As part of the acquisition or creation of a company, the business plan should be prepared to present your project in detail. This business plan summarizes your action plan, your strategy and the expected development of the activity and the company in the years after the acquisition or incorporation. It absolutely must be presented to your potential partners, investors and financing institutions to get their help…
What steps should you take before creating your business plan?
Your document must first of all:
- Bring your team to the fore: the people who take on the management should be presented first;
- Define the environment and context of the activity;
- Specify the expected king;
- Talk about the target’s needs with a detailed description of the latter;
- Show the proposed development plan;
- Present the overall strategy;
- Discuss how the project will be financed with details of your financing needs and your vision of the profitability of your project.
As the business plan summarizes the project, execute it after defining the business model and after conducting the market study. Also, before drafting it, choose the legal status of the company and then develop the operational and commercial strategy.
The business model
The business model is included in the business plan. So, although they are different, these two terms are related. In French, business model means “economic model” and denotes the technique used by the company to increase its profits. It also makes it possible to determine how it positions itself with its partners, its suppliers, its customers or in its market.
Long before starting a business or selling a new product, you should always do market research to gather and analyze various information related to your future business. You need to know the number of future competitors, the services and products they offer that compete with yours. Also, take the time to learn more about your customers, including their needs, characteristics, and behavior.
Thanks to this analysis, you master the market in which you are going to settle and you can develop your options or your strategy. So it is one of the elements to convince potential investors.
How To Succeed In Your Business Plan?
Essential for convincing business partners, distributors or financiers in particular, the business plan is used to better organize you to develop your business. It is also useful to hold initial forecasts to identify deviations from them.
Take the time to take care of the form, which should be clear and concise as your financing needs should be expressed transparently. This document should prove that you are trustworthy and allow a better understanding of your vision.
This document, both fluent and complete, is divided into three parts: the descriptive part, the operational summary and the financing needs.
The descriptive part
Although no model is imposed, this document should nevertheless contain several essential steps to explain and prove the potential of the project.
Integrate these different elements
Mention in the description:
- Detailed information about your competitors while specifying the elements that set you apart: technologies, products, marketing, etc.;
- The context: explain what it is all about and how you can achieve interesting benefits;
- Your solution: Present your solution by explaining how it can solve the problem, which angle you choose to apply it and why it can help customers;
- Your achievements to show customer satisfaction and your success;
- The size of your market;
- Your short and medium term strategy;
- A personal conclusion.
Mark your team
Demonstrate that the founding team has the necessary skills to carry out your project, i.e. skills related to the profession, their knowledge of the market, their background, their education, etc. Specify the role of each, in particular future partners and co-founders, as well as the names of the business manager and legal representative of the company.
Talking about project values
Demonstrate the values of the project that are the source of your motivation and that drive the leaders. They can be defined by their social impact, expertise in a field or sense of service. This element is key to encourage partners and investors to support your project.
Expose the added value of the product for the customer
In general, consumers buy a service or product for the pleasure it brings them or because it meets their needs. Show that you know your target group well and that the market research conducted is reliable.
Report on your market research
The market research you conducted should be reflected in your business plan. Report on:
- Q: Analyze your target audience by learning about their expectations, their average budget, their consumption habits;
- The offer: After identifying the number of competitors present in the market, determine the prices applied and their various offers. Also determine the offer available in the market and make sure you better understand the operational and commercial strategy of your competitors for better management;
- Identifying needs that the competition isn’t meeting: This step will help you define the competitive advantages that your business can take advantage of.
Explain the communication strategy
The communication strategy needed to execute your business plan aims to:
- Promote your business : choose the most suitable tools to make it known: advertising in transport, in newspapers, on television, on social networks, on flyers, creating a website, etc.;
- Improve the image of your company thanks to your own identity. It is defined by your sales pitch using keywords used to drive sales. This element also depends on its graphic charter, shaped in particular by its colors, its logo.
Discuss business strategy
Your business strategy can be explained from the Marketing Mix or 4P method:
- Place or distribution : to properly define the distribution strategy, determine the channels through which the company will market its services or products. In particular, he can sell them online, in brick-and-mortar stores, through distributors or with the help of other intermediaries, for example;
- Price or price : present the proposed formulas, a list of the services and/or products your company offers, various details about the prices, such as the decreasing rates, or the price list.
- Promotion or communication which is determined by your communication strategy;
- Product or product : all your services and/or products must be listed in a catalog with their features, offers, packages offered, for example.
The Operational Summary
The operational summary of management summary is the introduction to your business plan. It is generally used to verbally present and sell your project. To convince your interlocutor, this essential part presents the general vision of your project. With a maximum of two pages, it should be short and summarize the main points of your business plan.
The summary presents the leaders, the target audience, the name of the company, the history of the project, the values, the nature of the activity, the typology of the market with the opportunities, the size and the competitors.
The financial aspect
The financial part describes your vision for your company in the next 5 years. It shows the financial profitability of your project using two tables:
- The table related to the financing plan : Stay realistic by effectively anticipating your financial needs. It is not necessary to voluntarily reduce it to obtain financing. Your financing plan should include your internal resources as well as all the essential needs to start your activity;
- The table with the minimum expected turnover with the number of sales that can be made per day, as well as the costs generated by the operation, the establishment of the company. Other forecast data must also be provided: personnel costs, overheads, depreciation, capital expenditure, gross margins, etc.
Also include in this section:
- The Anglo-Saxon income statement;
- Month by month the financing plan for the first year;
- All costs with an estimate thereof;
- Estimated returns based on justified and consistent assumptions;
- The cash low;
- The financing plan with monthly data for the first year;
To effectively prepare a business plan, you need to include a descriptive part, a summary and a financial part. As the name suggests, the descriptive part presents, among other things, the management team, the values of the company, the results of the market study, the communication strategy and the commercial strategy. The executive summary is used as an introduction to summarize the document. Finally, in the financial section, specify all your expenses and all your financial needs to show that you can anticipate your interlocutors.
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