So you have decided to start a business? Congratulations. First, pat yourself on the back for your courage and now brace yourself for the journey. Because that’s what a business is about. A journey with roads full of challenges, streets full of obstacles and signals of green lights full of opportunities.
But what you need to navigate this journey is a roadmap. That roadmap is called a business plan. A document that shows the commercials of your business idea to potential investors and stakeholders. Not just the strengths of the company but the risks it entails and the potential solution as well. This is a handy guide for your first step towards starting your business. Welcome aboard!
Why you need a business plan
Kool Kanya tip: Make tough decisions now to smoothen your path later!
When should you start making a business plan?
When do you need a recipe to prepare a dish? So you start the business plan as soon as you have your business idea developed safely inside your head. Remember it’s the roadmap. So unless you have plans of getting lost in the woods, make your business plan faster than you can say ‘fast.’
The best spot for writing a plan is around the time when you actually talk to customers, get the product ready for market, and think through your promotional and marketing activities.
Kool Kanya insight: According to research by the University of Michigan, the most successful businesses write their business plan between six and 12 months after coming up with the idea.
How to make a business plan
Whoa! After all that research, you have finally arrived at the START point. Get ready for the action that will go into the making of this business plan. Checklists, tables and what-nots. We will hand hold you until you can run this race on your own. The first thing you need in a business plan is to:
Write an Executive Summary
Include company description
It’s always important to ask the right questions.
Describe your product or service
This one’s easy-peasy. What is it that you are selling? No one knows your product/service better than you do. So share your story. How do you plan to create and sell it? How does it meet an existing need in the market? This part shows the quality, value and benefits of your business. Here is a checklist for you to see if you have everything you need.
See the checklist below to include into your business plan
- Product pricing
- Competitive pricing
- Cost of production
- Estimated revenue
- Required production needs
- Supplier information
- Order processing
- Patents and copyright concerns
- Potential product upgrades
Analyse the market
Some of us love to have a bird’s eye view over things, and some of us like to delve into that microscopic speck of dust that we see on our desks. A good market analysis helps us to see the macro and micro details of the market we are entering. So wear your detective hat and pick up your magnifying glass and understand your current market situation and your future business needs.
Kool Kanya tip: Pssst! Follow your competition on social media, become an undercover detective and engage with them as a customer to see where they stand.
Find your team
Why would you walk alone when you can walk with your own tribe? Let us tell you a secret. Investors look for a secret combination – superior product, favourable industry environment and an extremely talented management team. For your handpicked team, you need:
Here’s how you can work on your marketing plan
Some of us are hard taskmasters when it comes to the organisation whether it’s our work desk, wardrobes or even life. But many of us are also those go-with-the-flow kind of people. We love to stop for halts during our journey simply because we feel like it. If you are the first kind, the marketing plan is totally up your alley and you will love doing it. For the second group, follow the steps below to determine your marketing goal for the next few years. After all, you have committed to the journey, haven’t you? Your marketing plan should include the following:
Unique Selling Proposition (USP)
If you sell snow to an Eskimo then you are a good salesman but to identify whether an Eskimo needs snow is the job of your business plan. A good question to ask yourself is what specific need does my product/service fulfil in the market?
- Competitive price
- Best quality
- First-ever product of its kind
Which one did you pick? That is your USP or the Unique Selling Proposition.
Imagine walking a tightrope. That is exactly what pricing feels like. When you can strike a balance between giving value to your customers and still be able to make a profit, you have a pricing strategy success.
- Fixed cost
- Variable cost
- Cost of labour
- Material cost
- Freight cost
- Administrative cost
- Selling cost
Distribution and sales plan
Obviously, you have arrived at this point so that you can show your baby to the world. This is the time to figure out how. What is the best and most cost-effective way to reach your customers? Which companies can you tie up with, which people can you partner with and what technologies can you adopt? Fill up this table to find out.
Advertising and promotions plan
Once you have mapped the roads through which you will reach your customers, you need signboards and billboards along those roads to tell people about your product or service. With multiple options to choose from, you have to pick the most cost-effective way to reach your target customer and create an advertising budget for the same. Fill this table to find out what you need:
Make an operational plan
Plan financial strategy for your business
If only we could build castles out of thin air. Since we can’t, we need to have a sound financial strategy which is basically about setting the targets your business wants to achieve, a time frame to achieve those targets and the action plan to reach those goals. Based on this information, you decide how much it would cost you to get there. A 3-5 year period is optimal for a sound financial strategy. The questions below will guide you.
Information to have handy for your investors
Kool Kanya tip: Investors look for business owners who put their own funds in the venture.
So you have reached the last step? If you have reached this far, you are a rockstar. No, we are not making a big deal out of it. Actually, we are. Small successes should always be celebrated. Now that you have a business plan, you are armed with a weapon of mass creation. You are ready to launch your own business. This is it girl. Go for it!
Research Credit: Devika Awasthi and Rasika Rane