Building a successful business is most certainly easier to do with a well-constructed business strategy plan in your hands. It’s important to understand what’s essential to any business plan, what’s appropriate for your venture, and what it takes to ensure success.
In reality, business plans can take a long time to write, require that you have great data at your fingertips, depend on projections, and often are responsible for creating a long list of research you still need to conduct as well as other work you need to complete. Although writing a solid business plan is a continuous process, it helps entrepreneurs arm themselves with the best tools and achieve long-term viability and success.
Let’s take a deeper dive into what to consider when creating a winning business strategy.
7 Tips for Building a Winning Business Strategy
#1. Know Your Competition
Many small businesses face a highly competitive environment. How can you outplay your competitions if you don’t know or understand what their moves are?
Knowing who your competitors are, and what they are offering, can help you to make your products, services and marketing stand out. Understanding your competitors can help you create marketing strategies that take advantage of their weaknesses, and improve your own business performance.
It is important that you get as much information as you can from the people that are already in the market. This can help give you an idea of what to anticipate and help you create a business strategy for yourself.
#2. Know Your Target Market
Small businesses don’t have the time or resources to be able to reach everyone with a product message. Identifying a target audience allows marketers to focus on those most likely to purchase the product. Limiting the population funerals research and budgets to the customers with the highest profit potential.
#3. Be Conservative in all Financial Estimates and Projections
Forecasting, or more importantly, accurate forecasting, is an art which has long been considered akin to crystal ball gazing. There is a strong temptation to be optimistic when forecasting growth. To counter this, many entrepreneurs end up using extremely conservative estimates. In reality, neither is the only option you should forecast. You should devote your predictive energy to at least two scenarios, one optimistic and another cautious. This is especially true if there is uncertainty surrounding major factors that could impact your business, such as government regulations, new competition, or even overall economic growth.
#4. Make Realistic Timelines with Resources Available
Being overly optimistic with time and resources is one of the most common errors entrepreneurs make. Startups operate significantly different than large companies. Many entrepreneurs predict that things will happen much quicker once they have the supplies and write the initial checks. Being realistic is important because it lends credibility to your presentation. A great rule of thumb would be to add 15% longer than you anticipated to any project or timeline.
#5. Document Why Your Idea Will Work and Empty Claims
In 2021, numerous products and services have already been invented. You do not need to reinvent the wheel. Use the existing competition to your advantage and use their performance data to better understand the market, clients, product and price structure. Find out what works for them, and what could be improved. Include all variables that could have an impact on the result or outcome of your idea. If some of the variables present challenges for your new company, explain how you intend to overcome them or make them better.
If you make a statement without supporting it, you might as well leave it out. You need to follow-up what you say in the next sentence with a statistic, fact or even quote from a knowledgeable source that supports the claim.
#6. Outline Each Step in Your Sales Process.
Your revenue projections should walk through the entire funnel of your sales channel rather than guessing at a top-line number. Create projections for each step of the sales funnel, and use that to arrive at your revenue projected number.
An example of the revenue projection might involve the following
- Identify the total addressable market in the area you intend to sell
- Estimate what percentage of that market can be reached through marketing
- Estimate what percentage of your audience that is exposed to marketing might actually come in the store/ shop online
- Estimate what percentage of people who come to the store or visit your website will actually make a purchase
- Estimate how much the people who do make a purchase will spend on average
#7. Be Logical and Constantly Reassess
It is important to be as objective and logical as possible. What may have seemed like a good idea for a business can, after some thought and analysis, can prove not viable because of heavy competition, insufficient funding, or a nonexistent market. If you do decide to proceed forward with your business idea after some thought and analysis, it is important to constantly update and reassess your business forecasts. Do not make one at the beginning of the year and ignore it for the next 12 months. Regularly evaluate how close your operating results mirror those forecasts, and adjust your forecast to reflect any new information. The more up to date your forecasts are, the better prepared you will be to make informed strategic decisions.
The Bottom Line
Regardless of how you plan your route, create a program of strategic planning in your business. You will find that consistently adding this step can help your business grow in a positive direction that may not have been possible without it.
Exemplar Small Business Strategy Experts: We Take Entrepreneurs to the Next Level
Exemplar small business strategy experts are helping entrepreneurs move your business forward with confidence. The Exemplar team is always ready and available for weekly meetings, completely connected to the current business environment and landscape in numerous industries, and future focused. We can help our clients act faster by tapping into new ways to drive growth and drive sustainable impact. Let’s get started today!
Managing Director, Exemplar Consulting, LLC
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