Investment business plan

A well-designed business plan for an investment project can be easily processed into a financial application that can satisfy the majority of investors. But it is not only lenders, professional depositors and investors who need this systemic document. Any entrepreneur or designer who thinks over the details of reconstruction, production, promotion of services studies the consequences of innovations and the necessary financial, material and human resources first "on paper" in the form of a plan in order to avoid costly trial and error in practice.

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Basic theoretical provisions for developing business plans

Document structure

In practice, a business plan is the only justification addressed to lenders and prospective investors to raise funds. The information provided allows investors to:

• determine the degree of sustainability and viability of the project,
• choose the best investment option for maximum profit,
• assess the prospects for a certain period, taking into account all technical and economic indicators,
• evaluate the actual results of the company's work,
• monitor the fulfillment of budgetary obligations,
• calculate the possibility of obtaining credit resources and attracting state support, etc.

Thus, the general task of business plans is to create a holistic assessment of the potential and prospects of specific investment projects, taking into account their specifics and to justify the introduction of innovations in the described conditions.

For this, the following are considered as a source of funding:

• own funds,
• government funds,
• funds of potential investors.

The settlement horizon in this case, most often, becomes the period of repayment of borrowed funds and another year after that.

In terms of form, there is a division into a complete business plan and a concept plan. In the second case, only the basis for negotiations with potential investors is created, which will allow determining the degree of their interest in the project. The official format in the design of such a design is guided by the requests of investors and / or the requirements of business partners, however, the general standard structure of a complete business plan for an investment project involves the inclusion of the following sections in the document:

Investment activity is inherent in any enterprise: there is no development without investment, without development - loss of competitiveness in the market, loss of competitiveness - the expected collapse of the enterprise. This is the inexorable logic of investment activity.

Pre-investment analysis of enterprise investment projects

• The first in a series of studies is marketing analysis. At this stage, investment projects are analyzed from the standpoint of market requirements:
  • whether the product as a result of investment meets the needs of the market;
  • what is the market capacity of this product;
  • is there a replacement product ;
  • what is the balance of supply and demand for the products produced as a result of the project.
• At the second stage, the technical feasibility of each project is assessed and the achievable parameters for each project are determined. This is a technical analysis of investment projects.
• The next stage of the analysis is the assessment of the resource capabilities of the enterprise. At this stage, the primary selection of projects takes place. At this stage, production capabilities are assessed: technology, equipment, auxiliary production, labor and the level of its qualifications, the level of current production costs. It also evaluates the resources, material and financial, necessary for the implementation of each investment project and selects one, maximum two projects from several for further analysis.
• For the selected projects, an integrated Feasibility Study (Feasibility Study) of each of the selected projects is formed and, as a result, the technical and economic indicators of each project are calculated, their economic efficiency is determined. Comparative analysis of all indicators of the feasibility study makes it possible to make a choice of an investment project and make a more detailed and in-depth study of the investment project.

The pre-investment analysis is fully included in the investment business plan of the enterprise as the initial stage of its formation and is an enlarged version of the business plan itself.

Below is an example of the results of pre-investment studies of an investment project for the construction of a thermal power plant in one of the settlements of the Moscow region. The study ends with the execution of the Section "Key indicators of an investment project for the construction of a thermal power plant", which looks like this:

Key indicators of the Investment Project "Imyarek"

The main indicators of the selected investment project out of five options demonstrate an acceptable return on investment, and IRR - the average annual profitability of an investment object over a period of 10 years, significantly higher in comparison with the cost of loan money. The indicators of the chosen investment option turned out to be the best at the stage of pre-investment analysis.

Investment Business Plan

Most European investment banks and investors are guided by the form of an investment business plan developed by the largest investment bank, the European Bank for Reconstruction and Development (EBRD). Business plan standards were also developed on the American continent - UNIDO, which was developed under the auspices of the UN, the EU developed the TACIS standard with a focus on the CIS countries. All of them have approximately the same content as the EBRD standard, the structure of which is as follows:

• Project Introduction (Cover Page)
• Confidentiality Memorandum
• Summary
• Investment Object (Enterprise)
  • History of the enterprise development and its state at the time of the creation of the business plan, description of current activities
  • Management structure, owners, management personnel, employees of the enterprise
  • Assessment of the current activities of the enterprise
  • Financial situation
  • Loans and credits
• Investment project
  • General information about the project
  • Investment project plan
  • Market analysis, competitiveness assessment
  • Description of the production process
  • Financial plan
  • Environmental assessment
• Financing
  • Sources of financing, schedules of receipt and repayment of loans
  • Pledges and sureties
  • Part of the project that will be financed at the expense of credit funds
  • SWOT - analysis
  • Risk assessment and measures for their down
• Applications

The development of the company's business is impossible without the reinvestment of funds. The main tool in order to draw up a plan for conducting events, assess their cost, and also attract the necessary resources is an investment project, the structure of which must be clearly and fully described.

Concept definition

An investment plan is a document or a set of measures that imply investment in the expansion or modernization of the company's activities, aimed at a specific effect determined over time.

Similar projects are prepared for both large and small companies that are aimed at developing their activities. The economic sense of investing is investing part of the profit as a reserve for its growth in the future.

• the essence of innovations
• new technology (production, sales, marketing, etc.)
• calculating the required investments
• economic effects
• further development prospects

This document contains a business plan, but is a more complete and broader description of what and why the business spends money. It often contains design estimates and other detailed materials describing the nature of the investment.

Project goals

The main idea in the development of the project is the implementation of the planned changes. In relation to an investment project, there are two main ones:

• calculating the payback period and profitability of investments for the owner
• providing evidence that the borrowed funds will be returned for a third-party investor

The main goal of drawing up an investment plan is to increase the profit from the business after its completion. Everyone is interested in this: both the owner and the investor.

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business plan innovative project

1. Features of business plans for investment and innovation projects

2. Investment business plan

2. Concept, types of business plan

2. The structure and content of the business plan

2. Business plan as the basis of an investment project

An ordered scheme of actions to achieve a certain goal is called a "plan", therefore, planning is a continuous process of finding new ways and methods of optimizing targeted actions at the expense of new opportunities.

Investment Environment Analysis

The investment environment in relation to a specific investment object is considered at the general economic level, at the industry level and at the local level, i.e. as the activity (business) of a company in a competitive environment. In accordance with generally accepted international practice, a survey and verification of the truth of all information (“due diligence”) about the investment object is carried out in order to prepare for the development of a business plan for an investment project.

General economic analysis of the investment environment

The process of analyzing the investment environment begins with examining the state of the national economy as a whole. International investment and financial institutions are especially attentive to this when choosing countries for the implementation of investment projects supported by these institutions.

During development, the business plan of an investment project usually considers:

- economic growth rates;

- level of social and political stability;

- level of legal stability;

- stability of the national currency;

- state of the country's balance of payments;

- the level of the interest rate for the loan;

- the size and dynamics of government spending and investment;

- development of market infrastructure