6 Detailed Steps To Build Your Business Plan

  • Devansh 
  • 4 min read
Business Plan

A business creator must establish a Business Plan to validate his creation project. For this, he must specify the different stages in order to build his Business Plan. The future entrepreneur must therefore ask all the necessary questions (and provide the answers) to ensure the success of his business in the long term. What are the necessary steps to build your Business Plan?

Step 1: Evaluation of your offer

The first step is to determine whether the products or services offered by the company we are going to create meet a real offer. We must therefore ask ourselves what is the added value of the products or services offered compared to the already existing offer. Are these products original and stand out from other products offered by the competition? What are their advantages and how are they innovative? Is the target market carrying a real offer?

Step 2: Carry out a precise market study

Then, it is necessary to know well the target market by the services of his company. It is therefore essential to launch a market study, the results of which will give a good vision of the defined market. Market research will make it possible to better identify potential customers: for example, to determine the average age of customers, to know their financial capacities and therefore their purchasing powers, the socio-professional categories represented, the geographical areas target… Thus, through a perfect knowledge of the market, it will be possible to establish the right marketing and commercial strategy for the activity of his company.

Step 3: Establish your “Business Model”

This part of the Business Plan serves to show that his future business will be economically viable and that it will produce substantial sources of income and profits. The sources of income may come from the sale of services or products, advertising, the sale of patents or technological licenses … In this same part, it will be necessary to determine and fix the sales prices of its products or services. Prices will have to be positioned in relation to those already in the same market. Finally, the business creator will propose his commercial strategy: ensure that he has a perfect knowledge of the market and the targeted customers, that he will know how to sell his products or services, that he will be able to find commercial partners.

Step 3: Position yourself against the competition

This section of the Business Plan allows the entrepreneur to position himself against the competition. It will be able to determine its pricing policy (prices higher or lower than the target market prices). The future entrepreneur will have to demonstrate that his company will be in a position of strength in relation to the competition and thus ensure the sustainability of his company over time.

Step 4: Define the nature of the company

In this part, the business creator must specify which legal form is chosen for the latter (SA, SARL, etc.). It will also have to specify the capital, the nature of the funds and the contributions. The future entrepreneur will also have to list the shareholders and define how they will distribute the company’s capital.

Step 5: Establish an action plan

This is the heart of the Business Plan. The entrepreneur will put forward his different strategies to develop his business within the first three years of creation. Thus, he will explain what are the key factors for the success of his business. It will give quantified objectives. The business creator will specify his research and development plan and by what means and investments he will finance it. But he will also have to assess production costs, give his commercial action plan, explain his human resources management policy … He will therefore have to provide a lot of figures and numerous arguments to demonstrate that he has a clear and precise vision of which will promote the success of his business over time.

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Step 6: Establish the financial forecast

This last part serves to demonstrate the future financial profitability of the company over the first three to five years of its creation and development. The entrepreneur will therefore have to specify his assessments as to the estimate of income and expenses. In addition, he will have to establish a provisional income statement, a provisional balance sheet as well as the financing plan and finally the cash flow plan.