All businesses start with a good idea. If you have a realistic concept of something you can turn into a product or service, then you’re off to a good start. Maybe you’ve already started dabbling in your potential new venture and are ready to get some structure in place.
A business plan identifies your long-term vision and sets out exactly what you need to do to achieve it.
But let’s rewind a few steps. Having a business idea is just the first step. There are some other processes you can go through first to make sure it’s got mileage.
Make sure others agree with you
It might seem like the best idea in the world to you, but it will only work as a business if there is a genuine market for it, so you need to do your research.
That means identifying your target market and potential customers to check there is a demand for what you are selling.
Speak to those people and find out what they think of your product or service and how much they would be willing to pay for it.
At the end of this research you need to know if you are able to provide the product or service at the price people are willing to pay for it, while making a decent enough return on your investment.
Check out the competition
If there are other businesses with a similar concept, check out how they are doing, what they are offering and think about how you are going to stand out from the crowd.
Develop the idea
Be prepared to develop and change your idea and fix any problems identified during the market research. If there was no demand, then it might be time to go back to the drawing board.
Turning your idea into a business
Once you’re happy with your idea and satisfied that it has real money-making potential, it’s time to make it a reality. This is where it’s time to put all your aims and findings into a business plan, detailing your intended target market, customer research, costs, level of investment needed and profit predictions.
A well written business plan can help you get funding and find other companies to work with.
So what is a business plan?
A business plan sets out your clear goals. It is a critical document for everyone in your business – motivating you and anyone else in your business to reach its goals. It determines how success will be measured and the performance indicators needed to get you to that point.
A business plan keeps you on track and an effective one has flexibility and helps you to keep focused when markets change or when new opportunities present themselves.