A business plan, an investment study, projections, and other business briefs, which depend on the amount and the complexity of a request, are produced only after the previously made analysis of the existing and desired state, and after the defined financing strategy.
It is false to imagine a project and elaborate it in detail, while not taking into account the current situation. This is the most common reason for the rejection of a financing request. Entrepreneurs are often advised by the banks to come back after they finish the study of the project. However, making the study itself, unless it is in accordance with the current business model, does not have a chance to succeed. This results in a waste of time and money invested in the preparation of documentation.
Each bank has its own credit risk policy, while each program intended for financing instruments defines parameters that need to be satisfied by a project or a company. What is more, each project or company has its own limitations. The aim of an investment study, a business plan, a projection, or similar documentation, is to obtain desired funds for the investment, permanent working capital, or supplementary liquidity for ongoing business operations.
However, there is another goal that is essential for getting the financing, called a business strategy. The strategy, both operational and financial, gives the entrepreneur a clear plan of how to implement a project, how to track the effects of the project, or it provides the whole activity workflow. The business strategy is an integral part of the study.