A business plan is the backbone of every business, whether it is a small family business or a large corporate house. Proper planning is very essential to ensure the survival and growth of any business.
So if you’re going to set up your own small business, your first step is to make a business plan. If you plan ahead, the chance of success will be greater. A business plan includes several dimensions. I will list each of them. So let’s get started. My guess is that you are the owner of your business and your business is a one man show or at best supported by your family members.
- Business goal:
Write a single short sentence that clearly states your business goal, it is the starting point of all business plans. I can give you a good example of this. A renowned brand before opening its new retail stores across India stated that its aim is to provide fresh vegetables to the end users and make them happy. This is your basic plan. In fact, it is very simple, but it transpires the basic business objective. Similarly, you should write your business objective, it should be simple, unambiguous and realistic.
- Describe your product or services:
This is the second important step in developing a business plan. You must write in detail what are the products or services that you are going to offer. Write down the salient feature of each product, including price, taxes, shipping and delivery charges, and time involved.
- Set your financial goal:
First of all, a word of caution. Never set an unrealistic goal, otherwise you may get frustrated very soon. Set your goals that you think are achievable. If you’ve just started your business and really don’t have much of an idea how much you can earn, at least try to break even within three to six months of starting your business. Most small businesses experience an early death because they aim for too high a bar in too short a period of time.
- List all available resources:
Resources include labor, machinery, raw material or finished product, their knowledge or experience in a domain. What you have or know, and if it is in any way related to your current business, please include it under the available resources heading. Try to use each of the available resources in the most efficient way. This will reduce the overhead of your business. For example, if you already have free space, you can use it for office purposes instead of hiring a new office space from scratch.
- Identify the market
This is an important part of your business plan. You need to know where the market is, how big the market is. After all, it is where you will earn income from. The better knowledge you have about the market, the better your products/services will sell. Stay-at-home moms are often successful in the cosmetics/jewelry business because of their access to end users. I have seen many of them selling clothes, sheets and bedspreads and making a lot of money. The key ingredient to their success is that they know the market. They may have access to a very small section of that market, but that is still enough for them to operate their business at a profit.
- marketing plan
Once you have identified the market, you need to set up a marketing plan. You can promote your products and services in a variety of ways. Most of them involve some cost. So, if you want to run a profitable campaign, use flyers, posters, and banners; posting classified ads in newspapers also word of mouth is the free but most effective campaign mode. Therefore, try to talk about your products and services to as many people as you can each day. I have seen a renowned resort company start their marketing campaign based solely on word of mouth. And it worked.
- Financial plan
This is the most important part of any business plan. Every business needs a certain amount of investment in the form of fixed and current capital. So after completing all other plans, calculate how much capital you need to start your business and how much capital you need to operate your business on a monthly basis. In any case, you must keep at least six months of working capital in reserve before starting any business. And now calculate the income you can generate. If you don’t have previous data, take the break-even point as your initial sales target. Your financial plan should reflect breaking even within three to six months and generating profits thereafter. You must take into account all kinds of expenses and probable income of your business.
- Strategic planning and implementation
Be very specific in preparing a strategic plan for how to run your business. It involves management responsibilities, daily work schedule, marketing and promotion calendar, progress tracking and review calendar.
- A final summary
After covering all the aspects, start a survey campaign. Talk about your new business and its various dimensions with your friends and family. Take your comments. Modify your plan, if necessary. But stick with the plan once you’ve completed it, for at least a two-year period.
