Welcome to the start of this new series friends! As with everything on Creative and Coffee, I want the series to be super actionable so you can follow along and apply all these steps to your own business.
Before we start, much like our MailChimp tutorial, this post comes with a safety warning. Caffeine is not only tolerated but encouraged, because we’re about to get deep on this one friends!
So let us both take the first step on our new business journey together and tackle the very first thing you need to consider when starting a new business venture:
Defining Your Purpose & Creating Your Business Plan
As I’ve mention in a few posts now (and the Design Course), for me, business is all about PURPOSE.
Imagine Mad-Eye Moody shouting CONSTANT VIGILANCE at this point, it should set the scene.
Really nailing down your purpose is so important because all your business decisions from this point onward should be based on furthering that purpose. Also, if you have a very clear idea about what your business is, it will make sure the message you are communicating to your audience is clear and obvious.If you message is confused and inconsistent, so shall your followers be.Click To Tweet
So firstly you will want to nail down your niche. This is the very specific area of business that you will be operating in which will allow you to effectively target and retain readers.
I’ve talked at length about finding your niche and its importance in our post ‘How To Find Your Business and Blogging Niche‘. So if you are still figuring out what your business is all about and what really drives you then swing by and check that out. Get the worksheets provided, go through them and then meet us back here.
One of the main reasons why I think have a business plan for your blog, business, shop etc is that is gives you focus. For example, when I was first thinking about all the things I needed to do to open a shop, I thought I had it fairly nailed down. I needed to create a visual brand, I needed a coming soon page and I needed to design the shop, among other things.
I wrote most of these down on a scrap of paper and then the massive weight of all the things I had to do hung over me. Every time I sat down to work I thought, oh my goodness I have sooo much to do.
And for some reason, that made me even less productive than ever.
So, last week, I got over my sudden work overload lethargy and wrote myself a business plan. And it really helped, on several levels but mainly because when I sat down to work I wasn’t thinking I’ve got so much to do, I was thinking, OK, today I am working on researching my target market, for example.
Now, as we go through the elements of the business plan I would like to say that life doesn’t always play ball. So don’t feel like you are chained into relentlessly pursuing this plan. Whilst your fundamental brand and values should remain and evolve with you, the exact strategies and projections may well change. In fact, in the business world, it is imperative that you can be flexible and change with the times.
So for me, at least, a business plan is a good way of solidifying all your ideas on paper. It’s a road map to take you in the direction, so you don’t get lost, accidentally double around on yourself and take the long way round. But, you know, if you hear some good directions about a short cut along the way, you can go off book.
Map analogy now ending.
So, before we get into specifics, I want you to think about some general topics before we get into the nitty gritty stuff.
Your Brand Values
So, firstly, your brand values. What do you stand for? What do you want people to feel about your brand? And, very importantly, what value to you give to your readers/customers.
These are all things we discuss in our ‘Finding Your Niche‘ post, so you should have a good idea about your values. If you are a little confused about what exactly branding is then you can also check out our post explaining what branding is (ie more than your logo).
So, similarly to above, we are thinking about what value we are giving to people but in this case, what specifically we are offering. If you are offering a physical product, like t-shirts or vast amounts of glitter, jot it all down.
You can also write down any intangible things you might offering, such as free content, online courses or training.
Most importantly though, jot down how your product is addressing the pain point of your reader/ customer. What value does your product bring to them?
Who Is Your Audience
Male or female? Wordsmiths, bakers, candlestick makers? Who is your ideal audience? If you already have a business then you may already have a pretty good idea from your social following and website traffic.
If you have no idea who your target audience is, do not fear, we’ve written a very in-depth post all about that here. So go check that out and come back!
This talk of products and target audience is all very well but let’s get serious here of a moment. All business is going to involve some sort of financial outlay. If you are starting a blog, selling digital products, then your start up costs probably aren’t going to be too eye watering.
At very least you will be looking at the cost for a domain name, website hosting and if you are with WordPress the cost of a reputable theme.
If the finance bit of your plan is where you start to feel all that doubt and uncertainty coming into play, don’t worry. It’s a serious undertaking and it would be strange for you not to be to cautious.
Hint: Make money is not the answer to this one.
If you plan on doing any form of marketing what so ever for your blog and or business then you will need a goal to work towards. It doesn’t need to be big. It can be ‘make ten sales a month’, for example. But try to be as specific as possible and include timelines. If you want to make a thousand pounds, that’s great but make sure to set yourself a timeline so you have something to drive towards.
Try and be fairly realistic with your goals but aim high.
I say this not to be like; it’s unrealistic for you to think you will make a million pounds in your first year. You might be a business genius that has totally nailed a gap in the market. Rather, what I mean to say is, create goals that you can strive towards which seem achievable to you.
If you set out to make a million in the first year and your shop makes ten pounds in the first month, it might feel disheartening, rather than celebrating the fact you made it to your first sale.
But at the same time, reach a little higher than you expect. It’s good to aim for your dreams, it keeps you motivated and often you end up achieving more than you thought you would, even if it’s not quite what you were aiming for.
Speaking of Marketing…
Practically every post I see about starting a blog and marketing it says this:
The old adage ‘build it and they will come’ is longer true
You are intelligent people my friends, so I know I don’t need to spend hours telling you about how setting up a website and waiting for people to roll in isn’t going to work. If you thought that I doubt that you would be here, reading about how to create a business plan.
So, we all know that marketing is crucial to business. I know marketing sounds like a super icky work and I get that. I like to think of it more as chatting to my business friends all day, which is actually what I do mostly and that makes me happy.
But you probably want to get a bit more specific than that, so consider your social media platforms. Find out where your target market hang outs, do your research on commonly asked questions your product can solve.
But most of all make sure you know your why.
If there is anything that my marketing lecturer drummed into me it is this:
Never start a marketing campaign without a specific and measurable goal.
For example, say you want to get a hundred likes on Facebook in order to get people to visit your Facebook shop.
If you launch, say a Facebook ad campaign and get a hundred likes, is it a success?
Well, did you get more traffic to the shop?
If you got more likes but no increase in traffic then that marketing campaign as failed. Analyse the data, learn what you can from it and build a better campaign.
The Business Plan
OK, so now I’ve got you thinking about these general areas of your business we can get down into the actual details of your business plan.
The Executive Summary
The Executive Summary is exactly that, a summary. It’s not a small dissertation on everything you plan to achieve. It’s usually a one page document, which contains the overall vision for your business.
And although it comes first in your business plan, I actually recommend writing it last.
When you’ve figured out all the details of your business, from products to marketing, you might find your overall vision is easier to summarize in a single page.
However, when you do come to write it I recommend dividing it up into the following:
Your Business Vision
What does your business do and what is it going to do?
First, you want to set out exactly what your business is doing. However, having a little nod to the future and keeping eye on long term growth and development suggests that you are in this for the long haul.
What Is Your Product?
Fairly straight forward. However, as we said above, make sure to include why your product adds value to your reader/ customer. Try to identify what it is about your product that is different from anything else that is in your market. It doesn’t have to be radically different, it might be an added feature, or a different approach to your audience.
This leads you nicely into who your audience actually is. Try to include geographic, demographic and psychographic information. If those words meant nothing to you, don’t worry, we explain it all in our ‘Target Audience Post‘.
However, for now let me tell you that you should include; where your market is, who your market is and why your market is going to buy from you
This isn’t one that traditionally shows up in business plans, so feel free to leave it out. However I have it mine so I thought I would add it in.
This basically is part of your branding to a certain extent. It’s all about what kind of people you want your community to be made of, what kind personality and tone of voice that you will all share. Think of it like your shop’s personality and how it will interact with others.
Like I said above, having a marketing plan is crucial. Now that you have explained who your customers are, you need to explain how you are going to reach them. What platforms are you going to engage them on and how you are going to engage them.
Of course, there will be a dedicated section on marketing later on in the plan, so you don’t need to go into the fine detail.
Ergh, I know, the tricky and pesky finance bit. You can write down your projected finances here. Of course, no one has a crystal ball so you can’t be entirely accurate with this. But it’s obviously very important because if you don’t think you can actual make enough money to support yourself or make the business worth while, you should probably go back to the drawing board.
Finally write a little something about yourself and any friends, family and business partners that are getting in on this party.
Who are you? What do you do? What skills and experience do you have? What party favors are you bringing to this shindig?
Party metaphor now ending….
Remember this is just the summary so keep you content accurate, brief and to the point. This is your highlights reel, not the day to day dairy.
OK, now we are getting into the specifics. This section is all about you and your overall business.
Here you should be getting into the detail of why you are in business, what makes your business different and everything you can bring to this business which is going to make it work. Simple, right?
Obviously, while it is easy to type out these questions, answering them is going to take some time. These are questions which are very specific to you and your business.
Getting a bit more technical, let’s talk about some of the legal stuff for a second here. Now, unfortunately I only specialized in UK business law, so I hope my international readers will forgive me for talking specifically about UK companies. However, the same general principles probably apply in terms of what you need to put in your business plan.
ie what is the legal structure of your business?
So for the UK you are probably looking at; a sole proprietorship, a company (ie a private limited company, a public limited company etc) or a partnership (eg limited liability partnership or general partnership)
Of course there are loads of different types of company in the UK (or more accurately England and Wales) however this isn’t legal advice, just a to give you a general idea that there are a lot of different options out there. If you are thinking about making your company into a formal, legal entity I recommend a boatload of research followed by a visit to a legal professional. In any case, you will probably be starting out as a sole trader.
Moving on, you should probably get a little further in depth about what exactly you are selling. Obviously the sort of content here will very much depend on what kind of business you are running. If you have physical products you might well need to talk about sourcing materials, or suppliers, for example.
It might also be helpful to mention any geographical base, if you plan to have a physical presence anywhere as well as including details of your online domain.
Whilst you will have mentioned the over arching principles of your business before, you can really break down you business vision and values in this section. Try and make them as specific as possible. Something that when your idea audience member sees them they think ‘hell yes, totally on board with this’.
That means try and stay away from generalizations like excellent customer service and attention to detail. I don’t know about you but I expect all companies to have excellent customer service. Most of the time I am constantly disappointed about the lack of excellent customer service, admittedly, but still.
If you do have a special emphasis on customer service, go into detail about why your customer service is so special.
For ‘The Boss Shop’, for example, I’m currently looking at packing options to make sure that receiving a package from the shop literally makes people’s day. And the specifics of that may or may not involve glitter.
The point is, get into the technicalities of what your value is.
You know when you go to a job interview and they ask where you see yourself in ten years?
And you say sipping martinis on a boat somewhere sunny and no one ever hires you?
This is where you want to explain what you overall plan is. Personally I’d recommend breaking it down into three subheading:
- Your initial objectives, getting your first sales and building your customer bases etc.
- Mid-term objectives, once you’ve got a solid base established how you are planning to expand your customer pool and stream line your processes
- Long-term objective, any plans you might have for future growth and expansion
Your Marketing Plan
Ooo getting to the juicy stuff.
This is where you get into the specifics of your ideal audience. As we mentioned above, you should have an idea of the age, location and interests of your audience.
Once you’ve got an idea of your audience you can move on to your marketing funnels, as my lecturer used to call them. I like to think of them as separate from ‘sales funnels’ because, for me, sales funnels talk about the specific steps that your customer is going through from landing on your page to purchasing your product.
However, your sales funnel will probably be based on the ‘Five Step Adoption Process’, which we’ve all heard of right? Don’t worry, it’s just some more sales jargon.
If you want to have more of an in-depth read about this process, this is a pretty good article.
But basically there are, as you might guess from the name, five steps:
Sounds simple right? But does it work in real life?
It breaks down something like this:
You become aware of a product. For example, on Pinterest you often see the same branded pin which crops up all the time. You don’t know who its by but you become aware of it.
Now that you are aware of this pin popping up time and again you begin to become interested. So you might have a look to see what this pin is all about, or in other words, you being to evaluate whether this blog post that keeps cropping up is worth your time.
So you land on the website and you think, hm, I like the look of this blog, I’m going to see what else they’ve got on here. ie the reader is trying you out.
After which your reader is like, ‘blimey this blog is rather excellent, I’m going to sign up‘. Therefore adopting your blog into their routine.
If you focus on strengthening each step of your funnel you can see how you can guide your readers and or customer further down the path to adoption ie sales and sign ups. Hooray!
Equally you can see that if you don’t get your reader onto the funnel, or they leave the funnel at any point, there goes your conversion.
So, your advertising and promotions will be fundamental in helping your reader to become aware and interested in your product. Whether that be by continually showing up with interesting things in their news feeds, popping up in Google searches or even appearing in magazines.
So in this case you want to discern where your customers are hanging out, eg Twitter, in order to start gaining awareness. What is to focus of your ‘awareness campaign’ going to be? Helpful blog content, social media, or PPC advertising?
Your Sales Plan
OK so, through your social media marketing you have completed steps one and two (ie awareness and interest). You are now into evaluation. Your reader is coming to your site.
So where is that site? Are selling via your website? Etsy? Facebook?
What systems have you got in place for your reader to purchase your product? Are their any barriers to entry, such as needing an account to sign up or that you only take particular credit cards?
Shipping policy? International shipping?
Returns policy? Do you take responsibility if something was damaged in transit?
Think about all the questions that you have when you order a product and make sure that you’ve answered them.
Your Operations Plan
This one is extremely practical and will be ultra specific to your business. This should detail out your workflow in terms of sourcing and making your products.
So, where are you getting your raw materials from?
What equipment do you need to make and promote your products?
If you are buying wholesale, who are your suppliers?
Where are you housing all this stuff?
What tasks will you need to complete daily, weekly and monthly in regards to ordering your material/products?
Who is handling your shipping and what are the costs?
Or are you using a drop shipping company?
How are you keeping an eye on your inventory? What categorical systems do you have in place? How are you making sure orders go out on time and don’t get forgotten?
Communication- How are you communicating with your customers? What is the process of a client getting a refund or making a complaint?
From start to finish how long does it take to make and ship out your product?
Your Financial Plan
To be honest, I had do some basic accountancy for my postgrad, it was so not my happy place.
At the end of the day, the financials make or break the business so it’s well worth while sitting down and really crunching the numbers on this one. So, let’s do this.
Yep, write down all your income and then take away all your expenses.
So, in the plus column you want all your sales. In the outgoing column you want to list production expenses and cost of sales.
You will also want to include all of your expenses from utilities to your insurance. If you are working from home of course, when doing this for tax purposes, you will need to have a close look at what you can claim for your utilities and rent etc as some of that is used for personal as well as business.
Balance sheets make me cry a little bit because working out deprecation of assets involves percentages, and as we’ve established I hate maths (even simple maths).
This is basically a sheet that tots up everything you own in terms of assets, cash and inventory and balances it against your liabilities, like money owed, depreciation of assets and earnings.
The Dollar Bill Statement
OK, it’s called a cash flow statement, I was trying to make it sound more exciting.
It’s basically like your income statement but it cares more about liquidity, as in, how much cash you have on you at any given time. So, you might be making a profit every month but if all your cash goes out week one and you don’t get any cash back in until week three, you would have a negative cash flow.
So you would take into account how much cash is coming in from your sales, any loans you might have, any business assets you sold and any investments that came in (be nice wouldn’t it?)
That is balanced off against your expenditure and cash spending, asset buying, any liabilities like repayments as well as taxes like sales tax and VAT.
It’s riveting stuff I know, but at the end of the day calculations like this will tell you how much cash you’ve got on hand at any given time. This is important, first, for your own state of mind and secondly if there is an emergency of any sort it’s good to know you’ve got some cash in the bank.
And on that super exciting note, we come to the end of our epic and lengthy tour through your business plan. I hope you guys have learnt a lot today. We’ve covered a little sales strategy and a little accounting stuff along the way as well, so I hope that has been helpful.
I would be so very grateful if you’d like to share this with your tribe, if you think they would find it helpful!
Any questions or just want to celebrate the fact you made it to the end of this humongous post feel free to drop me a comment below!
Next time we are covering how to actually work out who your ideal audience is.
Until then, have fun filling in your business plans guys!