“Do you have a business plan? “That’s a question every entrepreneur has heard dozens of times. Why and for whom should you write a business plan? What is the typical business plan?
This is an essential step for any business creator: the business plan! But why should an entrepreneur write a business plan?
The business plan is in fact a reference document whose purpose is to set out the idea, feasibility and initial projections of a project. The business plan is a communication tool for entrepreneurs: presenting a business plan is used to convince investors, banks or partners. It is necessary to know how to create a good business plan to seduce your interlocutors and involve them in your project.
The business plan helps investors to understand your business project. This is why this famous document must show the specificity of your project: how your company or your offer will be a commercial success and stand out from existing competitors. It is important to remain coherent. The business projection must demonstrate the possible return on investment. And this according to several hypotheses.
Writing a business plan is also an opportunity for the project leader to put all his ideas on paper and take a step back from his strategy. The business plan contains all the stages of the life of the future company for the next 3 to 5 years.
The business plan must be clear, short and precise but also present all the details of the project’s development axes. Let’s see what needs to be included in the document. How to create a business plan?
Who are the team members? Remember to include the CVs of the people on whom the project is based. Their contribution to the project in terms of skills and experience should be highlighted. Support them with the past achievements of the different members.
What does the project consist of? Who does what, when and how? State precisely what you are going to sell.
Analyze the market. Who’s the target? Who are the competitors? What are the current keys to the market? What are the future trends?
The commercial strategy
Present how you intend to make yourself known and propose its offer to customers. How to enter the market? Which distribution strategy to use? Think about the marketing-mix: Product, Price, Place, Promotion. You have already presented the product, this part concerns the last 3 P’s.
What are the human, technical and financial means necessary for the smooth running of the project?
Agenda of the project
Show how you will develop your project over time. When will the different key stages of the project take place? From the creation of the company to the commercial launch of your offer.
Accompany your business plan with an income statement, a balance sheet and a financing plan. Financial projections must be realistic. Several assumptions must be made. The most common is to present 3 assumptions: a low, a medium and a high. How will the company become profitable? You can save time and download forecasting models.
Opportunity for the investor
What is your proposal to the private equity industry? What funding is being requested? What are the opportunities and risks?