How to Make a Relevant Business Plan for a Start-Up
The main objective of the business plan is to synthesize the project of a start-up in a single document. Therefore, you will understand that writing a business plan is essential for:
- Convince potential investors to take part in yourstart-up project;
- Apply for financial aid for the creation of a business
In addition, this work will allow you to keep the guideline of your project while having the essential information of the development of your start-up at hand.
Essential Elements to Find in a Business Plan
When creating your business plan, it is advisable to mention all the elements that are often considered essential, such as:
- A quick and concise presentation of your project (executive summary);
- A quick presentation of the start-up project leader(s);
- A market study;
- The business model;
- Marketing strategy;
- Cash flow forecasts for the first months of activity and the first years of activity (forecast income statement, forecast balance sheet, cash balance sheet);
- The financing plan;
- The choice of the legal structure applicable to thestart-up.
In this article we’re going to discuss some of these elements
The Executive Summary: First Impressions Count
The executive summary is a clear and concise presentation of your start-up project. Without going into all the financial, legal and commercial details, the executive summary should nevertheless be sufficiently descriptive so that readers who begin reading your business plan understand at this stage what your project is.
This introduction is usually included at the start of your business plan or right after the summary. This is therefore the first written content that will be submitted to the appreciation of your readers, whether they are your investors or others interested in your project. It is therefore essential to take care in writing this part by choosing clear and relevant words.
Please pay special attention not to choose overly technical vocabulary that may not be understood by everyone. The idea here is that all reader profiles can join your project by understanding in a few minutes the opportunity that is presented to them to support a promising start-up.
Market Research: A Prerequisite for Estimating the Feasibility of the Start-up Project
Market research is a study that aims to target and analyse the economic market in which the start-up will operate. By studying the market in which the start-up’s products or services will be offered for sale, it will be possible to know in more detail the demand already present or supposed from targeted customers as well as the presence of direct and indirect competitors on the market.
Market research is an essential step to be carried out before the creation of a start-up in order to have a clearer vision of the place that the start-up could occupy in this economic market. In addition, carrying out market research will allow people who may want to take part in your start-up project to make sure that you have correctly estimated the likelihood of your business being successful.
The Business Model or How to Convince of The Profitability of the Start-up
Beyond the progressive aspect that your project may represent when faced with a problem, it is also essential to create your start-up project on a profitable economic model. Consequently, the business model chosen for the start of the start-up’s activity must be both consistent with the prospects for economic development, but also promising in terms of the expected profitability of the company.
Your business model must therefore present the products and / or services that the start-up will offer as well as the estimated sales in the coming months. To sum up, it is worth detailing how the company intends to quickly return on its investments and generate profits.
The Marketing Strategy Envisaged to Maximize Sales
Who says profits, they mean sales. Thus, the marketing strategy that you want to adopt to boost the sales of your products or services should find its place in your business plan. In this part, you can detail your action plan regarding the placement of your offer on the market, including:
- Marketing actions planned to increase the visibility of thestart-upwith target customers after market segmentation, for example;
- Selling prices established to ensure rapid profitability of the business;
- The proposed distribution methods that suit the nature of the product and the expectations of customers;
The Forecasts Concerning the Finances of the Start-up
When the time comes to provide forecasts, particularly for estimated turnover in the coming months, special attention should be paid to the figures you are going to introduce.
Indeed, beyond helping to develop a business with an innovative project, investors want to know if they can make a good investment. Whether bankers, private investors (e.g.: business angels) or even the jury of competition for the creation of companies, they will all linger on the forecasts of your project which until now interests them.
Regarding the financing plan, it is about presenting the capital that you will succeed in obtaining to start the production and marketing of your products/services. In addition, it will be necessary to explain how you are going to obtain your capital. It can be start-up equity, bank loans, capital from investors, financial support for business creation, etc.