Your business plan is one of the most important documents that you will have to create for your business. Writing a business plan is not an easy task, it’s not something you would do in one sitting and it’s definitely not something you would write once and forget about it. A business plan is critical to the success of your business, especially if your intentions are to search, apply and obtain government funding. But do you know the difference between a regular business plan and writing a business plan to get government funding?
There aren’t many differences however the differences that are there are very important when applying for government funding for your small business in australia.
Writing a Business Plan To Get Government Funding
So you’ve decided that your small business needs government funding. Great! But how do you write a business plan that will reflect your funding needs?
When you are creating your business plan for your small business in australia, there are certain components that simply must be present:
- Who are you?
- What do you want to do?
- What problem are you solving?
- Why are you solving this problem?
- How are you solving the problem?
- How much do you charge?
- Who else is doing it?
- Why are you better?
- How much will it all cost?
- How much will you make?
- How will you do it all?
- What does the future hold?
- What do you need to make it all work?
These are some of the questions your business plan, once completed, should answer.
When applying for government funding for your small business you have to keep in mind that the various government funding agencies across australia get hundreds if not thousands of applications. The review process is nearly robotic, thus your business plan needs to answer the questions the funding agency must know in order to determine to fund your business or not.
Simply missing certain components/answers that need to be there could result in your business funding application to be denied.
The “get me government funding” questions to answer
In any business plan, there is always going to be content that is considered filler content. You don’t want to submit a business plan that answers a important part of the plan with a sentence or two (it might look bad), but at the same time, you don’t want to ramble on and answer a question and not know how to end it.
You have to be a good judge of when it’s enough.
As a business owner or startup entrepreneur you may be very passionate about what it is your business is all about so you may be able to talk and write for ages, but there are certain points you want to get across to the reader (in this case a funding agency).
These points may change if you are writing a business plan to help you sell the business, or to help you find a potential partner, or to provide a business plan to your employees so everyone is one the same page. A business plan that is looking to obtain government funding, be it a grant, a loan, tax break or any financial support from the govenrment needs to showcase the funding needs.
How much of your own money have you put into the business or have available to invest?
When creating a business plan in hopes to obtain funding from the government, you want to show to the potential funding agency that you are being proactive and that you are investing your own money as well – or at least that you have the intention of doing so. The reason for this is because the government agency also looks at risk, and if you are not willing to take the risk on your own business with your own money, why would they? While not all funding agencies want you to invest your own money, it’s a sign of good faith in the business when the business owner is willing to make a contribution or at least spend some money to get the business going.
Don’t think you have to spend thousands of dollars to look great – even a few hundred bucks to show that you’re doing something can go a long way.
What do you need the funds for?
A business plan should outline how you intend on succeeding with your small business. That being said, it should also showcase the shortfalls, in this case – lack of funding. What do you need funding for? Perhaps you need money to help you startup, to expand, to hire and train staff, to pay for some tools, equipment, to get some supplies..etc; whatever your funding needs are, it is very important to break it down and show within your business plan what your funding needs are.
Remember to break it down – don’t just state “I need $100,000 to start my business”. There is no program that will give you $100k without an explanation of what you need. So the more you break it down, the better.
How much do you need?
Just like a break down of what you need funding for, it’s important to list out approximate funding amounts. Within your business plan, near the funding/financing section, it’s important to break down your funding needs and list approximate amounts. If you don’t know the amounts you need; more research is necessary to get you there. Take some time and evaluate your expenses, how much certain things would cost and express it within your business plan.
Remember, don’t think “how much can I get”, instead think “how much do I really need”. Once you get funded once, it’s a lot easier to get at it again.
When do you need the funds by?
Within your business plan, it’s important to set some timelines in terms of when you need the funding by. If the funding agency is looking at your business plan and they believe your business could be something they fund, they may not be able to provide you the full amount right away (depending on program and your needs). So it’s important to have an approximate timeline of when you need the funds by.
What could you do with and what could you do without? Prioritize.
What if you can’t get the funding in time?
The ultimate question that many funding agencies want to see is that you are not 100% relying on government funding to start you up and to keep you going.
If your business relies only on the success of obtaining government funding, there may be concerns among the funding agencies to provide you the funding. Getting denied isn’t always the case but the government does like to see that you have a plan in case you aren’t able to get funding 1) in time 2) in full 3) at this time.
What is your plan if the government funding agencies you applied to for your small business say no?
Answering these questions when writing your business plan will definitely set you up towards a greater chance of obtaining government funding for your business.
We also suggest you use the Business Plan Builder Tool provided here by australiastartups.org to help you answer these questions and to develop a professional business plan (which experts can review for you).