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How to create a business plan that will lead to success?

How to create a business plan that will lead to success?

Whether you are a new company or ready to expand your business, a business plan is your plan for success. Looking five years into the future, a business plan articulates your business goals and elaborates your way to reach these goals.

An entrepreneur needs a business plan in order to assess the validity of entering in the investment in a quality way, and then to find a bank that will participate in financing. It is also an important tool in managing and expanding the existing business.

Since every business is different, each business plan is different as well. But all successful business plans have some things in common.

In business planning it is not enough to assess the sales income and business expenses. The analysis is much more complex. During the drawing up of a business plan, all necessary elements must be recognized and quantified so that the project could come to life.

What should a business plan comprise?

Each business plan should have:

  • Management summary – explanation of key points of your business plan
  • Description of the company – answering the questions: who, what, when, where and why
  • Business goals – definition of business goals in short, medium and long term
  • Skills and experience – detailed description of your skills and experiences
  • Targeted users – your clients and approach to defining the prices
  • Market and competitors – detailed analysis of the competition and identification of market trends
  • Sales and marketing – promotional activities that will be used to attract customers
  • Operational plans – how to define staffing and space needs
  • Finances – detailed analysis of financial side of business

Which financial projections should be included in the business plan?

A quality analysis includes an analysis of investment structure and validity of an individual investment segment in comparison to other similar projects, taking into account the financial aspect.

It comprises a detailed analysis of income with an analysis of justification of the final price of the product/service in comparison to the competing companies and the level of product/service they offer, detailed projection of the number, structure and cost of employees, calculation of necessary capital investments in future periods etc.

An important element during the drawing up of a business plan is putting the project in a real timeframe, i.e. deadline plan that will define the time needed from an idea to the realisation of the project, i.e. the period until the project starts generating income.

The elaboration of business expenses on fixed and variable expenses is extremely important in order to optimally assess the working capital needed for the start of business; this is often neglected, which is why the investment is bound to fail at its very start.

What else you should pay attention to?

The comprehensive analysis of all elements needed for the study should be reviewed not only from a financial point of view, but also from the functional one, taking into account the tax aspect of an investment and time needed to prepare and realise the project in regard to the market situation.

Of course, the management of the investment / project is also very important after its realisation, i.e. the knowledge, skills and experience of persons who will be directly responsible for project management.

Talking with experts who understand the business planning process is a sure way of making a solid business plan. The good news is that this does not have to cost a fortune.