A business plan is an important tool that every aspiring entrepreneur should develop. A business plan can help you clarify what needs to be done in order for your company to succeed. It can also help you plan for changes in the market and other attract factors.
Here are five tips for developing a viable business plan:
1. Define the Scope of Business
Defining the business involves outlining its place in the market and its unique selling points.
- A marketing position statement outlines what the business would do to fulfill the needs and desires of its customers.
- The unique selling proposition shows how the products and services will be different from the rest on the market.
- Highlighted items should be strong enough to attract customers and compel them to take action.
2. Be Realistic
A viable business plan should be as realistic as possible.
- The sales goals, expense budgets and milestone dates should come from strategies that are possible to implement.
- A plan that involves a product that cannot be reasonably manufactured is ineffective and meaningless. The same applies to a plan that requires millions of dollars to implement but does not have a provision for teams that can oversee its implementation.
- The rule of thumb for making a realistic business plan is to identify the challenges and opportunities within your industry.
- Set realistic goals that help address these challenges and maximize the available opportunities.
3. Develop a Competitive Strategy
A viable plan should outline how the company will obtain and sustain a competitive advantage in the market. This entails the following:
- An analysis of the market to determine the strengths and weaknesses of the competitors.
- Identification of strategies that will offer your company a distinct advantage over its competitors. Strategies should anticipate potential barriers and solutions to those barriers.
- Identification of competitors’ weaknesses and how your company will fill that gap.
- Advertising, marketing, and positive media exposure that you will employ to get more customers.
4. Financial Performance Projections
The financial performance of a business is a measure of its success. The business plan must have a projection of how the company will perform based on the market conditions and exposure to fierce competition.
- It must address the price and profitability of the products and the number of customers the business expects to attract.
- A good approach when projecting financials is to undervalue the expected revenues and overestimate the company expenses.
5. Identify Forces that Can Impact the Business
There are three main factors that greatly influence the success of a business.
- Supply and demand
The business plan must define these factors comprehensively. For instance, it needs to highlight the role of fluctuating demands and supply of raw materials, manufacturing and labor. These factors play a pivotal role because they can affect the bargaining power of suppliers and customers.
As Charlottesville business law attorneys can attest, creating a viable business plan is an important stepping stone for achieving short and long term success for your company. The tips discussed above should help you develop a viable business plan for your business.
Thanks to our friends and contributors from MartinWren P.C. for their insight into developing a viable business plan.