What’s the purpose of a startup business plan? Well, think of it as the foundation from which your enterprise is built.
It’s the backbone of your company. The first impression for investors and potential partners. Essentially, it’s the roadmap you’ll follow to guide your business. Not only for the first several years but as you gain traction and grow.
10 Questions Your Startup Business Plan Must Answer
1. What need does your startup business meet?
This goes beyond the typical “What does your business do”.
Investors read a lot of business plans. Chances are, they already know what your business does. Give them something with a little more depth. Explain what problem is solved by your service or product.
Knowing what need you fulfil isn’t just for potential investors. Sure, they’ll have a better idea of why your company will be successful. But it will also help you learn to identify your customers’ needs. Because those may change! If you’re able to anticipate those changes, you can plan ahead and adjust your company’s focus.
Adaptability equals success.
2. What makes your brand different?
So you’ve established how your startup meets the needs of your target audience. Now you need to figure out how you serve those needs better, or in a different way, than your competition.
Here are a couple of questions to ask yourself:
- What are four key factors that set your company apart from other solutions?
- How can you translate these differences into a long-term advantage for your startup?
Acknowledging your competition doesn’t weaken your business plan.
In fact, learning more about them may strengthen your own business model! Research how they operate. Learn what they do wrong, what they do right, and how their business is doing in your local market.
3. Who is your target market?
Marketing to everyone would be a serious challenge. Narrowing down your target market will help you develop a better marketing and advertising strategy.
Factors to consider as you narrow down your market research include things like:
- Geographic location
- Marital status
- Employment status and profession
Don’t worry about your product or service becoming to niche. The needs of your target demographic may change over time! Fluctuations in your customers needs are just another opportunity to expand your business into other markets.
4. What is your plan for promoting your startup?
It doesn’t matter how genius your business idea is if no one knows about it. Marketing a business is every bit as important as creating it!
All your research on your target market and competition will pay off here!
- How will you attract your first customers?
- Where will you first introduce your product?
- What kinds of media will you use? Internet? TV? Audio? Why?
- What kind of social media presence do you have? Which platforms will you use?
5. How will your business generate revenue?
This may seem a little obvious. But you’d be surprised how many startup business plans fail to dive into the specifics!
Yes, of course you’ll make money by selling your product or service. But how are you going to sell them? Where will you sell from? How much will you charge?
The answers to these questions will bring up a few more:
- What will your operating costs be?
- Will you need to hire employees? How will you pay them?
- Will you need to pay for services to operate your business?
- At what point will you break even?
- What is your exit plan? Will the amount you expect to sell your business for be sufficient to pay off your debts?
These are all things an investor will want to know. And they’re important for your personal knowledge as well!
6. Do you have what you need to get started?
If you plan to use your startup business plan to attract potential partners and investors, this will be their bottom line.
Every business starts somewhere. However, that start line varies a lot from company to company. What will you need to launch your startup?
Include things like:
- Advanced equipment
- Start up cost
7. What have you accomplished already?
To make a compelling impression on investors and potential partners, your business plan should include a section on the traction you’ve already gained.
Let them know you’re working on more than a simple idea. Traction – that is, actions you’ve already taken towards launching your business – is a huge part of making your case.
Here are a few things you can include that will show your business already has momentum:
- Manufacturing & Distribution: Have you already made partnerships for manufacturing your product? How will you ship and distribute?
- Product Development: Where are you at in the process? Is your product already available for purchase? Or are you still working with a prototype?
- Intellectual Property: Do you already have patents for your ideas? A trademark for your company name?
8. How will you operate on a daily basis?
This part of your startup business plan doesn’t have to be exhaustive. Your operations section should cover the basics, like:
- Potential hiring costs
Stick to the pertinent points. Only give details on things that are critical to your daily operation. Remember, you want investors to actually read your plan. And retain it!
9. What makes your company a good investment opportunity?
This is where you let investors know what your goals are. How their contributions are critical to achieving those goals. And what they can gain from aligning themselves with your brand. Remember to include:
- How much money you’ll need from them.
- Specifics on how much they can expect to gain from investing in you.
- How do you plan to use the funds they give you.
- What you expect to achieve with their investment. And when you plan to achieve that.
Again, this answers the most important question. Why? Why they should want to be part of your company. Why you’ll be a success. Why now is the time for them to get involved.
10. How will you handle growth?
You’ve accomplished all those short-term goals. You’ve put out your initial product offering, acquired your first customers and you’re making a profit. Now what?
Where will your business go from here?
To complete this portion of your startup business plan, ask yourself the following questions:
- Do you have any new products or service ideas lined up?
- How will these new offerings enhance your current business?
- Will you expand to new markets? New customer base? New physical location? An online store?
- Will you take your company public with an Initial Public Offering?
Are You Struggling To Draft a Comprehensive Startup Business Plan?
When you first get started, writing a business plan seems easy. There are no real rules. No length requirements. The subject matter is really only a suggestion. But you may find that creating a truly comprehensive document on which to base your enterprise is actually pretty complex.
Hiring a professional team, like our writers at Bargain Business Plan, will help you find the right answers for the right questions. Whether you want to attract investors or just need a well-researched document to help you run your company. Contact us today for a free quote!