If you want to take out a business loan , it may happen that the lender asks for a business plan. The bank assesses the viability of the company on the basis of this business plan. This tells the lender whether your company is able to meet the payment obligations of the business loan. As an independent entrepreneur, it is therefore always wise to draw up a business plan. Do you want to borrow money and are you asked for a business plan? Then you have it ready and you can submit it immediately. This prevents delays and a possible rejection of the bank. In this article we explain how you can draw up a complete business plan in 7 steps.
Step 1: the introduction
The first chapter is, as it were, a very concise summary of the business plan. For the reader with little time, this is very useful to quickly get a picture of your company and why you want to start your own business. You introduce yourself and briefly summarize what is covered in your business plan. You mention the main points regarding:
- The market
- Potential customers
- Possible competitors
- The way your business stands out
- Main figures from the financial plan
Important: keep it short . You still have a whole business plan to explain everything in detail.
Step 2: the entrepreneur
The next step is all about you as an entrepreneur. Who are you? What is your background? And how can you make your new business a success? In this chapter, you will present yourself and provide basic personal information such as:
- Personal details (address and contact details)
- Training followed
- Relevant work experience
In addition, in this section of the business plan, you will explain why you want to start this new business. Why are you self-employed? What are your motivations? What do you want to achieve with this new company? And what are the strengths and weaknesses? Chapter two of a business plan is best viewed as a resume through which the reader gets to know you as an entrepreneur .
Step 3: the organization
When you have introduced yourself as an entrepreneur, you can start by describing the organization of your new company. In step 3 the plans and sector of the company are described in detail. You start by listing the latest industry developments and how your new business will be an addition. The questions below give you a clear picture of your company:
- Where are the opportunities in this industry? And what are the bottlenecks?
- What need will your company meet? What makes your company unique?
- What problem will you solve with your new company?
You can substantiate the answers to these questions with figures and statistics from reliable sources, such as the Central Bureau of Statistics (CBS).
Then describe your idea as specifically as possible and what kind of business you want to start. You also explain the consequences of this choice for business operations. You can see this as a general description of your company. To write this third chapter you can use the questions below:
- Are you alone or do you have a business partner?
- Are you a full-time entrepreneur or are you also employed?
- Are you a self-employed person or do you employ staff?
- Where is your company located?
- Do you need permits for your business operations?
- What are the success factors of your company?
- What are the risks for your company?
Step 4: the market
In step 4 you describe the sales market of your company. The sales market is the market where the company's goods and services are sold. Where are the opportunities and what are the possible risks? What is your target audience and who are your competitors? You map the sales market by means of market research and a SWOT analysis. A SWOT analysis is a very useful method to clarify both the weaknesses and strengths of your new company and the sales market.
- S = Strengths: what are the strengths?
- W = Weaknesses: what are the weaknesses?
- O = Opportunities: where are the opportunities?
- T = Threats: what are the possible threats?
Step 5: the marketing plan
A good business plan should of course not be missing a marketing plan. In a marketing plan you describe how you get your customers . By means of market research you describe the trends, developments and any plans the government has for the relevant market. On the basis of this analysis you describe who your potential customers are and how you will win them for you. The marketing plan is, as it were, a strategy to assess where the opportunities lie in the market and how you can achieve the goals of your company.
Step 6: the financial plan
The financial part of your business plan is essential. In step 6, you use figures to show that your company has a chance of success. To make a good financial plan, divide it into 4 standard budgets :
- Investment Budget = Clearly describe the investments required to start your business. Indicate how you want to use the investments and what the money will be spent on.
- Financing budget = here you show how you want to arrange the financing of your company. How much money do you need? And where do you get that money from?
- Operating budget = shows what the expected revenues and costs are over a certain period. In a standard financial plan this period is 3 years.
- Liquidity budget = cash flow - these are all cash flows in and out. Based on the cash flow, you can see how much cash you have at any time. Possible investors base their judgment on profitability (whether your company is able to repay the principal and interest) and solvency (the ratio between equity and debt).
Step 7: the legal plan
When you search the internet for what a good business plan looks like, the legal part is often skipped. Yet this is a very important part . In the legal plan you specify which measures will be taken when you are faced with legal matters. For example, how do you deal with a legal conflict with a supplier? What do you do if a customer does not want to pay? Or how do you draw up a valid contract? In step 7 you specify how you have legally arranged various matters concerning:
- Terms and Conditions
- Sales and purchase agreements
- Employment contracts
- Non-competition clause
- Patent or patent applications