So, do you have a Business Plan?
“Well, I know what i want to do”
“I have never written it down but I know where I want my business to go”
The problem is, knowing your end goal isn’t always enough, i mean barring the people who just happen to be in the right place at the right time, and something they stumbled across suddenly earns them a lot of money, most people have a vision, a goal to earn a certain amount of money, a dream of owning their own business etc… unfortunately this end goal need a path carving out to enable you to get there.
Location, Location, Location.
I asked one struggling business owner who her target customer was, and she answered; professional ladies, 30 somethings who want to look and feel great…
When we looked out of her shop window, we counted the number of people walking past and their age range…she was less than shocked to realise that from just a few minutes we saw more people in an estimated age range of 50, and she commented that there are a lot of older people in the area. When we looked at her client list i asked her how old each client was and we jotted it down, once again her existing clientele had an average age of 48! this one surprised her…
so either she needed to change her marketing to start targeting the people in actually frequenting her area, or if she really did want to target the 30 something’s then she had chosen the wrong location…
So if this business owner had written a business plan she should have realised during her market research that the salon down the road offering OAP discounts were doing it for a reason. Her competitors were offering gel polish and pedicures at great prices, but this particular salon owner was offering acrylic enhancements and had spent money training up her staff in this system, but was left out of pocket as the girls weren’t doing any acrylic enhancements, they were doing mostly gel polish and now when someone came in for a set of acrylic nails, the girls were taking too long to do them and feeling nervous as they were out of practice. Her special offers were based around acrylic enhancements and her work stations were ready for acrylic enhancements services, she hadn’t got a business plan written down, it was in her head, but moreover she was adhering to a few plans she had, and not actually looking at whats happening around her.
When i look at a business, market research is a big part of this, if you don’t know who you are marketing to and what people in the area are looking for you, may as well be throwing your special offer leaflets into the sky hoping they will land in someone’s hand!
This is a big area people really under-estimate. When you think of expenses of opening a salon for example, you may think of:
Paint/Wallpaper – you’re going to do this yourself of course, to save money…
The sign over the door
The window decals advertising your treatments
But had you thought of:
Rates on the property
A Solicitor, as the landlord you thought was a stand up guy has put a few extra clauses ‘clauses’ in your contract
The searches your solicitor said you need to have done on the property
Blinds for the windows once you realise that sunlight is curing the gel in the pot…
Desk Lamps – as you have to keep the blinds closed in the Summer!
The Microwave for your weight watchers lunch
The PAT testing required on all electric appliances
The handyman you need to fit your new shelving units to the walls as the floor is uneven and the unit is rocking…
The leaflets you have had printed because your first month was slower than you thought it would be
– and the 16yr old lad with his head phones embedded into his ears who said he will give them out for £30
This is just a snippet of what should be considered when writing your business plan, the question is if you are already in business when was the last time you looked at your business? has the area you are in changed since your business started? has the consumer market shifted? has the customers view on the services you offer altered? Is your business growing or standing still?
Are you where you thought you would be financially when you started your business?