What is a business plan?
The business plan, also known as business plan, is a synthetic document that allows to structure the details of a project but also to present them in a simple and effective way. It is essential for any entrepreneur, whether it is the creation or acquisition of an organization, but also a business development project.
This written document must be presented to various interlocutors and must contain information such as:
- A presentation by the project manager(s),
- A representation of the products and/or services offered and for which target group,
- An analysis of the competition and what sets you apart
- The financial needs of the project and how they can be met,
- The phases of project delivery,
- An anticipation of the return on investment.
It is also necessary to provide an overview of the actions that the company will implement, the means that will be used to achieve them, but also to set a timeframe for the achievement of its goals. A business plan serves as an argument, especially for the financing needs and potential profitability of a project, to convince potential investors, distributors and/or trading partners. It also provides a reference document for the founder(s) of a company during the deployment phase of a project.
Online tools allow you to intuitively design your business plan by choosing a template and filling in the information about your project in the different parts of this document. This data is then used by this software to perform automatic financial calculations, particularly with regard to the provisional balance sheet.
The 6 steps to creating a business plan
A business plan should be clear and concise. It should also be comprehensive and transparent, especially with regard to the financial requirements. It must best represent your vision and show that your project is reliable. The 6 steps to creating an effective business plan are as follows:
1. Introduce the project and the founding team
This 1st description phase is intended to present the project as a whole and the founders and partners who support it. As for the project, the point here is to show succinctly what it consists of. This means mentioning the nature of the project and the resulting offer, the potential of the project in the field of activity to which it is linked and the related needs.
The presentation of the team is also very important. This must show that the founding team formed as part of this project has complementary skills that are necessary for its realization. For this reason, it is recommended that each member’s background be accurately identified. This presentation must also show that the founding team members share the same vision.
2. Conducting market and competitive research
This step involves an in-depth study of the environment, ie the target market and the competitors in the industry. Therefore, it is important to explain which customer segment you want to target. It is about a detailed description of the customers, their needs, their purchase criteria, their consumption habits, their location or their budget.
In addition, this part is used to display the results of the competitive analysis, with a focus on the main competitors, but above all to show the opportunities observed in the target market. This step is also important to highlight the competitive advantages you can leverage.
3. Show the added value of your products or services on the market
Following competitive analysisyou can present the desired offer. This positioning must reflect what sets you apart from the competition. This step aims to display the detailed description of your product or service offering (features, prices, sales process, customer service, etc.).
4. State the financial requirements and the legal form of your project
This phase of a business plan is used to reveal key elements in shaping your future business, such as funding for the project, the legal form of your organization, or business premises needs.
On the one hand, with regard to the financial needs, it is advisable to be specific about the resources that you want to mobilize to carry out your project and to finance the expenses and investments. On the other hand, you have to show them legal status your future business. To define this part you can be accompanied by a professional.
5. Present the action plan and goals
This step serves to show and make measurable the goals you are setting, whether quantitative or qualitative. In fact, it is advisable to present the actions that will be implemented to achieve your various objectives and to set a time of implementation in order to create a complete action plan.
6. Provide a financial report
This part of your business plan is crucial. Its goal is to provide a detailed and complete accounting analysis over 3 years. This financial file must contain in particular:
- The projected income statement: it serves to show your profitability by listing income (sales, etc.) and expenses (purchases, salaries, costs, taxes, etc.).
- The cash plan: It includes the analysis of the development of your cash flow.
- The financing plan: this is the total financial need and financial resources that will be made available to the project.
Essential elements for your business plan
In order to be successful with your business plan, you should consider the following:
- The business plan is not a fixed document: A business plan needs to be adapted according to your interlocutor (banker, potential investor, distributor, etc.). It is therefore necessary to provide several versions of this document, highlighting the relevant information depending on the recipient.
- The summary is essential: This is the introductory part of your business plan. It serves as a summary for your entire document, so take the time to take care of that part.
- The presentation of your business plan should not be neglected either: Your goal should be completeness, clarity, and consistency in content and form. So pay attention to your chapters, titles and subtitles, add visuals, a synopsis and/or appendices.
- The figures must be justified: all figures presented, particularly with regard to financial projections, must be justified and based on reliable data (market research, field studies, etc.).
Downloadable business plan template
In addition to business plan tools which can be of great help, you can also download a ready-made template to write this document. In particular, Bpifrance Création offers a Template to fill out develop and write a business plan, including the various phases essential to its design.