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The Key to Writing Executive Summaries is to Sell
(not summarize)
your Business Plan
I'm sure you've read and heard about how important writing executive
summaries are to a business plan or report. You already know that executive
summaries should be concise and highlight the key aspects of your business plan.
What you might not realize though is how important it is that when you write
an executive summary, you are selling your plan, and not merely
summarizing it.
The term executive summary can be a bit misleading because it
contains the word summary. But that's only to stress the point that
when someone reads your executive summary, they clearly understand the essence
of your business plan, without having to read the actual meat and bones of the
plan itself. Since most executives are too busy to study detailed documents such
as business plans, they prefer to get to the point by reading executive
summaries.
10 Steps to Writing Executive Summaries that Lure and Impress Investors and
Lenders
- Gain the attention of your audience.
It goes without saying that the most important accomplishment in writing
executive summaries is to get attention. That's easier said than done, and
too often you hear statements like these without any explanation of what it
means to "get attention'.
The key is to focus on getting the attention of your audience within the
first few sentences of your executive summary. Start with a clear and bold
statement about your business concept. Briefly and directly state the
explicit problem your target users currently face and how your product or
service specifically solves it.
Stress any credentials, past success and recognition which is relevant to
your current proposal, and profile key players on your team that have a
reputation for success.
Your lead sentences should capture the interest of readers and move them
into the next step of your executive summary...
- Describe the specific problem your current users face.
When writing executive summaries, you must
demonstrate that the problem your users face is serious, urgent and in need
of a solution. Solutions may already exist in the form of competitor
products or services, in which case you will want to illustrate how these
solutions do not fully or satisfactorily solve the problem at hand.
By focusing on the problem, you are injecting the ever-powerful emotion of
pain into your executive summary.
Pain is a key emotion that everyone feels at various degrees. For for the
most part, we all want to remove or reduce any pain we experience. By
stating the problem and then intensifying the pain it causes to users, you
are setting the desire for a solution.
So what is pain? Pain extends beyond physical the physical emotion. Users
can experience pain such as high costs, poor efficiency, time delays, long
and heavy processes, additional paperwork and the list goes on. Once you've
described the problem, you...
- State how your product or service solves the problem.
In this step to writing executive summaries you describe how your
business will solve the very problem your target users face. It's crucial
here to not only demonstrate how yours is an effective solution, but how it
differs from and is preferable to existing competing products and services.
Is it faster? cheaper? more effective? more durable? better quality? Does it
look nicer? Does it feel nicer?
You get the point. So now that you've shown how your business will solve the
problems of its target users, it's time to...
- Translate your business concept into a market opportunity.
How attractive is your business from an investor's point of view? Is your
market a growing, saturated, or shrinking one? How much is it growing or
shrinking? How many potential users are there? What percentage of the market
can you reasonably focus on and capture? What specific niche can you
specialize in? Make sure you are realistic - and honest - about the
opportunity.
- Emphasize your competitive edge.
So why is your business better than the competitors? In a few sentences,
clearly explain the real benefits you offer over the competition.
- Discuss your business model.
How do you intend to create and grow sales? How will you manage cash flow,
expenditures and resources? How will you measure success? What is the
financial direction of the business over the next 3 to 5 years?
When writing executive summaries, your business model should clarify how
your business is managed and and generates revenue.
- Showcase your Management Team.
If anything, potential investors and lenders will be interested to see the
credentials and experience behind your management team. They will likely be
more impressed with specific, tangible results than from generalized,
blurry ones. Literally, brag about the results each team member has
produced in previous engagements - show potential investors that they have
the know-how and record for taking a business to a successful outcome.
- Describe the investment opportunity.
While it's true potential investors are interested in helping you succeed,
they don't see you as a charitable cause to help - they want to make money!
And definitely they want to make more money than what they would make
keeping the money in the bank. Therefore, you must present clear and
practical, yet attractive, financial projections. Essentially, your
projections must show that the profits you generate will far exceed the
investment capital you seek within an acceptable timeframe.
You should project for the next three to five years, and you should include
key summary financial data such as net worth, profit and losses, cash flow
and of course, sales forecasts.
- Make the pitch.
As I said, writing executive summaries are about selling your business to
potential investors and lenders. The aim is to persuade them to invest in
your business for the amount of funding you require. Your goal is to gain
their interest and then wet their appetites. They may not even read into the
details of the plan if you've won their interest in the executive summary.
Then again, they will definitely not read on if you haven't. Be direct, be
honest and be confident about the capital you require.
- Be honest and straightforward (no fluff).
It should go without saying that there is no room for lies or embellishing
when writing executive summaries. Keep your language direct and go easy on
dramatic adjectives. Tell the truth, and keep your executive summary to
brief. One page may be too short, but two to three pages should do the
trick.
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