?? How Business Development unravels the best-laid plans
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After this Article, you will learn:
Did you know one of the weaknesses in any business plan being submitted to a Lender is in its Business Development Function?
The financial forecast sent in by the applicant might look fantastic and seems to effortly improve month on month as the year goes on in the ever-confident document. The Lenders are more than able to determine the finance side but sometimes they ask if it rings true in other areas as well.
What the lenders are looking for is a reasonable case that has been put forward for the business development section of the proposed plan. They can start by pulling at this smallest thread, the weak spot of any business plan. The applicant for example sometimes shows a small modest budget for business development without providing convincing evidence to support the massive rate of growth that the plan proposes.?
The applicant's confidence in the fantastic return on investment with such a small budget for business development leads the Lender to ask how is this possible, what magic is this? Can the applicant share the secret of business development magic beans they have found so everyone can use this tactic to have a low spend but guarantee results??
The Lenders can then feel a bit misled and annoyed as the expensive package starts to unravel.
The applicant then starts to get some very uncomfortable questions for the much-needed application, who usually bats it to the accountant or who did the business plan, but the buck has to stop with one person only, the applicant.
?? The Impact of Inadequate Business Development Funding on a Construction Company’s Business Plan
A well-thought-out business plan is vital for the success of any construction business. However, even the most comprehensive plans can unravel if critical elements are overlooked - Business Development being one of the most crucial. Often, new construction businesses fall into the trap of assuming their services will speak for themselves or relying solely on word of mouth for growth. When an applicant fails to account for the funds required for effective Business Development in their business plan, their chances of success can be significantly undermined, regardless of how confident they are in their venture.
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? The Role of Business Development in Business Success
Business Development is the bridge between a business and its potential clients. In the construction industry, where competition is fierce and projects can be high-ticket, simply relying on previous networks or casual referrals isn't enough.?
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?? Overconfidence Can Lead to Costly Oversights
Overconfidence is a common issue for new start-ups. They may believe that their expertise, networks, or word-of-mouth will carry the business to success. However, this mindset overlooks the fact that a construction company, like any other business, requires a steady flow of clients to remain profitable. Merely believing in the quality of your service is not enough. Having a couple of clients or a golden egg client who keeps you busy all the time suddenly leave can have overnight damage to the business if you are not prepared, you must have a flow of different clients surrounding your business to ensure you’re protected in the long run!
?? That's a wrap!
Without a solid business development strategy—and the budget to implement it—reaching new clients can become a serious challenge. Getting that balance right is where Saint excels. There's a lot more to business development and this is where Saint Global is helping construction businesses like yours across the industry. Talk to Saint today to gain more insight into your business.
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