“If you build it, he will come – Kevin Costner, Field of Dreams”

We can all think of reason WHY we need to spend ample amount of time creating a detailed business plan, but here we have complied some of the benefits you will attain in that process. Consider this a little reminder on how valuable this foundation can be to your company.

From our experience, and in speaking with fellow small business owners, the overall process of creating a detailed business plan will force you to do a lot of market research. A LOT of market research. It might be tedious and seemingly not all necessary, but let’s take a look at what you will gain from it.

1. Obtaining an Understanding of your Industry Trend

Starting on a large and broad scale, you will gain a grasp on the industry you are entering. Is your industry growing or dying? As you define your specific industry, you will discover important trends. What is the industry projected to look like for the next 20 years? What have the past 5 years looked like? What is the overall current status?

It is important to be 100% realistic here. Identify the opportunity, but also highlight the potential risks. There always are. And if you don’t unveil them, your competitor probably has and that will put you at a serious disadvantage. Although you cannot control the risks, you can be prepared and control how you will respond to them. That, in fact, may put you ahead of those competitors and give you a competitive advantage. Which, in a way, brings us to our next point.

2. You Will Find your Market Niche and Competitive Advantage  

How are you going to compete? In researching your industry, you will find what your niche is, what makes you different in that industry and how you can stand out. In doing this too, you will find out who your specific competitors are, gather information on them and even analyze where they have made mistakes.

For many small businesses, a huge component to competing successfully is to pinpoint a market niche where you can capture a specific target market whose needs are not being met by the competition. Is there a section of the market that is being overlooked? Is there is a specific service or product that is not being offered? Maybe you will offer a better price, better hours, maybe a more accessible product. This research and planning will force you to identify how you will win the decision of your “target market” to choose you. Before we move on to that very topic, below is a sample competitive matrix analysis we found useful from thebalance.com. Hopefully you will too:

 3. Identifying your Target Market

Determining who you plan to sell to goes hand in hand with business planning benefit number two. As you find your niche, you will discover who you will target. Who will be the ideal candidate for your product? This is huge.

If you have trouble finding your target market let us help: Use the following list and pinpoint two of the following demographics, two as major players and two as minor players, that will impact the way your customer views your product or service.

• Age

• Gender

• Geographic Location

• Education

• Income

• Occupation

• Ethnicity

• Marital Status

• # of Children

This kind of market research is what separates you from the amateurs. When you know who you are reaching out to, it will influence your approach on how and where to market, how you communicate, it enables consistency, and gives you a deeper connection with your customers. End result – you know how to effectively reach the people you know you can impact.

4. Developing a Go-To-Market Strategy

This now brings us to your go-to-market strategy. As we had just previously mentioned, in your business planning you will benefit from developing your strategy on HOW you will bring your product or service to the market and how to best reach your target customers.

Remember, the customer, and thus the customer’s experience, is the most important factor in a company’s business strategy. What channels will you use to reach your customer? How will you create repeat business? How will you drive new customers? All of this is part of your business’s action plan.

Here are just a few great benefits to creating a solid go-to-market strategy:

• Increasing ROI through new marketing strategies

• Reducing time to market

• Reducing costs associated with failed product launches

• Reinforcing your brand and image

• Clarifying your plan and direction of growth

• Managing industry challenges

• Ensuring positive and effective customer experience

• Ensuring a successful product launch

• And many more…

5. Setting Long Term and Short Term Goals

Who doesn’t love hitting a goal?! Most likely all business plans will list company goals – long term, as well as short term. After a large understanding of your industry, competitive edge, target market, and marketing strategies, this will be relatively easy to create. And it is also the exciting part.

Short term realistic goals are just as important as the long term ones. Make them challenging, yet attainable – ones that give us stepping stones on the path to the big results. Set goals in all departments, making sure the business grows in each area, such as product development, marketing, monetary goals, employees, etc. Do not overlook these small goals. They give us a sense of accomplishment; help us prioritize. They keep us on track for the long term goals. And they give us reason to celebrate!

Whether you’re just starting a business or revising an old business plan, keep in mind how much you and your company will grow from, yes the actual plan, but also the process, and the knowledge you gather along the way. There are many more advantages than just the 5 that we have highlighted today. Think of more on your own. Don’t skimp your research and planning – you and your business have too much to benefit from it!