Previously, we have covered financials a startup should have and we mentioned a business plan several times. In the 12th article from our “Startup series” we’d like to talk more about it and study kind of an example of a startup business plan. Make sure you don’t miss the most interesting of the previous parts:
In fact, a startup represents the beginning of a new company development which at the time of launch may not even be an officially registered legal entity. Such firms start from scratch. Let’s get through the business plan creation process step by step.
Example of a startup business plan structure starts from Niche Analysis
In order to find investors, it is important to conduct detailed research of the chosen niche. You need to understand how big the market is and what are its financial prospects. It is necessary to determine the size of the target audience and to what extent potential competing companies are able to meet the needs of the consumer. It will be an important factor to determine the prospects and existing trends in a specific segment of the economy where the company is going to operate.
It is important to track a growing trend and avoid choosing a niche with a dying trend.
it will be easier for you to explain the prospects of their project to potential investors if you have studied all the mentioned aspects. In addition, it will help determine the level of risk and the amount of investment required. Even buying a franchise of some well-known brand can be a business idea if submitted under a changed format.
Based on market analytics, you can draw up a more coherent and thoughtful business plan and development strategy. It will also allow describing in detail the scheme of work and methods of making a profit.
Writing a product description for a Startup Business Plan
Experienced entrepreneurs and startup founders believe that a truly successful and interesting product cannot be based on copying someone else’s ideas, facts, or stealing business concepts. It should be remembered that quality is the first priority, and quantity is just an additional factor that has little effect on the bottom line of the business. You need to understand that if a person does not understand a business plan, then they will not be able to get into the project and you will lose a financial resource in the form of investments.
Regardless of professional skills, a business plan should be understandable to every investor. This is the only way to attract money to your side.
You should avoid including facts and information that will directly contradict each other to your business plan. It only gives the person the impression that you are an incompetent entrepreneur.
A business plan should clearly express your thoughts and ideas. Otherwise, it can push the investor to start discussions and disputes which will shake your position as a self-confident person and destroy their interest in the very idea of joint business with you.
Working out detailed information during the creation of Startup Business Plan
A startup’s business plan contains detailed information about the company. At the same time, the information is presented in a concise format and displays basic data about the startup. It would be a good solution to demonstrate a business plan in a presentation format. It will be much easier for an investor to determine the feasibility of financing a project if they can clearly see information about it.
It is recommended to make a presentation using the following outline:
- The goals pursued by the company in the course of its direct activities.
- The format of work within the framework of one short, but at the same time capacious proposal.
- Problems and needs of clients.
- There are ways on the market to solve similar problems.
- An innovative method of customer satisfaction. Benefits for clients when working with a startup.
- Description of the stage of development of a product or service.
- An example of how a service or product works.
- What are the prerequisites for your idea to be successful?
- Graph the niche development you are trying to enter with your product.
- Tell us about trends and market conditions.
The investor must understand how long it will take to offer your product to the market.
Writing a short summary for your Business plan
Each business plan contains a final summary. It is drawn up after you make sure that you managed to comply with and take into account all the other important details of the project, which are especially of interest to potential investors. Starting a business from scratch is not easy, especially from the point of view of finding the starting capital to implement an idea.
The resume should make it clear to the investor what you are, what you are striving for, and what goals you pursue when creating a startup. A resume is the essence of the entire Startup business plan: it should not only be concise and understandable but also get potential investors interested in your idea. With this part, the investor should become your product champion.
Planned Marketing Campaigns
A planning part of a startup business plan should include a clear strategy for the marketing campaign. You will need to work hard to create a product promotion system that should be significantly different from your competitors’ campaigns. This will make your product stand out from other similar products which will form a clear circle of potential customers.
With a competent and well-thought-out marketing strategy, you can identify the target audience, as well as the cost of the offered product. In the business plan itself, it is also necessary to include the calculations of the costs required to organize the promotion of the company and its product.
Organization of logistics
Logistics is an important aspect in the organization of any business, including a startup. Moreover, startups have limited starting capital. For this reason, it is important to develop an efficient delivery system for the goods to end consumers. Also, thinking over a system for the delivery and storage of raw materials for production processes is an important factor.
Providing a clear and well-thought-out logistic plan to a potential investor can significantly increase the chances of success and get the coveted financial resource for the implementation of the business plan.
Formation of the sales system
The production plan is included in the list of the main aspects that are important to analyze in detail in the business strategy. In a business plan, you need to describe the features of your product, its properties, as well as the process of its production, including what kind of raw materials will be used. The duration of the production process is also indicated. Based on data on the quality and cost of raw materials, as well as the duration of the production process and the required energy consumption, you can derive the final cost of the product. Knowing the price of your product you can define the exact sales system
In the organizational part of the business plan, it is recommended to describe in detail the business management scheme, as well as the roles of each member of the company’s management team. This will help not only to identify the degree of responsibility of each person but also speed up the further process of making certain decisions.
Regardless of the chosen business model, most startups face the problem of a shortage or a complete lack of resources necessary for the project launch.
Main sources of financing:
- Use of own funds;
- Money borrowed from family, friends, or fools;
- Bank loan registration;
- Organization of a fundraising campaign;
- Search for a person who can act as an investor in the project;
- Receiving government subsidies;
- Seeking help from special venture funds.
It is important to remember that a startup should bring benefits not only to its creators but also to investors.
When drawing up a business plan, it is recommended to split the project implementation process into separate stages. Next, the cost of each stage is determined. It is also important to determine the point of zero losses of the business and write down all possible expenses for the next few years.
When presenting a business plan to potential investors and partners, it is important to show a detailed analysis in figures and graphs of the idea itself. It is recommended to use the services of professional analytical and audit firms that will be able to assess all the prospects of a startup. Or, at least, gain enough knowledge from the trusted articles
This stage is important not only for investors but also for the business owners themselves because it helps to identify risks and shortcomings.
In this article, we went through an example of a startup business plan structure analyzing its stages. We can conclude that a business plan consists of niche analysis, product description, short summary, marketing campaigns, organization of logistics, sales system, organizational part, finances. Also, this work has a double sense as it helps founders to attract investors and develop a clear vision of a startup.