The success of the business that you want to carry out is highly depends on how solid the business strategic planning that you set.
When we fail to make a good business plan, that means we are actually planning for a failure.
Therefore, when we want to start a new business, we must be able to formulate a solid business plan.
How to Formulate a Business Strategic Planning
For those of you who may be planning to build a new business on a small scale, then all you need is just a simple business plan that is concise.
The content of a “simple business strategic planning” should include the following aspects:
- Description of the business and the uniqueness of the product
- Market potential analysis
- Marketing plan (marketing plan)
- Production plan and business operations
- Cash flow projection
Let us discuss one by one briefly.
1. Brief Description
A simple business plan should start with a brief description of your business. What is the product or service that your business offer, and what is uniqueness about it compared to your competitor.
For example, one of the businesses I run is selling business books and self-development.
The unique point: the title of the book is eye catching and the content are written in a down-to-earth and easy-to-understand language. Another unique thing is that every purchase of a book package will get an attractive audiobook bonus (not many of my competitor’s business book products provide an audiobook as the bonus).
2. Market Potential Analysis
Next, the business plan needs to analyze the market potential of the product or service you want to market out. Is it big enough and have good prospects?
Do a check on the market potential. You can do it by looking at the sales figures of products that are similar to the product or service that your business is going to sell (or identical products).
For example, when I wanted to start writing, publishing and selling business books, I researched how many business and self-development books were sold around.
In addition, I also see the sales of similar products from other authors who sold their books directly (direct selling) through online channels.
On the other hand, I also looked at the number of readers of my blog and social media followers; and predict how many of them will buy the books that I market.
From the various data, then I can estimate the market potential of my book.
3. Marketing Plan
Furthermore, the contents of the business plan should dissect the marketing plan that you will do. This is one of the keys that will determine the success of your business.
In the marketing plan, you need to at least describe:
- What are the types and content of the promotional materials
- Where will the promotion take place (online/offline?)
- How is the process of getting customer prospects
- What is the provided marketing budget; and for anything
- How many sales targets will be obtained through marketing costs that have been spent
For example, when I want to launch a book that I write and market, I plan the advertising material that I will publish.
Then, I determine through which channels I will do the marketing. In this case, I rely on thousands of paid advertising and emails that I have to carry out sales promotions during the launching period.
In addition, I also set a sales target during launching. I am one of those people who prefers small and easy-to-reach targets when setting a target. In my opinion, this is a better way than setting a very high target that are not achievable (the cost of failure can be very high if the target is too ambitious).
Studies also show that achieving business targets that are easy to reach (because we have set small targets from the start), in the long term will actually make us more consistent in taking action. This is better than setting an overly ambitious initial target, and then failing to achieve it, then eventually causing motivation to plummet. Disappointed because ambitious targets failed to be achieved.
So start small. Create easy and reachable targets.
4. Production Plan and Business Operation
Furthermore, the business plan also needs to outline a production plan or business operations. For example, how is the production process (if you produce it yourself)? How is the supply of raw materials and availability of machines? How many employees are needed?
If the product is purchased from a supplier; who the supplier will be a partner; how to pay; as well as how to store stock in the warehouse?
5. Cash Flow Projection
Another key part of the business plan is the cash flow projection. It describes:
- Sales target (and income) per month
- Expenditure plan per month
- Maybe at the beginning of the month there was still a deficit (more money going out than money coming in).
However, you must determine when or in what month the cash flow target to be surplus. This is because only with positive cash flow, your business will survive.
Final Thought
Statistical data shows, only 50% of new businesses can survive more than 5 years. And only 30% of businesses can last up to 10 years.
The chance of business success will be higher if our business starts with a solid business strategic planning.
