Subscribe to our Newsletter!
Join the Black Entrepreneur mailing list of more than 39,000 subscribers to stay up to date with the latest news and information.
For the next four hours I’m going to need you to fight the urge to catch up on the last season of Empire and say no to the let’s-catch-up-for-drinks invitation. Right now you need to focus on what could possibly be the defining moment of your future business: writing your business strategy plan.
The days of writing long, drawn-out business plans are in the past. Recent research has uncovered that the need for long-winded business plans is overkill and a one-to-two page summary, if done well, is just as efficient. Today we are going to lay out a quick guide on how to accomplish writing your business strategy plan in just four hours! Ready? Let’s begin.
Just about every business must provide value in some way, shape or form in order to successfully attract customers and sell to them your product or service. The very first step in creating your plan is identifying the value you’re providing that’s going to attract new customers from your competitors. Your Value Proposition should be a sentence or two that describes your target customer and how your product/service solves or improves their situation. Finally you’ll want to state why they should buy from you and not from the competition.
Fill in the blanks to complete your Value Proposition:
“My product/service is for (target customers), who are dissatisfied with (the current alternative/competitor). My product/service is a (describe), that provides (key problem-solving capability), unlike (the current alternative/competitor).”
MARKET NEED ANALYSIS
The next step is to identify the market’s need for your product/service. This is a critical step in product development. You can have the best idea in the world, but if there’s no need for it, you may want to consider approaching it as a hobby versus a business.
To start, you’ll need to research current trends and news to figure out if there’s a viable market for your product or service. This section of the plan will reveal the research that supports why your product is needed in the market you will serve.
Here are three steps that you’ll need to address:
Do your homework to determine if this opportunity is worth your time, money and effort by figuring out if there are enough customers out there that can profitably support your business.
Sales is the equivalent of solving your customer’s problems; hence, consumers purchase your product/service in response to a need. You must identify how your business solves those problems by defining the following:
If your business is not solving a problem, you must ask yourself: is this a good business opportunity that can support my current and future financial needs? If the answer is “no”, it may be time to move on.
Competition is a good thing. Ever wonder why you see a McDonalds, Wendy’s and a Burger King on the same busy corner? The presence of competitors creates a market in which you are trying to find an edge to drive the customers into your door versus your competitor’s down the street. In this process you must distinguish: what product/service do your customers choose today instead of yours and how are you different?
Answer the following questions:
It is now time to profile the ideal customer which you’ll plan to focus your business around. This is a very important strategy to develop because this will guide the type of marketing you’ll engage in to promote your product. For instance, would you consider promoting your new high-dollar gourmet chocolate product line to kids to distinguish your product over a one-dollar Hershey bar?
Things you need to consider as you profile are the age, gender, location, income, education, family status and ethnic background of your target customer. Once you’ve profiled your customer, you should be able to answer the following:
MARKETING AND SALES
Now that you know your target audience and you understand the industry and competition you’ll be facing, it’s time to brainstorm how you’ll market and sell your products and services to your customers.
Let’s first start off with addressing the following about marketing and creating customers:
Next, you need to define your sales strategy, by asking yourself the following questions:
Proper financial planning is the sign of good management. If you don’t project the financial results of your new venture, you may scare away some key partners you may need in the very near future: investors, partners and bankers. The goal is to estimate how much you think you will sell and how much it is going to cost you to make your product or deliver your service. What other key expenses will you have when your business is up and running?
A lot of businesses fail before they reach their full potential due to the lack of financial planning. Whether not projecting the shortfall caused by potential losses incurred while the business gets off the ground, personal expenses dependent on the immediate success of your startup or under-estimating the timing of your businesses conversion cycle, not strategically planning can be a huge hurdle in the success of your business. \
You should frame your financial projections by estimating the market share you’ll gain by entering the market and gradually improving on this number as time goes along. Some key factors to consider are your fixed expenses versus your variable expenses and the timing needed to break even.
This exercise should take more time outside of your four-hour session due to the complexity and structure of your unique venture. After this plan is complete, you will want to utilize a financial projecting template to create a more in-depth plan of your new venture’s revenue and expenses. SCORE is a national nonprofit association dedicated to helping small businesses. You can download their free template here: Financial Projection Template
PARTNERS AND RESOURCES
Finally, it’s all come together, but you still have one key factor to consider in making this plan come to life; and that’s identifying what partners and resources you need in order to start and successfully run your new business. Some things to think about: Do I have the right employees identified and suppliers? Do I have an accountant, attorney and banker to consult on various business decisions that need to be made? Do I have a business mentor who is at least familiar or has worked in the industry which I’m pursuing? The list could go on! Don’t try to do everything on your own, outsource the tasks that make sense while you focus on driving sales and branding your company.
The need for a long, drawn-out business plan is overkill and the focus should be on execution. A great business plan means nothing without it. At Black Entrepreneur we suggest you use the questions above to formulate your thoughts in a one-to-two page summary, enabling more time to produce real and measurable business results. Sacrifice four hours to begin the process of transforming that concept into reality.