How To Write A Start-Up Business Plan?

A business plan sets the ground rules for a start-up by establishing its goals. It offers guidance and direction to the founders and the employees to accomplish the milestones. Planning helps reduce risk and effectively utilise resources without wastage.

Another solid reason for writing a business plan for a start-up is that they can envisage the required budget, funding, estimated income, staff requirements and more. It helps them understand the viability of the business and get funding from banks and investors. It is an essential document that cannot be undermined. So, here is a step-by-step guide to creating a start-up business plan.

Format for a Start-Up Business Plan

A traditional business plan consists of the following sections. They must contain all the required information to run the business smoothly and understand its purpose. Before beginning the process, you need to identify business goals which can be broken down into short-term objectives.

1. Executive Summary

The first part of the plan has a brief summary of what the business is doing and how it plans to achieve its objectives. It includes a short description of offerings, business objectives, the target market, growth prospects and finances. A start-up can keep it short and simple by explaining what they intend to do and why. When you sell business online, buyers usually read this part first to get an idea about the viability of the entity.

2. Company Description

The company description should explain the opportunity in the market that will be capitalised by the business. It should provide details like the business structure of the organisation, its business name, address and products offered. The description should include the vision, mission and core values of the entity along with the information about the board members or founders.

3. Market Research

Market research is a prerequisite for start-ups. The entrepreneurs need to identify the geographical location where they will operate and provide details of their target audience. It must include the demographics and psychographics of the potential customers. They can create a buyer’s persona to help employees understand customer buying behaviour.

Besides the location and customers, they need to analyse the competition in the market. Thus, the business plan should have a detailed assessment of the direct and indirect competitors to stand out in the crowd. A SWOT analysis of the competitors can aid in improving your offerings and identifying ideal ways of promotions.

4. Organisation and Management

The hierarchy of the organisation along with the roles and responsibilities of the team members is explained in this part of the business plan. It basically informs the investors about the control and ownership of the entity and its structure. It should include details of the start-up tools and software needed to operate the business.

When you wind up and sell your business online, buyers often consider this part of the business plan carefully. It should provide information about the experience and skill-set of the team members and how they will contribute to the business. It should also have information about future recruitment requirements and their roles in the hierarchy and the organisation.

5. Products and Services

The product and services of the business must be explained in detail to help the investors and moneylenders understand them. It should have information about the product line, categories, packaging, pricing, distribution, trademarks, etc.

If the start-up intends to expand the product line by introducing new categories, it must also be mentioned in the plan. Also, the section must describe how the product will benefit the customers and how it differs from competitive products. The budget for all these activities and their timeline should also be clearly defined.

6. Marketing Strategy

Marketing expertise is one of the skills needed to become a successful business owner. The entrepreneur must plan the marketing strategy in advance. They should identify the media channels most visited and used by the target audience and schedule campaigns accordingly. They must create marketing calendars that have a list of all the promotional activities required to reach the buyers and persuade them to purchase.

Besides traditional media, it must have details of a digital marketing plan comprising the website, SEO, social media, email marketing, blogging, paid advertising etc. The business plan should also set the brand guidelines for all marketing materials.

7. Financial Plan

The financial plan is needed to ascertain the initial cost of the start-up, determine the working capital and break even. The section must be prepared by an accountant who can check the industry trends and expected costs to calculate the expenses and estimate the income of the business for the first three to five years.

The expenses should include all costs incurred by the business, including salaries, taxes, equipment, lease, utilities, etc. The financial forecast must be realistic and have room for unexpected expenses affecting the quarterly budget. The moneylenders will be closely reviewing this part to understand the funding requirement of the business. Thus, it must be prepared with accuracy and efficiency.

Conclusion

A start-up business plan is not set in stone. It can be changed to accommodate alterations in the economic conditions or an unforeseen financial crisis. Besides flexibility, it should have details of every aspect of the start-up to build a successful entity.