Plan For Success With a Home Based Business Plan
If you’ve ever applied for a small business loan from the bank or another lender, you know something about business plans. Among other things, a solid business plan helps lenders evaluate the potential of your business to beat the odds and succeed long enough to pay back their loan. If you’re starting up a home based business, you may be tempted to skip the whole process of writing a business plan – after all, no one is requiring one of you. Don’t. A business plan for your home based business can be the single tool that launches your home based business into high success mode.
What can a business plan do for your home-based business? Banks and lenders like business plans because the information that they contain makes it easier for them to see all the important factors for your potential success in nice, neat rows. The format for a business plan is designed to organize everything you know about your business and help you evaluate your strengths, and make allowances for your weaknesses.
With a good business plan in hand, you can make educated and informed decisions that will help propel your home-based business toward success. The research that you do to complete your business plan will give you a solid grounding in information about your products, your services, your capabilities, your market and your marketing options. And that’s before you look at the financials.
Take a look at this step-by-step breakdown of the important parts of a business plan and how each section can help you make the important decisions that will make your home-based business an unqualified success.
The Executive Summary goes first in your business plan – but should be written last. It’s an overview of your business that should concisely explain your business objectives, your product line, your market and current prospects, and make financial forecasts for the next 6-12 months and 1-2 years.
Describe Your Business: Background
Your business plan should contain a quick history of your company – the people involved and how they became involved, the date you organized, the type of organization that it is (non-profit? sole proprietorship? Corporation?)
When you take a hard look at your home based business, you’ll be able to identify your strengths and weaknesses. You may find that you’ve got a great product, good positioning in the market – but you haven’t put the effort into marketing that you need.
To make a lot of money! No, not really. By sitting down and realistically assessing your current situation, your strengths and the places where you need to bring in help, you can put together a feasible plan for the next several years. Ask yourself where you want your home based business to be a year from now. You want to expand your market by ten percent? What tools will you need to do that? What will it cost you to reach another 10 percent market share? Analyze each of your goals in the same way to help you plan out what you’ll have to do to get there.
Analyze Your Market
Your company is only one part of the success plan for your home based business. No matter how good your product or service is, if you’re trying to sell it at the wrong time or the wrong place, you’re bucking the tide. An industry and market analysis is a vital part of your business plan – and one that will help you organize your own business to compete successfully.
Describe Your Product or Service in Detail
How well do you know the product you’re selling? If you’re offering a service, what’s the need for it? Why are you uniquely qualified to offer it? What’s the potential market for your product like? Is it expanding? Are there particular advantages to your location and your background that play into your potential for success?
Analyze Your Competition
A good market analysis for your business plan will include an overview of the industry and its prospects over the next several years as well as naming your main competitors, their strengths and weaknesses, and how your business will compete and/or fit into the overall business picture in your community (and don’t forget that the internet is a community just as much as your city is.)
Identify a Marketing Plan
The market analysis and marketing plan are the meat of your business plan. This is where you describe step by step what you need to do to make your business successful. Figure out your prices, and justify them. Identify your avenues of sales and distribution. Describe how you plan to advertise and promote your new home- based business. Will you take advantage of internet marketing, newspaper advertising, radio spots? Why? Who are you trying to reach? What free publicity can you leverage?
Identify Your Risks and Weaknesses, and Your Response to Them
The second most important part of your business plan is an analysis of your risks and weaknesses. By identifying your needs and the possible problems you may encounter, you can plan ahead how to avoid them.