In my last article, I helped you find a business idea which meets has the potential to succeed. Today, I am going to talk about how to plan for success and decrease the risk of failure. To recap, a good business idea meets the following criteria:
- You’re passionate enough about that idea to work on it on a daily basis
- There is a potential market need for it; the people you asked are enthusiastic about the idea
- You have the skills required to execute it
- It has the potential to make enough money
Today, I’m going to discuss what a business plan is, and help you understand the different sections contained in your business plan. In later articles, I will discuss each section in more details.
A basic business plan contains the following sections:
- Products and Services: What products and services are you going to be selling? I generally recommend you diversify, and not stick to just one product or service, unless there is a really big need for it. You should also give your customers the ability to increase their relationship with your company. I will talk about this more in the next article.
- Market Analysis Summary: What is the current state of things in the market? How will your business change things for the better? Where will you start from? This section will require some amount of research, and knowledge about your market. For example, if you’re looking to open a new restaurant in town, you should know which groups of people go to which restaurants, and give them a reason to come to your restaurant. You might also want to find a way to target people who do not go to restaurants at all.
- Competitive Edge: What does really differentiate you from your competitors? Why would people want to buy your products/services instead of your competitor’s products and services?
- Marketing Strategy: How do you plan to inform people about your service? Are you going to use a word of mouth approach? Are you going to have advertising on Facebook? Are you partnering with other companies…
- Sales Strategy: Once you have informed people about your products and services, how do you plan on transforming those people into customers? Are you having a website with an online ordering option? Are you going to have sales representatives they can contact? Are you going to handle things yourself…
- Milestones: This is a list of steps you will be taking in order to make your business a reality. When I started my first company years ago, I had to register my company, build the product, build a website, and finally contact people who might be interested in my products. This list differs for each business. More on that later in later articles.
- Team Summary: Who will be running the business? Are you going to start on your own, or will you bring employees from the start?
- Financial Plan: The purpose of this section is to help you estimate how much money you will be making from your business, by calculating loans, expenses, sales revenue, taxes, rent…
In order to write your plan, you could simply use Microsoft Word. However, I would really recommend you buy Business Plan Pro , it will greatly ease your work by providing sample plans, examples and instructions to work your way through your plan. It’s really worth the money!
It’ In my next article, I will take a look at how to create your products and services in order to make more profit. Stay tuned!