In this post I am going to focus on the importance of writing a business plan to ensure the successful implementation of any strategy. Business plans are erroneously thought as just tools to achieve outside financing from either financial institutions, investors, or family and friends. Instead, they should be considered as the road map that guides any business owner to execute the desired strategies and to determine the necessary resources. Business plans are also records of financial estimates and can be useful to determine the business success.
So here are a few tips to help you in this task:
- Create your Unique Business Proposition - Any retailer should be able to define what distinguishes its business from the competition.
- Develop a Mission Statement - Spell out your vision, your retail concept, your message. Outline also a set of values, which will encompass all your company's activities.
- Identify your Target Market - You should be aware of who is going to be most interested in your unique retail concept. Identify your primary and secondary consumers.
- Research your Industry - Study your competitors and their business models. Identify what approaches have succeeded and improve upon them.
- Design your Marketing Plan - Develop strategies to reach your targeted customer and to get them in the store. Consider the need for advertising in all media, PR, direct mail, promotions, and more.
- Determine your Staffing Needs - Select the number of people and roles necessary to implement your retail concept. Recognize the appropriate skills that each employee should possess.
- Define your Merchandising - Identify the products to stock and the suppliers. The selection should be based on your customer's tastes, on your competitor's current offerings and of course on your retail concept. Devise a strategy to dispose of aged inventory as well.
- Set Goals and Rewards - Be precise about financial goals and about employees rewards that would result from reaching those goals.
- Forecast Sales - Estimate your market penetration and as a result conservative sales figures. Take into account market conditions, competitors and customers' spending habits and potential.
- Calculate the Necessary Budget - Determine the necessary investment in the business based on your sales estimate and the costs associated with marketing, staffing and merchandising.
- Anticipate Challenges - Build a series of scenarios to account for better or poorer than expected results. Include strategies to deal with those scenarios.
Finally, any business owner should recognize the importance of getting a second opinion. A consultant, a retail expert, a trusted industry veteran, or even an objective friend could point out possible weaknesses and come up with additional improvements to a business plan. I am personally always available to look at business plans for new and unique retail concepts.