To evaluate a business, professional investors would want to think with numbers, that is, with a business plan. The business plan is that document that demonstrates to potential investors that your business is legal and has the usual basis from a financial point of view. It is a huge mistake not to have a business plan; not having it means not having the compass capable of directing your future business in the right direction.

The business plan is the identity card of the company, in which all the components of a business plan are put in writing: from market analysis to the financial project, from marketing to human resource management. The more detailed it is, the more it facilitates the possibility of leveraging debt with institutions or individuals while asking for funds.

Preparing the business plan takes time and dedication. This is not a simple description of the activity that you intend to start, nor a reminder of the main expenses to be incurred. Doing so consists entirely of something else.

How to create a successful business plan

In drafting a business plan, you must consider these factors:

• The objectives; which will motivate entrepreneurs and potential investors 
• The market research and plan marketing
• The income statement with costs and revenues 
• The actual assets with cash flow expected

Sometimes, it is enough to evaluate the assumptions on which the business plan is based to understand immediately if the company will be successful and if this success will be sustainable. Only by reading the document, entrepreneurs, or investors (including banks) can evaluate the business idea. Knowing how to make a good business plan is not a guarantee of success for the company, but it is already an excellent sign to see what it is like to be an entrepreneur: and this applies whether you introduce yourself to the bank, the market, or to investor partners.

It’s not worth going into the detail of the business plan just for formalities, but it’s definitely a tool you can’t do without. Very few entrepreneurs may have started their businesses with a business plan, but not all have updated their plans over the years. 

To write an effective business plan, it is important that you carry out market research. Market research is an essential step in launching your business: How big is it, is it developing, what are the usual profits in the sector? Many questions must be asked in this step. This study can be carried out using documents on the internet, but I strongly advise you to get closer to the target clientele: Do not hesitate to contact professionals in the sector and above all to prospect directly in the field.