When you start a business you do not need a fully blown business plan as there are too many unknowns. You never really know how many sales you are going to get, how many leads, what your expense will be exactly as they usually go over budget. What you can do is factor in the expenses that you can control. That's what I do. For example, when anyone asks me about the initial stages I always ask for exact figures on the following.
Firstly, what will your rent be? Will you run the biz from home? Will you be working at your current job and try and set up your new business after hours? Will you be operating on a main road or in a shopping complex?
Next I want to work out incorporation costs and accounting. Computer expenses, office furniture, building the website and internet expenses. Setting up businesses have been under 5K for me generally so worst case scenario I will end up with a computer and some office furniture if it doesn't work out. As I have said previously, it is a small risk in the scheme of things. Think of it as a vacation you never had. Vacations are memories, success is forever.
My purchases are next. What stock do I need to purchase to get the business running? I then work out how many sales I need to break even. When I began the printing business I figured that I needed to make 10 sales a week to breakeven. That was two sales a day. It was a no brainer. Rent was zero because the business was online and I was working from my mum's study, little wages because I employed someone part time and no machinery as all the printing was outsourced. My only other investment was advertising to bring traffic to the website.
That is the formula I use each and every time I start a business. Now that I have more experience I move onto a second stage. The first stage only changes if you start factoring in putting on staff, having a large showroom, buying machinery. This involves a complex business plan. I want to specialize in low risk, big potential, don't get my hands dirty kind of success. Sitting on a beach without the headache of large rental and lots of depreciating machinery. I would rather invest in marketing and people because at the end of the day that is what is going to make you successful.
In stage 2 I like to go into detail on the product or service I am offering. I research competitors, develop pricing, complete market research, interview potential clients, develop my unique selling proposition, laser in on my niche market, work out pricing and develop the overall process of how each sale is made. From the first point of contact to the delivery of the product.
Sales materials are developed, auto responders set up, submission forms are tested and packaging developed. The website will be built from top to bottom to make sure that all systems are working when we go live.
Marketing materials and strategies are next. What social media platforms will I use? What keywords will I use on Google ad words? Will I use affiliates? Advertise on radio? You need to work out the marketing weapons you will use for your particular industry.
When someone asks me about logos, I tell them what about your website, do you have an elevator pitch, what is your USP, why should I buy from you, who are you?, what is your niche, who is your customer exactly? They stare at me in disbelief. This is no joke. We are not playing with toys. This is business. A logo or business cards does nothing for you. I know some of you are probably laughing or cursing because I am sure you have been through this experience. It took me 4 years to get business cards. I don't want them, don't need them, and don't care about them or my fancy logo. My first logo took 5 minutes, that's it. Years later when I actually made money, I got one done professionally. Not the other way around.
Make money, SALES, SALES,SALES, get the phone ringing, get me testimonials, get me in the media, that's what I want to establish in my business plan, not petty rubbish.
The business plan is no experiment or scientific process. It is simply this. I want to set up the business with as little expense as I can without risking my families livelihood. I then want to sell to the customer in the fastest way possible and for him to tell his friends about it. THAT'S IT. If I see one more forecasting excel spreadsheet I'm going to have an anxiety attack. Please show me just one of these spreadsheets that actually work. I have not seen one yet. Show me your precious excel sheet after a month of going live, not 6 months before.
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