Business Plan for a Startup Business 1. With a group
of (3-5) students in your class, develop a business plan for your own company
that you wish to have in the near future.
2. Make sure
that anything you take from any source must be cited (in-text citation and
references) according to APA style of citation.3. Present your
findings to your class. 4. The due date
for report submission is
...[Show More]
1. With a group
of (3-5) students in your class, develop a business plan for your own company
that you wish to have in the near future.
2. Make sure
that anything you take from any source must be cited (in-text citation and
references) according to APA style of citation.
3. Present your
findings to your class.
4. The due date
for report submission is Sunday
30/5/2021.
5. The
presentation will be at the last week of the semester.
6. Send your
report to my e-mail: [email protected]
7. Please be
familiar with the oral presentation rubric, team work rubric, and writing
rubric attached in blackboard
Cover page
should take this format:
OWNERS
Your Business Name
Address Line 1
Address Line 2
City,
Telephone
Fax
E-Mail
I.
Executive Summary
Write this
section last.
We suggest that
you make it two pages or fewer.
Include
everything that you would cover in a five-minute interview.
Explain the
fundamentals of the proposed business: What
will your product be? Who will your customers be? Who are the owners? What do
you think the future holds for your business and your industry?
Make it
enthusiastic, professional, complete, and concise.
If applying for
a loan, state clearly how much you want, precisely how you are going to use it,
and how the money will make your business more profitable, thereby ensuring
repayment.
What business
will you be in? What will you do?
Mission
Statement: Many companies have a brief mission statement, usually in 30 words
or fewer, explaining their reason for being and their guiding principles. If
you want to draft a mission statement, this is a good place to put it in the
plan, followed by:
Company Goals
and Objectives: Goals are destinations—where you want your business to be. Objectives
are progress markers along the way to goal achievement. For example, a goal
might be to have a healthy, successful company that is a leader in customer
service and that has a loyal customer following. Objectives might be annual
sales targets and some specific measures of customer satisfaction.
Business Philosophy:
What is important to you in business?
To whom will
you market your products? (State it briefly here—you will do a more thorough
explanation in the Marketing Plan
section).
Describe your
industry. Is it a growth industry? What
changes do you foresee in the industry, short term and long term? How will your
company be poised to take advantage of them?
Describe your
most important company strengths and core competencies. What factors will make
the company succeed? What do you think your major competitive strengths will
be? What background experience, skills, and strengths do you personally bring
to this new venture?
Legal form of
ownership: Sole proprietor, Partnership, Corporation, Limited liability corporation
(LLC)? Why have you selected this form?
Market research - Why?
No matter how
good your product and your service, the venture cannot succeed without effective
marketing. And this begins with careful, systematic research. It is very
dangerous to assume that you already know about your intended market. You need
to do market research to make sure you’re on track. Use the business planning
process as your opportunity to uncover data and to question your marketing
efforts. Your time will be well spent.
Market research - How?
There are two
kinds of market research: primary and secondary.
Secondary
research means using published information such as industry profiles, trade
journals, newspapers, magazines, census data, and demographic profiles. This
type of information is available in public libraries, industry associations,
chambers of commerce, from vendors who sell to your industry, and from government
agencies.
Start with your
local library. Most librarians are pleased to guide you through their business
data collection. You will be amazed at what is there. There are more online
sources than you could possibly use. Your chamber of commerce has good information
on the local area. Trade associations and trade publications often have
excellent industry-specific data.
Primary
research means gathering your own data. For example, you could do your own
traffic count at a proposed location, use the yellow pages to identify
competitors, and do surveys or focus-group interviews to learn about consumer
preferences. Professional market
research can be very costly, but there are many books that show small business
owners how to do effective research themselves.
In your
marketing plan, be as specific as possible; give statistics, numbers, and
sources. The marketing plan will be the basis, later on, of the all-important
sales projection.
Customers
Identify your
targeted customers, their characteristics, and their geographic locations,
otherwise known as their demographics.
The description
will be completely different depending on whether you plan to sell to other
businesses or directly to consumers. If you sell a consumer product, but sell
it through a channel of distributors, wholesalers, and retailers, you must
carefully analyze both the end consumer and the middleman businesses to which
you sell.
You may have
more than one customer group. Identify the most important groups. Then, for each customer group, construct what
is called a demographic profile:
·
Age
·
Gender
·
Location
·
Income level
·
Social class and occupation
·
Education
·
Other (specific to your industry)
·
Other (specific to your industry)
For business customers, the demographic factors might be:
·
Industry (or portion of an industry)
·
Location
·
Size of firm
·
Quality, technology, and price preferences
·
Other (specific to your industry)
·
Other (specific to your industry)
Competition
What products
and companies will compete with you?
List your major
competitors:
(Names and
addresses)
Will they
compete with you across the board, or just for certain products, certain
customers, or in certain locations?
Will you have important
indirect competitors? (For example, video rental stores compete with theaters, although
they are different types of businesses.)
How will your
products or services compare with the competition?
Use the Competitive
Analysis table below to compare your company with your two most important
competitors. In the first column are key competitive factors. Since these vary
from one industry to another, you may want to customize the list of factors.
In the column
labeled Me, state how you honestly
think you will stack up in customers' minds. Then check whether you think this
factor will be a strength or a weakness for you. Sometimes it is hard to
analyze our own weaknesses. Try to be very honest here. Better yet, get some
disinterested strangers to assess you. This can be a real eye-opener. And
remember that you cannot be all things to all people. In fact, trying to be
causes many business failures because efforts become scattered and diluted. You
want an honest assessment of your firm's strong and weak points.
Now analyze
each major competitor. In a few words, state how you think they compare.
In the final
column, estimate the importance of each competitive factor to the
customer. 1 = critical; 5 = not very
important.
Table 1:
Competitive Analysis
Now, write a
short paragraph stating your competitive advantages and disadvantages.
Niche
Now that you
have systematically analyzed your industry, your product, your customers, and
the competition, you should have a clear picture of where your company fits into
the world.
In one short
paragraph, define your niche, your unique corner of the market.
Marketing Strategies
Now outline a
marketing strategy that is consistent with your niche.
Product strategy
Now describe
them from your customers’ point of view. Describe in depth your products or
services (technical specifications, drawings, photos, sales brochures, and
other bulky items belong in Appendices).
What factors
will give you competitive advantages or disadvantages? Examples include level
of quality or unique or proprietary features.
Features and Benefits
List all of
your major products or services.
For each
product or service:
·
Describe the most important features. What is special about it?
Describe the
benefits. That is, what will the product do for the customer? Note the
difference between features and benefits, and think about them. For example, a
house that gives shelter and lasts a long time is made with certain materials
and to a certain design; those are its features. Its benefits include pride of
ownership, financial security, providing for the family, and inclusion in a
neighborhood. You build features into your product so that you can sell the benefits.
·
Packaging
·
Labeling
·
Branding
·
What after-sale services will you give? Some examples are delivery,
warranty, service contracts, support, follow-up, and refund policy.
Pricing strategy
Explain your
method or methods of setting prices. For most small businesses, having the lowest
price is not a good policy. It robs you of needed profit margin; customers may
not care as much about price as you think; and large competitors can under price
you anyway. Usually you will do better to have average prices and compete on
quality and service.
Does your
pricing strategy fit with what was revealed in your competitive analysis?
Compare your
prices with those of the competition. Are they higher, lower, the same? Why?
How important
is price as a competitive factor? Do your intended customers really make their
purchase decisions mostly on price?
What will be
your customer service and credit policies?
Proposed Location
Probably you do
not have a precise location picked out yet. This is the time to think about what
you want and need in a location. Many startups run successfully from home for a
while.
You will
describe your physical needs later, in the Operational
Plan section. Here, analyze your
location criteria as they will affect your customers.
Is your location
important to your customers? If yes, how?
If customers
come to your place of business:
Is it
convenient? Parking? Interior spaces? Not out of the way?
Is it
consistent with your image?
Is it what
customers want and expect?
Where is the
competition located? Is it better for you to be near them (like car dealers or
fast food restaurants) or distant (like convenience food stores)?
Distribution Channels
How do you sell
your products or services?
Retail
Direct (mail
order, Web, catalog)
Wholesale
Your own sales
force
Agents
Independent representatives
Bid on
contracts
Promotion strategy
How will you
get the word out to customers?
Advertising:
What media, why, and how often? Why this mix and not some other?
Have you
identified low-cost methods to get the most out of your promotional budget?
Will you use
methods other than paid advertising, such as trade shows, catalogs, dealer
incentives, word of mouth (how will you stimulate it?), and network of friends
or professionals?
What image do
you want to project? How do you want customers to see you?
In addition to
advertising, what plans do you have for graphic image support? This includes
things like logo design, cards and letterhead, brochures, signage, and interior
design (if customers come to your place of business).
Should you have
a system to identify repeat customers and then systematically contact them?
Promotional Budget
How much will
you spend on the items listed above?
Before startup?
(These numbers will go into your startup budget.)
Ongoing? (These
numbers will go into your operating plan budget.)
If your business is a
service organization, the marketing mix becomes 7 P’s and you have to add the
extra 3 P’s here
People
By people, we mean those people who are
directly or indirectly involved in the delivery of the service. This typically
means employees of the company. But it can also mean subcontractors with direct
interaction with customers.
All service businesses
should ensure that staff are well trained and motivated. But there is another
way to adjust the people tactic. This can be done by adjusting customer
experience to meet the needs of individual customers.
It can even refer to existing and past
customers of the company. These customers represent the company through word of
mouth.
Process
Process refers to the procedures,
mechanisms, and flow of activities that occur when the customer and the
business interact with each other.
When, for example, a customer books a
hotel room a process is triggered. When the customer then checks into the hotel
another process is triggered, and when they check-out yet another process is
triggered.
Physical evidence
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