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50 Questions Your Business Plan Should Answer
S adly, most investors don't read business plans. However, writing one is the only way you will be able to answer the following 50 questions which an investor will ask you:
1. What is the price of your product or service and why?
2. How much capital is required to execute your business plan?
3. How much is the company is worth?
4. What existing products/services does your company provide?
5. What is the use of the proceeds?
6. On a summary basis, what is the historical financial performance of the company (even if, and perhaps particularly if, you have no revenues)?
7. On a summary basis, what is the projected financial performance of the company?
8. What new products/services are being developed and when will they be ready for market?
9. What is the size of the market for your product in dollars?
10. What is the size of the market in terms of units?
11. How has the market for the product/service changed over the past 5 years and why?
12. How do you anticipate it will change going forward?
13. At what rate is the market for your product growing?
14. Is the competition highly concentrated or highly fragmented?
15. What is your distribution channel and why is it the best one?
16. On a broad level, what are the elements of your marketing strategy?
17. What does it cost to generate a lead, and what is the ratio of leads to sales?
18. What funding is being allocated to new product development from the financing and from ongoing operations?
19. How many potential customers have you talked to?
20. What are the gross and margins on your product/service? Why are they superior or inferior to a competitor?
21. What is your assumptions on the bad debt and collection period for outstanding receivables?
22. What are your working capital needs once sales take off and how will these needs be addressed?
23. What will happen to gross and operating margins as sales rise and why?
24. What percentage of your sales are recurring?
25. Who are your top five executives and what is their professional and educational background?
26. What regulatory or legal threats are present?
27. Are there international markets for this product and is the company positioned to take advantage of them?
28. Who is the largest competitor in your industry?
29. What criteria will be used to choose locations for geographic expansion?
30. How will you get this product into mass market distribution channels?
31. Is the product/service patented?
32. Who are your suppliers and or vendors?
33. Do you have more than one for each supplier/vendor of your basic raw materials or services?
34. What are your payment terms with vendors or suppliers?
35. What will cause gross and operating margins to improve as volume increases or decreases?
36. Where is the company located and how many square feet does it lease or own?
37. What is the length of the sales cycle?
38. How did you estimate returns and allowances?
39. How are sales personnel compensated? Incentivized?
40. What, as a percentage of sales, is the industry norm for R&D expenditures?
41. What is the earnings multiple of public companies like yours?
42. What is your immediate marketing objectives?
43. Does the company have a board of directors or advisors?
44. What is the ownership structure of the company? Who else is an owner?
45. How has the company been financed to date? What other financial transactions have occurred in the past?
46. Has the product generated any publicity? Where?
47. How old are the current liabilities on the balance sheet?
48. Who has prepared the historical financial statements and have they been compiled, reviewed or audited?
49. Is there any cyclically in sales?
50. What are the competitive advantages of your products?
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
David R. Evanson has more than 30 years working in the media, on Wall Street and in media relations. He has worked with investment banks, asset managers, private equity investors and institutional brokers on a variety of marketing and communications challenges. David is also a recognized financial writer, having authored five books on finance and economics, and articles in Barron’s, Forbes, Investment Dealers’ Digest, On Wall Street, Financial Planning and Entrepreneur, among others. David brings to the table a well-developed understanding of the capital markets, investments and corporate finance, and a talent for creating targeted media communications programs for financial services providers.
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6 Critical Questions Your Business Plan Must Answer If you want to lay the groundwork for a stable business and attract investors, make sure you're hitting these points.
By Larry Alton • Mar 18, 2015
Opinions expressed by Entrepreneur contributors are their own.
Never underestimate the importance of your business plan . It is the backbone of your company, a foundational pillar from which your enterprise will be built. It's going to serve as the first impression for countless potential partners and investors, and it's going to serve as a roadmap for your whole business -- at least for the first several years.
In some ways, writing a business plan is easy -- there are no rules or requirements for length, format, presentation, or even subject matter. But finding the right answers to the right questions is critical if you want to lay the groundwork for a stable business and attract sufficient attention from investors.
Related: 25 Common Characteristics of Successful Entrepreneurs
1. What need are you addressing?
This is an important question because it extends beyond the simple "What does your business do?" It's one thing to outline your business in general, describing what products you make or what services you offer, but if you want a solid business plan you have to take it to the next level.
It's nice to imagine your business as providing something useful, and if you're excited about the idea, it's that much easier to think about people buying it. But you need to be logical and critical when you consider the driving force behind your customers' purchasing decisions: what fundamental customer need is your business addressing? You'll want to back this up with research that shows the need actually exists.
2. What makes you different?
It's a big world out there, and startups are constantly coming on and off the radar. Chances are, there are multiple businesses out there who are already serving the crucial need you outlined from question one. That doesn't mean you can't serve it better, or serve it in a different way, but therein lies the challenge—figuring out what makes you different.
First, you'll need to acknowledge all the major players in your space, and this is going to require some research. Acknowledge what they're doing right, what they're doing wrong, and how they're going about their business. Identify the differentiating factor that will allow you to stand out, and emphasize it.
Related: Struggling to Define Your Business Goals? Ask Yourself These Questions.
3. Who is your audience?
Here's a hint: the answer can't be "everybody." No matter how useful or practical your product or service is, there's no way you're going to be able to sell to everyone in the world. Think about factors like age, sex, education, geographic location, working status, marital status, and perform some preliminary market research to determine the best path forward.
Your key demographic may evolve over time, so don't stay too committed to one niche. Also remember, that it's easy to expand to other markets once you've established yourself in one, so if you have multiple key demographics, it may be wise to focus on one to start things off.
4. How is your business going to make money?
This seems like an obvious question to answer, but you'd be surprised how many entrepreneurs fail to elaborate on their plan. The brief answer to this question is "sell products/services," but how are you going to sell? Where are you going to sell? How much are you going to sell for?
The other side of the question is what are your operating expenses? Who are you going to pay? What services or partners will you need to pay for? And ultimately, will the amount you sell be able to surpass the amount you owe? When will you break even?
5. How will you promote your business?
Promoting your business is just as important as creating it. Otherwise, people will never know who you are. Your marketing strategy should start off based on what similar businesses before you have done. Do they rely on traditional advertising or online marketing? Do they attend tradeshows and local events, or use technology to spread the word about their existence?
Related: The Ultimate Guide to Writing a Business Plan
6. What do you need to get started?
For many potential partners and investors, this is the bottom line. All businesses have to start somewhere, but that starting line varies dramatically from industry to industry and from entrepreneur to entrepreneur. Do you need any advanced equipment? Who will you need to hire? How much will you need for an initial run? These questions should give you an idea exactly how much capital and what resources you need initially.
It may seem counterintuitive, but answering these questions isn't a one-time process. Your business plan should be a living, changing document that evolves along with your company. Throughout your course of entrepreneurship, you're going to encounter new challenges, new opportunities, and hundreds of factors you never considered as significant to your business when you were writing the initial plan. To survive, you're going to have to revise your answers to these questions and update your business plan accordingly.
Related: The Essential Ingredients to Startup Success
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120 Questions to Ask When Starting a Business Plan
Starting a business is an exciting venture, but it can also be overwhelming. An important step in the process is creating a business plan that will serve as a blueprint for your company’s future. A business plan will help you define your business goals and the steps you need to take to achieve them.
120 Questions to ask when starting a business plan:
- What is the purpose of your business?
- Who is your target market?
- What products or services will you offer?
- What makes your business unique?
- What are your short and long-term goals?
- What is your growth strategy and how will it be implemented?
- What are your key success factors and risks?
- What are your short and long-term milestones?
- What is your exit strategy?
- What are your company’s mission and vision?
- What are the values and culture of your company?
- What are the roles and responsibilities in your company?
- What are your company’s strengths, weaknesses, opportunities, and threats (SWOT analysis)?
- What are your company’s value proposition and competitive advantage?
- What are your company’s core competencies and differentiators?
- What are your company’s positioning and branding?
- What are your company’s key performance indicators (KPIs) and metrics?
- What are your company’s organizational structure and hierarchy?
- What are your company’s policies and procedures?
- What are your company’s systems and processes?
- What are your company’s quality control standards and measures?
- What are your company’s innovation and growth strategies?
- What are your company’s sustainability and social impact strategies?
- What is your company’s risk management and crisis response plan?
- What are your company’s timeline?
- What are your company’s budget and financial plan?
- What are your company’s marketing and sales plan?
- What are your company’s customer service and support plan?
- What are your company’s product development and roadmap plan?
- What are your company’s talent and recruitment plan?
- What are your company’s technology and infrastructure plan?
- What are your company’s partnerships and collaboration plan?
- What are your company’s networking and networking plan?
- What is your company’s communication and public relations plan?
- What is your company’s legal and compliance plan?
- What is your company’s contingency plan?
Data and Analytics
- How will you measure and manage your organization’s performance?
- How will you use data and analytics to improve your products or services?
- How will you use data and analytics to optimize your marketing and sales efforts?
- How will you use data and analytics to optimize your operations and processes?
- How will you use data and analytics to support your business strategy and decision-making?
- How will you use data and analytics to support your fundraising efforts?
- How will you use data and analytics to manage and mitigate potential risks and challenges?
- How will you use data and analytics to drive innovation and growth in your organization?
Strategies and Sales
- How will you reach your target market?
- How will you differentiate your products or services from those of your competitors?
- What is your pricing strategy?
- What channels will you use to sell your products or services?
- What is your target market’s buying process?
- What are your marketing objectives (e.g., brand awareness, lead generation, customer acquisition)?
- What are your competitive advantage and unique selling proposition?
- What are your customer acquisition and retention strategy?
- What are your target market’s needs and preferences?
- How will you position your products or services in the market?
- What is the buying process of your target market?
- What are the strengths and weaknesses of your competitors?
- What are your marketing budget and timeline?
- What metrics will you use to measure the success of your marketing efforts?
- How will you adjust your marketing strategy as your business grows and evolves?
- How will you use customer feedback to improve your products or services?
- What partnerships or collaborations can help you reach your target market?
- What are the key components of your business model?
- What are the key resources (e.g., people, equipment, technology) required to run your business?
- What are the key systems required to support your operations?
- How will you organize and manage your team?
- What are the key processes and systems you need to put in place?
- How will you measure the performance of your business?
- What are the key operational risks to your business?
- How will you ensure the quality of your products or services?
- How will you manage and motivate your team?
- How will you handle customer complaints and problems?
- How will you manage your supply chain and logistics?
- How will you deal with unexpected events and challenges?
- How will you regularly review and improve your business processes?
- What are the key performance indicators (KPIs) for your business?
- How will you use technology to support and improve your operations?
- What are your projected revenues and expenses?
- How much funding will you need and where will you get it?
- What is your projected cash flow?
- How will you manage your financial risks?
- How will you measure the financial performance of your business?
- How will you forecast and budget for your business?
- What are your projected break-even points?
- What are your projected return on investment (ROI) and return on equity (ROE)?
- What are your projected ratios (e.g. debt-to-equity, current, quick )?
- What are your projected financial statements (e.g., income statement, balance sheet, cash flow statement)?
- How will you manage your financial projections and assumptions?
- How will you use financial models to support your business decisions?
- How will you manage your financial data and reports?
- How will you use financial metrics to evaluate your business performance?
- How will you use financial analysis to support your business strategy and decision-making?
Legal Aspects of a Business
- What is the legal structure of your business?
- What licenses or permits do you need to operate your business?
- What are your legal responsibilities and liabilities as a business owner?
- What legal protection do you need for your products or services?
- What legal protection do you need for your intellectual property (e.g., trademarks, copyrights)?
- What legal protection do you need for your business assets (e.g., contracts, insurance)?
- What legal agreements will you need with suppliers, partners, or customers?
- What legal considerations do you need to take into account for your industry or location?
- What legal requirements will you need to meet (e.g., taxes, labor law, environmental protection)?
- What legal resources (e.g., lawyers, contracts) do you need to support your business?
- How will you deal with legal risks and challenges in your business?
- How will you use legal strategies to support your business goals?
- What legal counsel will you need to support your business?
- How will you manage your legal budget and timeline?
- What legal documents and records do you need to maintain for your business?
- How will you use legal frameworks and standards to support your business operations?
- How will you use legal contracts and agreements to protect your business interests?
- What legal frameworks and regulations do you need to consider for your business?
- How will you use legal strategies to support your fundraising efforts?
- How will you use legal strategies to support your growth and expansion plans?
- What legal strategies will you use to protect your business against potential liabilities or risks?
- How will you use legal strategies to support the overall success and sustainability of your business?
- How will you stay up-to-date on relevant legal developments and changes that may affect your business?
- How will you use legal strategies to support your company’s overall compliance and ethical practices?
- What legal strategies will you use to support the overall governance and management of your company?
- How will you use legal strategies to support your company’s overall transparency and accountability?
- What legal strategies will you use to support your organization’s overall resilience and adaptability?
- What legal strategies will you use to support your company’s social and environmental responsibility?
- How will you use legal strategies to support your company’s overall reputation and public image?
Frequently Asked Questions
What is the main purpose of a business plan.
The main purpose of a business plan is to provide a clear and concise overview of the business, including products or services, target market, financial projections, and marketing and sales strategies. A well-developed business plan can help a company stay on track and achieve its goals by providing a framework for decision-making and action.
What are the elements of a business plan?
The key elements of a business plan typically include an executive summary, business description, market analysis, competitive analysis, product or service offering, marketing and sales plan, and financial plan. It may also include details about the management team, the target market, and the company’s competitive advantage.
What are the things to consider when starting a business plan?
First, you need to define your business idea and the products or services you want to offer. Next, you need to conduct market research to understand your target customers and the competition. This will help you determine the feasibility of your business idea and identify potential challenges. You will also need to create a financial plan that includes projected revenues and expenses, as well as a marketing plan to help you attract and retain customers. Finally, you should set specific goals and create a timeline for achieving them.
What makes a good business plan?
A good business plan should clearly outline the goals and objectives, as well as the strategies and actions that will be taken to achieve those goals. It should also include a detailed financial plan, market analysis, and competitive analysis. In addition, a good business plan should be well-written, concise, and easy to understand. It should also be flexible and adaptable, as the business environment is constantly changing.
When you start a business, it’s important to ask the right questions. If you take the time to think about these important topics, you’ll be better equipped to create a solid business plan and set yourself up for success.
Keep these questions in mind as you start your business plan, and don’t be afraid to seek advice and guidance from experienced entrepreneurs. With careful planning and a clear vision, you’ll be well on your way to achieving your entrepreneurial goals.
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Business Plan | 60 questions to ask yourself
Today, I’m going to show you the 60 good questions to ask yourself when creating your business plan . Here we go !
60 questions to ask yourself to create a Business Plan
Find in this video, the questions to ask yourself to make a business plan
Below is the support I used for my presentation on the business plan :
So at the start , to be completely honest with you, I didn’t necessarily want to do an article on business plans. The reason is quite simple. I’m not a big fan of business plans and I’ll tell you why. In fact, 99% of business plans always have the same form, namely, if we take a graph with income on the abscissa and time on the ordinate, we always go through the following phases: we are very poor at the start and afterwards as if by “magic”, you become very rich!
The question that arises is therefore that of the credibility of a business plan.
Why does this simplistic approach bother me?
When starting a business, if there’s one thing that’s hard to predict, it’s revenue levels. Simply because it is impossible to know in advance if we will succeed in obtaining many customers or not, after how long, etc. In other words, the only thing that we can predict more or less correctly are the costs, because with that, we can have a vision that is a little finer and a little more realistic. On the other hand, for income, objectively, even if you rely on statistics, even if you base yourself on market phenomena or trends, these will always be rough approximations.
That’s why often when someone talks to me about a business plan, I tend to take a step back and say to myself “Well, what are they going to tell me now? “.
So why did I finally decide to write an article about it?
I decided to write about business plans today for one simple reason. I had the opportunity to read an article in the Express Entreprise called “ Business plan, the 60 questions to ask yourself to develop it ”. And in fact, I found this article to be really well done. Why ? Quite simply because this article allows you to ask yourself some real good questions.
Indeed, beyond a simplified curve as I was able to show you before, a good business plan, or rather a good way to draw up a business plan, is above all the fact of asking the right questions, and therefore, to defend your project more effectively with a banker, a business angel or an investor. These different questions will allow your investors to see that you have understood all the different parameters necessary to set up your business.
So, I decided to play the game as well.
The 60 questions I’m going to ask myself and make sure to answer them for my business concern SEO consulting .
These 60 questions to ask yourself for your business plan will be organized into 6 main parts:
- Your profile
- The team you are going to train
- The commercial marketing strategies you are going to start
- Protecting your know-how and your product
- Finding financing
I want to do two comments before starting the round of questions.
Of course, some questions will be more or less conducive to my activity. Indeed, insofar as I am going to launch an activity in SEO consulting, do not be surprised if I quickly go over certain questions which will be more related to industrial companies.
Second point that I would like to mention, the opinion or rather the perspective that I am going to give you will be perfectly “personal” and “subjective”. For example, in my current situation, I will not immediately need financing to start my business. Indeed, I have personal resources and I will not spend miles and cents in any case, so I will not call on a banker or an investor. So my view is going to be a bit skewed.
The objective of your business plan is to try to seduce, to show “white paw” to an investor to try to convince him that you know what you are talking about, and you know in which direction your business will go.
Come on, let’s start!
First, let’s talk about market issues.
A) The market
Having a good understanding of your market, the players and what your client wants is essential. This is the first part, one of the most important from my point of view. So first question,
1) What is the size of your market? Is it local, national or global?
The size of the market is indeed important. Quite simply, because there are markets that are really very small and you can’t do much about them. Then there are markets that are huge and sometimes that can be scary.
To the question, “Is it local, national, global?” “.
Objectively, if you start your company, don’t say to yourself from the beginning “I am a company that is global”. If you manage to become a “global” company, good for you. That’s really what I wish for you. The thing is that at the start, it never happens like that. We are on a local, national business, why not. But worldwide, no.
We will try to go there step by step. For the size of your market, you can see that on the different types of statistical studies that exist in your sector. Knowing that, this type of information, we must try to take it with hindsight. Why ? It’s good to have a vision of all the revenues of an industry. The problem is that it doesn’t really give you an indication of how and how many customers you will be able to convert. You just know there is a market and you see the trends are positive.
Now, I will answer you in a concrete way for the SEO sector.
In SEO, the only numbers I could find are industry-wide from a global perspective. In France more particularly, I searched and I found nothing in particular. In any case, what I know is going to be more on the order of trends . Unsurprisingly, there are more and more websites, for one thing. On the other hand, companies are investing more and more money in SEO campaigns to improve their organic traffic.
Am I going to approach this from a local, national or global perspective?
So first of all, my company will be located in a very specific place, namely Paris. Therefore, I will make sure to find clients in Paris and its surroundings. Afterwards, the advantage I have with SEO is that it is an online business. Thus, I will be able to do some of my activities remotely. For example auditing activities or even advice.
As long as I have information like Google Analytics or Google Search Console, I can work from just about anywhere. So initially, it will be from my point of view, local and national. The world, why not. You have to have ambition, that’s for sure, but that’s clearly not the priority. If at some point growth is strong from a local and national perspective, why not consider something else. But not immediately.
Afterwards, you also have to know if the content and services that I offer are likely to be of interest abroad. I think so. But in any case, we start “small”, we start local, potentially national. The world in a second time, but not immediately.
2) How many customers can you expect?
When you are going to start your business, it is important from the start to gauge how many customers you can expect to get. Of course, when you start your business, the number of customers most of the time is zero, and that’s completely normal. Little by little, you will manage to have customers, succeed in convincing them, etc.
Knowing that my activity will be SEO consulting, the objective will be to give the maximum added value to my clients to try to have a real qualitative approach .
What does it mean ?
This means concretely that I aim at the beginning between 1 to 5 customers per month.
Why am I sure of this ratio?
Because I could have said 20 customers. The problem is that in fact if you have 20 customers from the start, and only one person takes care of them, the quality will inevitably plunge. With my SEO agency , I don’t want to tend towards a low-end service, but rather towards a mid-range service at first, to have low prices and customers who are interested. And gradually move up. So between 1 to 5 SEO clients, it seems good to me to have a qualitative approach.
3) On this market, is there a shortage or an excess of supply?
Indeed, there are very competitive markets where there will be a lot of people, and others, much less competitive, where there will be very few people. Therefore, if you have a particular skill that is in high demand, good for you. This means that you will succeed in obtaining significant growth for your activity and your business. Knowing that the competition, or the fact of having for example an excess of supply is not always a problem in itself.
I will have the opportunity to repeat it in other questions that will follow. But in essence, if ever there are people in a market, it means most of the time that there is income in this market. Therefore, you have the opportunity to create a business in this market.
Always pay attention to markets where there is no one. If there is no one, it’s either that everyone has missed out, so it’s a golden opportunity, or it means that there isn’t necessarily any money to be made in this sector.
In SEO, there is no shortage or excess of offers. I would say it’s really in between actually. There are very good freelancers, but also very good agencies. So I don’t think we’re in a kind of over-offering at the SEO consulting level. There are, but I think there is enough room!
4) Can new actors appear in the short term?
Sometimes, it happens to find markets in which players have been there historically. So, if you want to enter this market, it will be possible, but it will be more complicated. So it will depend on your sector, your products, your service, etc.
Regarding SEO, my answer is clearly yes. I think new actors can appear. Currently, there are no predominant players to speak of. There are some very good actors, but none who are particularly above the rest. Regarding the barrier to entry, we will say that it is relatively low. So yes, there is a possibility of seeing new actors appear.
5) Is your activity BtoB (business to business) or BtoC (business to consumer)?
Depending on your business, your activity will tend towards BtoB or BtoC, and of course between the two, the approach will be radically different. In BtoB, you will be dealing with professionals. In BtoC, it will be up to consumers. Consumers and professionals are not approached in exactly the same way. So be aware of the nature of your audience. In this way, you will be able to adjust your communication, your marketing, the commercial aspects, etc.
In SEO, clearly we are on BtoB. Knowing that in the communications that I will do, there will be a large BtoB part and a very small bit of BtoC (for example on YouTube). But basically, the actual SEO consulting service that I am going to offer will be for professionals above all.
6) Is your offer in line with market expectations?
It seems logical, but sometimes we can miss the obvious. So take some time to look at what the competition is doing. Why ? Simply because if you come up with a product or service that is not at all aligned with what your customer wants, you are not going to sell anything, and your income will be 0. Therefore, really try to know market expectations, so you will be able to propose an offer that will be adapted.
For my SEO company, I will make sure that the different offers that I will propose are in line with customer expectations. There will be SEO audit, “On Page SEO”, backlinks, etc. In short, a range of activities that aim to satisfy customers. Knowing that the objective when launching an SEO campaign will be to increase organic traffic to client websites.
7) What are your customers’ expectations? Are they loyal or captive?
Understanding and knowing customer expectations is absolutely crucial. Why ? Quite simply because when you are going to set up your business, you may have things in mind. The problem is that between what you are going to have in mind and the reality, sometimes there is a sort of abyssal gap. Therefore, when setting up a business, first of all, it is important to go to see the customers or to go to see potential customers, and to ask them:
- “Concretely what do you want? “
- How can I help you?” “
- How and what are the elements of added value that I will be able to give you?”SEO
, the expectations are simple. Clients have website(s) and want to get more organic traffic, i.e. traffic coming directly from Google. This is what SEO does. The other element that interests them is going to be the income that is linked to organic traffic. In other words, we increase organic traffic, as well as income.
SEO also allows you to do this. And it will be part of the expectations of customers. Other SEO KPIs can also be interesting, such as the return on investment of an SEO campaign. For example if I invest 1 euro, how much will go into my pocket after this SEO campaign? 2, 3, 4, 5…, 10 euros?
Then, the other element: are the customers loyal or captive?
Indeed, it will be important, because some clients will be difficult to obtain because they are very loyal, for example to the SEO firm with which they work. And others much less. For example if they go through freelancers. Knowing that this is an example. I could very well have said the opposite. There are freelancers who are exceptionally good at what they do. So you shouldn’t be caricatural about that at all. In any case, be aware of the loyalty of your customers.
8) What are the customer benefits of your product or service?
When you’re going to offer a product or service, you need customers to buy it because they feel there’s some kind of added value or extra benefit compared to other products and services on the market. Depending on your sector and industry, these benefits may be different.
In SEO, the benefit for the client lies in having more organic traffic, and earning more money from it.
9) Are you in direct or partial competition with an existing offer?
When you have more or less significant competition on your market, logically, it will be more or less easy to find your place. But to come back to what I was saying earlier, the competition should never scare you. I know that when you’re a new entrepreneur, you often think “Oh lala! There’s competition, I can’t go! “. Don’t take it like that. Really consider the fact that there are people as a real lever for growth. Consider that there is potentially money to be made in this market. Therefore, do not be afraid.
Will it be more complicated than a sector where there is no competition at all? The answer is yes “. But the thing is that sometimes, sectors where there is no competition at all are explained simply by the fact that there are no profits to be made. So don’t be afraid of the competition!
In terms of offers from an SEO point of view, services related to SEO auditing , “ On Page SEO ” or backlinks , are often the types of activity that are offered by companies in this sector.
10) Can you easily differentiate yourself and find a niche position?
When you start a business, try to start, if possible, in a niche, that is to say in a relatively small market segment. Why ? Quite simply because it will allow you to become an “expert” on a very specific part of your market, and to satisfy your customers. This is a good way to get new customers. Then, when you have gained the trust of your customers, you can increase the services offered and grow your business little by little. In any case, I advise you not to start in a huge market. Start small, with a service or something that will set you apart.
At the level of the business that I will launch in SEO consulting, the differentiation will be at the service level. I will really try to promote my service in order to be perceived as an “expert” company in “On page SEO”. It’s part of the things on which I really want to be defined, of an axis on which I really want to press in order to succeed in convincing my clients. So that’s one of the differentiating aspects, and that’s my niche part. Afterwards, there may be changes. We will see how things will develop.
At the level of differentiation, there is also another element on which I think I can distinguish myself. This is about creating my content. There is already a lot of content in SEO. And the content is crucial. Of course, people who work in SEO know how important this is. So I’m going to try things a bit differently. This will notably go through the type of content, for example YouTube videos. I will also particularly make an effort in terms of my blog, my articles, in terms of visuals. I really want to make a consistent effort to show future customers what my company is capable of.
11) How many years of experience does it take to be credible with your customers?
There are sectors where experience is a determining criterion. So, if you don’t have 10, 15, or 20 years of experience, it’s going to be very problematic for you. In SEO, experience is important, but you don’t have to be in this industry for many years.
What you have to understand with SEO is that it is a sector that evolves quickly and regularly. In other words, from the moment Google makes changes to algorithms, it is each time a new way of doing things, because the way of doing SEO changes radically. So the years of experience, why not. But the real criterion from my point of view, to choose the right SEO company will be above all to know which company is the sharpest on the latest news that impact the algorithms.
Finally, it will be its ability to evolve over time, which from my point of view, is the most important element. For example, if a person who has 15 years of experience in SEO, does SEO like the first day of 15 years ago, I can assure you of one thing, it is that at present , it clearly doesn’t work.
12) Who are your competitors?
Take a moment to try to see what the different players are in the market. It could be something important. Afterwards, you have to know them, but you shouldn’t be obsessed with what they do either. Otherwise the only mistake you risk making will be to reproduce a pale copy of the original, which would be a shame. So you have to have a look at the competition, but not be obsessed with it.
SEO is a market where, on the one hand, there are, let’s say, SEO agencies that are structured. From my point of view, there is no actor who stands out more particularly from the others, even if there are very good agencies that already exist. This is the first part of the market. And on the other side, there are the freelancers. Just like for agencies, there are freelancers who are extremely good, others who are not necessarily exceptional. So we can say that there is a kind of duality, with freelancers on one side and agencies on the other.
13) Does your know-how give you a real advantage?
Indeed, there are skills that are extremely rare and that will allow you to have a real advantage. For example, if you are an exceptional craftsman or if you have a special skill. Therefore, you will get a definite advantage to complete a mission that is difficult for others to do.
Speaking of SEO, I think there are several things I think I have an edge on. These include “On Page SEO”, where I have the opportunity to bring a lot of things to market. There are others, but at present, it is above all this aspect that I wish to highlight.
14) Where is the added value created in the sector?
Knowing where the generation of added value is happening in your industry is an important element to know, because it will be a criterion that will affect several elements, including the definition of price levels. For example, if you have an activity that does not create a lot of value, that means that in terms of price, it will be difficult to offer high prices.
The added value in SEO really comes down to the ability to grow a website in terms of organic traffic and increased revenue.
15) How are prices changing?
In some markets, price fluctuations can be considerable. Therefore, it is important to know the specifics of your market in relation to this. Take for example the milk market. Unsurprisingly, you will suffer world prices with staggering price changes. So depending on your sector, you can be hugely impacted by price changes.
In SEO, there are global trends on the market, with average prices for services. After that is negotiated, depending on the customers and the type of service you are going to offer.
In the same way, I will set prices on the business that I am going to start. Since I’m in “start-up” mode, I can’t afford to come up with what we call eccentric prices, that is to say very high or the highest on the market. When you arrive on a market, you must first have your first customers, satisfy them and ask for a recommendation. Thus, thereafter, I could gradually increase my prices if I wish.
So it will be prices, let’s say at the market average, or even a little lower, just to try to be as attractive as possible at first.
16) Will regulatory changes make it more expensive to start the business?
As I had the opportunity to tell you in the introduction, there are questions that are not necessarily going to be favorable for my activity. Maybe that will be the case for yours.
Indeed, legal changes can sometimes impact the launch of a business. Therefore, if you are in a sector prone to regulatory changes, I advise you to regularly monitor developments so as not to be caught off guard. To my knowledge, regulatory changes have no impact on SEO consulting.
17) Who are your suppliers? Are they many? Concentrates?
In SEO, there are no direct providers per se. But if you are for example in the field of ready-to-wear, the fact of having suppliers who are going to be concentrated or not will play a huge role.
Because if you have problems with prices that are too high and there are not many people, that simply means that you will be able to compete. In the opposite case, if there are none, i.e. the suppliers are concentrated, this situation will have a direct impact on your business. So knowing your suppliers well, understanding the very structure of the supplier market will really be relevant for your business.
18) Is it easy to change providers?
This question overlaps enormously with what I have just said a moment ago. Namely, if you have a price or quality problem. You do not have to stay with the same supplier if you are not satisfied with them. So you can change it very quickly.
19) Will they have the power to influence the quality and cost of your offer?
Indeed, if there are not many suppliers and they offer you something that is not of good quality and at prices that are too high, you will have practically no room for maneuver to negotiate.
This situation does not apply to SEO.
Now that we have finished this part on the market, we can now move on to the next one, relating to the profile of the contractor.
B) The profile
Now, I will introduce you to the various questions relating to the profile.
Indeed, when you are going to present your business plan, know that it is above all about you, just like the business in general. Therefore, it is not surprising that investors are interested in what you have done in the past in order to understand your background. Sometimes, some questions can even go as far as the personal life framework, as this is a relevant element for investors. They know that certain personal concerns can have a lasting impact on your business.
20) Have you ever run a business?
This is indeed a question that investors can ask people who want to create their box. Depending on your answer, investors or bankers will be able to assess the risk according to them.
Indeed, investors have more confidence in people who have already managed companies. If you’ve never ridden a box and it’s your first, don’t stress about it forever. There are plenty of examples where people who have never run a company have succeeded by becoming excellent leaders. The best known cases, Bill Gates and Zuckerberg. But many others too. So for me, it’s not mandatory. It’s just a little extra. Some investors sometimes like to think that if the entrepreneur already has experience, it’s more reassuring.
So my answer is yes, I have ridden boxes in the past. Some are completely planted. So the goal is to try to capitalize on what didn’t work to make sure you succeed.
21) Are you trained in management?
Same as the previous question. For me, being trained in management is both important, but not essential, if this is not your case. If you have never studied management, business school or that sort of thing, and you want to set up your company, do not block yourself for this reason. The fact of not being trained in management is a personal point of view after all, it is not the most problematic element.
Afterwards, on this subject, I have a slightly biased point of view. For me, management, it is not compulsory to learn it in training or to go to business school. In my opinion, most of the time, “management” is above all a story of common sense. Namely, are you able to put yourself in the shoes of others to understand their interests? What are its objectives ? What is he aiming for? And many others. It turns out that there are people who are naturally good at management and who have never been to school. Conversely, there are people who have gone to school or studied management, who find themselves at some point in a managerial position and are absolutely catastrophic.
For me, management is above all a relationship with people. I personally believe that there are many more management lessons in the literature than in any other book that will claim to teach you management. Again, this is my point of view, you don’t have to agree with me.
So to the question, have I been trained in management? The answer is yes, I went to business school.
22) Can your family environment facilitate the realization of your project? Do you have the support of your spouse?
This question close to the intimate sphere can sometimes be disturbing. And yet, this is a very important and decisive point.
Simply insofar as when you go to set up your box, you will find yourself in the same situation as if you were creating a kind of boat to go to sea. Obviously, when you set up your box and especially for the first times, it tends to to really rock. There are doubts, uncertainties, you are going to have moments of loneliness and you are going to be afraid. In short, moments when you will feel alive. However, it is so difficult to set up a company if you do not have the family who supports you. It’s a kind of weight that we add to the boat and that can literally sink you.
Same thing with your spouse. It’s even stronger with the spouse. If you want to set up your company and your spouse is not aligned with it, or is even formally opposed to it, it’s a really bad start! Because not only will you have to fight to exist as a company, but in addition, you will have to fight between quotes in your home to show that your decision is the right one. So it’s very difficult.
On a personal level, does my family facilitate the realization of my project from a financial point of view? I’ll be absolutely clear, the answer is no. I don’t come from some sort of upper middle class. My business, I’m going to set it up with my own finances, not asking anyone for money.
Does my family get in the way of setting up my box? The answer is no. But there may be times when some members of my family are afraid.
Ultimately, entrepreneurship is also knowing how to manage your own fears, manage the fears of others, and that can be a little more complicated. But over time, experience and confidence allow me to ensure that this is not a hindrance. So my family doesn’t put a spoke in my wheels in relation to that, but financially doesn’t help me either. Especially since for the activity that I want to create, namely SEO consulting, there is no one in my family who has already set up companies in this area.
Then, in terms of support, I have Mariana’s at 200%. At times, she will even help me with this business that I’m going to set up, especially for all the design aspects related to the brand’s identity. Mariana is therefore a support, and it’s a real pleasure to have someone who supports you on a daily basis because being an entrepreneur is difficult!
23) Do you know someone with whom you can regularly review the project?
Indeed, it is always a good idea to regularly take stock. It can be with someone in your industry, someone who has already set up a company in the same sector… In short, different types of profiles, people who will suit you, knowing that it’s still better to score points with people who know your business or people who have already set up boxes. If this is not the case, it is a little more complicated in fact, because they will not necessarily have, from my point of view, the ability to really give you advice that is relevant to your specific situation. talk.
So am I going to do it?
In fact, the real people I’m going to do the accounts with, in quotes, are you. So you will watch my videos, you will see the evolution of my business, and regularly I will make points. And why are the points important? Quite simply because it allows us to see what we have managed to do, and above all, what will we be aiming for next. So it’s really a good game to operate. Afterwards, don’t spend 15 years there either.
Spending time preparing for meetings to take stock when you’re a start-up, when you’re a big structure, it’s a little different. But when you’re a small start-up, you have to make points, but not spend too much time there either.
Have you ever met an association of creators and support?
Indeed, if it’s your first time, it can really be interesting to join an association that will accompany you in the creation of your box. Knowing that in fact, it will also depend on another element, namely whether you are a solo entrepreneur or whether you already have members in your team.
Depending on this, you will have to adapt your strategy. Because sometimes, when you start in entrepreneurship when you were in another sector, often in the end, you are not really competent, as a business creator. So it requires knowledge, sometimes basic knowledge, knowledge that can be human. In short, there are a lot of things to develop. And about me, rather than very theoretical things, I prefer knowledge that is more pragmatic. Well, that’s my point of view.
So yes, I had the opportunity to go to certain support or designer associations in Paris, in particular some that are quite large and well-known. I stayed there, but not very long. To be honest, I’ve been to some of them just three, four times. In any case, it was never really long term. Quite simply because in fact, I had the feeling that at certain times, it didn’t make me progress very much.
Once again, it is not an overall vision that I wish to give. It’s mine. Simply sometimes, for example when I ask myself a question, I go on the Internet to find out, I watch videos, and in fact, it solves the point where I potentially have a problem or I want to improve. And the problem I find with associations is that they have so many things to deal with that sometimes, from my point of view at least, it’s a bit long, a bit theoretical. In the end, it’s added value that we lose, especially time. When you are an entrepreneur, do not waste time!
Are you ready to make financial sacrifices?
Indeed, when you set up your company, and it is finally quite linked with the story of the spouses / spouses of earlier, the financial side will be something which you must absolutely discuss with your wife, or your man , no matter. To build your company, especially if you are in a position that is relatively comfortable, stable, if you have been in a company for a while and you have prospects, you do not necessarily pose problems, the financial sacrifices you make, but not too much. Also know that when you set up a box, in general the income at the beginning is 0 and therefore, it can be complicated at the start to start your box.
So my advice to you in relation to that is to really imagine what are the things or what are the activities that you consider a sacrifice. The idea when setting up a company is not to be frustrated. Let’s say you love to play sports, gym, whatever, and that’s your passion. If ever when you set up your box, you say to yourself, ok to set up my box, I have to delete my sport or the activity that I particularly enjoy, you will end up being frustrated. So it’s not a good plan at all to do this stuff.
Try to think about things that don’t seem essential to you. And when there are some that really make you happy and you know deleting them will frustrate you, don’t. Really, never delete things that will frustrate you because a frustrated entrepreneur is the worst thing!
What will your financial needs be in the coming years? (children / apartment)
We really get into the personal with these aspects.
Indeed, depending on your business, you will have to give more of yourself. Let’s take the example of a Tech-type business. The thing is, it requires R&D (Research and Development) for several years, before you start generating revenue. I actually mean that sometimes the personal calendar and the professional calendar can be a bit of a confrontation. When you have life goals, sometimes entrepreneurship involves shifting them a bit. So you have to be aware of it to do things right.
Then the third point is to form a team.
C) Forming a team
This goes back to what I was saying earlier. You don’t build a business or an empire alone. We can start alone, that will be my case. But the goal, of course, is to get people to join you in order to succeed in blowing up your business.
Can you rely on a close-knit, complementary, experienced team?
Indeed, when you begin entrepreneurship, in any case a start-up, having a team that is united is very important from my point of view. Besides, experience will come. Even if you’re not the most experienced at the start, it doesn’t matter. From the moment you are welded, it will fix a lot of things.
Obviously, if you are complementary it is also very good. For a very simple reason. It’s that sometimes we can be very good at some things and very bad at others. Therefore, if you manage to bring together people who have different skills, it allows you to accelerate your business much faster.
For once, I’m starting as a solo entrepreneur on this project, so SEO consulting. Knowing that obviously the objective for me, it will then be to grow the company and succeed in creating a complementary, close-knit and experienced team, of course!
Are the key skills for the success of your project represented?
It’s a good question. Because if you want to get into technology, for example, and you don’t have any engineers on your team, it’s complicated. So, still have a minimum of key skills in the activity in which you want to get started. Again, you don’t have to know everything. But at least have a good foundation or key skills in certain aspects. It’s really important for your business.
Personally, I have good SEO skills. On the other hand, one of the elements where I think I will have to find someone fairly quickly to help me is, for example, at the commercial level. I can do things myself, but there are people who are clearly much better than me on this subject. So that’s going to be part of my priorities, in quotes.
Failing that, can you count on outside skills?
In fact the idea is simple. It’s just a question of understanding what your state of mind is in relation to the subject. And understand that if you don’t know how to do everything when you set up your box, that’s normal! Nobody knows how to do everything. A business is not created like that. You’re going to have to have multiple types of people, multiple types of skills, and that’s how you’re going to grow your team and then be successful in the end.
So relying on someone outside or external resources, really take that into consideration. Don’t tell yourself, to launch my company, I have to know how to do everything. Otherwise it will never happen.
Are your goals understood and shared by everyone?
Indeed when you set up a company and you are a team from the start, it is really important to share your objectives with the other members. Why ? Quite simply because if you don’t share your goals, you will gradually realize that in the end, you are not going in the same direction at all.
The problem really is that a start-up at the start, if it ever starts to have a bit of growth and it forms two types of teams, there will be one that wants to go in this direction- there, and the second in the other direction. And I tell you, it will spit fire!
So what you will obviously have to do is communicate as much as possible, see if everyone agrees with you. And if that’s not the case, which can be normal, really try to separate yourself as soon as possible from people who do not potentially share your goals or your vision. Because otherwise it won’t. A concrete example. If in your business, you are with a partner who wants to get money, let’s say extremely quickly, why not, it’s commendable, and your goal is to create a long-term business, which pays you money and allows you to be satisfied over a long period of time, you clearly see that you are in opposition.
So gauge well, see the objectives of each and based on that, make decisions.
Me for example, I am a solo entrepreneur, I agree with myself let’s say, in terms of my objectives. But really, the goal with my business, the business I’m going to create in SEO, is to try to set up an agency that will have a lot of authority in the coming months/years. Because the objective for me is to have a long-term activity. I’m not looking for the first attempt where I make money for a little while and then after, I do something else and I leave I don’t know where. So it’s really long term that I want to create. And that’s why my global approach will always be long term.
Have you planned to retain your key people?
Indeed, when you find people who will have the same objectives as you, people who will have important skills, what you will have to do is succeed in keeping them. It may seem trivial, but managing to keep skills and key people is essential for me. Maybe I have a vision that is a bit particular, but for me, a business is really above all about people. It is above all values that you will share. Therefore, if you ever find people who are aligned with your goals, your values, and who are effective, do everything to keep them.
So there may be several levers, but try to do your best to keep them. It can sometimes be through remuneration, through financial aspects, but it’s not just that either. There are many other aspects that will come into play.
In any case, it is above all a team story, a growing company. And for now, I’m not going to paraphrase Bill Gates, but at one point he told a story where he said that in the end what he made of Microsoft was not so much him, but the 20 first people who joined Microsoft in the very beginning. And I think he’s absolutely right. Simply because a company at the beginning, if there are not the right people or if you cannot keep your key people, things can quickly get out of hand.
Then the fourth part, marketing and commercial strategy.
D) Marketing and sales
strategy Marketing and sales strategy. I tell you, the articles I will do, clearly it will be mostly SEO, but there will also be some on online marketing. Simply because it is absolutely crucial.
So if you have ideas like “yes, marketing is good on paper, but hey there…”, you’ll have to delete them, because marketing is going to be really crucial.
Do you know what types of customers you will be addressing?
Indeed, when you start your business, it will be important to know what type of customers you are aiming for.
In the context of SEO, insofar as I’m going to start, I won’t be able to address myself outright, let’s say, to large companies, for example from the CAC 40. Large structures, clearly, will be inaccessible. Because in addition, to enter the selection process, it’s a lot of things and in any case, it will take time. Therefore, the big boxes later maybe, but not immediately.
First, what I’m really going to focus on will be start-ups, especially those that have raised funds. Because they will have funding. Generally speaking, start-ups that are doing well and already have money that they want to invest in SEO to increase their organic traffic. Because I love start-ups and I think that even beyond SEO, I can give them a lot of advice.
The other element on which I will really try to concentrate, it will be the TPE. Because they already have a rolling business, but do not necessarily have skills on the Internet, especially in terms of SEO. And there clearly, I can give them my expertise, I could help them grow their organic traffic.
Basically, these are the two types of clients that I will prioritize.
Besides, why do you have to prioritize clients?
Simply because at first, you started with very few resources. So the objective is going to be to try to allocate your resources, your time, as best as possible, to obtain clients that will potentially last in the long term. And that as quickly as possible.
That’s why it’s interesting to know from the start which types of customers seem to you to be the most affordable and, above all, those who will also allow you to have a significant margin. If we consider two customers, one with an average margin and the other with a slightly larger margin, prioritizing the one with the larger margin will be interesting, because it will allow you to have more silver. As a result, you will be able to grow your business even faster!
Is your market segmented?
I will take the example of SEO, it will be simpler. The SEO market is clearly segmented, I would even say almost fragmented, in fact. On the one hand, there are the SEO agencies strictly speaking, for which this is their core business. There are several on the market, at least in France. And on the other side, there are let’s say the freelancers. So there you have it, on one side are the agencies and on the other the freelancers.
Have you defined priority targets?
It goes back a bit to what I said before. When you are going to have clients, really try to focus initially on those who are the least difficult to obtain, with the best remuneration, therefore the best margins for you from the start. It is important to prioritize precisely because it will allow you to accelerate faster.
Will you face a network of priority prescribers?
There for once, I don’t know anything about it, I don’t even know what a network of priority prescribers is. So sorry. If it ever concerns you, look, but for once I don’t know.
What are the commercial means to be implemented to reach your turnover objective?
Indeed, I will mix the commercial means with marketing. Of course, when you are in a company that has just started, you do absolutely everything. So all the domains in quotes are mixed. We are not in a big company, where there are people who do the commercial aspects, some the marketing and others the finance. There as a start up, you will do a bit of everything. So the commercial aspects, I’m going to mix them with marketing.
Basically for me, the right way to get new customers is with inbound marketing on one side and outbound marketing on the other. I will explain to you what it is. Inbound marketing in a very simple way is when customers will come to you to see your business and use your service. Outbound marketing is when you contact customers. So you understand that in terms of approach, it’s two different things.
I am someone who strongly believes in inbound marketing . And SEO is inbound marketing. Content creation is also inbound marketing.
The advantage with inbound marketing, it’s a huge advantage, is that when you start it and you do it well, it allows you to have customers on a regular basis, customers who will come constantly knocking on your door asking you to work with them.
Outbound marketing is different. Because you’re the one who goes in quotes to take the time to pick up the phone or send an email. In short, prospecting to get a new client. So we should do inbound marketing from the start. And that’s exactly what I’m going to do. Because for me, it’s really the most crucial element.
In summary, inbound marketing from the beginning, at the level of content creation, and in parallel a little outbound marketing, the first three months.
Outbound marketing can be useful, effective, but the thing is that inbound marketing, from my point of view, is much more powerful. And that’s why I recommend setting it up from the start.
So here are the different commercial means.
Is your marketing process defined?
The answer is no, I don’t have a process to speak of. Maybe you, it’s already clear in your head.
Yes, I basically know how I’m going to approach a client. Most of the time when doing SEO, one of the good entry points is the customer audit. Because it will make it possible to see what technical problems there may be on the client’s website and therefore help him quickly to resolve them. Afterwards, why not sell another service, an annex to SEO.
So here it is, my marketing process is at that level. But objectively, it deserves to be dug on my part.
How will you organize your sales force?
So there, it’s the same. I think it’s good to ask this kind of question. In a structure, with a team of 2 or 3 people, everyone will do a bit of everything at the start. Except if you decide from the start to split the tasks with a person who will only do the sales. Since I’m a solo entrepreneur right now, the sales force will be me.
Have you planned a forecasting and reporting system?
Indeed when you start a business, when you start an activity, the idea will be to follow your information, financial or otherwise. So having a reporting system is important.
I think I have good Google Sheet and Excel skills in general. So it will be the kind of reporting that I will do when it requires a manual aspect. But especially from an automatic point of view, insofar as I’m going to work on my site, I’m going to use a system called Google Analytics, which can also be coupled with Google Search Console. It doesn’t really matter. But basically, on Google Analytics, you’ll see the sources of your traffic, your revenue and all that. So it will be extremely effective to have a reporting system.
Do you need a marketing function?
So for once, my point of view on the subject will be partisan. But I almost want to say that no matter what you do, whether you’re a plumber, a pastry chef, a consultant or a builder, marketing is very important. And to show you, I’m just going to give you an item.
Imagine, for example, two people with the same skills, and wanting to get into the same sector. They have the same money at the start. We can say that at this stage they are identical. Now, one of them is going to have much more developed marketing skills than the other. I can assure you of one thing, it is that with equivalent skills, the person who is gifted in marketing will explode his business much faster than the other.
So really take that into account. Marketing is not something to be taken lightly, especially not today. After saying that, I’m still going to relativize too. Let’s take the same example.
There are two people who want to create a business on the same activity. One of them is very good at his core business. The other no. The person who is not good at his core business is on the other hand very good at marketing. What’s terrible right now is that the person who is not good at their core business but good at marketing is going to be better off in the short term. In the medium to long term, it’s the other who will come out on top, simply because word of mouth will work. And since his customers will be satisfied, it will make his business grow.
What I mean by that is don’t see marketing as some kind of superfluous thing. It clearly shouldn’t be. Today, to create a successful business, marketing from my point of view is more important today than ever. And tomorrow it will be even more so. You may say to me “From what you say, form is more important than substance”. The thing is, when putting together a box, shape and substance have to be prioritized. There is no form more important than substance, or substance more important than form. Both have to be good.
Have you calculated your communication budget?
Bankers can ask you that question. With the box that I’m going to mount in SEO, I’m not going to bring in any amount of money to speak of. However, I will spend some time there. Because communication is really important, it’s really capital at the start.
So yes, I will spend some time there. Financially no, but it is possible at certain times that I use certain tools. Some of these tools will be free, others will be paid.
Don’t worry, I will have the opportunity to show you concretely how I do it.
What communication tools do you have?
I have already answered a little but indeed, there are tools that will be more or less important. After that, I don’t know exactly which ones. Because depending on the business, there may be things that we prioritize more or less. Depending on your sector, you can prioritize, for example, social networks like Instagram, others are more like Pinterest, or platforms like Linkedin.
In short, depending on your sector, whether you are BtoB or BtoC, and what the customer expects, the tool will vary. So for me, this question is not very relevant.
D) Protecting your know-how and your product
Sometimes depending on your sector of activity, in particular if you’re doing R&D, you’re going to spend time doing research, which can be extremely expensive. And so that just means that in the end, you’re going to have to protect what you’ve done. Because otherwise, there will always be clever people who will be there to steal your technology. Or your know-how.
Can your technological knowledge be subject to legal protection?
Don’t take this lightly. If this is your case, take the time. It’s true that it’s not the most glamorous time when you’re doing entrepreneurship, but it’s really important to protect your business, legally at least, to avoid there being the slightest glitch afterwards. Because it can sometimes go very wrong.
Can your solution establish itself as an industry standard?
Yes. Indeed, the more innovative a solution, the more important it is to protect it. Simply because when you arrive on the market, you potentially explode what is being done, and that can create tension among other players. So have that in mind. And that’s all I wish for you.
If you have a solution like that, congratulations. This is exactly what you should try to do.
Will you have to convince other technological players?
Yes. Of course, there are ultimately certain technologies that are combined with others. And the problem is that if ever these actors don’t agree to implement your solution, well, it simply won’t be viable. It’s not that it won’t be viable, but that it will never exist on the market. So sometimes, there are certain sectors where it can be extremely decisive to check this kind of thing.
Is your innovation in danger of being quickly outdated?
Again, this is not an SEO issue at all. But overall, if you do research and development R&D) for two, three, four years, and you finally realize that when you put the product on the market, 6 months later there is no longer anyone who buys your product , that’s a shame. So it’s true that technology is moving at such a speed today that sometimes it’s a bit difficult to predict what’s going to be the next move. But simply, it is better to say “stop” than to embark on something that will ultimately lead to nothing. Or something outdated.
Have you quantified your R&D needs?
If you are in technology, R&D, you will have to quantify it. Your banker or your business angel will be interested in it.
Will your production tool initially be sufficiently calibrated?
I don’t really know how to understand this question. In any case, my interpretation of it is that if you have a business in ready-to-wear, for example, and you have machines that create your articles, your new products, well from at a certain level, your machines will come to some sort of limit. So that means that potentially you’re going to have to invest again if you want to grow your volume. Knowing that in certain sectors, if you don’t reach a kind of critical size, it’s not really worth it. So hey, I don’t know if that’s the way I should interpret it, but that’s how I understood it.
Do you know how to arbitrate between in-house production and outsourcing?
What I recommend to you in quotes is that depending on what you do, if you have a core business, a core activity, it has to stay in-house. On the other hand, anything that is potentially support, or anything that is not essential and that does not intervene directly in your core business, yes, you can outsource it. But of course, the fact of internalizing things, the fact of subcontracting, generally, it is a bit on a case-by-case basis. Company by company. You really have to ask questions. And there is no obvious answer to such questions.
Finally the last part, it will be to find the financing.
Find the financing
This is the time when we will talk about finances and when your banker or your business angel will potentially challenge you.
What is your overall financial need?
In many cases, ultimately, to start your business, you will need resources. So the resources, it can be linked to indebtedness. But there may also be resources that will be linked to your equity, so for example to your money or your savings. You can also use what some call “love money”. Love money is simply asking for money from loved ones.
That’s basically. So understanding your financial needs is important because it simply saves you from asking for too much when in the end you won’t need as much. So here it is, it can really be an important thing for bankers.
What is the breakdown between equity and debt?
That for once is important. Your banker will challenge you on the subject. If for example you were planning to take out a bank loan, by putting 0 of your personal contribution, I tell you, there is very little chance that it will work. I would be really curious to know the name of the banker with whom it would have worked, since most of the time it does not happen. Investors are still waiting for you to put your hand in your pocket as a business creator too. It’s a question of credibility. And they too, the investors, they will tell themselves that if they ever lose money, you lose it too.
Is your business a consumer or a revenue generator?
There are businesses finally, where in terms of earnings, it will be complicated. If that doesn’t speak to you, I’ll give you some examples.
Take for example the case of supermarkets. Supermarkets are a type of business that have a positive WCR (Working Capital Requirement). It simply means that the supermarkets will receive the money from the customers. For example, when you go to the supermarket, you pay the structure directly for the different products you buy. So the supermarket receives the money immediately from its customer. On the other hand, the supermarket will pay its suppliers long after. It could be in 30, 60 days. And that, what does that mean from a cash point of view? This means that we will always have a cash flow that will be positive.
So the supermarket will be a revenue generator. This is going to be extremely interesting. And bankers absolutely want to know. Why? Simply because if it’s the opposite and you are a consumer of income or in other words, you have a negative WCR, that will mean that it is your bankers who will finance your lack of cash. And that overall, they don’t like it too much.
The thing with that is that it’s really going to depend on your business type. In the end, there are very few businesses that will be extremely revenue-generating, like the supermarket. So be aware of it, because cash is essential. It has to be taken into account.
What will be your cash flow needs in the first year of activity?
As I told you earlier, cash is really important. Indeed, money in general is the sinews of war. I don’t intend to teach you finance. But understand, the stakes around cash flow are important. There will be lots of challenges. Good investors will really challenge at this level. Because if you don’t have cash, if you can’t generate cash, it’s going to be extremely difficult to make your business last over time.
Afterwards, there may be activities where the BFR is negative, in a structural way. But in that case, you have to have financing and other methods.
What will be the collection time for customers? Can you provide payment deadlines from suppliers?
It goes back a bit to what I just said, with the supermarket stories. In fact, I took for the supermarkets, the cases where the cash flow was positive. Let’s take the opposite case. Suppose you want to set up a box, in ready-to-wear fashion for example. With ready-to-wear, you are going to need working capital from a structural point of view.
Quite simply because in fact, for a collection, between the beginning and the moment when your client is going to pay you, the time is going to be very long. The problem with this is that when you go to create your collection, you will request products from suppliers. And these last ones, you will have to pay them. You can put deadlines on suppliers, but you will have to pay them at some point. Here, your suppliers will ask for their money before your end customers have paid you. So that will mean that you are going to be in the negative.
So. When you are a start-up or an entrepreneur in general, the ability to negotiate the collection time of customers or that of suppliers can be a kind of lever on which you can pull, in order to try to improve your situation by Treasury.
After how many months will your cash flow be consistently positive ?
When I told you that cash is a bit of a cream pie thing, we weren’t there yet. What does it mean? Basically, this means that there will be what we call in finance, cash flow tables, which will allow you to see when you are going to spend and when you are going to receive money. You will be able to make predictions thanks to this. And above all, it will allow you to know in how many months you think that the whole will be positive.
What is the projected amount of your cumulative financing requirement before reaching the cash breakeven point?
It’s the same principle. We ask you how long it will take you to be positive. Basically that’s it. And once again, where it’s problematic, and I’m not at all enthusiastic about that, it’s at the level of sources of income and projected income, when you’re an already established company. When you are, for example, a kind of big liner, it is possible to have income forecasts. In any case in a much more serene way. But when you’re a start-up, it’s absolutely impossible.
So the problem is that we are always on big assumptions. Sometimes things work well, other times they don’t. And the only right way to do that is to test. That’s why I’m not a big fan of it all.
When do you expect to break even?
It’s the same principle. Breakeven point, break-even point… This is the cream pie trick of business plans.
Is the profitability generated over the three to five year horizon sufficient?
There, we are on the stuff that I do not necessarily appreciate with the business plan, but that you must do if you ever ask for money from a banker, the BPI or whoever you want. Because once again, the profitability generated will depend on the income that you are going to fix. And when you start a box, you never know the income that will fall. Just because you look at the numbers from a statistical point of view and from a global point of view doesn’t mean that’s going to be the case. So we are on something very nebulous from my point of view.
That’s it, we’ve done the trick. It took longer than expected. I am sorry. The idea for me was to dig into the subjects to try to show you precisely what questions it may be interesting to ask yourself when making a business plan. The questions I have presented to you are much more relevant than an ever-rising curve. This is what will allow you to finally ask yourself the real good questions that can be useful for your business.
Again, if you ever want to borrow money or you want to present a file to the BPI or to business angels, there is a good chance that they will ask you for a business plan. For income, you can make assumptions. So don’t listen to me if you need money and don’t want to be a solo entrepreneur like me. Do it, you will satisfy the people who need to have this information because it reassures them.
But overall, the concrete usefulness of the thing will be very limited. The business plan will allow you to ask yourself the right questions about the market, about your profile, and therefore, potentially strengthen your conviction that what you are going to do is useful, it will have an impact in the future. , and that you will succeed in growing your business.
So there you have it, thanks for reading to the end. From the next articles, we will get into the pragmatics and it will be from my point of view, much more interesting for you and for me to show you all that.
See you soon!
1 thought on “Business Plan | 60 questions to ask yourself”
This was very helpful,and informative, especially for those that are new to writing business plans it makes it more understandable and practical
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6 Questions Every Business Plan Should Answer
Table of contents.
An actionable business plan is crucial, whether your business is brand-new or an established player in its field. A business plan is especially vital for SMBs, which often must contend with lower name recognition, fewer loyal customers and other typical business challenges. While it doesn’t guarantee success, creating a business plan with research and care can help a business prepare for any future uncertainties.
Entrepreneurs and small business owners must ensure their business plans address six primary questions. Thinking through these questions and developing potential solutions helps set up your venture for success.
What is a business plan, and why does it matter?
A business plan is a formal document designed to help you set achievable business goals and outline how you’ll accomplish them. The business plan should include various road maps dedicated to the following operational elements:
- Product creation
- Operational goals
A business plan is a valuable tool internally and externally.
- Internal business plan functions: Internally, a business plan helps align its decisions with an overall road map to help it stay on track. Businesses can also use road maps to help think through difficult choices, such as headcount decisions.
- External business plan functions: Externally, a road map is critical for securing funding from outside investors like angel investors . A business must demonstrate to investors that it has a solid business plan with achievable goals and a road map to success.
When pitching your business idea to investors , emphasize how your product or service solves a problem and frame your pitch as a story to demonstrate your passion.
What should a business plan include?
Typically, a business plan should include the following elements:
- Executive summary. An executive summary highlights a business plan’s essential elements. Readers should be able to understand your business plan by reading your executive summary, even if they don’t read the rest of the document.
- Budget. A small business budget should include overall operational and personnel costs. Consider your payroll budget , marketing budget and other departmental budgets.
- Market analysis. A market analysis should include a thorough market assessment that identifies competitors, your target customer , customer buying habits, marketing demographics and what customers are willing to pay. A market analysis may include a competitive analysis that dives more deeply into direct and indirect competitors.
- Product analysis. A product analysis outlines decisions about optimal product pricing. While you want to sell as many products as possible, low prices can scare off customers and eat into your profit margins, while prices that are too high will have customers turning to your competitors.
- Marketing strategy. Your marketing plan should outline how best to market the business and its products or services. Consider digital marketing targeted to specific online and social platforms, email marketing and local marketing.
Business plans vary in length depending on your business’s size, industry and scope. An SMB typically has a shorter and more succinct business plan than a larger, established business that operates across industries.
Collect market intelligence for your business plan by conducting customer surveys and researching social media metrics, competitors’ sales and target customer data.
Questions every business plan should answer
We spoke with six business leaders who shared their thoughts on the crucial questions a business plan should answer. Consider these six essential questions to optimize your business plan.
1. What is the competitive advantage?
Scott Locke, chair of the intellectual property department at Dorf and Nelson LLP, advises thoroughly researching copyright infringement issues when determining your competitive advantage.
“I always look for what will give the business a competitive advantage relative to businesses that want to offer the same or similar goods and services and an analysis of the competitive landscape,” Locke explained. “I pay particular attention as to whether there is valuable intellectual property, be it patents, trademarks, copyrights or trade secrets, that will serve as barriers to entry for competitors. Similarly, I like to see a discussion of the intellectual property of the most direct competitors and how the new business will avoid infringing on it.”
2. Is the business in a growth market?
Walter Recher, principal consultant at SmallBall Marketing, says your business plan should emphasize how you plan to grow your business .
“The key to any successful business is to be a growing company in a growth market. A business plan should articulate how the entrepreneurs will enter the market, apply their investment to prepare them to grow quickly, and participate in the expansion of an industry that is thriving, with a better-than-average growth trajectory,” Recher said. “As I have spent my career working for hyper-growth companies in rapidly expanding markets, a founder of several small businesses and adjunct professor of a course on entrepreneurship, this has been the common denominator.”
3. Will customers pay for it?
Andi Gray, founder and president of Strategy Leaders, advises examining the risks of entrepreneurship and determining what and how customers will pay for their products and services.
“When looking at business plans, I always want to know how the owners plan to get paying customers to engage at a fee and quantity that allows them, as owners, to be in business and sustain themselves,” Gray advised. “My frequently asked question is, ‘How do you plan to feed and clothe yourself, and where do you plan to sleep while you’re getting this venture off the ground?’ My hope is that it will cause the students to consider why they are planning to take the risks of entrepreneurship.”
4. How will the business be staffed?
Larry Holfelder, senior consultant at DJL Insurance Services Inc., emphasizes the importance of staffing considerations.
“In every business plan, I like to see the recognition of the need to cover and staff the production, sales and finance parts of the business. Roles should be established for the entity as if it were mature and successful,” Holfelder advised. “Multiple roles should be assigned at first, if necessary, and filled with the right people as the entity grows and the timing is right.”
Holfelder says thoughtful staffing coverage shows that the business owners are realistic. “I like to see that type of thought process because it shows me they recognize that they won’t be able to do it all themselves and that business success revolves around collaboration and management,” Holfelder said. “It also shows that they recognize their own limitations, their ability to focus on their strengths, and the need to bring in others who know what they don’t in order to reach the goals they envision.”
Consider using a staffing agency if you need to scale quickly and want flexibility and reduced legal risks.
5. Is the product innovative?
Irwin Glenn, chief identity scientist at Hunova, stresses the importance of innovation and inventiveness as well as the team’s level of inspiration.
“Is the idea for the product or service innovative, a unique invention, or is the dream truly inspired? Glenn asked. “By innovative, I want to understand if the business plan is centered around a new twist on already-existing technology or services delivered in a new and compelling way. If inventive, can the idea be protected against new or existing competition? Finally, is the team assembled an excellent group that can’t be stopped from succeeding? Are they inspiring to me, each other, and their marketplace?”
6. Are the plans and goals realistic?
Charles North, former president and CEO of the Dutchess County Regional Chamber of Commerce, prioritizes a realistic business plan with reasonable expectations.
“I look for it to be a realistic business plan, not something that is pie-in-the-sky. I want to see reasonable expectations,” North explained. “I tend to look more on the conservative side, since I feel that is the safest way to go. The idea doesn’t have to be reasonable; the plan does. The idea can be anything.”
North also emphasizes the importance of sales forecasts . “I always look for projections on what the business will do in the first year, second year, third year and fourth year showing sales, expenses [and the] bottom line as the business progresses. Those assumptions have to be reasonable.”
How planning for success pays off
A great business idea is no guarantee of success, but a solid business plan is a way to start a new business off the right foot and prepare your venture for a lucrative future.
Business plans are a vital resource for businesses of all sizes. While business plans should, at minimum, lay out a series of goals and a road map for achieving them, a business plan should also help answer questions ranging from analyzing a business’ competitive advantages to considering if its goals are realistic.
If you think through these questions while creating your business plan, your business will be in a better position to achieve its goals and weather any challenges it may face.
David Mielach contributed to the reporting and writing in this article.
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Entrepreneurship / Business Plans - Hammond Campus
- Small Business News & Information Sources
Questions You Should Answer
- Industry Information
- Company/Competitor Information
- What is your financial plan
- Writing Business Plans
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- Citing Sources
What is you company
Why do customers need your product or service?
What is your business concept or business model?
What are the conditions and overview of your industry?
Who is your target market / customer?
Who is your competition ?
Is your competition local or national?
Are there many or few competitors?
What is your Marketing Plan?
Describe your target market.
What is your product strategy?
What is your pricing strategy?
What is your distribution strategy?
How will you advertise or promote your product or service?
What is your sales forecast?
How will your company operate?
Location and facilities
How will you grow your business?
Who is the Management Team?
What risks does your business face?
Risks from competitors
Risks from changes in the marketplace or economy
Changing consumer needs or tastes
What type of financing and how much will you need?
What is your financial plan?
Gross and operating margins
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