writing a business plan is a complex task, especially for beginners! There are so many elements to search, analyze, write and structure, that it is very easy to make mistakes. It is a road full of pitfalls that you have to know how to overcome.
Structuring the ideas and arguing them is the part that usually causes the most problems when making a business plan . Entrepreneurs are usually people who have no problem generating ideas but don't always know how to structure them. That is another song!
Without an orderly and coherent structure, no one is going to bother to read our business plan.. Obviously, no one will want to read a thirty page business plan without head or tail. A well-structured plan has to be easy and pleasant to read, with a logical and orderly sequence of data, and easy-to-understand information.
Each business plan structure will be different depending on the project. Obviously, we will not present a business plan for a restaurant in the same way as another for a mobile app. The points to be discussed will not necessarily have to be the same, even if there are similarities in both business plans.
It is true that in the structure of a business plan there will always be a common trunk.All of them will include market trends, a 3-year action plan, a detailed marketing strategy, and even a Business Model Canvas and/or SWOT analysis.
In this article we are going to see what the ideal structure of a business plan would be. In our company, we have been writing business plans for more than 7 years. In 90% of the cases we use the same common trunk to structure our models. Below we will offer more details and advice on the subject, as we also do in our article on the business plan for beginners or in the price of a business plan.
LET'S START WITH THE CONTEXT AND THE MARKET OPPORTUNITY
To start a business plan, market elements must be presented . You always have to start by presenting the market to which we are going to focus our project. It is necessary to give the figures and characteristics of said market and, if possible, demonstrate that it is dynamic and/or is growing. Otherwise we will have to explain what have been the changes that have recently been made and how we are going to get the most out of them. Obviously, a market in full economic mutation is a market that presents new opportunities. Taking advantage of them depends on us!
Describe industry trends.It will be necessary to be aware of the latest industry trends and show how they can be used to modify our project. Describing the trends will also serve to show our banker or investor that we are aware of recent changes and that we are going to integrate them to create an innovative solution (and one that will not be obsolete in a few years!).
What are the success factors of a company like ours?At the end of this first part, we will have to have shown that we have thought about the aspects to work on to create our company. For example, if we want to open a restaurant, we will have to make a list of the factors that make a person want to go to a restaurant. Some of them, such as the location, are important, although others must also be taken into account: general atmosphere, menu, menu of the day, quality of service, facilities, etc.
Business plan structure that we usually use in our business plan models
IT'S TIME TO PRESENT THE PROJECT!
We must present our project clearly and simply. It will not be necessary to go into many details if our type of project is quite common and therefore easy to understand (for example, in the case of a game room or a bar). However, if what we want is to create a technological or innovative solution, which is not yet well known in the market, we must take our time to explain what it consists of. The idea needs to be crystal clear to the person reading our business plan! It must be taken into account that it is normal that we have already detailed our project in the executive summary.
Explain its operation.The same in this sense: if we plan to open a hairdressing salon, it will be a waste of time to describe its operation in detail, since everyone knows it. However, if we are going to develop a complex product, intended for a specific market niche (such as a photovoltaic panel that works with uranium, for military laboratories). If necessary, its use by the user should also be detailed.
What is our value proposition? We must explain precisely and briefly how we are going to add value to our target market. For example, if we are a haute cuisine restaurant, the value we provide will probably be quality food (and perhaps attractive prices) in a setting with a pleasant atmosphere.
Finally, it is time to introduce ourselves as the owners of the project. Generally, businessmen tend to give little importance to this part, although for a business plan it is essential. Not only the idea matters but also the person who is going to develop it. Therefore, we will have to present our best profile and explain our track record, experience and qualities to manage the company well. Of course, we will add our CV although this does not exempt us from dedicating a section in the business plan to introduce ourselves.
CONCLUSIONS OF THE MARKET STUDY: AN ESSENTIAL PART OF THE STRUCTURE OF OUR BUSINESS PLAN!
Describe our market segments . Who are the people who are going to buy our product or service? This is not always clear to the person who is going to read the business plan. Therefore, we will have to define our market segment. If there are different profiles, it will be convenient to regroup them into different categories: it is what is called segmenting the clientele.
SWOT analysis, which makes it possible to take stock of the competitive environment. It is a very practical tool to describe the strong and weak points of our project, and also the opportunities and threats that surround it. It is part of the study of competitive analysis. Regarding the opportunities, we can mention the hypothetical changes that would allow us to develop new ranges of products or services in the future. As for threats, we can talk, for example, about geopolitical risks or the difficulty in obtaining the necessary financing to start our project, which would be a significant inconvenience.
Present the competitors, and also the strengths and weaknesses.It is inevitable that our company will have both direct and indirect competitors. We will talk about them briefly and explain the value they bring to the market. We will also have to talk about its "gaps" (prices, level of reactivity, little presence on the Internet, etc.), and about what we are going to do to offer the market a more satisfactory solution.
We will end with the description of our competitive advantages. These are the points that we are going to work on to gain market shares. For example, if we are going to open a sports center, one of our competitive advantages could be to extend the night hours or offer a subscription to XX (euros/pesos) per month.
OUR STRATEGY (3 YEARS AHEAD) TO CAPTURE MARKET SHARES!
This is the part that varies the most depending on the type of project . For example, in the context of a business plan for the sale of products, it is important to make a section for the distribution strategy. Are we going to sell directly, or through a network of associates? This question will have to be clarified. In any case, in the sale of services, the distribution part is not always relevant.
Submit a 3-year action plan. In this section, we will have to expose the most important stages of the project. Our plan should not be limited to 1 year but also include the 2nd and 3rd. You have to show a long-term vision! This phase of the development of the plan is made up of the drafting, obtaining financing, launching the activity, possible conditioning and/or equipment works, launching a new range of products or services, creating marketing campaigns, signing associations and including expansion into the foreign market.
Describe our business model with the Business Model Canvas.The business model is the way in which we are going to generate profits and profits in the long term. To do this, we can use a very effective tool: the Business Model Canvas with which we can summarize our business plan as a whole on a single page.
The marketing strategy: an essential element. Entrepreneurs do not always give this section due importance. Many of them mistakenly think that word of mouth and the distribution of brochures are enough to attract customers.
However, marketing is what will allow us to increase our income and therefore generate long-term benefits.We must have a good strategy. There are many ways and channels to attract new customers. For example through associations, organic positioning, social networks, professional shows, or even the use of tools such as Google Ads or Facebook Ads.
What are the risks associated with our project?We must describe and present our strategic plan to avoid them or at least minimize their impact on the company. Instead of hiding them you have to take them into account. For example, there are the risks associated with the treasury, or being denied financing. There is also the risk that when developing the company we are behind schedule. We must demonstrate to the person who is reading our business plan that we have thought of a solution to solve these risks, or at least minimize their impact. We can talk about these risks in the PESTEL analysis.
Finally, we must summarize the strong points of the project in 5 or 6 points.It is the final part of our business plan before tackling the subject of finances. Simply, we have to briefly summarize the reasons why our project is viable. After all, this is what a business plan is for! It is not worth getting lost in explanations. The more we try to justify ourselves, the more difficult it will be to believe that we have a solid and thoughtful plan.
An excerpt from a sample business plan for a creperie
AND WE WILL CONCLUDE WITH THE FINANCIAL SECTION!
We will have to explain our financial premises well . It is necessary to explain the way in which we have built our assumptions to obtain income in the financial plan. Let's talk about our average basket and the number of customers we plan to serve in the first few months of launch. We must also show how our income will grow as the months go by and if there will be a seasonal effect.
The goal is to show the person reading our business plan that we have made conservative assumptions and that even in the event of an adverse scenario, the project would still be financially viable.
Financial tables are essential when making a business plan.All that are necessary must be presented: provisional balance, treasury budget, provisional income statement, financing plan, intermediate management balances, and if possible, the detailed calculation of the need for working capital, as well as an analysis from the equilibrium point.
And finally, we will list what our first investments will be . If we have created a business plan to request financing, we will have to explain how we are going to use the amounts we are requesting. You must detail the list of initial investments and be as specific as possible.
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