There are many reasons why you might write a business plan.
Whether you decide to pitch your business to investors or simply to lay out your development strategy, the business plan is an effective way to see more clearly the feasibility and future of your project.
A good business plan can help you clarify your strategy, identify potential obstacles, determine the resources you’ll need, and assess the viability of your idea before you learn how to start a business.
In this article, we will give you tips for making an effective business plan for your startup.
Summary
- What is a business plan?
- Why make a business plan?
- How to make a business plan step by step
- 3 key tips for writing a business plan
What is a business plan?
A business plan is a document that describes a business, its products or services, how it makes or will make money, its management and staff, its funding, its operating model, and many other details essential to its success.
Why make a business plan?
A business plan can be useful to you for many reasons, both for raise fundsthat for bootstrap your future startup.
Investors rely on business plans to assess the feasibility of a business before financing it. This is why business plans are generally associated with fundraising.
But there are several compelling reasons to consider writing a business plan, even if you don’t need funding.
here are some benefits of writing your business plan.
- Planning : Writing your plan is an invaluable exercise in clarifying your ideas and can help you understand the scope of your business, as well as the time, money and resources you will need to get started.
- Evaluation of ideas: If you have several ideas in mind, a rough business plan for each can help you focus your time and energy on the ones that are most likely to succeed.
- The research : To write a business plan, you will need to research your ideal client and your competitors, information that will help you make more strategic decisions.
Start your business plan with a structured plan and key details on what you will include in each section is the best way to start your BP.
First of all, know that there is no standard business plan, it will depend on your project, we only have recommended elements to integrate.
Generally the outline of a business plan is as follows:
- Executive Summary
- Company Description
- Team presentation
- Market research
- Presentation of the products and services offered
- Marketing plan
- Logistics and operational plan
- Financial plan
Executive Summary
A voucher executive summary is one of the most important sections of your plan, it is also the last section you should write.
The purpose of the executive summary is to distill everything that follows and give time-pressed reviewers insight into your business or project that should persuade them to read on.
As this is a summary, highlight key points only.
If you’re writing for your own development planning (non-fundraising), you can skip this summary, but you can still try writing it, just for practice.
An abstract should not exceed one page. Here is what the executive summary of your business plan should contain:
What does your business do?
What is the company’s vision?
What are you selling, and why is it different?
Who are you selling to?
How do you plan to reach your customers?
What is your current turnover?
What income do you expect to make?
How much money are you asking?
Who is involved in the business?
Company Description
This section of your business plan should answer two basic questions: who are you and what are you going to do?
Answering these questions helps explain why you’re in business, why you’re different, what you have to offer, and why you’re a good investment.
A few points to clarify in your business description:
- The legal structure of your business
- The business model
- Your company’s vision, mission and value proposition
- General information about your company or its history
- Business goals, short and long term
Team presentation
The team section of your business plan should help your PR readers understand who is running your business.
If you have a team, use a flowchart to show the internal structure of your business, including the roles, responsibilities and relationships between the people therein.
Explain how each person will contribute to the success of your startup.
Market research
Market research is an essential section of your business plan, whether or not you intend for anyone else to read it.
It should include an overview of the market size that you value for your products/services, a analysis of your company’s position in the market and one overview of the competitive landscape.
It is important to conduct thorough research to back up your conclusions, both to persuade investors and to validate your own assumptions as you develop your plan.
Here you can back up your words using different marketing analysis methods such as SWOT, understand who your ICP (ideal customer profile) is and demonstrate it with A+B.
Presentation of the products and/or services offered
Obviously, you have to talk about your innovation in most sections of this business plan, but here it is describe it in detail.
If you sell many products/services, you can include more general information, if you only sell a few, provide additional information about each one.
If you have a SaaS-type product, for example, detail all its features in this section.
Also, if you have a roadmap productdescribe new products and services/features you will be launching in the near future and any intellectual property you own.
Explain how they will improve the profitability and development of your startup.
Marketing strategy
Your marketing strategy is directly influenced by your ideal client.
Your business plan should outline your current decisions and your future strategy, emphasizing how your ideas meet the needs of your ideal client.
If you plan to invest heavily in SEO, for example, it might be a good idea to indicate whether SEO is an interesting channel for your audience or not.
Show here how you are going to do your customer acquisition and why.
Give figures as soon as possible and justifications, compare your marketing strategy to the competition.
Logistics and operational plan
In this section, you should explain how you will be able to deliver your product to your ICP. (ideal customer profile)
Give details on the execution, the development of new functionalities, if you need to call on external services, need for equipment, etc…
Provide as much information as possible.
Financial plan
This part may differ depending on your sector of activity of course, but overall you will have to provide different types of financial information such as:
- A Financial plan : how much do you need ?
- A investment plan : how will you distribute the funds obtained?
- THE income statement (if you are already started)
- your Forecast turnover
- your break even
- etc..
In this part, it is better to talk to your accountant to obtain the necessary documents and also to achieve a realistic forecast turnover. You can also provide a cash flow plan.
If you wish to have more details on the creation of a business plan, you can read the following article from Partners Finances which is very complete.
3 key tips for writing a business plan
There are a few key things to keep in mind to help you rwrite an effective business plan.
Adapt your business plan to your audience
When you know who will read your plan, even if you write it for yourself to clarify your ideas, you can tailor the language and level of detail to that audience. It can also help you ensure that you include the most relevant information and determine when to omit sections that don’t have a big impact.
Have a clear goal
If your goal is to secure funding for your business, you will need to work harder and provide a more comprehensive plan than if you are working on a plan for yourself or even for your team.
Invest time in research
The sections of your business plan will primarily be fueled by your ideas and vision, but some of the most crucial information you’ll need requires research from independent sources.
This is where you can invest time in understanding who you will be selling to, if there is a demand for your products, and who else is selling similar products or services.