A Flawlessly Designed Startup Business Plan = A Successful Startup
An idea is nothing without implementation. So the vice versa is also true. Which means that implementing things without proper planning also won’t help you achieve your goal.
The same goes for businesses and startups, If you want to build a strong business that can survive the ups and downs of the market it becomes necessary to lay your startup business plan correctly.
A business plan is equivalent to a house plan that an architect draws before he begins his project. It’s a way of organizing the many thoughts you have about your business and how you’d like to see your business emerge out of a single idea.
Your business plan is perhaps your most important asset when you pitch your idea to investors who will provide you with the required funding which will turn your IDEA into REALITY.
So, how to make a business plan?
In this post, we have tried to include all the ingredients required that will help you make a startup business plan.
Note: It’s recommended to first Validate Your Startup Idea before you start creating a business plan for your startup.
How To Build A Startup Plan.
The Business Plan isn’t only a look at what your company will become few years down the line. But it also reflects what efforts you have already put in building a runway for your startup.
We have listed the most important module every startup business plan must have:
- Executive Summary
- Startup overview
- Products & Services
- Market Analysis and Competition
- Marketing and Sales Plan
- Operational & Management Plan
- Ownership Plan
- Financial Plan
Let’s take a deeper dive to discuss each module of making a startup business plan.
It provides a detailed overview of your business and the different factors you have considered in the business plan. It should not extend more than 2 pages in your startup plan. Often, it’s the only part that a prospective investor or lender reads before deciding whether or not to read the rest of your startup business plan. It should be able to convey your enthusiasm for your business idea and should also get readers excited about it.
In spite of it being at the start of any business plan its always recommended to write your Executive Summary LAST, after you have completed the rest of the business plan. So you will be sure you have included all the important points in your executive summary.
Make sure you include the following things in your executive summary of your business plan:
- Overview of your business
- A description of your product/service
- Your target market & competition
- Your goals
- Your startup management plans
- The financial outlook for your startup
It should include the following elements mentioned below:
A VISION is the most important factor for a business plan because it enlightens the reader about where you see your company 5 or 10 years down the line and what you want your employees to work towards.
The MISSION is equally important because it is a brief explanation of your company’s reason for being. Try to keep your mission statement concise and wind it up in one to two lines.
here are a few examples of how formal and short written a mission statement can be:
Facebook Mission Statement
“Give people the power to build community and bring the world closer together”
McDonald’s Mission Statement
“Be our customers’ favorite place and way to eat and drink”
A LOGO – You must also have a logo for your company which helps consumers and investors identify and remember your company, it should be memorable and very eye-catching a good logo makes a large difference in how people perceive your company.
here are some of the world’s best-designed Logo’s:
A TAGLINE – It is a phrase or a sentence that is expressive of what your product or service is all about, something that’s easy to remember and helps the marketing of your product to a great extent.
“The Ultimate Driving Machine”
“Just Do It”
Without these elements, a business can never lift off in full slate and your startup business plan will never be considered as complete.
PRODUCTS & SERVICES
This section of your startup business plan provides a more detailed view of your products and services and elaborates on the overview given in the executive summary. You should be able to explain what makes your products and services different and unique from others.
Create a detailed list of products and services you wish to offer to your target customer. You also need to have a brief explanation of how your products and services will help people solve their problems and how it is better than your competitors. It should also include what additional benefits your target audience will get by using your products and services.
You will also have to emphasize the following points like what will be will be the market price of your product, what will you the discount that you will offer on your product and also if your product or service has some patented feature.
MARKET ANALYSIS & COMPETITION
This segment of the startup business plan should be able of providing an overview of the ecosystem you are launching your startup in. This information will be very valuable for your investors since they will be able to judge how big the market is and what is the potential of the market. It will also help you understand where do you stand when compared to your in-market competitors. Its recommended you also create a list of your TOP 5 competitors along with their USP.
You should also perform a SWOT analysis to analyse your market better and to make your point stronger. It includes your Strengths, Weaknesses, Opportunities & Threats.
You have to list as many things as possible in each box to obtain the best outcome from this exercise. Within this startup plan we are providing few pointers that you can think on while filling each box for your startup.
- What advantages does your organization have?
- What do you do better than anyone else?
- What unique or lowest-cost resources can you draw upon that others can’t?
- What could you improve?
- What should you avoid?
- What are people in your market likely to see as weaknesses?
- What factors lose you sales?
- What good opportunities can you spot?
- What interesting trends are you aware of?
- What obstacles do your competitors face?
- Changes in government regulations
- Changes in technology
- Changes in the economy
- Changes in your industry
For more detailed information about SWOT Analysis click here.
MARKETING AND SALES PLAN
This section of your startup plan deals with how you plan to sell your product and keep the sales up through distribution and a through promotion strategy. You must describe how you plan to grow the scope of your product and how you plan to increase your profit margins. It should also include how to plan to compete with your competitor’s marketing and sales plan. It is very important in preparing your business plan.
The key elements of every startup’s marketing and sales plan are their 4P’s
Let’s take a deep dive into each “P”
Your product is usually the reason why you would consider starting your own business. The product should be unique and preferably something the market hasn’t seen before. It is necessary that the product which also is your idea is original. It is not necessary that the product has to be a physical object or piece of technology, it can also be a service. The startup business plan is centred around the products and services.
The price of your product will decide how your product will sell in the market and how much investment will be required. You will have to do a cost-benefit analysis. The price depends on the cost of making your product or service, you should know the following: the manufacturing and selling cost, the taxes and overheads, etc. Also, your price will be decided based on certain factors, such as your demographic i.e. who your buyers are, your competition as in who else is providing the product/service and at what price they are selling it at. It also decides your profit margins.
This basically explains how you plan to sell your product and advertisement it. This is an essential part of your startup plan. If nobody knows about your product, chances are that they may not buy it. Promotion ensures the longevity of your product. Successful promotion can make or break the business or startup.
Placement of a product refers to the channel you will use to distribute your product. This is essential to your cost and will also tell you how your product will reach your consumer. It should be a mix of both online and offline.
So now you know how much important these 4P’s are for your business plan lets move forward to the next phase of your startup plan.
This segment of preparing a business plan take a deep dives into the engine of your business – “Operational Planning”, one of the most imperative pieces of the entire business plan, as this caters to how your business is equipped to handle all the operational challenges coming your way. This should entail all the details of the production methods & methods by which you will ensure that your products are best in the business.
Your business location should also be a part of this plan, as that will give a brief overview of the size of your business, how easily you are accessible to your customers & also what amount of capital is required for rent, maintenance, utilities, insurance or any remoulding cost.
Imagine You are an Investor !! would you want to get involved in all the legal tussles of any business? The answer is a big Nooo, Right? So the next piece is encompassing all the legal details of your business. This should include details about any licenses, permits, trademarks, copyrights or patents which are requisite for your business. Your Operational plan should also include details about the type of personnel your business will need, which will explain about the employee strength required, what will be the pay structure of these employees & how do you plan to recruit these employees.
If your business is of the nature that will require an inventory, then your plan should talk about what kind of inventory will you keep, what will be the average value of your inventory & details about the fluctuations in inventory based on seasons. It should also include minute details about your suppliers, such as name & addresses of your suppliers, their history, also how equipped are you to handle any turbulence when it comes to supplying shortages and fluctuations in supply costs.
OWNERSHIP & MANAGEMENT PLAN
This section of your startup business plan deals with the legal side of your business and who will run it. You should mention what kind of a company this is whether you share ownership with partners and what kind of organisational structure you function under. Another question to consider is, who are you going to involve? Will you be the sole proprietor, are you going to have partners, if so who? And Why? Who will be your employees? What will you offer those you hire. You must also familiarise yourself with the laws and restrictions that come tied to your business.
This part of the startup plan should also mention how much are you ready to offer your investors. Will they share a percentage in your startup or will they have a share in your profit? It should make the investors aware of what type of ownership they can expect to get when they invest a huge sum of money in your startup.
Last but not the least in developing a startup plan is to explain how you plan to finance the business, who or what is funding your business. You need to explain the equity break-up here and make sure you attract potential investors and make clear what liabilities your business already has. The financial overview of the startup business plan will be most interesting for your investors.
You can create a template of your own as it is not necessary to follow any particular format. You have to figure out what will work best for you. Keep in mind it should be able to tell your reader what they want to read.
Drafting a business plan is always time-consuming and requires a large amount of research. Hope our article will assist in you drafting your business plan for your 100 million dollar startup.
Do mention in the comments section if our article on how to create a startup business plan helped you in some way or the other.
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