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Each small business is as unique as the entrepreneur running
the business, and there is no one standard formulae for starting
your own business. However, there are key success factors
to help guide your business and ensure you are on a solid
foundation before you open the doors.
Abilities
The first is to assess your own personal capabilities, resources
and characteristics. Why are you going into business for yourself?
What are your strengths? What areas need improvement? What
resources are available to you? Take a personal inventory.
Research
This is the most important step, and should take the most
time. It is important to fully understand the market for your
product or service. Market research involves learning about
the industry, traits and buying habits of potential customers,
any government guidelines, and the strengths and weaknesses
of your competition. While conducting market research you
will get a good sense of whether you can implement your business
idea and be successful. You may want to draw a path of where
the industry has been and the possible future paths.
Marketing Plan “the 6 P’s”
Product: What are you selling? Be very specific and detailed
on this question, it will help keep your focus throughout
this process. What are the important features and benefits
that will encourage a person to buy your product or service?
A good product will satisfy either a real or perceived need
of your customer.
Price: How will you price your product so it is low
enough for a customer to purchase yet high enough to cover
all fixed and variable expenses of your business and make
a profit. Price should reflect the image of your product,
for example, is your product a premium product, discount type
product, or somewhere in between. A good rule of thumb is
charge what the market will bear. You should know that from
the research that you have done.
Promotion: How will customers find out about your
product or service? What form of advertising will you use?
Who will you be promoting your product to? What message and
image do you want to promote through the various forms of
advertising? How much can you afford to spend? Some lower
cost forms of promotion are; flyers, radio, internet, word
of mouth. Some more expensive tools are television, sampling,
and tradeshows.
Path of Distribution: How will you deliver your product
to your customer? Do your customers visit you or do you have
salespeople visit your customers? Will you sell direct or
through a distributor, or retail store? Do you rely on a supplier
to provide raw materials to you? If so, what suppliers are
available, and what is the quality and price of their goods?
Does your supplier fit your goal? Did you compare suppliers
to get the best deal?
People: Who is involved in your business? Do you have
employees? How much do they cost? How many can you afford?
How much do you cost? Do you work well with the people you
work with? How do you keep everyone happy?
Process: What are the steps, from beginning to end,
of the entire cycle. The best way to do this is a “flow
chart”. List the major factors along top, and then break
them down into more detail underneath. As well as just clarifying
what it is you actually do, this will also help you find inefficiencies
in your process.
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