Be sure to list every document you are including in the plan. Business identification, purpose, description Depending on what resource you use, this section is broken down differently. Berle and Kirschner, for example, break down business identification, purpose and description into three of their 12 steps. Others combine them.
Let’s start with identification. In addition to your name and tagline, you should also include all the identifiers of your business: your address, your phone and fax numbers, tax number, names of principals and more. Include the legal definition of your business and if you are incorporated.
Now that you’ve identified the dealership on a surface level, the business purpose and description will require a deeper, more thorough representation of your business.
In this section, Bangs says you will want to explain three points:
• What your business is
• How you run it
• Why you think your business will succeed
“Deciding what your business is — and what it will be in five years — is the most important single decision you have to make,” says Bangs. His book offers seven questions helping you pare the information down, touching on the business’ form, status, profitability, hours of operation and seasonality.
McKeever says you should develop a problem statement — describe the problem customers have, and how you solve it. He says that this part may take a little time and a few drafts before you’re happy with the statement. “The important thing is not how long it takes to do this, but that you end up with a realistic, well-thought-out business description,” says McKeever.
Market research and competition
This section of the plan is very important because this is where you prove the population around you needs your service, and that the market can support your dealership. If presenting the plan to a banker, this section of the plan is weighted heavily in the decision. Most bankers aren’t very familiar with the unique needs and services offered by a power equipment dealership. Here is your chance to draw a picture for them of how effective your business can be in the marketplace.
Berle and Kirschner say, “The more meaningful figures that you have at your disposal, the easier it will be to prepare a business plan that will work for you — and open the doors to potential loan demands.”
A significant part of this section should talk about your customer. Discuss not only the demographic makeup of the typical customer (and prospect), but also their buying tendencies. There are several surveys out there from marketing research firms that have already done national (and sometimes regional) research for you.
Research does not have to be expensive. There are several ways to get this information. First, start with your own built-in focus group: your current customer base. Second, check with trade journals. For instance, Yard & Garden magazine has done several articles on the issue. Also look at end-user magazines (A good example: Organic Gardening magazine regularly conducts a survey of its readers). The library and the Internet are two other excellent resources. And don’t forget your vendors. Many manufacturers conduct their own product and customer research that would lend itself well to your business plan.
Make sure this section demonstrates one important point: “You want to be able to identify your best (most profitable) prospects and understand them well enough to be able to satisfy their perceived needs,” says Bangs.
Although this section falls toward the middle of the business plan, the research you conduct should happen before you start writing, since the research may well affect your business direction.
When discussing the competition, be sure to include specifics. And, after demonstrating your understanding about their customer attraction, make sure you also emphasize how your business is different and/or better at attracting customers. How will you gain market share?
Make sure you maximize one of your biggest assets: you. “The person or persons who run the business will determine, more than any other factor, whether the enterprise has a chance to succeed or is doomed to crash with the first ill wind,” says Berle and Kirschner.