Establishing a business plan is a mandatory step when the entrepreneur plans to convince investors or bankers to invest in his project. This is seen as a presentation tool that demonstrates the strategy used for the realization and smooth running of the project. Therefore, it must be impeccable, both in substance and in form. This raises the question of what the business plan must contain to be convincing enough and the formalisms to follow for this purpose.
A powerful introduction
The purpose of the trailer is to make people want to see a movie. It is the same for the introduction of the business plan. The latter is better known under the name “ Executive Summary.” This summary of operations is not necessarily long since it is only two pages long. However, its content must stand out. It represents a simplified content of your detailed plan allowing your auditors to have a global vision of your project. It includes various elements, including:
- The nature of your activities
- The values of your project: your strengths and advantages over the competition
- Presentation of your team: their experiences and know-how
- The market typology: the competitors, the opportunities, and the size of the current market.
- The forecast result: the income statement expected over three years
- The need for financing
In short, the executive summary serves to display the project in its best light. This introductory part can also serve as a pitch when presenting the project to future partners or investors.
Presentation of the team
The professional background, the training followed, as well as the skills of each member of the team appears in the executive summary. A duly trained chef with some experience in the cooking world is more likely to convince potential funders for his project to open his own restaurant compared to a young apprentice. In addition, you must specify in this summary the role of the co-founders and future partners in order to highlight the complementarity of their skills.
In general, potential partners take into account the capacities of the people rather than focusing too much on the project itself. In short, the cohesion and complementarity of skills between the members of the team constitute one of the main strengths of the business plan.
Study the market well
Concretely, the market study contains three fundamental parts, namely:
- The offer: the competitors constitute the essential component of this element. Indeed, you must know the number of your competitors, as well as the variety of their services and their prices before launching your project. Taking into account the offer helps to establish the commercial strategy to adopt in order to better understand the shortcomings of the offer on the market. By filling market gaps, that is, needs not met by the competition, you have a significant advantage over your competitors. This is, for example, the case when an entrepreneur decides to open his fashion house to create original and tailor-made clothes in a city where ready-to-wear is legion, as is the case in Paris or in other large French cities.
- Demand: by studying the needs of target customers, you will be able to strengthen your business plan. Identify consumer spending habits and budgets for this purpose. By determining, for example, the most popular dishes in your region. You can concretely develop a standard menu likely to attract customers to your future restaurant.
- To complete your market research, meet directly with clients as well as market players. In this way, you will better understand the target market, which will also prove your involvement in your project.
A good economic model
To be convincing, the business plan must answer the question ” how to make money?“. ” A part that relates to your business strategy for generating profit. In particular, it involves the needs necessary for launching the project as well as the resources mobilized for this purpose. The provisional financing table is adapted according to the requirements of bankers and potential investors. First, identify the lever for financing your future business by knowing the maximum amounts granted and the award criteria of the banking establishment you have selected. To better assess the relevance of your business model, you can compare it with other models offered on the target market.
A complete financing plan and a profitable forecast income statement contribute to the establishment of a good economic model of the business plan.