Have a good plan for your business -Part 4

Planning for a good business location

Avoid the fatal mistake of a bad location

Some years back, when I was opening my first business, I made the near lethal error of leasing a business location without a plan. All I planed for was how much I felt I wanted to pay in rent and who would be my realtor.

Once I got in the location I had to do three times the amount of marketing necessary just to contend with the competition. I spent more on marketing than I would have spent on the extra rent of a better spot on the street I was on.

But you live and you learn so here are some things I learned that I hope you can make use of.

Understanding and matching your needs with a business location.

When planning for a new location keep in mind your business specifications.
• Will you need a warehouse, store front, office…?
• Do the clients come to your location?
• Are your clients upscale or bargain bin (rich or poor)?
• How much space will you need?
• Based on projections, how much income do you expect this location to make?
• Will you need to renovate?
• How much are you prepared to spend for renovation?

Targeting cities for your business

If the clients never come in to see your location, I think it’s ok to get a location that’s as inexpensive as possible. Cut out all extravagant expenditures to save on overhead and start up/renovation costs.

Just don’t skimp on safety, or peace of mind. Make sure you and your staff can be comfortable working there.

If you are a store front selling to the local market, the locals must make the type of income necessary to purchase your products. You’ll sell more authentic Luis Vuitton items in Beverly Hills than you might in Compton.

Some cities have areas specifically for certain types of businesses which can help cut at very least marketing costs.

Take for instance a city with a farmers market or two. A produce company will get exposure to hundreds, if not thousands, of people and for much less in rent than opening a small market near a residential area.

However you should always keep your business mission in mind. In the example of the produce company imagine they want to sell upscale food without the haggling customers associated with farmers markets. Well they’d have to get their own store, in a very specific city or part of town, to target a particular market and income level.

Note that it is always a good idea to visit any prospective locations and spend some time there. Find out if the businesses nearby are beneficial to your company. It’s also a good idea to talk to the neighbors and see what they are like. What they have to say about their experience in the area can save you time on research.

If you want to be even more sure the location gets the type of traffic you’re looking for go there at different times of the day for one week and count traffic.

Once you have decided on the area, size, and amenities of a location find out the going lease rates or property values (and interest rates) if you plan to purchase.

Try and understand what will be included or excluded in your lease agreement. Will the lease include triple net payments? If not what services (like trash or maintenance) will be covered by the Landlord and what is the tenant expected to cover.

Once you get the numbers mapped out, make your cost projections. Include projected utility and finance costs along with regular expected maintenance costs.

Now you’re ready to write out a strong plan that will land you the location your business needs. You now know the “who, what and how much” of the location. The next step is to call a good realtor or agent.

If you need help finding a good business real estate agent don’t hesitate to email us for guidance. We have some excellent resources that may help you get your dream location.

As for the rest of my lovely readers out there in blog-land, we’d love to hear from you! Contact us with any questions or concerns regarding today’s topic.

Best of luck on your business endeavors.

Planning for your products, services, and Intellectual property

In our last entry we started the Organizational Plan section of your business plan. Your assignment was to develop your Business Summary.

Hopefully you now have a good grasp on what your company is, what it does well, and a basic strategy on how you are going to reach your goals.

Today we will begin discussing specific sections of your business to help you develop a strong in-depth organizational plan.

Describing your products and services for a business plan

There are three main categories your business can fall under:
• Distributor (wholesaler) / manufacturer
• Retailer / e-tailor
• Service provider

Manufacturing

As a manufacturer you will need to describe the process of creating the product and explain whether you will need to employ the work of humans, machines, or a combination. Explain the parts that will play in manufacturing your product.

Elaborate on the process including materials you will use, how many steps are involved, how long it takes to manufacture the product, and the amounts you wish to produce.

Don’t forget to describe how you will be getting the materials and machines needed for manufacturing. Find out how available those materials are to you and if the material needs to be shipped to you; figure out the costs and turnaround time.

Retailing/e-tailing

As a retailer you will most likely sell a variety of products so it is important to get organized. Make a list of the products you plan to sell. Describe their usefulness and the specific target markets they are sold to.

Decide on and list any vendors and distributors you plan to use. Once you have chosen the right vendors explain how the products will be shipped to you.

Does the company deliver the product ala drop shipping? Do you have to or want to handle picking up the product? How much will it cost to get the product to you?

Make an analysis describing the way you will handle your inventory. Decide when you plan to refill stock, and the amount of specific products you will need for your inventory.

Find out your wholesale costs for each product then decide on your mark up.

Lastly, if it is your job to ship the products, explain how the customer will buy the product. Will they buy in-store or online?

What will you charge for shipping? How long will it take to ship to the customer? Will you make overnight delivery available?

Providing services

If you provide a service or an entire selection of services, this section is extremely important because as a service provider you will use much of the information you write here in your procedures. Try to be as detailed as you can.

First, list the services you will provide to the customer. Describe how clients receive the service as well as how long these services will take to be distributed.

Second, explain the process that you and your staff must undertake to issue the service to your clients. Describe the amount of staff needed to perform these services.

Third, describe the payment process; for instance, do you offer continuous service with recurring fees? Or perhaps the client pays before or after the job has been started, half now half later, etc…

Developing intellectual property

Mo matter what type of business you are in you must develop and protect any ideas specific to your company using copyrights, patents, fictitious business names, logos, trademarks and procedures.

Unfortunately, the world will live in isn’t perfect and there are some people out there who would like to take advantage of companies through frivolous lawsuits.

Make sure you protect yourself by registering any intellectual property to the right government agencies. Another option, if you are not sure where to register your intellectual property would be to get legal advice from an attorney.

Make sure you get and keep all supporting documents in an easy to locate reference file cabinet. You never know when you might need them.

Please feel free to email us with any questions you may have on this section or contact Assurance Advertising for a consultation.

Join us next time when we talk about location, location, location.
]]> http://www.smallbusinessmarketingandadvertisinghelp.com/blog/2010/01/07/make-sure-you-have-a-good-plan-for-your-business-part-3/feed/ 0 http://www.smallbusinessmarketingandadvertisinghelp.com/blog/2009/12/11/make-sure-you-have-a-good-plan-for-your-business-part-2/ http://www.smallbusinessmarketingandadvertisinghelp.com/blog/2009/12/11/make-sure-you-have-a-good-plan-for-your-business-part-2/#comments Fri, 11 Dec 2009 20:00:22 +0000 admin http://www.smallbusinessmarketingandadvertisinghelp.com/blog/?p=240 Have a good plan for your business – Part 2 (if you missed Part 1, CLICK HERE)

Starting the business plan

At this point you should have a pretty good idea of what your business is and what you hope to accomplish. The next thing you need to know is what information is important for a business plan.

The basic business plan outline

• Cover sheet
• Business summary
• Table of contents
• Organizational plan
• Marketing plan
• Financial analysis and documentation
• Supporting documents

Your first steps to a good business plan

Cover sheets are simple and fairly self-explanatory. Note that some information may not be available on the first draft, just put as much information as is available.

The information contained on a business plan cover sheet

• Name, phone number, address (or website) of the company itself.
• Name, phone number, address, and title of the owners or corporate officers.
• Month and year the plan was written.
• The name of who wrote the plan
• The draft number

The executive summary, and table of contents are at the beginning of a business plan but generally you write these sections last since you’ll need to know what your plan is before you can summarize it.

The first section of an organizational plan

The Business summary

The business summary is an overview of your business. Explain what you are selling, why you decided to form the business, as well as long-term & short-term goals. We shall now cover in detail what is included:

1)The Mission Statement

Once you have decided on your goals you will need to write out a mission statement. In a few paragraphs spell out exactly what your goals are, the direction you are planning to take the company and your company’s ideology.

A mission statement not only gives you something to refer back to as a reminder of goals but it also lets your employees know what type of company they’re working for and how they will be expected to behave. Think of it as a statement explaining the culture you want within your business.

2)The Business model

There are four main factors that are considered when deciding on a business model

• Value to the customer
• Target Market
• The four “P’s”; Price, place( distribution), production and promotion
• Competition

Once you have assessed your situation with all of these variables you can decide how you will work your business to fit your situation. Note that business models need to be adaptable as the business grows and develops you will make changes.

3)The business strategy

Determine your short and long term objectives and detail what strategies you intend to implement to achieve your goals.

4)The SWOT analysis –Strengths, weaknesses, opportunities and threats

The SWOT analysis lets you know what you are up against so you can determine if it will be worth it to even open shop.

The SWOT analysis can also be a tool to attract investors to your venture.

Get as detailed as humanly possible. Rigorously research your competitor’s strengths and weaknesses.

Don’t forget to make a detailed account of what opportunities you have and how you will utilize them to reach your goals.