An online business opportunity requires a sophisticated, detailed business plan which will be the road map for your business future. A business plan not only provides direction but also allows you to take into consideration the various benefits and pitfalls of your online business opportunity before you actually start.
A business plan is valuable, as it enables the entrepreneur to identify and build specific policies for the different sections of the business. It will also help you to familiarize yourself with the priorities, perspectives and wisdom that are essential to start a business.
If you will require bank financing to start your business, your lender will require a copy of your business plan and will scrutinize it carefully before they will even consider lending you any startup funds. In short, having a sound business plan is the most essential ingredient in laying the foundation for a new business and turning it into a reality.
Factors to Consider When Creating a Business Plan
Plan Your Source of Funds
Estimate as close as possible, the cost of starting your business and determine if your personal available funds are sufficient to not only hand all your start up expenses but that you also have enough left over for working capital to carry you through the first year. If not, you’ll need to do the research necessary in order to find the best financing option available that fits your personal risk tolerance level.
You need to format and organize your business plans for easy understanding. The overriding goal is to structure your plan so that it meets your overall business objectives in a logical and easily understandable manner. You need to be aware that it is the road map to reach your business goals. If your plan does not meet your Lenders criteria you will risk not getting your startup business funded.
The business plan should be straightforward and believable. Proper presentation of the business plan needs to instill confidence in your Lenders mind in order to secure a loan. You also need to convince your prospective Lender of your business concept in order to develop his respect and confidence.
Market Research and Analysis
You need to thoroughly research your product or service to enable you to fully understand who your targeted customers’ are and what their potential requirements are. Simply doing a Google or Yahoo search will help you to determine a lot of valuable information to help you in this arena.
Thorough research will help you determine the price for your product or service that you wish to sell, the level of competition in the market and possibly a solution to potential risks that you might encounter with your new business.
A thorough market analysis will help you select a business niche more effectively and will help you to decide on a marketing strategy that will offer you the best chance for success for your online business opportunity.
Your business plan needs to include a marketing plan on how you will draw customers into your business. Are your customers local, national, or world wide? Depending upon where they are located, you will need to have a plan on how best to reach them. Local customers could be reached by newspaper ads, word of mouth, referrals and etc. If they are national or worldwide customers, then you may need to consider trade magazines, national publications, internet ads and other similar marketing avenues. Needless to say, you will need to keep your advertising budget restrictions in mind no matter which advertising method you choose to follow.
As part of your business plan, you will need to analyze your business risks to determine in advance potential liability problems that could arise. As part of your analysis, you will need to determine what type of insurance you will need to protect yourself in case your product or service is deemed to have caused injury or loss to a customer. What about auto insurance, office insurance, health insurance and other related insurances? You will need to develop an aggressive management plan to mitigate or avoid as much risk as possible.
Executive Summary: After having completed all the segments of your business plan, you need to write an executive summary highlighting the essential components of your plan including your intended return of investment and your contingency plans for repayment of financing funds, if any were borrowed. This will be essential for your Lenders’ review in their decision to grant you funding.
To achieve any level of success in your business, you must take the first step of creating a business plan. Once the plan is finalized and approved by your Lender and funding has been secured, your next responsibility will be to execute the plan and to manage it on a daily bases in order to insure that you are moving in the direction of succeed in your online business opportunity.