Statistics from different sources worldwide indicate that 60% to 90% small businesses and startups fail within the first five years of their operations. He figures is highly debatable because success and failure also depend upon various external factors such as economic situation in a country, government regulations, and laws, currency fluctuations as well natural and man-made calamities.
However, the success of a small business also depends upon entrepreneurial skills of the owner and astute handling of resources, especially money. Opening a small business is a dream for every person. It is quite easy to make a small business successful provided sufficient thought, research and planning are undertaken before launch.
Importance of Business Marketing Plan
Thought, research and planning are keys to opening a small business and its success. This is made possible by writing a great business plan. Broadly speaking, a business plan is like a roadmap for the venture. It speaks about various elements vital to start, sustain and prosper the business.
A good business plan also helps attract funding for the small business through venture capital, crowdfunding or loans from banks and other lenders. Here we look at ways and means to create a business marketing plan to make your small business successful.
Renowned American author on time management, Alan Lakein states: “Failing to plan is planning to fail.” This axiom holds true for every small business. Before launching a venture or when a small business is running, it is essential to chart the course.
Planning is not an easy task by any means. It involves a proper understanding of the market and buying patterns of consumers. In-depth knowledge about competitors small and large is essential to position your small business in the market.
You will also require planning on how to market your brand at minimal cost and accrue profits. Planning also means deciding on the number of staff your small business requires and budgeting. Upon finding this data relevant to your business, get down to writing a great business plan.
Define Mission and Vision Statement
Mention the Mission and Vision Statement for your small business at the very beginning of the plan.
- The Mission speaks in brief of your business field, defines objectives and clearly mentions steps that you will take to achieve these goals.
- The Vision Statement is brief description of the long-term objectives of the company or the position it intends to attain in future.
- The combined Mission and Vision Statement serve as the foundation for a business plan. It indicates the purpose, objectives, and values of your small business.
- A good Mission and Vision statement impresses financers and motivates your employees to exert extra efforts towards achieving the stated objectives. It gives a proper direction to your small business.
Unique Selling Proposition
Also called Unique Selling Point, it speaks about why your small business is different from others. The USP of your small business should include reasons that would attract customers to your business, despite the presence of established small and large competitors. Here, you define the uniqueness of your brand and steps you have taken to ensure it stands apart from existing players.
Before writing the USP, position yourself as a customer and consider why you prefer will choose the brand over others. Speak of innovations included in your product and service offerings. Explain how your small business offers better value for money to customers and why they will stay loyal to the brand. Most small ventures flounder and fail because they are copycats of successful businesses and hence have no USP to harp about.
Unless you are offering a product or service that has no precedent, market positioning is extremely important. Write a good description of the market niche your brand will be positioned.
This depends upon a lot of factors such as your target clientele, cost of your product or service, seasonal demand, quality, and pricing. Avoid the error of positioning your brand in the lower or middle segment of the market: it can prove fatal since customer patterns clearly indicate they prefer established vendors.
Positioning your brand in the upper niche and promoting it to high-end customers by offering excellent products and services at very competitive rates helps immensely. Customers look for upscale brands at affordable prices and hence are more likely to try your offerings. Targeting lower and middle market niches tend to create an impression that your product or service is mediocre and fails to arouse curiosity needed to create a new market.
Advertising and Marketing Strategy
Include a well defined advertizing and marketing strategy while writing the business plan. Undeniably, advertizing and marketing is vital for success of any small business: your target customers need to be aware about the existence of your small business and it’s USPs. Mention how you plan to generate awareness about your small business to attract clients and ways and means by which your brand will deliver products and services. Also, speak about budgetary allocations for these essential activities reasons that justify the expenditure.
A good advertising and marketing plan should also include the use of free resources available online. These include advertising and marketing through Facebook Business, Facebook Marketplace, LinkedIn, Shopify, Twitter, Instagram and Pinterest, YouTube videos, affiliate marketing as well as signing up for online sales through majors including Amazon and eBay. You can also use ‘Commun.it’ which is trusted by over 1 million users for small businesses and their social media management. You can also mention free classified that you intend to post on leading websites including Craigslist.
Return on Investment
Every large business opened as a small venture. Examples include Amazon, Airbnb, Apple, KFC, Starbucks, Mattel and hundreds of others around the world. They succeeded because investments made by founders paid rich returns on investment (ROI) that could be utilized for innovation and expansion.
ROI is one of the most important elements of an excellent business plan.
- To write about ROI, you will require market research and realistic projections about brand positioning, advertizing and marketing strategy as well as anticipated expenses on running the business such as electricity, telephone and Internet bills, logistics, payroll and others.
- With good market research and proper budgeting, you will be able to project a realistic ROI on your business plan for the small venture.
- Understandably, returns will be lower in the first few months or even a couple of years since inception. Sometimes, returns will also fluctuate according to seasonal demands for your brand.
Good research into these factors will help you make a realistic or near accurate estimate of Return on Investment. ROI is something that lenders, VCs and crowdfunding platforms look at before investing in a small business.
Legalizing the Small Business
Getting your small business registered is very important. Without proper permits and licenses, your business can be deemed illegal and render you prone to lawsuits. Hence, before launching a small business, it is advisable to complete all legal formalities and get proper registrations in place. This can also include copyrights and Intellectual Property protection if your brand offerings are innovative. There is no dearth of copycats in the market, who can steal a march by pirating your brand and claiming it as their brainchild.
Mention the type of business incorporation- proprietorship, partnership, Limited Liability Company or others under which your small business will be registered. Explain reasons for the type of business registration you have chosen.
Also, mention a list of permits and licenses you will procure or possess for the small business and reasons why they are necessary. A small business that conforms to laws attracts funding from various sources and protects you against lawsuits. Customers are more inclined towards patronizing a legit business compared to small-time ventures that are yet to be registered or have scant legal documentation.
Indubitably, the success of any small business depends upon its nature and relevance to customers. There are hundreds of excellent ideas for setting up a small business that you may consider. Majority of these small business ideas are time-tested and prove. Though a lot may appear like a copycat or “me too” ventures, you can always impart the small business a unique direction by innovation and excellent marketing. Once you have finalized the small business idea, embark on the research necessary to create an excellent plan to make your venture successful.