Even though it is not given much attention in our country, every business needs a good business plan in order to be successful. A business plan allows you to focus better on your business and helps prevent bad surprises in the future. So how to create a good business plan? Here are 10 steps that will help you do it right.
Why do you need a business plan?
You may wonder why you need a plan before starting a business. Assuming you have a clear idea in mind of what you want to achieve, you know the market and you have the necessary skills. So why is a plan needed? Let's list some of them;
- Write Everything Down: You're embarking on a new task to give concrete shape to your ideas. You may have more than one idea in your mind, write these ideas down from the very beginning. Your ideas appear clearer on paper than in your mind.
- Have a Plan B: You will encounter many problems in the future in your business, this is inevitable. Of course, it is impossible to calculate all the problems you may encounter, but you should have a plan B against these problems from the very beginning. You need to think of as many alternatives as possible and create solutions to problems that may arise. You should write these aside whenever you think of them.
- Validate Your Ideas: Sometimes ideas may seem very reasonable to you and may excite you so much that you lose sleep. But the worst thing in this situation is that it is one-sided. Sometimes, even though the ideas that come to mind excite you, they may not give the same excitement to others. Does the idea you have in mind really excite others as much as you do? To get the answer to this question, reach out to as many people as possible, talk about your ideas in writing and get feedback. In this way, you can have information about how many people your ideas will create the same excitement when they become reality.
- Analyze Your Customer Base: You should know the answers to the following questions from the very beginning because even the simplest investor will ask you these questions. Whether you talk to an investor or use your own capital, you need to find answers to these questions before starting a business.
- Who are the people/companies who will purchase your products or services?
- Which sectors will you focus on?
- Will you only focus on companies? Or will you also provide services to the end user?
- Will you make sales to your customer base regularly (monthly, yearly, etc.)? Or is it a one-off?
- Have you actually talked to your potential customers? Does the segment you target need your products or services?
- Where are your customers? Will you provide service domestically or abroad? Will you be able to receive payments from customers and handle accounting matters abroad?
- How will you manage logistics (cargo, transportation) operations? What external resources will you use?
- If you are going to serve the end user, analyze your customers' demographic information (Age, gender, social status, profession, area of interest)
- Plan for possible growth: A saying we hear everywhere is “Think Big”. Usually every business starts small, but there is no rule that it will always remain small.
- Have a constant plan for business growth
- If you are going to sell online, how will you attract traffic?
- How will people find you online?
- Will you need a sales network(s) to further grow your business? If you don't have a sales network, how will you persuade people to buy your product?
- Will you transition into a retail business when business starts to grow more? If you don't have a proper plan in place when your business starts to grow, it can become difficult to both run the business and plan for growth. You should create a chart to answer all these questions
- Understand and research the competition thoroughly: There are competitors in almost every industry, there cannot be a business without competitors. It is naive to think that a business is unrivaled. Think comprehensively and list all the alternatives that compete with you, take notes.
- Who are the direct competitors? Do they sell the same type of product or service as you?
- Who are your indirect competitors? Will they indirectly conflict with you on a sectoral basis?
- Do you have a plan to prevent competitors from competing with you? What will make you different from them when marketing the same product and service? (Price, quality, extra services, support, etc.)
- Create a financial plan (budget): One of the most important items of all business plans is the budget and financial situations. You should calculate the overhead costs to start and maintain your business from the very beginning.
- Costs of producing or purchasing the product. (Starting quantities, stock quantities)
- Production and labor costs including raw materials
- If you are in a formation focused on the service sector, personnel costs
- Costs such as distribution, storage, marketing, advertising
- Your fixed expenses. (Your monthly costs, rent, internet, vehicle, communication, consumables and others)
- Your variable expenses. Costs that may arise as surprises, for example, travel, exchange rate fluctuations, education, etc.
- Create a general marketing plan: Be sure to record this section of your business plan in detail.
- Pricing: How much will you sell the final product for?
- Positioning: Where are your products or services positioned in the market? Your own store, retail, online marketplaces, your own e-commerce site.
- Promotion: What channel will you reach customers to attract and communicate with them?
- Profitability: How much profit will you make per product or service after accounting for all costs and expenses?
- Create your operations plan: Put your vision aside for a moment and consider a few days of execution of the business. In this process, write down the entire process from supply to production, marketing to logistics, sales to support and service. Create solutions for possible disruptions and calculate the extra costs that will arise in this situation.
- Find the right people: It is very important to hire the right people and work with the right people. Think about how you will find people who are compatible with your business and who are experts in this field and how you will manage to persuade them. When you are stuck, determine the sources from which you can get consultancy service from the beginning, research your consultants carefully regarding their qualifications, and evaluate their costs.
Finally, remember that simplicity is the key. When creating a business plan, do not drown in pages of confusing and meaningless documents. Prepare each document with simplicity and ease of explaining your business plan to an investor. No investor will read the page-long document, and even if he does, he won't be able to focus.
Your business plan is a road map for your business, but don't treat your plans as an unchangeable law. Try to update your plan at regular intervals according to your business processes and the market. If there is something to change, do not hesitate to change it as soon as you believe it is right, be brave about it.
