Starting a new business can be an exciting but also incredibly challenging process. Whether your business operates primarily online or has a more physical presence, before it can earn its first dollar much research, planning, investigation and insight is required to get long lasting sustainable results.
A good business plan is crucial to this process, challenging business owners to really examine potential growth, goals, strengths, weaknesses, possible hurdles and production issues in-depth. Ultimately helping identify potential problems hopefully before they occur and setting achievable targets for the future.
There is no one-size-fits-all approach to creating a business plan, but there are a few key things to keep in mind.
- Be Specific. Focus on what you want to achieve, goals or objectives that are too broad will make it difficult to measure the outcome, whether it be success, failure or somewhere in between. Specific goals also help to give a clear understanding of the direction the business wishes to take.
- SWOT Up. A SWOT analysis is a useful tool for determining strengths, weaknesses, opportunities and threats. Strengths and weaknesses tend to originate within the business, with opportunities and threats coming from external sources. A SWOT analysis effectively highlights areas for improvement and the competitive advantages your business might have.
- Crunch The Numbers. Statistics New Zealand has some useful business tools and information when determining target demographics. Look for data relating to previously identified potential customers within certain age, income or industry ranges.
- Keep It Concise And Easy To Read. Having an encyclopedia sized document is going to mean you are less likely to refer to its contents regularly. Keeping the business plan to a manageable size will keep it ‘alive’ meaning it will continue to remain useful on a day to day basis.
- Set Realistic, Industry Specific Goals. Remember to consider the current economy and any specific local issues that may have an impact on your new business. Goals need to match your business type and be achievable within the desired time frames.
- Ask Your Customers For Feedback. Talk with your potential customers to gain a deeper understanding of what they would expect from the product/service, what they would use it for and how much they would expect to pay for it. Keeping up with industry trends and customer needs over the long term will help identify future business direction and growth areas.
- Seek Out A Suitable Business Mentor. Don’t be afraid to lean on the wider business community for assistance. Business advisers, consultants and business support networks are readily available to help when needed. These people are a wealth of information and can provide one-on-one advice, feedback and support. The Business Mentors Organisation is a great place to start, they offer targeted start-up or already trading mentor programs.
A business plan is not a static one-off document; it is necessary to continually track changes within your industry and adjust the business plan to reflect new directional growth and development as well as areas of concern. For more information on how to create a business plan see the Ministry of Business Innovation and Employment website.