How to make a shop business plan?

It's decided; you're going into entrepreneurship. You want to open your store. However, there is no question of getting started without a business plan!

Do you have no idea how to create a business plan? What tools will you need to do this? What should it contain? Do not panic! We are here to help you make it happen.

Why make a business plan before launching your store?

Many French people embark on the difficult exercise of creating a business. However, only half of the companies make it past the first year. We strongly advise you to overcome this difficulty by making a business plan before opening your shop.

Making a business plan or business plan in French is essential in creating your store. It will allow you to check that your store creation project is financially viable, at least on paper, before you start and assess its profitability potential.

Making a business plan will force you to look in detail at each aspect of the project, estimate the necessary resources, and assess the need for initial financing. 

Your business plan will be your reference document to convince your financial partners to follow you on the adventure. You will be asked by banks, your possible investors, or public bodies if you want to apply for an honor loan or grants. 

Your business plan will also be a reference point for the whole team. It will allow us to situate the company, understand its evolution, and understand where it starts and is going.

What information should you gather before making your store's business plan?

Before we gather information, let's look at how a business plan works.

A store's business plan has two main components:

• A financial forecast which aims to highlight the potential profitability of the project and the need for initial financing
• A written part presenting in detail the project, the team, your commercial strategy, and your medium-term objectives

To make a good shop business plan, you first need to conduct market research. It will allow you to refine your commercial positioning, set your prices, and collect the information necessary to estimate your projected turnover. As a result, market research will use to inform your financial projections.

As for your written part, you will present your commercial strategy and the marketing plan. It will allow you to assess the communication budget to be planning to communicate effectively on the launch and your store's offers.

You will also have to list and evaluate the cost of the human and material needs necessary for the launch and then the development of your store. Again, remember to ask for quotes from several suppliers to assess the costs accurately. This included will be a section in your financial projections as well.

The provisional financial budget of your boutique business plan

The interim budget allows the entrepreneur to anticipate all the financial aspects of his business before its launch or at a turning point in its life (launch of new services or products, refinancing, new establishments, internationalization, etc.).

But its interest is not limited to this: a provisional budget is also a tool that allows financial partners to assess the company's fundamentals, which are its growth, its profitability, its ability to generate cash, and the stability of its economic structure.

Four major tables summarize the provisional budget:

• First, the cash flow forecast allows you to check that the operation of your store generates cash and to visualize the impact of the working capital requirement (i.e., the money tied up by the stock).
• The forecast income statement. It will allow you to assess the growth of your shop's turnover and its profitability. In addition, it will be very useful for you to identify opportunities for cost reduction.
• A forecast report. This will use to assess the weight of working capital and financial debts in the structure of your store. It will verify that the company's economical system is balanced.
• The break-even point table, or the break-even point table, is used to calculate the break-even point. It will allow you to easily determine the amount of turnover or sales volume required to establish financial equilibrium. 

The written part of the business plan

The written part of the business plan is essential. It counts as much, if not more than the financial part, because it allows:

• provide the context needed to understand the numbers
• to show that you have seriously thought about all the parameters of your store project
• to show that you have anticipated the risks associated with the execution of the business plan
• to highlight the advantages of the project

It will consist of different parts, which we will review below.

The summary of your boutique business plan

The summary of your shop business plan, or executive summary, presents the key points of your business creation. This part will be a summary of your business plan. It will allow you to give your business plan concisely and useful for your potential investors if they want to have a short overview of your project. Click here for more information.

The presentation of the company

This part will include a presentation of the company: the legal structure you have chosen, its shareholders and managers, its registered office, and its location. In this part, you will be able to understand a diagram of the distribution of roles to illustrate this.

The products and services of your store 

In this part, you will present the commercial offer of your shop: what you want to sell there, in terms of products or even services. In addition, this part will include a section where you will detail the price of the objects or services offered to the public and the cost of each thing.

Market research for your store

Market research will allow you to highlight the business opportunity by analyzing the market, trends, regulations, and competition. Here, you will summarize this market research, which will allow you to explain why your store touches an interesting market segment and deserves attention.

The business strategy

We are talking here about the part highlighting the company's strategy in setting prices, marketing the offer, and managing the risks inherent in your store project.

Here you can answer some questions: will you sell only in stores or on the internet? Do you plan to open a chain store? How do you plan to manage your risks? Etc.

The operational organization of your store

Here you will present the operational organization of the company (staff plan, distribution of tasks between the different members of staff, organization chart, suppliers, opening hours) as you wish.

The financial plan 

This part will present the financial forecast we mentioned at the beginning of this article.

Tips for writing a business plan for your store 

Everyone makes mistakes, but some are easier to avoid than others. Here are some tips for writing your business plan without losing your reader.

Don't underestimate seasonality.

The impact of seasonality on sales and the need for working capital must be considered in the financial plan to anticipate future cash flow concerns.

Avoid getting lost in the details.

Knowing that you will need (x) full-time equivalent salespeople because your shop will be open Monday to Saturday from 8 a.m. to 9 p.m. is interesting because it allows the investor to validate the adequacy of human resources with the project.

On the other hand, if you put five paragraphs to explain the exact schedules that each salesperson will make and the lunch break time, you are wasting your reader's time.

Have your business plan proofread by someone who knows nothing about your industry

It is unlikely that your banker is an expert in your sector. Although you have tried to avoid using the jargon specific to your industry, there are very likely to be some passages in your business plan that are a little difficult to understand for your banker.

Have your plan proofread by someone who knows nothing about your industry. It is the best way to ensure that your banker or an investor will understand your entire project.

What tool should use to draw up a store's business plan?

Now let's move on to the realization part of your business plan. Again, you have three choices, each with its disadvantages and advantages.

You can choose to:

• Make your business plan yourself with Excel and Word
• Have your business plan written by a consultant
• Use online business plan software

Make your business plan yourself with Excel and Word.

The key benefit of this technique is that it is simple to implement. You won't have to pay a penny if you choose to do your business plan yourself. 

However, you will need to have a solid knowledge of accounting not to make mistakes when creating your financial statements. And you should know that writing and formatting your business plan yourself will take you quite a bit of time. 

You will have to build your financial forecast in Excel, lay out your document in Word, import the tables from Excel, and update everything when you change your figures.

Have a consultant draught your business plan.

Having a consultant draught your business plan will help you prevent math errors and provide a professional document.

Make sure you find a consultant who is an expert in your field, though – someone who can help you make your assumptions and look critically at them, not just type in the numbers you give them.

The main disadvantage of having your business plan carried out by a consultant is the cost. The cost of a business plan specific to the creation of a store is variable; it depends in particular on:

• the hourly rate of the consultant: generally between 50 and 200 euros excluding tax per hour
• the amount of work required based on the complexity of your project

Use online business plan software.

The other alternative is to get help from an online business plan software.

Using specialized software has several advantages:

• You are guided in writing by detailed instructions and examples for each part of the plan
• You can draw inspiration from business plan templates already written
• You easily make your financial forecast by letting the software take care of the calculations for you
• You get a professional document, formatted and ready to be sent to your banker