small business plan

small business plan

Developing a Successful Small Business Plan

1. Executive Summary

High levels of academic competition and the desire to make a success in providing an experience to run a business has driven the team to launch this service providing application. The team also sees the current society who are busy with their work, so the Go-Clean team sees this as an opportunity to take advantage of the situation to reach their goal. This business also is a good alternative to ease the people as it is able to help them to complete their house chores. So, Go-Clean has high hopes that their business will be successful and able to move forward in a long-term period.

The name of the business is Go-Clean. The business is in collaboration between six students from IIUM, Kulliyah of Languages and Management. Go-Clean is a service providing application for cleaning service which targets households, companies, or any organizations. This application provides a convenient way of booking for cleaning service. Customers only need to make a booking through this application and then a team of cleaning service will be provided to deliver a service at the customer’s location. This cleaning service is not only providing general cleaning, but the team will also perform add-on services such as ironing, washing dishes, refrigerating, etc. This service is specialized for those who have no extra time to clean. Usually, the target customers are working individuals or couples. Therefore, Go-Clean is the best alternative to provide their needs of a clean and tidy living place.

The business that I would like to develop is a service providing application for iOS and Android operating systems, which targets the society. It is expected that through this investment, it is able to provide experience to the students in first running a successful small business and also at the same time acquiring knowledge and experience in the business development area. In creating this business, its primary objective is to reach an achievement.

2. Market Analysis

The first stage of a market analysis is figuring out the demand for a product or service. Starting with a product, the business must attempt to figure out if the product is a necessity, it improves the quality of life or is disposable. If the product is a necessity or it improves the quality of life, it is likely going to be successful. If the product is disposable, it will need significant improvement to be competitive in the market. A necessity or quality of life enhancement is referred to as inelastic; this product is recession proof and would be successful in any economic conditions. A product that is disposable is elastic; this product will not be successful in bad economic conditions. At this point in the market analysis it would be beneficial to use a SWOT analysis to assess the strengths, weaknesses, opportunities, and threats. This will be valuable to compare the potential product with that of a rival product. A consumer survey or a focus group related to the product may also be a great method to see the mind of the consumer.

Entering the market must involve an extensive market analysis in order to measure the feasibility of a business to flourish, no matter how big or small the scale of the company. A comprehensive market analysis plays an important part in the business plan because it could determine the success or failure of a business, especially in its introductory stage. The market analysis must be specific to the business, if it is to be general the data collected will be irrelevant.

3. Business Strategy

Future courses of action can sometimes be an extension of the original strategy, and at times, particularly when market conditions or internal circumstances have changed, a strategy may be scrapped and the formulation of a new strategy will occur. This also includes monitoring and control. Measures must be taken to review the strategy and what has been achieved, and corrective action must be taken when it has been found that certain results do not match what was intended. This can be considered as a failure to achieve the set goals and objectives, and making corrective actions is always better than persisting in error.

Although it was stated that a strategy is crafted by ‘manager’ actions to meet the objectives of the firm, the strategy itself is not an action. It is a combination of an organization’s efforts to achieve a sustainable competitive advantage and the grand cause for the betterment or success of the organization through planning how to compete in the market and achieve the cause. Strategies are often long term, aiming towards the results that meet the objectives. A sustainable strategy should be able to be effective whether it’s a big decision or a small minor decision. And at all times mentioned throughout this section, decisions must always be grounded and aligned with the cause of the organization.

Designing a successful business strategy is a complex activity. It can never be perfected, and a strategy must be tailored based on the type of business and the prevailing market conditions. We do believe it is possible to identify key criteria for a successful business strategy that are applicable to all business types. This includes clarity of a strategic vision, which should be able to craft the objectives of the company and provide a platform in which all members of the organization are able to identify with in order to make collective decisions aligned with the goals of the company. A business strategy should be focused and catered to the market in which a product or service is generated.

Your textbook’s authors define the business strategy as “a set of planned actions taken by managers to help a company meet the expectations of the objectives.” A business strategy can be a combination of determining which customers to target, what product position to take in the minds of the customers, and what the company’s competitive advantage is when delivering and creating value for customers. Another part of the strategy to consider is crafting the business plan and mission to a level that is meaningful to stakeholders.

4. Financial Projections

The figures in a start-up financial plan have a tendency to be speculative, particularly if you are currently in the early stages of developing your product or service. Hence, it is important to show the logic behind your calculations. For example, you may project that you should employ an additional salesperson in 8 months’ time. This can be shown as an additional line on the income statement, which feeds from the assumptions stating that at a certain point in time, you will increase sales revenue by employing another employee. This then has implications on the expenses of the firm and can be shown in the cash flow and balance sheet statements. By doing this, you can see exactly how changes and investment in your business will affect its financial position. Always provide evidence for your assumptions. This could be done using data from similar existing firms or even primary sources such as surveys and interviews.

So where will you be in 3 years’ time? This is a leading question frequently asked of entrepreneurs, and seeks information regarding long-term financial projections. While in year one of your business, you’ll want to prepare a forecast of its income statement, balance sheet and cash flow for inclusion in your business plan. Income statements show the revenue and expenses of the firm over a period, while balance sheets show the various assets, liabilities, and owner’s equity of the firm. Cash flow statements add insight to the timing of the income and expenses of the firm, showing how its liquidity changes over time. A three-year income statement projection can be developed, and then based on the assumptions set in the income statement, a pro forma of the future balance sheet and cash flow can be constructed.

5. Implementation and Growth Plan

The primary goals of the implementation and growth period of the business plan are to maximize the long run profit and survival of the business in the market. In order to achieve these goals, the company’s founders will use the company’s services to provide an innovative product in the clothing industry. A clear understanding of the product leading to its appreciation in the market is essential. Thus, a substantial amount of time will be dedicated to the quality of the pants, both in overall appearance and fitting. It’s evident that a quality product with its own unique characteristics will do better in the market. This will be followed by intensively promoting the product directly to our target market, which will be mentioned later on. The successful sales of our product will be used to fund our expansion into the international market. With an expected increase in revenue, the company will expand by hiring a larger workforce to aid in the manufacturing and selling of the product. Sales experience will be kept in mind for future promotional purposes. Funding for the additional capital would be to take out a business loan. With a larger source of revenue, Rompymon will then expand into foreign markets. The success of selling our product in foreign markets will be the brink of the vertically integrated stage.