Why You Need Pro Business Plans
A business plan should be a well-written document to spell out considerations and strategies for an entrepreneur to meet business objectives. Business objectives focus on the sale product/service, identify the target market, pricing, financing (budgeting), marketing, sale projections and eliminate operational efficiencies.
Much as all commercial activities require business plans, startups in particular and other risky businesses must have comprehensive business plans to guarantee survival and expansion. In this article, we highlight how a business plan helps performance of your business
What are you selling and why? Simple as it may seem, successful businesses understand the demand and supply dynamics around the product or service what they trade.
The ideal product/service is rather scarce in the market and has a significant level of demand to support income-earning potential for the enterprise. A business plan qualifies that you are not planning to “sell ice to eskimo” or supply pork meat to a community that is largely Muslim.
A business will have to pass the “test of rationality” where costs remain marginally below the revenues. A business plan helps you keep track of the initial and day-to-day costs so you do not end up unnecessarily surpassing the budget or make losses.
At the same time, no one must use all their personal money in setting up and running their business. Appropriate use of borrowed cash allows entrepreneurs to exploit external capital and realize leveraged profits.
Remember, interest on debt is part of business costs; a business plan should recommend use of affordable debt.
Customers, Pricing & Marketing Strategies
Based on market studies, a good business plan recommends the most competitive price for goods and services. The market price refers to the price at which potential customers are willingly able to purchase a product/service in the market. An overpriced product/service will drive customers away from your business; underpricing will occasion lost income for the business.
Additionally, a business plan maps out the location of your potential customers and strategies to reach the target customers. For instance, it is counter-effective to run T.V advertisements for kid’s products past watershed hours.
Inadequate/poor planning is a major causal factor for business failure even for seasoned entrepreneurs.
Pro business plans will help you identify risks and inefficiencies in the business cycle from supply to the point of sale.
Engage pro business plans today to help you define your business for growth and profitability through acute market research, strategic planning and viable financing schemes.