Are you drawn to the mysterious and enticing world of video games? If you have a passion for gaming and a head for business, you may have decided to open your own eSports bar.
Before purchasing your video games and setting up a bar, however, it's important to think carefully about your business plan - because the success of your venture depends on it.
If you're not sure how to go about drafting up a business plan, then you've come to the right place. Simply read our guide below to make your eSports business plan come to life.
What's the purpose of writing a business plan for an eSports bar?
The business plan for an eSports bar enables an entrepreneur to examine their business in detail, evaluate the amount of funding needed to get it up and running, and assess its expected profitability.
It also serves as a roadmap for the business' first three years of operation. As your eSports bar moves through its first throes of operation, you can use the business plan to track whether it's flourishing as it should, by comparing the figures estimated in your initial forecasts.
An eSports business plan will also be specifically requested by any bank or investor you decide to approach, so drafting one up is a mandatory step when it comes to securing financing.
So what does a business plan for an eSports bar look like? In a simplified way, it consists of two main parts:
- A financial forecast highlighting the expected financial performance over the next 3 years and the potential for profitability
- A written part that presents, in detail, your project, the team, your business strategy, and your medium-term objectives.
What information should an eSports bar business plan contain?
The business plan for your eSports bar will first require specific information to help you build a realistic financial forecast.
Market research is an essential prerequisite for the creation of any business plan.
It will not only enable you to understand the dynamics of the market you've chosen to enter (whether you're opening an independent eSports bar or joining an already established chain) but also help you understand the expectations of your customers to ensure you're offering the type of games and screening the sort of competitions they're looking for.
Staffing and equipment needs
Writing a eSports business plan also enables you to keep track of the staff and equipment requirements of launching an eSports bar, as well as how much each investment will cost.
Operating an eSports bar means having to invest in video game consoles and computers for your customers, as well as purchasing licenses for the games you'd like to make available within your bar.
Don't skimp on creating a cool layout with comfy chairs for your customers, and if you plan to serve snacks, you'll need to think about fitting in a kitchen - or buying a space with a kitchen already installed.
You may also decide you'd like to specialise in one type of eSport or set up a concept that will set you apart from rival eSports bars. If this is the case, don't disregard the extra costs involved.
Investment is not be the only cost to consider. You'll also have to add up the operating costs, including the stock, insurance, legal and accountancy fees, as well as your utility bills and rent.
By listing all these expenses, you'll be able to decipher how much turnover you'll need to achieve to reach your break-even point.
Developing the financial forecast for an eSports bar
The financial forecast of your eSports business plan corresponds to the figures mentioned at the start of this guide.
This forecast is made over 3 to 5 years, allowing you to envision the future of your business and use it as a roadmap to ensure you meet the goals you and your team have set out.
The financial forecast gives you the opportunity to gauge both the amount needed to start up your eSports bar and the turnover to be achieved for it to be profitable.
We go into more detail on the tables that make up this section below...
The projected profit and loss account
The projected profit and loss account gives an overview of the expected turnover, growth, and profitability for your eSports bar over the first 3 to 5 years of business.
This essential table helps you identify potential opportunities to reduce costs and enables you to ensure the profitability of your eSports bar.
The projected balance sheet
The projected balance sheet shows the value of the assets (what the company owns) and liabilities (what the company owes to suppliers, lenders, etc) at a given point in time.
The projected cash flow statement
With the help of a projected cash flow statement, you will see how much cash is generated in your eSports bar business plan, where it comes from, and how it is used, whether it's to repay its loans or buy new video game consoles.
The start-up capital
This section of your eSports bar's financial forecast gives your bank or investor a quick overview of the resources needed to launch your business and their costs - as well as ways in which they'll be financed, including via equity contribution, shareholder loans, and bank loans.
How does the editorial part of an eSports bar business plan look?
Once the financial forecast of your eSports bar has been developed, you have the opportunity to put these figures and estimations into context by delving into the written part of your eSports bar business plan.
The editorial section of your eSports bar business plan is just as important as the financial forecast because it presents each aspect of the business in detail and proves to investors that you've thought carefully about the risks associated with it.
It's broken down into 7 sections, which we have summarised below:
The executive summary
Think of this section as the equivalent of a cover letter for your eSports bar business plan. The aim here is to introduce your project to investors in as engaging and concise a manner as possible, encouraging them to read on and learn more about your exciting venture.
This section provides essential information about your eSports bar, from its directors and partners, to its location and legal form.
Products and services
This section explains the service and products being sold by your eSports bar, as well as the prices you've set for each.
It's within this section of the eSports business plan that you'll present the results of the market research we mentioned at the beginning of this article. The objective here is to demonstrate that there is indeed a viable business opportunity for your eSports bar to flourish.
Your business strategy
In this part, you'll reveal three key plans:
- Your sales strategy - the prices you'll set
- Your marketing strategy - the actions you'll take to attract customers and build customer loyalty
- Your risk management strategy - how you'll minimise the risks related to your business
From your employees to your relationship with suppliers, you'll detail the operational organisation of your business.
The financial plan of your eSports bar
The financial plan of your eSports business plan puts your numbers into tables that you'll be able to present to potential investors so they get a better idea as to your expected profitability and how much funding you need.
3 key pieces of advice for writing an eSports bar business plan
- Trends move fast in the gaming world, so make sure you generate enough cash to regularly renew your video games, consoles, and computers
- Don't forget the licences required to acquire specific games for your bar, as well as to screen and organize competitions - and incorporate these costs into your financial forecast
- Anticipate seasonality: on sunny days, people are more likely to want to frolic outside rather than play video games - so take measures to prepare your business for days over the summer where you'll greet less customers.
What tool should I use to write my eSports bar business plan?
There are several tools available to help you write your eSports bar business plan. To ensure you pick the solution that best suits you, we've reviewed the pros and cons for each below.
Write your business plan using Excel and Word
This solution has one major advantage: it's cheap.
Be wary, however, that you'll need to have an accounting background (or at least be very good with numbers) to write your plan in this way without making mistakes in the calculations.
Hire a consultant to develop your business plan
Hiring a chartered accountant or consultant to take care of the financial part of your eSports business plan is a good way to avoid errors.
However, the fees are generally quite expensive: budget around £1.5k ($2.0k) for a complete business plan, plus more if you need to make changes after the initial version (which happens frequently after the initial meetings with lenders).
If you decide to hire a consultant or accountant, remember to check what's included in the service - are they developing a complete business plan or just doing the financial forecast? And are you willing to pay extra for them to make changes, if necessary?
Use online business plan software
If you're not used to writing business plans, another good solution would be to use online business plan software.
There are several advantages to using specialized software:
- You are guided through the writing process by detailed instructions and examples for each part of the plan.
- You can be inspired by already written business plan templates
- You can easily make your financial forecast by letting the software take care of the financial calculations for you.
- You get a professional document, formatted and ready to be sent to your bank.
If you are interested in this type of solution, you can try our software for free by clicking here.
That's it for now, we hope this article has helped you better understand how to write the business plan for an eSports bar. If you have any questions related to setting up your business, please do not hesitate to contact us.
See also on The Business Plan Shop
- Business plan template for an eSports bar
- How to open up an eSports bar
- How to carry out market research for an eSports bar
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