A business plan is an essential document that formalizes your company’s financial outlook and defines its strategic objectives.
The creation of a business plan is essential, whether you are making an acquisition, raising funds, selling a company to prove its development potential, or planning and executing internal growth projects.
AKCEAN can help you model your project’s profitability and create projections that reflect your vision. We’ll help you prepare a convincing business case that will maximize your chances of accessing the financing you’re looking for.
What is a business plan?
A business plan is an essential document that summarizes the key elements of a business project and its prospects.
It’s common to simplistically reduce a business plan to financial projections. In reality, it’s a much more comprehensive document, offering an in-depth understanding of the company and its prospects. It includes a detailed description of the company’s operations, organizational structure, strategic objectives and target market. It also specifies financial requirements and the underlying assumptions that inform financial projections.
The main purpose of the business plan is toassess the viability of a project. It plays an essential role in guiding the company’s internal operations, but also in convincing external partners , whether banks, investors or commercial partners, of the interest and soundness of your project.
How do I draw up a business plan?
there are no hard and fast rules for presenting the contents of a business plan. However, there are a number of steps to follow, and a certain logic should be observed. The project must be described in all its aspects: human, strategic, financial and technical.
Reading the business plan should enable stakeholders to appreciate the realism, relevance and viability of the project. The essential elements to include are the context in which the company operates, the objectives set, the key people and their roles, the business strategy and its implementation, the financing plan, detailed financial projections and the expected return on investment.
Effective presentation of a business plan requires an organized and coherent structure, as illustrated in the following example:
Part 1: The executive summary
This section should capture the essence of your project in a few incisive paragraphs including the following points:
- Nature of the business, company values and history;
- Organizational structure and shareholders;
- Clear identification of target market;
- Presentation of the management team;
- Company objectives ;
- Financing requirements; and
- Expected return on investment.
Part 2: The team
This section describes the organizational structure and identifies the company’s key people and their specific skills, highlighting :
- Their professional experience ;
- Their roles and responsibilities; and
- How their skills complement each other and contribute to achieving the company’s vision.
Part 3: Market research
This part provides an in-depth analysis of the market in which the company operates, including:
- Current and future industry trends;
- Demographic and psychographic analysis of potential customers;
- Customer expectations and needs;
- An analysis of competitors, their offerings and performance; and
- The company’s strategic positioning in the market.
Part 4: Business model
This section should detail how the company creates value by presenting the following elements:
- Description of the company’s core activities and value chain;
- Presentation of product or service offering and pricing policy;
- Profile and segmentation of target customers;
- Description of the customer experience;
- Sales segmentation;
- Description of sales strategy;
- Details of key resources required, including personnel, material and technical resources and financing;
- Identification of strategic partnerships; and
- Details of main fixed and variable costs.
Part 5: Financial section
The financial part of the business plan projects the company’s financial health over the medium term, generally over a five-year period. This section is crucial for determining the financial needs and economic viability of the project. It should include the following elements:
- Initial Financing Plan: A table detailing the funds required and the sources of financing envisaged.
- Forecast Income Statement: This provides detailed forecasts of sales and operating costs, giving an idea of future profitability.
- Operating cash flows: These are projections of cash inflows and outflows from the company’s current activities, enabling an assessment of operational liquidity.
- Investment cash flows: These are forecasts of financial flows linked to investments in durable assets, such as equipment or real estate.
- Financing cash flows: Projections of cash flows relating to company financing, including borrowings and transactions with shareholders.
- Valuation Scenario: An estimate of the future value of the business and the return on investment for the company and its investors.
Benefits of the business plan
The creation of a business plan offers a multitude of strategic and operational advantages essential to the development of a company:
- Formalization of corporate strategy: The business plan formalizes strategic thinking by detailing the company’s target market, positioning and marketing strategy.
- Transformation of vision into concrete objectives: It defines and communicates measurable short-, medium- and long-term objectives.
- Assessing resource requirements: The business plan identifies the resources needed – whether human, material, technical or financial – to achieve the objectives set.
- Profitability estimates: The business plan projects the revenues, operating costs, investments and financing required to assess the company’s future profitability.
- Scenario forecasting: It offers the possibility of adjusting key assumptions to simulate various growth and cost scenarios, aiding decision-making.
- Convincing partners: A well-developed business plan is an effective tool for convincing investors, buyers, banks and business partners.
- Performance monitoring: It enables actual company performance to be compared with forecasts, facilitating a strategic review if necessary.
Tips & tricks for successful implementation
Your business plan must enable the reader to quickly understand what it’s all about and take a stand on your project. It reflects the coherence of your project. To achieve this, it must be neat, concise, clear and structured. Here are some tips and advice on how to optimize your plan:
- Highlight your team’s skills and experience to reinforce the credibility of your project.
- Emphasize added value: Clearly explain how your product or service differentiates itself in the marketplace.
- Quantify and justify your data: Use figures to back up your claims, and justify your assumptions convincingly.
- Be cautious and realistic : Make sure your projections take into account market dynamics and remain achievable, even in situations of economic uncertainty.
- Tailor the content: Tailor the business plan to your audience – for example, if the business plan is aimed at investors, include the exit strategy and return on investment.
- Be transparent and concise: Make sure the document is accessible to everyone, without overloading it with superfluous information.
- Take care with visual presentation: A well-organized, visually appealing document encourages reading.
A well-designed business plan is a reflection of your company’s strategy and potential, crucial for engaging stakeholders and establishing the credibility of your project.
Last update: November 2023
