Retail Business Plan

The business plan should be written in an interesting and convincing style. Keep it simple and explain what you are going to do. It isn't a legal document so it doesn't need to be written formally. If you are using your business plan to inform your bank or potential investors then it may well read more like a sales document.

For many small startup businesses, certainly on the internet, your business plan will also be a feasibility study to find out if you have a business at all. Do it before you do anything else and be prepared to throw it all away and start again if the business is not viable.

The business plan will define your business objectives, describe how they are achievable and outline the plan to achieve those objectives.

Be as specific as possible. For every activity you should show:

• Start and end dates
• Who is responsible
• The budget
• Expected outcomes
• How you can measure it

Business plans always change so you will need to update the plan. If you can, review it monthly as part of your cash flow analysis.

Executive Summary

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The executive summary describes the general nature and activities of your company; the purpose of your business. This is where to convince yourself and any investors, that you have a unique business opportunity.


What you are going to do and how you are going to do it with the resources you have?
What are your goals?
What steps will you need to take to get there?

• Mission - What your business is doing for the customers, employees and owners.
• Vision - Where your company is going - what it will look like in the future.
• Objectives - Milestones in development that are specific, clearly identifiable and measurable. This is your gauge to your success.
• Key Focal Points - What you need to focus on to ensure your business will succeed.

Strategy & Implementation

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Keep focused. Your strategy should be simply stated with no more than 3 or 4 key points. If you produce too many priorities then human nature means they are increasingly less likely to be implemented.


Your strategy has to be realistic; it must be achievable and your job is to be able to explain how.

It has to be consistently applied. It takes time to reap the benefits so plan for 5 to 10 years ahead. Make sure the strategy is sufficient to propel your business over this time period.

You have to anticipate what is going to happen in the market. State clearly what you think is going to happen. This will give you a measure against which you can gauge your accuracy and adapt quickly if you get it wrong.

You can only do certain parts of your plan, you will not be able to do it all. At times you will make decisions that will exclude other parts of the plan. and you have to adapt to this eventuality. Don't be concerned if there are contradictions. In time, it will become clear which part of the strategy is going to take over.

Measuring your performance in real terms:

Sales figures Units sold Percentages Calls made Complaints received Total number of transactions Items returned Volume

Company Description

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Provide a short summary of your company background.State where your business is right now and the factors affecting it:

• History
• Current and former ownership.
• Start-up plan and costs for new businesses.
• Geographical locations.
• Existing plant, machinery and personnel.

Situation Analysis

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Provide a SWOT analysis (strengths, weaknesses, opportunities and threats). Strengths and weaknesses are internal to your business. Opportunities and threats are external. List each and briefly describe them and how you intend to deal with them.

There is also the PEST analysis (political, economic, social and technological). You may feel that you need this if political, economic, social or technological events have any direct impact on your business.

Products & Services

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The characteristics of your products or services that set them apart from the competition need to be identified.

• Benefits - comprehensive list.
• Features - comprehensive list.
• Sourcing - identify any reliance on a single supplier that could compromise your business if that supply became unavailable.
• Technology - state any features of your product that may be protected by current IP or patent law.  Provide evidence of how they are different and how they might be a barrier to entry for potential competitors.

Market Analysis & Segmentation

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Know your market. Take a step back and look at it.

Market Analysis

1. The Target Market - The Individual Customers

Build a customer profile.

Who are they?
What is their spending power?
What do your customers need?
What do they try to avoid?
What are they currently doing without your product or service?
How do your customers think?
What motivates them?
How do they perceive your business?
What are the benefits of your product or service to your customers?

2. Market as a whole

• How many potential customers?
  
• Where are they? Offline and online. Which websites do they visit, are there discussion forums or other social networks where they concentrate.
  
• How do you reach them?
  

Identify all your potential and existing sales channels. State how you plan to reach your customers and what resources you will use.

• Websites.
  
• Direct mail.
  
• Direct sales force.
  
• VARs.
  
• Partners.

Market segmentation

Provide a clear description of your target market, and any market segments that may exist within that market.  Include potential market size and growth rate. this will produce useful manageable groups so you can focus and prioritise sales and marketing activity.

Market Trends & Growth

Identify the current growths and trends in the market and provide a forecast as to how this will affect your business

Competitor Analysis

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List any current or potential direct and indirect competition.  Briefly describe the competitive outlook and dynamics of the relevant market in which you will operate.

1. Background
   
   1. Business model
      
   2. Strengths
      
   3. Weaknesses
      
   4. Offline Business outlets
      
   5. Website URLs
      
   6. Ownership and key personnel
      
   7. Date they entered the market
      
   8. Current market share - Alexa & Qantcast data
      
   9. Size of company
      
   10. Financial Data. You can Google them if they are a listed company but many of your online competitors will not be so you can only go through the financial data they provide on their sites.
       
2. Products
   
   1. Product Name
      
   2. Sales page URL or offline sales outlets
      
   3. Model range (basic to deluxe)
      
   4. Price range
      
   5. Discounts
      
   6. Offer
      
   7. Sample sales copy, headlines, USP's
      
3. Marketing
   
   1. Customer profile
      
   2. Number of customers
      
   3. Growth - keep this updated
      
   4. Target customer profile
      
   5. Market share
      
   6. Marketing startegy - how they win their customers.
      
   7. Advertising themes, sample copy, headlines, PPC ads
      
   8. Distribution channels - websites, articles, affiliate programs, PPC etc.
      
   9. Geographical area
      
4. Facilities
   
   1. Location
      
   2. Shipping factors
      
5. Personnel
   
   1. Number and type of of employees
      
   2. How and where they recruit
      
6. Strategies
   
   1. Objectives, mission statement, growth plans, etc.

Competitive Analysis

Product - chart these two scales intersecting
Expensive-Inexpensive
Slow-Quick

Core competency

Sometimes referred to as your unique selling point.
What one thing do you do well that sets your business apart?
Online sales? design? customer service?

Competitive advantage

Explain what advantages you have over your competitors. You should be able to explain this simply and clearly.

Suppliers

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List all of your key suppliers. Youneed to know what is happening in their business to anticipate any supply problems. You will need to list:

• Strengths
• Weaknesses
• Your reliance upon them
  

Key Staff - Human Resources

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Explain the organisation of the business and who the key members are. List the skills that individuals bring to the company and any prior experience they may have. This will enable you to identify any missing skills that you will have to resource from outside.

You may also want to set up a development plan to cover human resourcing as the business develops.

Finance

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Choose which items will serve your purposes from the following lists and include them in your plan. You will almost certainly want to include financial projections forecast to at least 3-5 years and any audited accounts you may already have.

• Company ownership
• Use of funds
• Loans and repayment plans
• Investor offerings
• Cash Flow
• Profit & Loss
• Balance Sheet
• Valuations
• Sales Forecasts
• Personnel Plan
• Personal financial statements
• Plan where profits will go and how you will manage business growth.

Profit & Loss

Sales - Costs of Sales = Gross Margin

Gross Margin - Expenses = Profit

Balance Sheet

Shows the state of the company at a point in time.

Assets - Liabilities = Current Capital

Cash Flow

What will you need to spend to implement your business plan?
Will you need to outsource?

Money Received - Money Spent = Liquid Cash

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