Business Plan: What you need to know before marketing.
There are some key sections of your business plan required to support a winning sales and marketing strategy.
Before you start promoting your business, you need to know your business. Writing a business plan helps to develop your idea and document your findings. This information will help you find the best ways to promote your business and generate sales.
The following sections of the business plan provide vital information to help you develop a winning sales & marketing strategy.
Some examples are included in each section using the scenario of a bicycle shop business.
Market Segment
What segment of the market are you going to target? Short-term & long term
What opportunities are there in the marketplace to support your business idea?
Next:
Define your segment - Who are they? What are their needs, motivators, challenges that you are going to solve? (e.g. target audience research) Where are they located? Are they in a specific industry? What is the size and opportunities of this segment?
Target audience - Identify specific audiences within your market segment and list them as primary and secondary. Your target audience will be developed further in your sales and marketing strategy.
Vision Statement
The vision statement offers an aspiring statement for the company that helps keep employees focused and motivated on what matters and where the company is going.
What are you offering? What do you want to be known for?
What are the benefits?
Who are your customers?
How will they show they are satisfied (success of you delivering on your promise)?
We aim to be (known for, market position, etc.) ______________ by (ideal Client)_________________ so they will (benefit from doing business with us, how)_____________, and then (action to show satisfaction) _________.
“From novice to experienced, we aim to bring out the smile on every mountain biker’s face!”
What is your mission statement?
A mission statement tells how you will reach your vision. It explains what you do, your goal/mission, whom you serve (ideal customer), what you will do to help your customer. The mission statement rarely changes. Keep it short and to the point; 2-3 sentences max.
Your vision is aspirational, while your mission statement is practical and descriptive. Your mission statement will guide your decisions as you conduct business and build your action plans.
We are ___(business)_____ whose mission is to provide provide ____(service/product)_____ to ___(ideal client)_______so that they will ______ (satisfaction)_____.
“Our mission at (business name) is to provide novice to expert level mountain bikers, who live in the (area), with the products, service and opportunity, so they can have the best cycling experience(s) possible; so that they will make (company name) the first place they go for all their cycling needs.”
What is your Value-Added Proposition (VAP)?
Understanding the challenges or problem(s) that your product/service solves is the beginning of your value-added proposition (VAP). Your VAP should state the tangible benefits of doing business with you. It may be things like cost, or time, or quality. Write down who will receive these benefits (i.e. who is your customer) and how much value they will receive (quantify it). Perhaps you can include testimonials in the business plan, or if you conducted research, you could mention them here.
State the problem and how you plan to solve it.
Who are your customers?
What value do you offer the customer as a result of them buying your product or service?
What are the benefits that they should expect to receive when they acquire your product?
Why is your product better than the competition?
“Whether you are just starting out or an experienced mountain biker, our expert staff will help you select the right product, provide competitive pricing, offer exceptional service to keep your bike working at optimal performance, and give you the personalized support you need, to get you out on the trails and experience a lifetime of excellent mountain biking memories!”
Goals & Objectives
Align your goals and objectives to your mission statement; what you want to be as a company and who is your customer. Goals help define where you want to go and are typically general statements. Objectives give details on how and when you plan to get there (specific, measurable, achievable, timely). Create long-term and short-term goals. These should be updated annually.
Example of long-term goals [for the bicycle shop]
Increase the profitability of our service department (profitability) - short term goals should support long term goals.
Examples of short-term goals
Increase efficiencies of our service department (operations)
Reduce the turnover of service department staff (problem-solving)
Provide skill development/training for service staff (development goals)
Evaluate service opportunities to expand the bicycle business, e.g. offer spin classes in the winter months (innovation)
Examples of objectives
To improve the profitability of the service department by 30% in 2 years.
Increase the number of service repair gross revenue by 20% within 6 months, while maintaining the same dollars spent on labour.
All service staff to complete Shimano training certification by the end of August.
Complete a feasibility study for a spin class studio by September, with the projection to start in November.
S.W.O.T.
Based on your situation, research and description of your business put into a grid your
Strengths - e.g. your competitive advantage, skills of your team, government regulations - need to be identified as a priority, prospective clients have the budget available.
Weaknesses - What weaknesses have you identified that may slow down your success. E.g. highly competitive industry where you do not have a strong competitive advantage, minimal start-up capital, a clearly defined market may make it difficult to take your product/service to market.
Opportunities - what circumstances did you discover in your market research to show that you can be successful with this business.
Threats - these are external risks that can prevent you from reaching your goals.
Competitive Advantage
How will you win against your competitors? Why will they pick you?
How will you differentiate yourself in the market?
The following are three different ways you can position your business to be competitive in your market.
Cost advantage - provide a lower cost for product/service as compared to the competition
Offer advantage - you will offer additional value-added features in your product/service
Niche advantage - provide a product/service that is not available in the market or is better than anyone else.
What’s next?
In this rapidly changing economy, it is essential to review your business plan often and update it as needed. Individual sections have the potential to change more than others. For example, your vision and mission statement defines the purpose of your business, so often remain the same unless a significant change happens in the company. However, your goals may need adjusting as you respond to marketing shifts. Goals, SWOT, product/service offerings, and audiences are some of the sections to review regularly and adjust as needed. Your business plan is a guiding document, so it is essential to keep it current as you will be referencing it when creating your business, sales and marketing (action) strategies.
