A business plan for a startup or an established company is essentially a road-map for defining goals. This road-map details the actions needed to be taken in order to bring the product to the market and decrease uncertainty. Using a business plan, the entrepreneur can decide how much capital the company needs and its exit strategy. The time and resources put into the preparation of a business plan are significant, but is essential in both the short and long term. A business plan allows the entrepreneur to perform better.
How to build a business plan
- A description of the nature of the business or the solution offered by startup
- Analysis of the business environment, including an examination of the target market and competition
- Sales and marketing strategy – paying close attention to the go-to-market strategy
- Forecasts and financial background, including a profit and loss projections.
A business plan should meet accepted standards regarding its form and content. The content is the most important, especially if the developer’s goal is also to raise money on the basis of the concept. It allows for a better reflection of the goals of the startup and strategies needed for achieving them, while serving as an effective tool in front of a potential investors, banks, employees and so on.
A business plan presents an economic evaluation based on the working assumptions, business data and long-term forecasts. The structure and content of the business plan differ from business to business and are tailored to each business according to its nature and objectives. Business plans aimed at investors should have an emphasis on management and staff review; while business plans designed for the purpose of business streamlining will have an emphasis on the history & present situation analysis, using accepted models such as SWOT, Porter and BCG
Below is the structure of a typical business plan (the structure varies from plan to plan):
Chapter 1 Executive Summary
Summary of the business plan essentials
Chapter 2 The company and products
Company vision and goals
Description of products/services
Characterization of services and products
Chapter 3 Market
Review of potential local and global target markets
Defining the target customers B2C and B2B
Porter five forces analysis
Evaluation of target market size
Identification of competing products
Breakdown of the key factors for success in the various activities
Benchmark reference points
Chapter 4 Strategic Planning
Exit strategy or business development strategy
Description of the ongoing comparative advantage
Formulating short and long term strategic goals
Market penetration analysis
Examination of potential strategic partnerships
Chapter 5 Intellectual Property
Chapter 6 Implementation of the strategic plans
Development of the business model
Costing and Pricing
Formulating principles for the marketing plan
BTL & ATL
Chapter 7 Financial Plan
Examining the required funds and operation volumes
Examination of profitability measures (gross profit, operating profit and EBITDA)
Examination of operational metrics related to the company operations
Exploring funding options
Income statement projections for first years of operation
Operating cash flow projections for first years of operation
Examination of the balance point – Break Even Point
Examining the ROI and NPV
Chapter 8 Work Plan
Development of an operational work plan for the implementation of the marketing processes and construction the “Gant” chart. The Gant chart defines the activities and their inner relations, while noting the time of each activity and the activity itself.
Chapter 9 * Valuation
Valuation based on assets value, including IP. The valuation methods include both multiples valuation and DCF.
* Intended for companies or entrepreneurs interested in investing in a business or selling their own.
You have a winning business idea. You are excited, inspired and ready to jump into the deep end. The next step is to write a business plan. With a simple Google search you will find plenty of tips on how to design an executive summary, marketing plan, and financial projection. Although, all of these are fundamental parts of the business plan (and you definitely need them), a good plan has more than that. A winning business plan fills the reader with passion and a desire to become involved in the project.