It’s incredible, but it’s still just an idea without foundation. It could be successful, but it could also flop. It makes complete sense in your head, but you have no clue how to turn it into a legitimate business.
You’re not alone.
Startup businesses fail every year because people don’t follow the correct business plan, if any at all. Generating an idea is simple; executing it is often the hard part. Here are three steps to take that will help get you started on the right path.
It may be difficult to take things slow when you have a great idea, but rushing into a startup without proper planning can stall it before it has the opportunity to get off the ground.
Even if it seems counter-productive at first, spending a couple weeks brainstorming may help increase your chances for future success. Begin building a foundation for your business by writing down a list of goals and objectives.
Do some research and use it to create a business identity. What is the company going to sell, what is the business title, what are the market demands for products and who is your target audience?
Next, construct a tagline that sums up the business and could generate buzz in the community. Then start thinking about an online presence to promote the brand and persuade potential customers. During the brainstorm, create a list of questions you need to answer and map out a plan for answering them.
Learn the market
You may have an awesome idea and a product to sell, but there’s zero guarantee that people will have interest in purchasing it. To manage a successful business, you’ll need to research about potential customers (supply and demand), market trends (economic indicators and employment stats), who your competitors are and how they attract consumers.
According to the U.S. Small Business Administration, market research is, “the process of analyzing data to help you understand which products and services are in demand, and how to be competitive.” Determining a target market audience, demand patterns and market trends are important for businesses because it may help identify sales opportunities, uncover present or future business problems, and help limit business risks.
Write a business plan
The business plan is the proverbial roadmap that companies follow. It generally plans a few years ahead and summarizes the direction the company expects to take moving forward.
Some key components of the business plan include:
- Executive summary –This is the most important section of a business plan and is usually written last. It includes the mission statement, company and financial information and future growth expectations. An executive summary briefly answers general questions about the company and highlights assets.
- Company description – Details the products or services the company provides, who the target audience is and how the company plans to meet the needs of its potential customers.
- Market analysis – Includes market research findings, such as market trends, customer supply and demand patterns and competitor analysis.
- Market & Sales – Explain the marketing and sales strategies for the business, how growth is expected to be achieved and how to reach new customers.
- Financial Projections – Be sure to present historical financial data, such as company income statements and balance sheets, as well as projected financial statistics, i.e. future income statements, balance sheets and cash flow statements.
A strong business plan is an essential part of a company’s success because it breaks down every layer of business strategy and in turn, helps expand the company into something more.
Don’t waste your big idea. Plan ahead, research and get on the path toward future success.