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Business Plans : The Executive Summary
The executive summary of a business plan is an important part of your business plan. It should almost immediately answer the most important questions the final decision maker would have. If you wrote a business plan for a landlord you would address the experience you have in running a similar business. If you wrote a business plan to apply for a loan you would mention affordability and available security in the executive summary. If a business plan is written to facilitate a black empowerment deal or to receive a grant from the DTI you would mention how many people will be empowered / how many new jobs will be created by saying yes to your deal.
The executive summary should be so well written that it will entice the reader to read further but with the mindset of yes. (Yes , this business plan ticks all the boxes.)
Big Blue Construction is seeking Asset finance of R1,200,000 to acquire a new mobile cement mixer . The own contribution by Big Blue Construction will be R350,000 to purchase the new mobile cement mixer valued at R1,550,000. Big Blue Construction has been in business since 2008 and their actual audited financial statements for the past 3 years, attached to this business plan confirms the budgeted financial statements which indicates that the loan is affordable to be repaid over 60 months. Big Blue Construction’s current contracts awarded for the next 12 months are valued at R15,6 million rand with a net profit projected at R2,000,000 for the 2018 financial year. Big Blue Construction as well as all its Directors have a strong and clear credit record. The net equity of Big Blue Construction is R4,500,000 with only asset finance of R1,200,000 over land and property being the current debt of Big Blue Construction.
In South Africa the main criteria for private financial institutions, when considering whether or not to approve a loan, is security and affordability. Your business plan clearly has to indicate that the loan applied for is affordable and that there is sufficient security available.
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