Not Only for Startups: The Business Plan as the Road Map to Success
From a purely objective point of view, the business plan is a written business concept containing all the information and steps required to implement a business idea, ranging from the legal form of the company to the marketing concept. It is designed to reduce the risks of a new project by going through different scenarios in advance. In this way, it also serves as an important planning instrument for existing companies.
The business plan is a pre-requisite, not only for providers of capital - whether banks, private investors or venture capital companies as well as any kind of funding agency - but also for public authorities issuing residence or work permits or approving the founding of start-ups in line with Austria's Red-White-Red Card.
How do I develop a business plan?
Several banks offer detailed templates and examples on their Websites. In addition, the Startup Service of the Austrian Federal Economic Chamber has made a helpful tool available, namely the business plan software "Plan4You". Provided that a good business idea exists, a well thought out business plan is the ticket for the fast lane on the road to success. For this reason, it is essential to take the following points into account.
1. Be well prepared
Preparation is everything if one establishes a new company or expands to international markets. Analyse the market you want to operate in. Identify niches and also consider your USPs. However, many points such as a competitive analysis, market potential, opportunities and risks are the result of a comprehensive market study. Moreover, the suitable legal form for the company is frequently the consequence of the expected profits budgeted in the financial forecasts.
2. Think in terms of eventualities
Whoever wants to be well prepared should allow for eventualities. In spite of a careful market analysis, what will happen if a competitor suddenly emerges offering the same product or service? What will you do if an important supplier unexpectedly disappears from the market? Does a Plan B exist? A good business plan should cover at least three possible scenarios, namely an optimistic, average and pessimistic scenario.
3. Precisely define your planned activities
This point applies to start-ups as well as established companies aiming to conquer a new market. It is important to precisely define which business activities are planned, where exactly, and to what extent. What will be done at corporate headquarters in the country of origin, and what will be carried out in the new foreign subsidiary or branch office? What about sales, production, marketing and R&D? How is the assignment of tasks defined i.e. who is responsible for what? It is essential for start-ups and newly established companies to outline the skills and existing business experience of the founding or management team in order to convincingly demonstrate existing capabilities and talents.
4. Keep it brief and be precise
Your potential investors are most likely not in this position because they spent days on end discussing business plans which are as long as a humanities dissertation. Accommodate their effective way of working and keep the business plan brief and precise. A business plan consisting of 20-30 pages (DIN A4, plus attachments) should be sufficient to get to the heart of your business idea and implementation plans. A business plan is seldomly read in the presence of the author. For this reason, it is recommended to use clear and unambiguous wording which is easily understandable for people who are not technical experts. A clear structure will also enable the reader to quickly familiarise himself with the information.
5. Keep your business plan up to date
It is not unusual for key basic assumptions or parameters to change as the business idea is transformed into a mature concept. Nevertheless, it is important to always ensure that the business plan is kept up to date. In order to stay on top of things, it is recommended to consecutively number the individual thematic areas and carefully note all cross-references. In this way, subsequent updates can be simply and efficiently carried out.
6. Be your own creator of your road map to success
Naturally it makes sense to call upon an experienced business consultant to help you align your business plan to market conditions. Ideally the consultant will play the role of a moderator. Nevertheless, in any case, you yourself should draw up the business plan. The bottom line is that YOU are the one who will have to present it to business partners and financiers and answer their questions. Furthermore, nobody else can advocate and promote this business idea as effectively as you can.
Create a business plan: Download instructions
Here you can download more detailed information and a structured guide on how to draw up a business plan and what elements it consists of.
>> Please do not hesitate to contact us for further information about how to start your business in Austria!