Blueprint for success: a strong business plan can help secure early funding.

• Author: Coon, John
• Position: Entrepreneur Edge

Generating a million-dollar business idea doesn't mean much without the right blueprint. That's why creating a strong business plan is a vital first step if you want to start and grow your own business. But what do you need to do to make your business plan look more attractive to financial institutions and secure a loan or funding? Learn some tips from the experts here:

Be Realistic

A solid business plan starts with grounding your plan in realistic numbers and projections.

"There's a great line I love: 'Any fool can plan, but it takes a genius to go from crisis to crisis,"' says Mike Pazzi, executive vice president and regional business banking manager at Wells Fargo. "It shows they are a planner. They've thought something through and they've thought it through in a way that says, 'I know what I'm making, I know what kind of service I'm providing, I know what freight I want to charge and I know that if I have this infrastructure, I'm going to make money.'"

A business owner should count on showing they are comfortable with numbers in their business plan. When loan officers from a bank or credit union examine the plan, they want to see that the business owner has thought through a multitude of scenarios to arrive at their budget projections.

Have a Few Back-up Plans

Contingency plans are an essential element. Business owners need to tell the financial institution how they will anticipate situations like changes or interruptions in the revenue or expenses that may be volatile to price increases. Their revenue projections and anticipated expenses have to match up with economic realities.

In other words, shooting from the hip with numbers never works. That's a hard lesson some new business owners don't learn until it's too late. "It just takes longer than we think," says Blake Weathers, vice president of business services at America First Credit Union. "It's a long-term prospect in the life cycle of a business. Those who get enough working capital to begin with, and have plans that are realistic and meet common sense, do better than those who don't have a plan."

Understand the Numbers

Weathers says understanding how the numbers relate to what you are looking for in the future is critical in a business plan...