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In order to dominate any market, it’s important that you know who and where your competitors are. Your marketing strategy should describe who the competition is, where the competition is, how the competition is currently meeting customer needs and at what price. This information can give you an idea of what it will take to acquire customers whose needs are being met elsewhere.
Answering the following questions will help you in determining what information you will need to know about your competition:
Excerpted from, "The Start of Something BIG: Your Ultimate Guide to Writing a Dynamic Business Plan."
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Once you’ve identified your target market, you will need to develop a PROMOTION strategy to build your brand and company image. This is accomplished via advertising, social media, electronic media, print media or public relations, or networking activities designed to inform, persuade and remind customers about your company and to buy your products/services. In developing promotion strategies and campaigns, determine:
Today, social media is the most popular and cost effective form of promotion. Costs are free or minimal, and regardless of the platform used (e.g., Facebook, Twitter, Instagram, LinkedIn, Pinterest, et al.) millions can be reached instantaneously, worldwide. And for those not embracing social media, email is used as widely by nearly every person in the world. It is understood that social media is not for everyone, but not employing a social media campaign in your business could easily mean lost revenue. Electronic media consists of paid television and radio advertisements. This is the most expensive form of mass selling. Print media, on the other hand, consists of paid advertisements via newspapers, magazines, external paid newsletters or billboards and is considered less expensive than electronic media. Publicity or public relations are a free form of promotion. It can take the form in either electronically or in print, in-house newsletters, press releases, attending networking events or speaking engagements. Excerpted from, "The Start of Something BIG: Your Ultimate Guide to Writing a Dynamic Business Plan." The Management Plan is a representation of the company’s principals, employees, temporary staff, outside professionals, contractors, subcontractors, freelancers, and their backgrounds, responsibilities and capabilities. It is the detailed structure of all the company’s human resources, compensation and benefits. As part of your business plan, include résumés, curriculum vitae, or employment/contract agreements for key personnel here or in the Appendix.
If you are just starting out in business, you will need to give serious consideration as to whether it’s necessary to hire employees. It may be more cost effective to simply use outside professionals. For permanent hires, however, make sure you are aware of and adhere to federal, state and local employment laws and regulations. That includes avoiding asking questions that cannot be asked legally in the interviewing process or after hiring. But either way, you need to be sure that roles, responsibilities and compensation are clearly defined and disseminated in writing. Components of a Management Plan include:
Excerpted from, "The Start of Something BIG: Your Ultimate Guide to Writing a Dynamic Business Plan." The Executive Summary (sometimes titled the Introduction, Business Description, Statement Purpose, etc.) is used to summarize the details of your business plan, other document or other report. In addition to your mission and vision statements, you may want to include your company’s value statement (describes a company’s intrinsic value, importance or desirability) and guiding principles (describes what the company views as its rule or code of conduct).
While the Executive Summary is located at the beginning of any business plan or other document ore report, it’s always prepared last. This is because its purpose is to summarize all the details contained within the body of your document. It should be two to four pages in length, and give the reader a concise synopsis of your business. If you are seeking outside financing, the Executive Summary should pique the interest of the reader enough to read further, and ultimately finance or invest. Each question should be answered briefly from the information contained in the body of the document. In-depth descriptions are not necessary here as they are covered in detail in the body the document. Each section should be one to two paragraphs in length as described below:
Regardless of the type or purpose of the document you are creating, an Executive Summary is critical. Even though preparing a report of any kind can take a tremendous amount of time an effort, many financiers or other interested parties, do not take the time to read it in its entirety. But make sure your Executive Summary is inextricably tied to the details of your report. Excerpted from, "The Start of Something BIG: Your Ultimate Guide to Writing a Dynamic Business Plan." In What Areas Do Your Company's Strengths, Weaknesses, Opportunities & Threats (SWOTs) Lie?9/29/2017 A clear understanding of strengths, weaknesses, opportunities or threats (SWOTs) is essential to capitalize on new directions or new opportunities when they present themselves. It will also signify your company’s ability to compete in whatever environment it exists. Not even Fortune 500 companies function perfectly at all times. And as a small business owner, you are not expected to be any different.
Using the key results areas prepared by each manager or key person, identify each SWOT. You will want to discuss the impact on the following in each item listed as they relate to:
Excerpted from, "The Start of Something BIG: Your Ultimate Guide to Writing a Dynamic Business Plan." KRAs are defined as highly-selected areas of a manager’s or key person’s job where results must be achieved to be most successful. These areas include, but are not limited to, operations, marketing, human resources, capital resources and profitability. This activity is intended to assist each manager in directing his individual resources that will contribute to the overall success of the company.
Perform an analysis of the key areas of your company to determine where success needs to be achieved and whether success is being achieved by responding, in detail, to the following:
Excerpted from, "The Start of Something BIG: Your Ultimate Guide to Writing a Dynamic Business Plan." Pricing objectives and policies must be established and guided by your company objectives. Your objectives and policies should explain:
The simplest pricing method is often based on cost plus a desired mark-up. This is a pricing model that most accountants prefer. The mark-up is expressed as a percentage of the selling price added to the cost. Sometimes mark-ups are a determined standard set by middlemen in a channel by industry. Whatever pricing method you use, carefully consider what the market will bear. Be sure not to underprice your product/service because that is definitely the formula for going out of business. A good profit margin is somewhere between 40% and 50%. It’s not necessary to compete on price if you’re offering more value for the going rate. Once you’ve established prices for each product/service, you will need to perform a breakeven analysis. This analysis will provide you with sales objectives expressed in dollars or units of production at which your business will break even. This is the point at which your business is neither making a profit nor losing money. The breakeven point can be calculated for a one-product/service company or a multi-product/service company. This critical information gives you a definite target you can plan to reach. Excepted from, "The Start of Something BIG: Your Ultimate Guide to Writing a Dynamic Business Plan." Changes in every industry occur frequently. In the technology space, for example, changes seem to occur every second. Make learning your industry and keeping abreast of the changes a priority by either working in a similar business, hiring, consulting or partnering with an expert.
When researching your industry, seek to learn the following: 1. History and background of the industry (i.e., when and where did industry begin). 2. How has the industry changed or grown in the past three years? 3. Describe the environment the company functions within (e.g., technology, economic, political, legal, social, cultural). 4. What factors contributed to those changes (e.g., economics, technology, market conditions, government, competition, etc.)? 5. What are the current industry trends. 6. How large is the market currently? 7. Is the market in a growth or decline mode? 8. What profit margin is the standard for your industry? Excerpted from, "The Start of Something BIG: Your Ultimate Guide to Writing a Dynamic Business Plan." Government agencies and private corporations have supplier development initiatives to assist their suppliers in growing and developing their businesses. The benefits are two-fold. Once an agency or corporation establishes a relationship with a supplier, the supplier essentially becomes an integral part of the agency’s or corporation’s operation. The development that takes place is designed to provide the agency or corporation with the reliability and cooperation from the supplier that enables the two entities to maintain a long-term, productive and profitable relationship.
Corporations institute supplier development initiatives to assist current and potential suppliers in identifying and developing business opportunities with their companies. This development process helps in the growth and expansion of a supplier, and is implemented in one of three ways:
The most notable supplier development initiative in the private sector is supplier diversity. Either by government or corporate mandate, corporations institute supplier diversity initiatives to promote the integration and retention of certified minority, women and service disabled veteran business enterprises (S/D/M/W/V/DVBEs) in corporate-wide contracting and procurement. These firms are provided a vehicle to expand their present capacity, and for less experienced ones, the training and assistance needed to grow. Supplier diversity initiatives have served to increase the competitive advantage of corporations in the marketplace. It’s believed that diverse firms provide innovative business solutions, improve bidding advantages, as well as promote an increased diverse customer base. Corporations actively seek to integrate their supply chain to reflect the markets they serve through the development and implementation of a supplier diversity program. If you are certified as a woman, minority, disabled veteran or small business enterprise, you are eligible to participate in a corporate supplier diversity program. Visit the web site of the corporation you’re interested in developing a business relationship. Search for the supplier diversity, corporate sourcing, purchasing, emerging business office (or the like) for more information. Excerpted from, "The Start of Something BIG: Your Ultimate Guide to Writing a Dynamic Business Plan." Mentor-Protégé programs are designed to enhance the capabilities and improve the abilities of small businesses to successfully compete for and receive public and private contracts. The benefits of participating in a mentor-protégé program may include, but is not limited, to:
Program eligibility and criteria vary by organization. But in most instances, participants receive management and technical contract assistance, financial aid and subcontract support. Requirements of mentors and protégés include: Mentor
Protégé
As with any other business relationship, a mentor-protégé relationship begins with a written agreement. The agreement is intended to specify the responsibility of the mentor and protégé, as well as, provide a mechanism for monitoring the overall relationship. The most critical aspect of forming a mentor-protégé relationship is that roles are specifically understood by both parties and the relationship does not turn in to one where the protégé becomes an “employee” of the mentor. The agreement must include:
Federal government agencies such as the Small Business Administration, Department of Defense, Department of Transportation and Department of Treasury all have mentor-protégé programs. Even your local SCORE office can arrange a mentor your business. Excerpted from, "The Start of Something BIG: Your Ultimate Guide to Writing a Dynamic Business Plan." |
Author
Kimberly L. Johnson is an author and business development professional specializing in business start-up and business development. Archives
May 2018
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