5 Things to be Considered Before Writing a Business Plan For Your Startup
When planning your entrepreneurial venture, there is a huge misconception that the business idea is the fundamental key for success. That the idea determines how your business should fare. The truth is, idea only provides the foundation. Coming up with a business idea isn’t actually that difficult. There have been countless brilliant ideas which were deemed an immediate success when they were first presented, but they failed to make any significant impact and consequently had to be scrapped.
The problem lies on the fact that aspiring entrepreneurs focus more on the idea and less on the planning and execution. You yourself may have a great business idea that you want to explore with your friends but without a proper business plan, you shouldn’t expect much success if not outright failure.
There are a million different aspects that you have to consider which may not strike you in the beginning. But for the most part, there are 5 essential points that you need to consider before delving further with your project.
Determine your purpose
Previously, the sole purpose of a business was to earn profits. Money was the ultimate end goal. Consequently many decisions and strategies were centered around it. For instance, the concept of hard selling i.e. using insistent or persuasive language to get the customer make a purchase. The idea behind it was to make the product first and push it towards the customer.
Times have changed now.
No longer is the focus on the company or its products but rather on the customers themselves. Now, businesses have to cater to the needs of the customers and craft their products and services around them. Therefore, the purpose of your business should be on covering a market gap (solving a problem) instead of simply profit generation.
Build your Vision
Having a clear vision of what you want to achieve is vital to business success, but before you jot down your plan, you need to come up with viable strategies that will make you achieve your goals. Evan Singer (CEO of SmartBiz) says, “Sometimes, less is more.”
It’s better to have to have quality over quantity. If you can accomplish three of your goals in a proper manner with a good yield, it is much more preferable than having ten goals which are being rushed and handled inefficiently.
“The first point of the mission statement ought to be why you’re running this business. After you completely comprehend the why, at that point you have to characterize ‘what’ you will do and ‘how’ you will do it. The third and last piece of the statement ought to be the ‘who’ you need as clients and how you are going to treat them,” said Tina Bacon-DeFrece, president of Big Frog Franchise Group.
She included that from the mission statement, it is a simple change to determine your “value proposition” statement that characterizes what makes you remarkable/different in the marketplace and how you expect to separate and position your business.
Clarify your business model
Alex Muller, senior VP and Chief officer of GPShopper at Synchrony Financial believes that a perfect financial model ought to incorporate all the details you would put in your business plan — for instance, hiring, pricing, sales, cost of procurement, costs and development. Similarly, with business plan, your model ought to be updated as the realities of your business begin to unfurl.
“Begin [answering] ‘what ifs,’” said Muller. “If I charge this product at this price, and this is the expense of customer, what rates of return would i be able to get? When you’re finished building [and testing] the model, at that point you can return [and] compose a business plan.
Identify your target market
Identifying your target market would be a tough task to get through. To narrow down your market, Grant Leboff, CEO of Sticky Marketing Club, answers the inquiry, “How am I uniquely solving the problem?”
“If you can’t answer the query, you either have the wrong target market of the wrong offering. For this situation, more work should be done before you begin focusing on your potential clients. If what you offer isn’t attractive to your market segment, you may need to change your offering or need to change your target market.
Test your business idea
Entrepreneurs ought to go out and communicate with experienced people of the industry, potential clients of their target market and different business people to decide their business’ feasibility.
“Take feedback from few potential future customers [and experts], and request some legitimate input,” Bubb disclosed to Business News Daily. “What’s their opinion about your business idea? Who, explicitly, would you say you are focusing with your business? How huge is the market? Will your market purchase what you are offering? Who are your competitors?”
Just formulating a business plan won’t make your firm successful. It will, however, provide you with a road map and guidelines on how to proceed forward. Of course, the more you are prepared, the better it is for you and your business.
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