Recently, studies have revealed that 70% of entrepreneurs recommend writing a business plan before starting a company. Indeed, when properly exploited, it represents a powerful strategic tool that will serve as a benchmark for your business.
Currently, future business owners tend to minimize the usefulness of a business plan in their projects. Indeed, one entrepreneur in ten believes that they do not have a plan, however, properly written, it makes it possible to considerably optimize profits. In addition, following research and analysis, it has been shown that companies with a business plan grow 30 times faster than others. In addition, according to the Journal of Business Venturing, setting up a business increases the performance of small businesses. In addition, the majority of investors rarely bet in a box that does not have a solid plan of action.
Business plan: what’s the point?
First of all, a business plan is a document containing all the actions to be taken for the development of a company. In general, a business plan should clearly outline the objectives and the strategies planned to achieve them. The objective is to discover the commercial opportunities related to the project in order to develop the action plan adapted for its realization. Therefore, a business plan must contain the commercial, financial and strategic objectives. Nevertheless, over time, a project will have to adapt to the needs of the market and will therefore be constantly evolving. In this regard, the business plan can serve as a benchmark during the first 3 years, which are also the most decisive for a company.
A business plan is also a communication tool for future partners. In theory, it allows investors to see the preponderance of a start-up in the market and its potential for long-term survival. In order to reassure a supplier, the business plan must highlight a credible and attractive order volume. In addition, however, as it is a professional document to be provided to financial partners, its visual aspect should not be neglected. Therefore, the content must be clear and airy.
How to write a business plan?
Step 1: Executive summary
The executive summary consists of making a summary of about two pages that usually contains a global vision of your company. This is the hook of your business plan so this part must present the document in its best light. Therefore, it includes essential elements such as the name of the company, the nature and values of the project. For the drafting of the executive summary, it is necessary to:
- Recognize your target audience and identify their needs.
- See the current gaps in your market.
- Advance relevant solutions to solve customer dissatisfaction.
- Analyze the strengths and weaknesses of the competition.
Step 2: Introducing the founding team
In this section, you should highlight the skills of your leadership team members. The objective is to convince potential investors about the capabilities of your company as well as those of its members. Therefore, it is essential to demonstrate the expertise of each member and their roles in business decision-making, so this part must include:
- A presentation of the members as well as their training and careers.
- Vacancies that still require a recruitment campaign.
- The costs of hiring.
- The role of future partners.
- The values that drive the management team
Step 3: Market research
This is a crucial step that will determine the relevance of your business plan. In addition, it makes it possible to analyze the flaws and potentials of the market. This study is based on 3 essential axes:
The offer: Once your target audience has been determined, you need to analyze the offers already available on the market. To do this, it is necessary to understand the business strategies of competitors.
Demand: here, you have to focus a little more on the target clientele by identifying their buying habits as well as their budgets.
Market flaws: it is necessary to carry out surveys of the competition and your niche. The objective is to discover unmet needs within the market in order to propose an adequate solution.
Step 4: Strategies
This part plays an important role in the success of your project and the relevance of your business plan. The implementation of this step is done in two parts. On the one hand, there is the business strategy that integrates all product data. Therefore, prices and service catalogues must be included.
On the other hand, the communication strategy which consists of defining the image of your company and promoting your brand. In addition, it aims to improve your visibility, especially on social networks such as Facebook, Instagram, Twitter, etc.
Step 5: The business model
The business model is an essential part of your plan, as it allows investors to determine your financial capabilities. Indeed, in this section, you will establish the business model of your company. To do this, you must include:
- A minimum turnover forecast table containing the estimated sales per day and all the costs necessary for the operation of your business.
- A table of the financing plan integrating the resources available as well as those necessary for the launch of the project.
Step 6: Legal form
The legal status of your company will determine the expenses related to your various tax charges. In addition, the tax system, social and administrative costs must be included in your spending forecasts. Indeed, this data is essential for the development of your business plan and the proper functioning of your project.
Step 7: Funding
Now that you have all the information you need to launch your project, it’s time to move on to the final step of your business plan. Here, the objective is to facilitate the obtaining of financing from a potential investor. Therefore, you must determine your need for external financing and detail the means you will use to find it.
Basically, the business plan plays an important role in the launch of your project as well as in the search for partners. For this purpose, it must be drafted carefully and must evolve as your company progresses.