Somewhere between the financial document and the marketing document is the business plan. As any good business promoter knows, this document is one of the most important when setting up or redesigning a business activity. So what are the best practices to follow when developing it? Follow the guide!
50% of new businesses do not make it past the two-year mark. Entrepreneurship experts have conducted various studies and analyses to find the cause. A lack of thought (i.e. a lack of a business plan) seems to be at the heart of the problem. However, this is a document that demonstrates the seriousness of a business project. Moreover, a business plan allows you to get organized and move in the right direction.
A business plan, no matter how big or small your business is
Whether you are an SME or a start-up, you will definitely want to make a name for yourself in the increasingly competitive business market. First of all, it is important to know your objectives. This is what will first determine your business plan. Then ask yourself the right questions: what should it contain? What makes a good business plan and how to write it?
What are the objectives of a business plan?
The main function of the business plan is to present a project. Serving as a business proposal, it is the first step in launching a business. Moreover, this document often determines the success of the project in question, since it is what will convince potential investors. In addition to finding an investment fund, another purpose of the business plan is to serve as a guide. Indeed, this document will act as a real steering tool for the project leader. The scope of this plan is therefore financial, operational and strategic.
What does this business plan contain?
First of all, a well-written business plan must be precise. The services offered should be clearly stated, as well as the resources required and how they will be used. In addition, you should not forget to mention what the business project will bring.
There are some essential points to mention in your business plan:
- The overall description of the business project as well as the different ways of execution. Or else, several economic assumptions.
- A market study to demonstrate your analytical skills and the viability of the project.
- Financial and accounting statements, whether long, medium or short term. This includes balance sheets and cash flow plans, among other things.
- The inventory of the necessary resources: human, financial or material.
Furthermore, in order to make your business plan more accessible, do not hesitate to attach an appendix. The latter will contain all the information needed to clarify your business plan or to provide certain details.
Characteristics of a good business plan
A good business plan must respect certain rules. First of all, it must be accessible (clear, precise, concise). Secondly, it must be adapted to the corporate purpose of the business project. This makes sense, but it is worth remembering that it must also be attractive. Finally, the information presented should be realistic and supported by solid facts.
This document should provide a clear picture of what is being offered to consumers. It should also identify the distinctive elements of the project. After reading a business plan, you must be able to assess the profitability of the project, calculate its risks and identify the resources to be deployed for its realization.
Call in a professional or do it yourself?
If you are not ready to write it yourself, it is possible to hire a professional to write your business plan. However, it is good to know that there are several software programs to develop it yourself. Most of them are even free and available online. If not, you can split the difference and write your business plan, then use the services of a chartered accountant, for example. The latter could help you to think further and check whether all the information is consistent.
Checklist (not exhaustive) for a successful business plan
- To highlight the capacities, experiences and skills of the human resources who will participate in the company project (the real wealth of any activity is the human capital).
- Present the information in a synthetic but complete way.
- Always give real information by focusing on a thorough analysis and the qualitative aspect.
- The figures: you must be careful to justify them as best you can, taking care not to be too literary.
- Don’t forget to cite your sources of information. This way, your business plan will be credible to the recipients.
- Do not overestimate your projected turnover.
- Present a detailed competitive analysis and business strategy as well as key success factors and risk analysis.
- Don’t forget to submit a detailed project schedule.