Starting your own business can be an extremely profitable, rewarding and fulfilling choice to make. However, knowing where you should start can be difficult, and there are plenty of things that you should know before you start trading. In order to avoid the many pitfalls that can befall business owners, you will need to make a business plan. A business plan should be a detailed strategy that predicts potential events and plans solutions to any potential obstacles. A solid business strategy should also be adaptable to the unexpected. There are many things to remember, and in this guide, we will explore ten of the top tips for planning your business strategy.
Research the Market
Market research is a vital part of an effective business strategy. Creating and disseminating market research surveys or polls can be a highly effective way of carrying out market research. The data that you collect from the results of market research surveys can enable you to find statistics (which are useful for just about everything, see here for more information) and identify trends around which to build a strategy.
Identify Your Competitors
It is important to make sure that the market for your particular products or services is not too crowded. You can use the internet to find local businesses that may be your competitors in the field. If there are too many or the competition is too fierce, it may be worth considering relocating to a less crowded area.
Find a Unique Selling Point
Even if you have a lot of different competitors in the market, you may still be able to compete successfully. One way that you can do this is if you have what is known as a USP, or Unique Selling Point. This is something that differentiates you from the other competitors in your field. It can be something subtle or something much more complex and distinct.
Don’t Overestimate Your Financial Projections
Coming up with financial projections can be difficult, especially if you are yet to start your business, as you may have very little data to use to make predictions. For this reason, your predictions may be inaccurate. It is better to make modest predictions and exceed them than it is to overestimate your profits. Overestimating how much money you will make can lead to problems like initial overspending on resources, staff, marketing, and other expenses that may not need to be that expensive.
Work Out Your Cash Flow and Expenses
An accurately planned and predicted cash flow is essential for your business. Neglecting this can result in insufficient funds to carry out necessarily daily operations, which can be disastrous and even cause bankruptcy. Cash flow will most likely look different across different types of business in different industries. You will need to consider every expense that your business will have, from purchasing stock and paying staff wages to renting accommodation for your business premises. Your income stream needs to not only exceed the cost of your expenses, but also be paid into your account regularly enough to cover costs. Taking on large projects that take multiple months can disrupt cash flow, so it may be best to break down the fee you charge into regular instalments.
Choose the Name Carefully
The name of your business is extremely important as it is the first thing that most people will learn about the company. Some names are to be eliminated instantly, such as names that have already been taken, names that may be offensive to people, or names that are entirely unpronounceable. You should also choose a name that suits the tone that your business wants to project, and fits the industry that you are in. For example, a gift store business could have a humorous name based around a pun, but this would not be appropriate for a funeral director or a solicitor.
Networking is useful for plenty of different reasons. For one thing, this may be how you find out who your competitors are, as well as your potential customers and target audience. Networking can also help you to meet people with business experience that can give you advice and share hard-earned wisdom. You can network at corporate events, or on online social networks like LinkedIn.
Develop a Solid Marketing Strategy
Marketing is a complex art. Whether it is word-of-mouth advertising, print, TV, or radio ads, or digital marketing, you will need to have a solid strategy in place. Marketing can often be a case of trial and error, but it is still best to go into it with some knowledge of what to expect. Using statistics from your market research is a good place to start. You should also identify the channels where you will be reaching potential customers—from online social networks such as Facebook and Instagram, to real-world venues.
Developing marketing and advertising campaigns can be difficult. It may be worth considering outsourcing this to professional marketing firms, at least until you get an idea of what kind of marketing strategies work best for your business. It is not just marketing that you may want to consider outsourcing—other areas such as accounting and security can also take up precious time and effort that you may prefer to spend on more useful business tasks. Outsourcing can also enable you to make sure that every aspect of business is carried out by an expert, rather than by a “jack of all trades”.
Follow the Industry
Whatever industry your business is a part of, it is vital to know it like the back of your hand. This means keeping up to date on all of the happenings and shifts that may occur in this industry. For example, if you are in the finance industry, you will want to know what the current state of the stock market is, or if you are in the music industry you should know what genres and trends are likely to “blow up” in popularity over the coming months and years. This may mean dedicating time each day or week to reading newspapers and blogs, listening to podcasts, or talking to other professionals in the industry.