- 1). Outline your small business plan. You can download a template online, make a mind map or collage, or simply write it out. However you approach your plan, you'll want to include information on what you're selling, who you can realistically sell it to and how you can reach them, who your competitors are and how they do business, how much your business will cost to run, and how much money you can make from it.
- 2). Describe your product or service. Label this section "Market Opportunity," and describe what you will be selling in terms of the market for it. For example, if you live in a beautiful and scenic valley with lots of tourists nearby, but there are no hot air balloon companies operating locally, there is a market opportunity for your balloon rides and photography service. Describe exactly how the service works. Also mention what you will not do. For instance, you might eventually expand into weather balloon services but never into helicopter rides.
- 3). Define your target market. You might have a great idea, but if there are no customers who want your product or service, the business will not succeed. Consider exactly who will be purchasing from you, and ensure that there are enough of them that you could sell to fewer than 1% of your audience and still be profitable. Once you know who they are, determine how they make purchase decisions, and how they would learn about your product. This is your "Marketing" section.
- 4). Investigate your competition. Every business has competition, even if the alternative to your service is to simply go without, or to substitute a very different product that accomplishes a similar purpose. For example, sweatshirts from Wal-Mart may compete with your hand-knit sweaters. Determine what your competitors charge, what their costs might be, who their target audience is, and how they advertise. Describe why your business is uniquely compelling to customers.
- 5). Calculate your costs, revenues and profits. Most entrepreneurs underestimate costs and over estimate how many customers will purchase their services. Calculate not only the costs of making your products, but also overhead costs such as business insurance, legal and filing fees, taxes, and advertising. Then determine how many customers you think will actually buy your services, what they will spend on average, and how quickly they will pay you. Plan on one-tenth of that as your revenue. Then estimate how long it will take to get to that number, because you won't have all of your customers the day you open for business. Also calculate how many of your products or and how much of your service you need to sell before you break even. Make sure you have enough cash to meet all expenses before that breakeven point.
- Advertisement -
- Advertisement -