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| Business plan is essential |
Making money online isn’t as easy as you think. It requires careful planning and an analysis of the competition. If you purchased an existing offline business and required a substantial bank loan, the lending institution would require you to present a Business Plan.
Even though you can set up an online Internet business with only a couple hundred dollars, it is a good idea to write a Business Plan. A Business plan will help you identify exactly how your business will succeed. It will also help you find ways to gain an advantage over your competitors. A well written business plan is an excellent blueprint and motivator for your business. It can be a basis on how to drive your business to the next level and beyond. You can download great samples of business plans on the internet. It basically consists of an executive summary of your business (usually 1 or 2 pages), description of your business, market strategies, competitive analysis, development plan/and or operational strategy, financial plans and appendices if applicable.
There are many books and free online resources explaining how to write a business plan. There are hundreds of sample business plans to study. Writing a business plan will guide you on starting a business. It will ensure you do an in depth analysis of your customers, competitors and your chosen niche market. It can be continuously reviewed and updated and will help you keep focused on your business. It is paramount that you firstly research whether a niche market actually exists for your chosen product or service. This exercise will save you a lot of time and money because it will assess the business viability and profitability before you anything else.
I highly recommend you do a SWOT analysis: Strengths, Weaknesses, Opportunities and Threats as part of your business plan. This is a great way to assess the viability of your business. This should be part of the competitive analysis of your business plan. The first part of the SWOT analysis is to identify the above four attributes of your proposed business or niche market.
For example, strengths are the internal factors that are a benefit to the project. The internal positives may be your skills and knowledge in the niche market, low set up costs, no loans required, automation of the web site and your uniqueness. Weakness: Weaknesses are the internal factors that negatively affect the project. The internal negatives may be lack of knowledge regarding your competitors, lack of planning, is the market large enough? How much is the cost of advertising to gain traffic to your site?
Opportunity: Opportunities are the external factors that may lead to further development of the project. External positives are factors such as industry growth. Threats: Threats are the external factors that may lead to the diminution of the project. External negatives such as governmental law changes, social trends and competition may impact on your business. The second part of the SWOT analysis is to take on board the information supplied in the first part and then identify the strengths, weaknesses, opportunities and threats as they seem to apply to/in your business. This is the strategies and actions that you will apply to maximize on the business strengths and opportunities, whilst minimizing the effects of the weaknesses and threats.
The benefit of the SWOT analysis is to assess whether the niche market is viable. You must find the market first and then develop the product or service. Too many people make the mistake of developing the product/service first and then searching for the market. Often they have wasted their time by learning there was no market in the first place. The SWOT analysis can save you a lot of time and money by properly researching your market and competitors.
Another advantage of the SWOT analysis is that you can maintain a competitive advantage. Constant research analysis and education will help you identify and understand important trends. Continually listening to your customers will ensure you are meeting their needs, solving their problems and uncovering new niche markets.
As you can see, a well written and researched Business plan may mean the difference between achieving success or failure.
As Nike says “Just Do IT”.
Even though you can set up an online Internet business with only a couple hundred dollars, it is a good idea to write a Business Plan. A Business plan will help you identify exactly how your business will succeed. It will also help you find ways to gain an advantage over your competitors. A well written business plan is an excellent blueprint and motivator for your business. It can be a basis on how to drive your business to the next level and beyond. You can download great samples of business plans on the internet. It basically consists of an executive summary of your business (usually 1 or 2 pages), description of your business, market strategies, competitive analysis, development plan/and or operational strategy, financial plans and appendices if applicable.
There are many books and free online resources explaining how to write a business plan. There are hundreds of sample business plans to study. Writing a business plan will guide you on starting a business. It will ensure you do an in depth analysis of your customers, competitors and your chosen niche market. It can be continuously reviewed and updated and will help you keep focused on your business. It is paramount that you firstly research whether a niche market actually exists for your chosen product or service. This exercise will save you a lot of time and money because it will assess the business viability and profitability before you anything else.
I highly recommend you do a SWOT analysis: Strengths, Weaknesses, Opportunities and Threats as part of your business plan. This is a great way to assess the viability of your business. This should be part of the competitive analysis of your business plan. The first part of the SWOT analysis is to identify the above four attributes of your proposed business or niche market.
For example, strengths are the internal factors that are a benefit to the project. The internal positives may be your skills and knowledge in the niche market, low set up costs, no loans required, automation of the web site and your uniqueness. Weakness: Weaknesses are the internal factors that negatively affect the project. The internal negatives may be lack of knowledge regarding your competitors, lack of planning, is the market large enough? How much is the cost of advertising to gain traffic to your site?
Opportunity: Opportunities are the external factors that may lead to further development of the project. External positives are factors such as industry growth. Threats: Threats are the external factors that may lead to the diminution of the project. External negatives such as governmental law changes, social trends and competition may impact on your business. The second part of the SWOT analysis is to take on board the information supplied in the first part and then identify the strengths, weaknesses, opportunities and threats as they seem to apply to/in your business. This is the strategies and actions that you will apply to maximize on the business strengths and opportunities, whilst minimizing the effects of the weaknesses and threats.
The benefit of the SWOT analysis is to assess whether the niche market is viable. You must find the market first and then develop the product or service. Too many people make the mistake of developing the product/service first and then searching for the market. Often they have wasted their time by learning there was no market in the first place. The SWOT analysis can save you a lot of time and money by properly researching your market and competitors.
Another advantage of the SWOT analysis is that you can maintain a competitive advantage. Constant research analysis and education will help you identify and understand important trends. Continually listening to your customers will ensure you are meeting their needs, solving their problems and uncovering new niche markets.
As you can see, a well written and researched Business plan may mean the difference between achieving success or failure.
As Nike says “Just Do IT”.
