clearly

Avoid reading your presentation from your slides or a piece of paper. Know your text. If you are not that confident about how you will present your pitch deck, have a few note cards but try not to read directly from them so your presentation still feels fluid.

Look out for filler words

We all have used – “um”, “uh”, “er”, “like”, “ah”, when talking, without even realizing that we do it. Try not to use them at all while presenting your pitch deck.

You will sound more professional, trust us. Our professional business plan writers advise you to slow down and make shorter sentences when talking. It will reduce the usage of filler words.

How you present your pitch deck is equally important as the document alone. Implement these tips from professional business plan writers, and you will present your pitch deck successfully.

To present a Pitch Deck, you need to have one. Find experts, like those in the Advisory division at Joorney Business Plans, who will not only write and design your deck but are also willing to give you tips for an effective presentation!

4 Key Customer Data Market Research Methods for an Information Memorandum

 

Market Research is beneficial for your information memorandum in many ways. You can gather data and learn more about your target audience, and if done effectively, you can bring home the victory of succeeding in your market industry.

Whether you have a B2C or B2B company, market research is a crucial part of your business journey. The goal of every business is to focus on the customer and to understand their needs. A common approach is to do customer data.

There are several methods of customer data market research you can do for your Information Memorandum.

Here are 4 crucial customer data methods that everyone should know.

Surveys

This is the most common method for doing customer data research. A survey is a list of versatile questions where you can collect specific data from a particular group of people. You can conduct this method either in person or online. These questions can be open or close-ended. Some of the close-ended surveys can be in a form of:

- Multiple-choice questions

- Demographic questions (besides the provided information, asking about gender, age, education, etc.)

- Ranking questions

- Checkbox

An important part of this method is knowing what questions to ask, but what is also important is how you ask them. Good questions with a good approach to the person you are questioning will lead to a good analysis.

Focus Groups

This is a simple yet often tricky method to put into practice. You carefully select a specific group of people, ask them questions about your product, services, their user experience, etc. By doing this, you will gain deeper insights. This is an open-end questionnaire, like a conversation, where the person can spontaneously talk and share their thoughts about the topic.

Business plan experts recommend using this method if you have a well-established business model and experience in the market.

Interviews

This is one of the most insightful customer data market research method. It is a face–to–face (in person or virtual), and one–on–one conversation with a selected target audience member. This method is insightful because it is personal and in-depth, with open-end questions. It also helpful because it allows you to ask follow-up and deeper question on the spot.

The only downside of doing interviews for an Information Memorandum is that it is time-consuming and it can get expensive. Be smart when with your resources and do whatever is most beneficial for your company.

Observation

This is the most powerful market research method where you monitor and observe your target audience. The key is that the audience behaves naturally with no pressure. This way, you will get real insights and get the most out of your results.

This method is often suggested for use in retail. Observing shoppers on special occasions or seasons is the most common way to get that insight.

As you can see, there are many customer data market research methods for an information memorandum or any other document. Understand your needs, and ways to achieve them, and you can easily choose the perfect Market Research for your business.

If you have doubts about choosing a customer data Market Research method, considering contacting professionals who can help you develop your methods and even be the ones to conduct the research for you!

A Professional Business Plan Writers Tips on How to do Market Research

 

Conducting market research is a great idea that can benefit your business in many ways. It can be used to make various business decisions such as marketing strategies, product improvement, budgeting, as well as be used in documents to gain fundings and investments. But because of the scope and the complexity of the task, many companies hire specialized agencies and Professional Business Plan Writers to conduct market research for them.

However, if outsourcing your research to other agencies is not an option for you, here are a few useful tips from an expert himself to guide you through your research.

“A good beginning makes a good ending”

Collecting, going through and analyzing all the data you need for your research can seem like a tremendous task, but if you know where to start and how to proceed, it makes things a bit easier. Professional business plan writers know that a good start will determine the quality of your Market Research, and any good research starts with a good formulated question and an execution plan.

That is why setting the parameters and research scope early on is the best way to ensure you do not get lost along the way and waste your time and resources with bad quality research and inconclusive or inaccurate findings.

“There is a lot of (free) information available”

Market research is a way of gaining information about your customers and industry, and there are many ways you can do that. Telephone polling, mailed questionnaires, online surveys and personal interviews just to name a few. These would all be considered primary research, because all of the information comes from the customers directly.

On the other hand, secondary research is conducted by gathering information about the customers from other sources and public records like (public or university) libraries, government agencies, industry associations etc. A professional Business Plan Writers advice is not to overlook this kind of research since it can be a valuable source of information. Secondary research is a great way for finding information about your target demographic as well as your competitors in the industry.

“Dive deeper into your research”

There will come a point in your market research when you think you have everything you need and you found what you were looking for. But it actually might be a good idea to continue with your research. Professional Business Plan Writers always keep in mind that correlation doesn't imply causation and some things may not be what they seem.

There can be underlying factors that drive consumer behaviour that you just did not pick up from your initial research. So in order to derive the most accurate conclusions from your research it is best not to leave any stone unturned when gathering the information you need.

“Keep researching”

Market research is never ending, because the market is ever changing. Experienced business owners are aware that continuous and repeated research is necessary to be able to stay on top of the competition. If you are basing your business decisions on outdated models, statistics and data, your business will surely suffer. That is why professional business plan writers suggest to keep doing regular research to be able to keep track of market trends.

Market Research can be a strenuous task, especially if you’re doing it on your own. Luckily, we can always turn to the experts for help. Their advice can guide you through the whole process and show you how to conduct the most optimal research and get the best results for your business.

4 Questions to Answer when doing Market Research for a Bank Loan Business Plan

It is well known that Market Research is vital for any business. By doing market research, you will understand who your customers and competitors are, as well as the demand for the product/service you provide. A lack of funds when establishing a business may slow up your entrepreneur journey. One of the best ways to increase your business efficiency is to apply for a bank loan by composing a successful business plan.

Here are the 4 questions you need to know the answers to when doing market research for a Bank Business Plan.

What is the purpose of the research?

When doing any type of research for a bank loan business plan, first, you need to establish your purpose. What is the reason behind the market research? Is it to analyze past mistakes, problems, or successes? Or to establish who your customers are? Or, do you have other reasons?

Before even starting your research, determine the purpose.

What is the outlook of your industry?

Now, you have established the purpose of your Market Research, what is next? Summarize the state of your industry.

Determine the direction your industry is heading, and be sure to have reliable data from trusted sources to support your conclusion.

Your bank loan is more likely to be approved if you do your homework on the industry of your business.

Who are your target customers?

After acknowledging the outlook of your industry, focus on your customers.

This is an important segment of market research for a bank loan Business Plan. Not every person can be your customer. To establish who your potential customers are, you may consider the following criteria:

• Age
• Gender
• Location
• Education
• Income
• Occupation
• Family status

Implying these metrics, you will be able to define who your target customer is.

A common approach is to create a buyer persona. This is a fictional character that represents your ideal customer. Your business can have multiple buyer personas.

Creating our buyer persona

Let us say that we own a business plan writing company – like Joorney, for example, and that we need to establish our buyer persona based on the data that we have.

• Here is an example:
• Occupation: Immigration Lawyer
• Education: Harvard University
• Age: 45
• Income: $120,000
• Location: United States of America
• Gender: Male
• Family status: Married

Who is Your Competition?

The final segment of doing successful market research is to study your competition. It is crucial to understand who your competition is. Research what your competitors offer to the customers, and who is their target audience. It will not do you harm if you spy on your competition, because this is the smartest way to learn the strengths and weaknesses of your competition.

Doing thorough market research for your business will help you compose a successful business plan, and having a successful business plan means that your chance of bank loan approval will increase. Simple as that!

If doing deep market research seems difficult, our Professional Business Plan Writers at Joorney will be happy to help.

3 Reasons Why Market Research is Important for an Information Memorandum

What is an Information Memorandum, and why do you need it? An Information memorandum, also known as an offering or sales memorandum, is a document primarily made for potential acquirers or investors. It describes what type of transactions you would like to have with an investor – how much of your business you are selling and what the audience will gain for their investment.

An information memorandum is similar to a business plan but more transactional. This document is necessary if you want to invite investments or outright sell your business. Market Research represents the activity of gathering information about the customers using your product or service.

One way to gather information is by directly contacting the customer through interviews, online surveys, and questionnaires. Market research is also crucial when it comes to your competitors. You need to know who your competition is and how well they operate their business.

Here are 3 reasons why market research is important for an information memorandum.

Information

Market research is important for gaining information about your competitors and industry which can affect your future Financial Projections. If you are a business owner, you probably consider yourself a hands-on type of person. You may also think that you are well aware of the business industry your company is in, and that you know the market.

Unfortunately, in most businesses, that is not the case. No matter how much a business owner knows about the market, it may not be enough. When it comes to any market, it changes and evolves all the time. Novelties and new trends can appear in any industry daily, and you have to keep track of the changes.

Business Strategies

When you gather information from your Market Research, it is logical that you will use it in a certain way. This information will help you make vital decisions for your business.

For example, if you see that the price of a product or service skyrocketed, you will likely also raise the price of that specific product or service. Or, for instance, if market research shows that customers are interested in a new product that your company does not have, what will you do? Market research will help you create new or change old business strategies. That way, when reading your information memorandum, investors could see a financial potential with your company.

Challenges

Like any other business, even yours has some challenges. Market research will help identify your challenges and weaknesses and detect the source of them. When you manage to notice and acknowledge the challenges of your company, you can address them.

Turning your weaknesses into opportunities and strengths is a selling point to the investors. Your business will look more attractive if you present how you overcame challenges and made the best outcome out of the situation. Conducting market research will secure you with potential investors in no time.

Composing a perfect information memorandum requires professional assistance. The right team will gladly help with creating an impeccable Information Memorandum for your company.

A Three-Statement Model of Financial Modeling in a Bank Business Plan

Let’s assume that you want to build a new financially sustainable business, but you need some funding. To raise the funding, you will go to a bank, and ask for a loan. Asking a simple question is easy, but convincing a banker to fund your business is not easy at all. You need to provide your banker a bank business plan. A Bank Business Plan for your business is like an ID for you, without it, no one will have any data on you or your business.

A bank business plan is an overview of your company’s goals and future, and what will you do, as a business owner, to achieve them. Before composing a bank business plan, you need to do Financial Modeling, which can become your worst nightmare if you do not know how to set it up.

Financial modeling is the process of creating a dynamic, working summary of a company’s expenses and earnings in a form of a spreadsheet. The information about your company’s expenses will affect the banker’s decision about the loan.

Here is a three-statement model of financial modeling in a bank business plan.

Income Statement Model

The income statement model results in the projection that allows you to present your company’s profits and losses by showing revenue and costs. This way, the banker can have a clear vision of the financial state of your company. Tracking an income statement is very useful because it can help you determine how to make a profit. It will help you decide things like whether to increase revenue by decreasing costs, remove unprofitable products or services, decreasing inventory, etc.

To be a successful entrepreneur and have useful financial modeling in a Bank Business Plan, track and analyze your existing income statement then make reasonable predictions about the future.

Cash Flow Statement Model

The cash flow statement model allows you to visualize how cash is flowing in and out of your business. This statement model shows the banker what happens to your money on a monthly basis. Put yourself in a banker’s shoes. If you are likely to loan money to a business, you will want to know if the person owning that business is reliable. A banker will want to see what happens with the money in your company and how you manage it. By looking over your cash flow statement model, the banker will know if you can fund your day-to-day operations or if you have a debt or not.

Balance Sheet Statement Model

A balance sheet statement model shows “how rich” your company is – or who owns it. This financial statement model represents assets, liabilities, and shareholder’s equity in your company. It is called a “balance sheet” because the sides of this equation must be balanced. For example, if a company takes a ten-year loan of $20,000, its assets, as well as the liabilities will increase by $20,000. A balance sheet is the financial health of your company. As your doctor would like for you to be healthy, your banker will like the same for your company.

Financial Modeling is one of the most challenging parts of preparing a business plan. To compose a successful financial model that will lead to accurate projections, you need to know accounting, finance, and business metrics. A team of skilled Business Plan Writers can help you create a perfect bank business plan in no time!

The Importance of Financial Modeling in the Bank Business Plan

Writing a Bank Business Plan can be a nerve-wracking task. It is a document that represents a deciding factor in getting a loan approved. Its main objective is to show that your business is eligible for repaying a loan in a timely manner. So, keep in mind that it has a very specific objective. Including your history in sales is a must, but unfortunately not enough. While it is important to show every aspect of your business, maybe none is more important than prospects of a steady income. This is where Financial Modeling comes into play.

Financial modeling, in this context, is a process of creating a future financial projection of a company. This number crunching operation is performed in order to calculate possible financial outcomes of a business. A mathematical equation is used in which any variable can be changed to achieve a different result. For that reason, financial models are of great use in a bank business plan and can serve many purposes.

Creating financial projections

Just like for any other business plan, Financial Projections or forecasts are extremely important for bank business plans too. They can show loan officers that your business can generate enough income to be able to repay your debt.

Financial models are used to create financial forecasts of future revenue and expenses, and therefore are a useful document to present to lenders. What lenders are most interested in seeing in a business is financial stability and using financial modeling to create financial projections can help with that.

Oftentimes, financial projections are broken into monthly or quarterly forecasts, which helps businesses keep track of their finances, and helps lenders estimate the credit risk.

Predicting and solving problems

An extremely useful aspect of financial modeling is that it is great at anticipating and detecting potential problems and shortcomings. This comes in handy when writing a bank Business Plan, as you will be able to adjust your expenses.

Depending on the most optimistic, pessimistic and realistic scenarios, businesses often make a few financial projections, by creating multiple financial models. This is how they are able to see what are the best, the worst, and the most likely outcomes. Knowing in advance what obstacles may come your way will give you an advantage and help find you a solution.

Showing you are prepared for any curveball thrown your way will more likely get you approved for a loan.

Making responsible financial decisions

Financial Modeling is a great tool for managing and organizing your business’s finances. Knowing exactly where you can cut costs or allocate funds can mean the difference between failure and success.

Being able to save money means being responsible with your spending and avoiding excess costs. Financial models can help you with deciding what expenses to take on and when. Making financial models can help with making smart and informed decisions. Being responsible with your finances makes you a low risk and more appealing borrower.

Financial modeling is an essential tool for any Bank Business Plan. It demonstrates to loan officers that you are a good candidate for a bank loan by proving that you can generate a steady revenue, are responsible with your finances, able to make good business decisions and overcome potential issues. If you’re not sure how to create one, consult a professional!

Why Professional Business Plan Writers Refuse to Write Business Plans Without Conducting Market Research

Business plans are not compulsory, but they are surely useful when trying to get a loan or for helping you organize and structure your business operations. So what is exactly necessary for writing an outstanding business plan? Well, Professional Business Plan Writers can tell you that the first and most basic thing for writing a good business plan is collecting all the necessary data and information. It is usually gathered from your company's history in sales, its previous costs and expenses, but a lot of useful information can be obtained through market research.

There is just not much to go on without an in-depth knowledge about the market. That is why experts do not write business plans without understanding the market’s needs first. Some of them will expect their clients to do their own research, but others will conduct it themselves as part of their fee.

Either way, there is a good reason why professional business plan writers need Market Research before they begin to write business plans. It helps answer a few burning questions, such as:

Is there a market for your product?

It is ill-advised to go blindly into business without testing the market first. Doing market research beforehand will greatly help reduce risk for failure. For a company to succeed there needs to be a demand in the market for its products and services. Research conducted through surveys and product testing will determine the likelihood of your product’s success with the potential customers. Professional Business Plan Writers cannot write business plans without knowing a company's target audience and its size.

Is the price right?

It is not enough to know if the customers are willing to buy your product, but also how much they are willing to pay for it. Knowing the value of your product on the market will help you set the appropriate price for it. Overpricing can result in lower sales. Additionally, having a good understanding of the market means knowing your competition as well. Properly pricing your products will help you better compete on the market.

Additionally, Market Research can help professional business plan writers compose documents, like financial projections for example. Determining the price can be used to calculate future revenue and predict business’s profit margin.

Is there a need for improvement?

Keeping an eye on the most current market shifts and adjusting your products and pricing accordingly is crucial for writing successful business plans. Because the market is fast changing, you will need to keep up with those changes in order to stay in business. Regular market research is necessary for the most up-to-date information. professional business plan writers need to know the latest market changes to be able to modify and adapt your business plan to the latest industry trends. This helps the experts write a business plan that will help you outperform your competitors.

Without market research there is just not enough data for writing a well-structured and successful business plan. This is why many Professional Business Plan Writers hesitate to write business plans without researching the market first. By doing so, they can collect all the crucial data that is fundamental for most sections included in a business plan.

4 Reasons You Need Professional Business Plan Writers for Your Business Plan

Being an entrepreneur is very exciting, but yet, it can be stressful too. Today, many open-minded people try their luck by switching their 9 to 5 jobs to entrepreneurial life. Whether starting a fast-food chain business or a local fruit shop, you need a business plan. A business plan is a written document that describes how a business defines its objectives and achieves goals. A person writing a business plan should use their creativity, experience, and a little bit of imagination if they want the business plan to be effective. And who could write a better business plan than Professional Business Plan Writers?

Here are 4 main reasons to use one:

Speed

A professional business plan writer knows that it is essential to compose business plans quickly. Time is money, and no business owner is that rich to waste his precious time on composing a business plan. The professional Business Plan Writers are dedicated to their work and not distracted by any day-to-day obligations that a business owner may have. This way, by delegating a business plan to a professional writer, you will have more time and energy for different business operations.

Professionalism

Let’s make it clear – anybody can write words on a piece of paper, sentences, paragraphs, add numbers and create a business plan. But it takes a great set of skills, experience, and research to compose a successful Business Plan. Professional business plan writers have background knowledge in market research, finance, marketing strategy, and sales techniques. It is hard to find the right people with the right skills and experience to write a successful business plan. Search no more, because Joorney (www.joorney.com) experts will make a professional business plan in no time.

Meticulousness

An expert has an eye for detail and will never miss out on anything. They will make sure that your business plan contains the most important information and clever ideas for the future. Professional Business Plan Writers are very careful, precise, and realistic with the future business forecast and the information about your company. If you want, for example, to point out a slight financial setback from a year ago, you can freely do it, and the professional business writers will make sure to include it in great detail.

Objectiveness

We all know that your business is your baby. You cannot be objective when it comes to your baby, I mean business. That is why having professional business plan writers is crucial. A professional will take their time in learning about your brand and company. They will look through the existing plans of the company and figure out how to overcome different obstacles on the way. What is most important - they will see your business objectively. But, you, as a business owner, need to be included in this process. Your job is to be present and provide business plan writers with adequate information. It is vital to always be available to the Professional Business Plan Writers to create a successful business plan.

If you are interested in creating a professional business plan, feel free to contact us (https://www.joorney.com/contact-us/) or visit www.jorneey.com