*This information is taken from the Small Business Center Network (SBCN), part of the North Carolina Community College System, and full packet, entitled “How to Develop a Business Plan” can be viewed here.
Identify your customer groups. Of course, your customer groups depend on whether you plan to sell directly to consumers or if you sell through a channel of distributors, wholesalers, and retailers.
In your business plan include your targeted customers, their characteristics, their geographic locations/demographics.
For each customer group (you’ll probably have multiple customer groups), identify:
- Income level
- Social class and occupation
- Anything else that is specific to your industry
If you are selling your product to distributors, wholesalers, or retailers, include:
- Size of firm
- Quality, technology, and price preferences
- Anything else specific to your industry
This part is not fun. … but, you have to know who your competitors are. Familiarizing yourself with your competitors can only help you and your business.
List your competitors and include their products/services. How will you competitors compete with you? For certain products? Certain customers? In certain locations? How will your products/services compare with your competitors?
Evaluate your company and your products/services honestly and carefully. Think about how you will measure up in customers’ minds. Does your company and products/services have any strengths and/or weaknesses?
For every one of your products/services rate its strengths and weaknesses and how important that product/service will be or is important to customers. Look at the quality, selection, stability, appearance, and price of your products/services.
Some questions to ask yourself:
- Who are your close competitors? Where are they location in relation to you?
- Are your competitors’ businesses steady? Increasing? Decreasing?
- What are your competitors’ strengths? Weaknesses? Resources? Compare your answers to your company.
- How will competitors react to your entry?
Be sure you can identify and articulate the reason(s) why someone would buy from you instead of from your competitor(s).
*Remember: as uncomfortable as it may be, know your competitors and what makes them successful. Research what draws customers to your competitors.
Part 4 of this blog series will cover how to promote your product/services.
Contact the SBCN