A well-researched business plan is an often-overlooked key to success. In addition to providing a game plan for directing and guiding your business, a business plan can provide a great tool for communicating your business to potential investors and financial institutions.
Statistics have shown that those who develop and implement a business plan tend to survive and those who do not, fail.
The documents and links below have examples of business plans, templates, and planning resources that should be helpful:
A business plan is the result of thoroughly investigating your industry, your market, your product, your financial situation and your proposed organization. A business plan outline provides an organized system for researching the feasibility of your business.
Business planning is a process that leads to a product. Your internal business plan should be in a format that is easy for you to understand, access, store and retrieve, edit and update. There are a number of business plan formats, but here are two examples that we think work well:
A common mistake is thinking that everyone will want your product. Those who succeed identify target markets, learn about their needs and provide the appropriate bundle of goods and services to meet those needs.
Find out as much as possible about the industry you want to enter. Is it emerging, growing, stable or declining? What are the trends? Who buys and what do they buy? When do they buy? What percentage of the population buys? What is the demographic profile of each target market?
Virtually any industry you can imagine has a professional association that gathers data and processes it into useable information for their membership. Go on-line and search for "(your industry) association."
Look for an association that provides statistics. Many will publish trade magazines, newsletters or e-letters. They may also provide membership or vendor lists, although this information is usually only available to members. It may be a good idea to become a member.
Apply the national statistics to your local demographics. If 3 percent of the national population uses the product and your local population is 100,000, then you can expect 3,000 potential customers. Then consider identifying your target markets. Are there under-served markets with pent-up demand in your area? You may create a market niche by supplying the products and services they can't find elsewhere. Are there opportunities to sell to government agencies, clubs and user groups or business to business?
Select those markets that have the greatest potential for success, as you define it. That may include profit, return on investment, long-term sustainability or some other valuation you may choose
First let's dispel one of the common myths that "I have no competition." Even though there may be nobody in your demographic area providing the same product or service, most competition is for discretionary dollars. Therefore, you are in competition with anybody who wants to sell anything.
You need to identify all competitors and analyze their strengths and weaknesses to determine how you can best compete. Realistically estimate what percent of the consumer population (market share) will become your customers, and why. There are only two ways to get customers in a competitive market: either develop new customers or take them away from your competitors. Also, study the competition for ways to become co-operators rather than rivals by buying or selling from each other.
Now that you have found what people are willing to buy, you need to make a sales forecast. After studying the industry, consumer profile and the competition, you have enough information to do some simple projections.
For each of your chosen target markets, estimate your market share in number of customers. Based on consumer behavior, how often do they buy per year? What is the average dollar amount of each purchase? Multiply those three numbers to project sales volume for each target market.
To get better numbers for your projects try locating a business similar to yours, in a community like yours, that's far enough away so you won't be considered a competitor, then ask them. Better yet, go there. Take the owner to lunch. Walk around, observe, take advantage of good ideas, and avoid the bad. Then go back home and forecast your sales.
The question remains: is this business financially feasible? You've already projected sales. How much will it cost to achieve that level of sales? Start with fixed costs like rent, utilities, insurance and salaries. Then calculate the variable costs of sales including cost of goods sold, hourly wages, shipping, etc. Subtract the cost of sales from the sales forecast. This is your gross margin.
Subtract the fixed costs you identified from the gross margin. If the remainder is less than zero, then the project is not feasible. If the number is positive, is it large enough to justify the risk? Starting or growing a business requires financial risk. If the business idea does not meet your financial requirements, then invest your money in something that does.
step by step instructions for creating a business plan from the SBA
Strategic planning is the critical process where you step back, assess the situation and change strategy. It can be complex and challenging because the experience and ability to develop and manage it is hard to find.
An free online resource that mirrors a business plan and provides insight to the fundamentals of writing an effective business plan.
Access business statistics and benchmarks, useful financial ratios, and effective and understandable online analysis of businesses and industries.
This commercial site contains about 60 online examples of business plans. It also contains information about planning software available for sale.
This public site provides information on consumer expenditures nationally, regionally and by selected metropolitan areas.
Various Business Calculators from Entrepreneur.
Samples of business plans and other tools.
Legal information on starting, financing and managing a small business.
Guide to business plans by type of business.
Articles with solutions gleaned from CEOs and business owners. Includes perspectives on managing growth in key areas such as communication, finance, marketing and sales, HR management, legal issues/taxes and technology.
Articles and resources for creating your business plan.
Information for starting and growing a business. Includes free business forms and agreements.
Projecting & Controlling - PROFITS, INVENTORY, and CASH FLOW.
These courses with the 3-in-1 calculator teach the basic financial levers of a retail business. Using the training and tools ROI delivers allows retailers can see for themselves how fluctuations on the P&L (sales, margins, expenses) and Inventory turns combine to affect Cash Flow.
This public site is a major link to demographic and economic census data.
This is a complex site but you can find information on SBA programs and other resources. Surf the library and you’ll find information to help you in planning your business.
This site contains information on presentations for venture capital. It includes a model business plan, financial model, a PowerPoint presentation, and other useful information.
This public site provides information on retail sales within the State of Washington in detail to selected cities by NAIC code. In addition, many tax topics are covered. Be sure to look at the "Statistics & Reports" section.
This public site provides information on economic, social-economic, population, estimates and forecasts, and city and county data. It also provides links to the United States Census 2000 web site.
While this public site deals primarily with employment, it has great insights as to the general economic conditions of areas within Washington State. Of particular interest are analysis and articles by "Regional Economists".