| A business plan is simply a written document that | | | | website, your online marketing brochure, ask people |
| outlines the steps required to build a successful | | | | what they think of it. Each opinion you receive many |
| enterprise. For larger companies, this document can be | | | | not be useful, but if you see trends the responses, you |
| quite long, 30 pages or more, with extensive | | | | may be able to use that information to improve the |
| information about the market, the competition, and | | | | content on your website. Pricing an online product or |
| detailed financial projections. Many times the Business | | | | service is always tricky. If you are going to use |
| Plan is used to introduce the company to prospective | | | | affiliates to help you market it, you need to have the |
| investors, so the Plan is designed to assure investors | | | | price high enough so there is room to pay them a |
| that the management group has the skills and | | | | percentage. Asking people what the price point should |
| experience needed to make the venture a success, | | | | be can give you at least a ballpark idea of what the |
| the market the company will be competing in is large, | | | | marketplace is willing to pay. |
| and the company will have certain competitive | | | | Once you understand your competition, and have |
| advantages that will allow it to outdistance the | | | | determined how to position your product/service in the |
| competition. | | | | marketplace, now you can get to the heart of planning: |
| Your home based business probably doesn't need | | | | figuring out the action steps that are needed to launch |
| anything this detailed, but taking time to thoughtfully plan | | | | your business. You should create a timeline for these, |
| out your business will pay dividends down the line. | | | | for the next 12 months, so you will be able to track |
| Understanding your competition is very important. Find | | | | your progress. |
| out what they are offering, how much they charge, | | | | Once your action steps are in place, then you can |
| what their reputation is, how successful they are. This | | | | progress to your last step, the budget for your |
| insight will help you design your product/service | | | | business. Large companies plan 3-5 years ahead, but |
| offering so it has the highest probability of success. | | | | as with the action steps, doing a budget for the next |
| We can all learn from the successes, and | | | | 12 months, and then adjusting it as conditions change, |
| shortcomings, of other home based businesses. | | | | should suffice. Most of us starting a home based |
| Many business plans start with the fundamental | | | | business do not have unlimited funds, so you really |
| question: why does the customer need my product | | | | need to be sure you have thought of all the costs |
| service? In other words, what benefits are you | | | | involved in getting started. You then need to forecast |
| providing the customer, how are you saving them time, | | | | your revenues, and when your business will break |
| money or making their lives easier? This is not | | | | even, in other words, bring more cash in than you are |
| necessarily an easy question to address. Many | | | | paying out for expenses. One word of caution about |
| businesses go astray by assuming large numbers of | | | | revenue projections: it almost always takes longer for |
| customers need what they are offering, and are willing | | | | revenues to ramp up than we suppose when we |
| to pay for it, when in fact customers are lukewarm | | | | start. Our natural enthusiasm tends to blind us as to |
| about it, and therefore are not motivated to buy. | | | | how hard it will be to obtain those first few customers. |
| How do you find out whether customers need your | | | | Err on the side of caution, and assume your business |
| product or service? Ask them. The numerous business | | | | will start out slowly. Then you won't be disappointed or |
| forums on the Internet can be incredibly valuable | | | | frustrated. |
| resources for you to use to conduct informal market | | | | With a plan in place, you can work more confidently |
| research. Describe what you are doing and ask the | | | | toward reaching your goals. |
| forum members to react to it. If you have a prototype | | | | |