FREE online courses on Venture Capital Funding - Major Sections of a Business Proposal - Product or service

 

Describe the product or service precisely, in terms that will leave no doubt in the mind of the reader as to what you produce or plan to produce. If you have several products or services, describe each in a separate paragraph. You should describe the price of the product, how the price was determined and the amount of gross profit.

 

Entrepreneurs tend to treat the pricing of their products too hastily. Make sure that you explain in straight forward, logical terms, the rationale behind the pricing -- is your product's price governed by its competitors? Is it priced high because you can get away with it? You must be prepared to answer these questions.

 

Customers of the product

Describe in detail the customers of the product: Who uses it, what they use it for, and why they buy your product or service. Do they buy your product because of price alone, or are there other considerations? What need of the customer does the product or service satisfy?

 

List the top three purchasers of your product, along with the rupee value and unit volume of their purchases in a columnar form:

 

Name of the company	Rupee value of the order	No of units purchased
Company A	100,000	200
Company B	50,000	100
Company C	25,000	50

 

Furnish the Venture Capitalist with a complete purchaser's list if he becomes very interested in your company.

 

Industry or market

Here you should describe the general marketplace for your product: the total rupee value, the rate it has grown, and the overall demand for this product or service. A projection for the future size of the market place is necessary. You may use a tabular format such as:

 

Year	Industry Sales	% Increase
Prior Year Actual	100,000,000	--
Last Year Actual	120,000,000	20
This Year Projected	150,000,000	25
Next Year Projected	200,000,000	33
Two Years Projected	280,000,000	40

 

Don't fall into the trap of stating industry sales for the entire marketplace when, in effect, your product will be sold to only a very small part of that industry.