A good idea is not enough to start your startup. First, comply with the legal requirements and register in the special section of the Business Register. Then, to survive, the idea must be valid:
- Have a market (i.e., a demand, customers).
- Be operationally feasible.
- Be sustainable from an economic-financial point of view (i.e., capable of bearing costs and producing profits).
The idea must therefore be verified methodically: this is what the business plan for your startup is for.
Business plan for startups: why it is needed
Proper planning of the business project – therefore, an accurate and realistic business plan – is essential for a startup. Otherwise, the risk of failure – already statistically very high – can increase. Unfortunately, most startups fail for the most diverse causes: lack of market, difficulty in intercepting customers, fierce competition, poor quality of the product/service, high costs, financial problems, working groups not up to par, and legal issues. To these reasons are often added the absence of a business plan and – once the startup has started – its failure to update it with the feedback received from the market.
Therefore, why bother writing a business plan in the first place? Why should you commit your time to doing it yourself, seek the assistance of professionals, or take advantage of the services offered by startup incubators and accelerators? The business plan serves as a descriptive and, more importantly, an analytical tool for your new venture, specifically for:
- Planning: puts the idea on paper to turn it into a business, clarifying the objectives and the action plan, thus studying its feasibility, risks, necessary resources, profitability, etc.
- Control: The company’s management is used to evaluate the performance to the expected results.
- Communicate: both internally so that everyone has a unique reference to the business and its risks and externally to obtain financing, seek investors, attract talents, etc.
The business plan is not only for innovative startups or, in general, for new companies but also for established companies. Whether it is an SME or a large company, in the life of a company, creating a corporate business plan may be necessary, for example, before launching a new product/service or making strategic decisions.
For more information you should visit business plan consultants.
Business plan example for startups
How do you make a business plan? We propose a business plan model for startups. Here is a summary of the contents it should contain:
- Executive summary
- Description of the business project
- Description of the innovative product/service
- Professional profile of the startup’s founding team
- Market analysis
- Competition analysis
- Marketing Plan
- Operational plan
- Economic-financial plan
How to make a business plan for your startup
The executive summary should be written last when the business plan is complete. As it is the part of the plan in which you must be able to communicate the salient points.
The description of the business includes the analysis of the reference sector. The mission of the startup, the description of its business objectives. And how it intends to achieve them. The service/product description highlights the innovative aspects and the added value for customers. In the professional profile, on the other hand, the skills, experiences, and roles of the founders and the startup team will find space.
The real starting point of the business plan is the market analysis. Which is the basis of the strategy to get the business project off the ground and grow. Market analysis is useful for collecting and analyzing data on the environment the startup wants to enter. Evaluating its dimensions and characteristics – including existing products/services, sales methods, etc. – and formulating predictions on its evolutionary trends. The customers of the market must then be studied and segmented, which can be consumers (if the business of your startup is B2C) or companies (if the business is B2B), to choose the most interesting ones (targeting).
Competitor analysis is essential to know the competitive system of the sector you want to enter: who are the main competitors? Then, looking at the competition broader, are there any potential or future ones? What do they offer, and what is their strategy? Finally, what are your direct competitors? From the analysis of the competitors comes the ability to identify the competitive strategies that the startup can implement: low prices, differentiation, aiming at a niche market, etc.
It is therefore possible, with the help of the marketing plan, to establish market objectives, strategies, the marketing mix (product, price, distribution, and communication), resources, and times to conquer the slice of the market to which the startup aspires. This is all based on the analysis of the market and the competition.
The operational plan is where the company that is just getting started outlines how it will produce its product or service. This includes the production or delivery process, as well as the technologies that will be used (not just “hard” machinery and equipment, but also software solutions). Which resources (such as raw materials, personnel, third-party services, financial funds, etc.) are you looking for? In what ways do you obtain your supplies? How will it be distributed, in terms of sales channels, distribution structure, and other factors?
Finally, the economic-financial projection for startup planning includes the plan of investments in goods and services to launch the startup; the amortization plan; the sales plan from which the revenue plan, the production forecast plan, and the purchase plan derive; finally, the estimated income statement which, by comparing the assumptions of costs and revenues, elaborates projections on the financial future of the startup.
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