Start-up Businesses

Business plan

A carefully developed business plan is the foundation for a successful start to independent entrepreneurship. The more well-thought-out and detailed a plan for founding a company, the higher the chance that the project will result in the hoped-for success.
The plan supports an appropriate assessment of the company’s prospects for success, and serves as a basis for banks, chambers of commerce and institutions to review the feasibility of your project.
Tip: Would you like to establish a commercial enterprise in Hamburg? Then make use of our online Business Workshop, where you can create your personal business plan – with support from an expert at the Hamburg Chamber of Commerce. The web-based financial plan will help you prepare your figures properly. Of course, you can also make use of all the other information (such as checklists, leaflets, forms and templates), the community that has Germany-wide connections, the marketplace and our fantastic media library. The Business Workshop offers free-of-charge assistance during the orientation, planning or practical phase.
Is your business plan ready? You are welcome to consult us for concept advice; we will check your plan for plausibility, bank acceptability and clarity. We also welcome pitch decks!

Components of a business plan

1. Summary of the business idea

The summary should contain a brief and clear outline of all the key aspects of the business plan (generally no more than a single page). As a rule, this bulleted list is generally only written at the end, once the entire business plan is complete.
You should answer the following questions in this area:
  • What is my business idea?
  • What skills do I or my team of entrepreneurs have?
  • How do I allocate management tasks where applicable?
  • What does my financial plan look like?
  • Where do I see opportunities and risks?

2. The business idea

Product/service

The business concept should start with a precise description of the project. This should summarise – as briefly as possible but also in as much detail as necessary – the key elements of the business idea in a comprehensible form. The specific focal points of the description will vary depending on the business idea.
We recommend that you describe the product or service in simple language, so that someone who is not a specialist can understand it and finds it appealing. It is also about highlighting that “certain something”, i.e. what distinguishes the company from all other competitors on the market? The magic word here is “USP”, which stands for unique selling point. Technical details are often superfluous. Instead, it is better to try to convey to the reader a concept of the idea and explain to them why customers will buy the product or service.
  • What products or services are being sold?
  • What is special about the product or service?
  • Does the product/service fulfil the customers’ actual wants?
  • Is the product/service unique, or is there at least a clear feature that differentiates it from the competition?
Caution! The business idea should, where possible, be built on your own knowledge and professional experience. So be careful about copying other, harder-to-understand concepts, or if you are entering more unfamiliar sectors.

Customers

A precise definition of the target customer group and market is important. Only by knowing who you wish to address with the product or service and what the current market situation is can you sensibly plan pricing, advertising strategy and product range.
The following questions should be answered, among others:
  • Who is my customer?
  • Am I depending on a small number of major customers?
  • Is there a need for my product/service and what is the buying behaviour? (Customer analysis)
  • Do I have an overview of the market for my products/services?
  • How is the industry developing?
Your own surveys can be very revealing here, as can phone calls with companies in the industry. Banks and savings banks often have up-to-date industry analyses available that can also be useful for comparison when setting out how the future business will develop.

The competition

If the targeted market is profitable, there is almost always someone who is already active there, or is becoming active there. For that reason, you must identify your competitors. The internet, “Yellow Pages”, or information from our chamber of commerce or respective trade association can be used for research in this regard.
  • Who are my most important competitors and what are the most important competing products?
  • What are my competitors’ strengths and weaknesses?
  • How can I set myself apart from the competition?

Location

The location often plays a crucial role in a business’ success. The wrong choice can expose companies to barriers to growth or even result in a premature termination of operations.
  • Where will my business premises be located?
  • Is the site close enough to customers, if relevant?
  • Is the catchment area sufficiently large and does it have enough buying power?
  • What about transport connections and parking?
  • Are the intended business premises suitable for my purposes, including for later expansion?
  • How high are the rent and ancillary costs, as well as the deposit and broker’s fees?
  • Are there official requirements or plans for changes to be made?
Important! When choosing the right location, different trade law and building law requirements must be complied with depending on the type of activity, so we recommend that you make contact with the respective district office, building review department, in advance.

Pricing policy

Price is an important marketing instrument. It not only determines the level of a company’s profit and turnover, but also has a decisive influence on its positioning in the market.
With this in mind, the following questions should be considered:
  • What calculation forms the basis for my prices?
  • What prices are standard on the market for my product or service?
  • What price strategy will I pursue and why (high price, low price)?

Sales

These days, a good product or an excellent service alone is no longer enough for market survival. A concrete sales strategy is absolutely essential.
You should think about the following questions early on:
  • How will I market and distribute my offering?
  • What measures am I planning (advertising, acquisition, collaborations)?
  • Are there already contacts in place with potential customers / business partners?
Tip: For anyone going it alone when setting up a company, “franchising” is available as an interesting alternative. In this form of collaboration, a partner (franchiser) hands over a proven business concept to another partner (franchisee) for use. We offer regular franchise consultation days at the Hamburg Chamber of Commerce, relating to this method of starting a company.

3. Information on the company

The founder and the company

Whether it is the choice of legal form, the company’s organisational structure or the selection of employees, a well-structured and properly considered business plan has a decisive influence on the company’s long-term success in this respect too.
You should be able to answer the following questions in this context:
  • Who is founding and managing the company?
  • Who takes on which tasks in terms of focus areas?
  • What are the personnel-related and entrepreneurial requirements?
  • What previous technical experience and contacts do you have?

Legal basis

  • What legal form is suitable for my project?
  • Have all the questions relating to trade law been clarified (e.g. franchising)?
  • Have the planning law and building law requirements been met?

Organisation and employees

  • What does the company organisation look like (organisational and operational structure)?
  • How many employees will I employ, and with what qualifications?

4. Finances

Private financing requirement

A list of all private income and expenditures will help you answer the question of how much you need the project to earn in order to secure a livelihood.
Sales and earnings forecast
The sales and earnings forecast (returns forecast) is one of the most important but probably also the most difficult calculations in the course of planning the founding of a company. Though a forecast of this type is of course affected by incalculable uncertainties, you should still be able to realistically evaluate the prospects of success for your service offering. In determining the market potential required for this and analysing the competition and location, you can contribute your own experience or even consult experienced specialists (business advisers, tax advisers, people you know who have industry expertise etc.). There are company comparison results available for certain industries, such as retail, and these can provide reference points for your own planning. These sources of information can be requested from our chamber of commerce or trade associations. However, it must be taken into account that business expectations need to be in line with the individual business capacities.
Important! The profitability forecast should comprise at least three full business years, as sales, costs and profits can develop very dynamically and variably, especially in the start-up phase.
If your living standard is to be maintained and you are to earn at least as much as you have earned previously as an employee, depending on your marital status and personal tax liability profits may need to be up to 50 percent higher than your previous gross salary; this is because entrepreneurs bear sole responsibility for all social security benefits such as pension insurance and health insurance. It must be considered that profits need to secure not only your standard of living, but also debt redemption and maintenance of assets as well as reasonable business growth.

Liquidity planning

Well-founded liquidity planning shows financial solvency for a certain time period. The expected income must be set against the expenditure (monthly and quarterly overview).

Capital requirement and financing plan

Solid financing is the basis for any business start-up. For this reason, you must start by considering in-depth how much money is needed for:
  • Investments such as land, buildings, facilities, machines and vehicles
  • Storage and raw, auxiliary and operating materials
  • Founding-specific expenditure such as notarial and other fees, and initial advertising
  • Working funds, e.g. launching costs
  • Personal requirement to bridge the first phase
After determining the financial requirement, you must determine which “components” will be considered for financing the project. The decisive foundation for this is equity capital. This must be used to a reasonable extent to achieve solid and crisis-proof financing.
The investment requirement and also some of the working fund requirement should be financed through equity and/or longer-term debt capital (bank loans, public loans). You must check whether favourable government financial support (loans, grants, guarantees) can be utilised (see section 4). Sufficient short-term financial capital is needed (overdrafts). Based on experience, credit lines should not be set at too low a level, as otherwise liquidity difficulties may occur. A sufficient reserve to fund your personal living expenses must be budgeted for until the new business yields sufficient income.
The required debt capital can be made available by banks and savings banks. As the terms and conditions may differ between banks, you should compare the different offerings. However, addressing your own main bank first is recommended.
Important! Financing problems are the most common reason why young companies fail. The capital requirement – in particular for working funds – should therefore not be underestimated in your calculations. Sufficient capital (as a rough guide: at least 15 to 20 percent of the total cash requirement) must be contributed. In addition, it is vital to use the right financing instruments in line with the business’ needs.

Additional documents for the business plan

(if required)
  • Rental contract, articles of association (possibly in draft form; contract templates can be found in our Commerzbibliothek “Commercial Library”)
  • Purchase agreement, balance sheets / annual accounts, current business analyses (in the case of company purchase/participation)
  • Cooperation contract (e.g. as a franchisee, possibly in draft form)