5 Things to Think About When Creating Your Business Plan
“If you fail to plan, you are planning to fail.” That quote has been bandied about for so long, it is difficult to accurately determine who said it first. It has been credited to Benjamin Franklin and other great minds.
Regardless of who made the statement first, or since, it has definitely proven true when launching and managing a business is concerned. When creating your business plan, remember the following five important considerations which will help you achieve your goals.
1. Raising capital
In 2013 Forbes magazine reported that 8 out of 10 businesses fail within their first 18 months. What is the principal reason behind that 80% failure rate? The primary reason businesses, big and small, off-line and online, fail so quickly is a lack of capital. You need money upfront to launch your business.
You should also include in your plan a continual influx of capital, whether that be through sales, outside investors and venture capitalists, or diverting your personal income to your business. Your business plan should provide for 5 years of business expenses.Your business plan should provide for 5 years of business expenses, make sure you have enough capital. Click To Tweet
2. Establishing your UVP
So, you are starting a widget business. Good for you. Don’t forget that the world already has plenty of widgets. Why is your widget different? What hole in the widget marketplace does it fill? Why is your widget better, faster or bigger? Businesses fail all the time because they are not unique. Establish your product’s unique value proposition (UVP), also known as a unique selling proposition, and you immediately differentiate yourself from much of your competition.
3. Understand your target market completely
It goes without saying that if you’re trying to sell cheeseburgers to vegans, you won’t be in business long. You need to understand your customer completely, better than anyone else in your market. Allow room in your business plan for uncovering the intimate fears, worries, problems, and dreams that your target market has. Make sure your product addresses these and you’ll never have an issue selling your products and services.Make sure your product addresses your customers' issues and you'll never have an issue selling your products and services. Click To Tweet
4. Sales and profit timetable
To stay in business you need to sell something. Your business plan should include sales and profit projections for your first 30 days, 90 days, 6 months, 1 year, and 5 years. These projections need to be based on relevant information and not some hopeful pipe dream. Be honest with this part of your business plan and you will realise how much upfront and ongoing investment capital you will need to generate to stay in business.
5. A clear-cut and proven business model
Many entrepreneurs start a business without a clearly defined model. They put some money together, come up with an idea for a product or offer, and throw open their virtual or brick-and-mortar doors. That is wishing on hope and luck. Find a proven business model that will work in your market, tailor it to your offerings, and work your model. This part of your business plan should include a smooth process for moving from prospect to customer to profits.Your business plan should include a smooth process for moving from prospect to customer to profits. Click To Tweet
If you cover these five points when you plan your business, it will help you join the ranks of the 20% of businesses who succeed! You can read more about business planning in my blog Why You Need a Clear Plan for Business Success.
Digital Marketing Glossary
Trying to understand the terms used in digital marketing is like learning a whole new language.
Download this glossary as a reference to help you master the language of digital marketing.