- BUSINESS PLANNING
i.
Current market situation
To earn enough revenue, your business must be able to
achieve a share of the available market. To do this, you’ll need to have a
thorough understanding of your market environment, including its size and the
share that you can realistically achieve. The size of your share will depend on
1.
Market
trends: find out what influences your target market now, and how your product
can take advantage of this
2. Target customers: describe
who your target customers are and how
many there are; also justify your estimate of the market share you aim to get
3. Competition: list your
competitors and describe their products; also describe in detail how your
product will be different
ii.
Current target customers
Define the characteristics of the target groups of
customers that could buy from your business. Make a list of the features that
your products have, and the associated benefits that these features can provide
to your target customers.
1.
For
individuals, describe them in terms of characteristics like;
a. age
b. income
c. location
d. lifestyle, and
e. marital status.
2. For businesses, consider
the following;
a. location
b. numbers of employees
c. public or private sector
d. industry type, and
e. Turnover.
Carry out some research into how many customers there are
in your target group and how much they spend, and also try to identify trends
that tell you whether this group is growing or shrinking.
iii.
Competitor analysis
Competitors may be in the same (direct competition) or
similar (indirect competition) business to you. The level and strength of
competition in a market indicates how difficult it will be to gain a share of
the market. However, it is not simply the number of competitors that you should
be concerned about; analyze the following aspects of each competitor’s
business:
1.
Their
products: are their products and services the same as yours? Do your
competitors provide something that you don’t?
2. Their customers: are your
competitors targeting the same customer segments as your business?
3. Their share of the market:
how large is it, and could you take some of it?
4. Their strategies: how they
grow, market themselves, and price their products. Can you learn from how they
conduct business, or do it better?
5. Their operations and
facilities: what levels of service are customers demanding?
iv.
Marketing strategy
With a clear understanding of your market, you can define
your overall strategy. Break this down into objectives and targets relating to
the volume and share of the market (or market segments) you hope to achieve,
and when you intend to achieve them by. Ask yourself, for example:
1.
Who
are your initial marketing targets?
2. What products, services or
particular deals will you be offering?
3. Is there a specific volume,
value, or share of these markets that you hope to achieve?
4. When do you hope to achieve
these targets by?
5. Why are you choosing these
markets first?
6. Who will you target next,
in the next 6 or 12 months?
v.
Marketing plan
Now that you have a coherent marketing strategy, you need
to be clear about how you are going to make it happen. A detailed marketing
plan must explain how you go about achieving each of your marketing targets and
objectives. Such a plan will include some or all of the following:
1.
The
methods you will use for each target segment
2. The specific action you are
going to undertake
3. A timescale or timetable
for each marketing activity
4. Who is going to carry it
out
5. The estimated costs of
particular marketing activities
6. How you will monitor and review progress
7. How you will handle the
response to your marketing
It will also be important to identify how you will manage
the overall marketing plan, in other words, ensuring that the entire budget is
not spent in the first couple of months, monitoring results, adjusting the
plan, and introducing new tactics as you go along.
vi.
Sales targets and
objectives
Your marketing plan, when implemented, needs to be
converted into perhaps the most important business goal of all: sales revenues.
Set out your forecasts in terms of sales of different product types by;
1.
volume
and value
2. sales from different customer groups and
3. sales from different distribution channels.
vii.
Operational requirements
Information about your operational requirements will be
required for your financial forecasts, while other information will be needed
for your basic operational planning. Outline your plans for:
1.
premises
2. equipment
3. staff
4. suppliers and
5. compliance and licensing, and estimate the
respective costs involved.
viii.
Current financial
requirements and financial forecasts
Your business plan should include a
breakdown of your financial requirements, the sources of finance you have
available to you, and any additional amount that you may need. This breakdown
should include:
1.
the
cost of starting your business;
2. your personal budget;
3. details of your own
personal budget;
4. details of your own
personal finance;
5. a detailed cash-flow
forecasts that will help to estimate how much available cash you will have in any
particular month;
6. a profit and loss forecasts to help to
estimate when your business will start to make profit (which will be essential
to your medium-term success);
7. and a balance sheet forecast to provide you
with a snapshot of the trading position of your business, identifying what your
business will owe, what it will own, and how financially strong it will be at a
particular point in the future.
ix.
Management Processes
Even if you are the only person involved in your
business, it is still important to consider your key skills, responsibilities,
and management processes. Think about
1.
Management
team-outline skills and experience
2. Key staff and
responsibilities-summaries roles and contribution to the business. Be sure to
cover the following tasks: marketing and sales, finance, recruitment, products
development, general management, and administration
3. Monitoring and
co-ordination-set out how you plan to monitor performance (against objectives
and targets), and to co-ordinate the key roles in the business.