Should You Stick to the Business Plan or Change It?

should you stick to the business plan or change it

Is it time for plan B?

The best and most useful kind of business planning is not just a use-once business plan, but rather a continuous process.

The first business plan is just the first step. For the rest of your business’s life, you review the plan once a month. Compare actual results to what you had planned, determine what steps to take to optimize, and revise the plan.

You’ll find that continuous business planning helps in many ways:

  • It helps maintain focus
  • You’ll be able to align the team with priorities
  • You can address changes in the marketplace as they happen
  • It helps you tune strategy and tactics to what’s working and what’s not working

It starts with knowing what happened

Review means comparing what actually happened to what you expected. Business plans are always wrong, so there will always be a difference between the plan and the actual results.

For the actual business numbers, such as sales, expenses, and such, accountants call the difference between the estimates in the plan and the actual results variance. Variance analysis looks at these differences to determine where the numbers are different, and in what direction.

You can do variance analysis on the numbers with a spreadsheet, or with accounting software. LivePlan can link to your accounting software and deliver automatic dashboard comparisons between actual results and the plan, and between actual results and previous results.

The illustration here shows an example:

should you stick to the business plan or change it

The Dashboard in LivePlan.

What’s important here is not the accounting or the calculations, but rather the resulting management. You look for indications of problems or unexpected positives, so you can react.

In the illustration above, revenue is lower than planned and expenses are higher. Operating income is less than planned. Cash and cash flow are improving, which is good news. However, that may be because this company is stretching out its payments, averaging about six months, which is seven times more than in their plan. So accounts payable is 25 percent higher than planned. That’s good because it’s helping with financing and keeping money in the bank, but may also be bad because it could be spoiling reputation and relations with vendors.

The point is the management, not the hard numbers. What should be done, given these results, to make the company better?

The monthly review meeting

The monthly review meeting is absolutely essential to real business planning—Lean Planning. The real value of business planning is the decisions it causes, and the management that results; and for that, you need not just a plan but a regular monthly review to track results and revise as necessary.

And the toughest part of the review meeting is this crucial question: Do we stick to the plan, or do we change it?

That comes up often because in the real world things never go exactly as planned. Business plans are supposed to set goals, tracking, milestones, and expectations.

The review meeting is when you ask:

  • What happened? What went right and what went wrong?
  • If I change the plan, then is my plan (forecast) versus actual result valid?
  • Doesn’t it take consistent execution to make strategy work?

These are valid questions, and there are no easy answers. You won’t find some set of best practices to make this easy. You’ll end up deciding on a case-by-case basis.

Hear more about changing business plans with Peter and Jonathan on the seventh episode of The Bcast, Bplans official podcast:
Click here to subscribe to The Bcast on iTunes »

The arguments for staying the course with your plan

I consider this an awkward, difficult fact about business strategy:

It’s better to have a mediocre strategy consistently applied over three or more years, than a series of brilliant strategies, each applied for six months or so.

Too often, management teams get bored with strategy before it’s had a chance to be effective. I was consulting with Apple Computers during the 1980s when the Macintosh platform became the foundation for what we now call “desktop publishing.” We take it for granted today, but back in 1985 when the first laser printers came out, it was like magic. Suddenly, a single person in a home office could produce documents that looked professional.

What I saw in Apple at that time was smart young managers getting bored with desktop publishing long before the market even understood what it was. They started looking at multimedia instead. They were attracted to new technologies and innovation. As a result, they lost the concentration on desktop publishing and lost a lot of market potential as Windows vendors moved in with competitive products.

That argues for staying the course. Strategy takes time.

The arguments for revising the plan

On the other hand, this is also true:

There is no virtue in sticking to the plan for its own stake. Nobody wants the futility of trying to implement a flawed plan.

Generally accepted best practices have changed over the three decades I’ve been focusing on business planning.

Back in the 80s, business timeframes stretched longer and many business leaders recommended sticking to the plan. But times have changed. You’ve probably dealt with the problem of people doing something “because that’s the plan” when in fact it just isn’t working. I certainly have. That kind of thinking is one reason why some web companies survived the first dotcom boom and others didn’t. It also explains why some business experts question the value of the business plan.

This is sloppy thinking, in my opinion—confusing the value of the planning with the mistake of implementing a plan without change or review, just because it’s the plan.

Download the Business Plan Template today!

How to decide: Stay the course, or revise the plan?

This consistency versus revision dilemma is one of the best and most obvious reasons for having people—owners and managers—run the business planning, rather than algorithms or artificial intelligence. It takes people to deal with this critical judgment.

One good way to deal with it is by focusing on the assumptions. Identify the key assumptions and whether or not they’ve changed. When assumptions have changed, there is no virtue whatsoever in sticking to the plan you built on top of them.

Use your common sense. Were you wrong about the whole thing, or just about timing? Has something else happened, like market problems, disruptive technology, or new competition, that has changed your basic assumptions?

Do not revise your plan glibly. Remember that some of the best strategies take longer to implement. Remember also that you’re living with it every day; it is naturally going to seem old and boring to you long before the target audience gets it. But do revise your plan if it is out of date, inaccurate, or based on false assumptions.

That’s why you have the plan in the first place: to manage your business better.

Note: Some of this material is taken from my latest book, Lean Business Planning, published by Motivational Press in 2015. A LivePlan version of it is available for download free at this link.

This article was originally published in 2015. It was revised in 2018.

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Grow Your Business Through Sales and Marketing Alignment

Aligning your sales and marketing teams isn’t an easy endeavor, but it’s one that can have profound and lasting benefits.


8 min read


This story originally appeared on Due

Whether you’re an entrepreneur just starting out or you’ve been leading a business for a while, you understand that sales is key to growth. You don’t have to have all the answers to everything before you start your business, but if you can consistently close sales, you can buy yourself time to figure everything else out and scale for the future.

To do this, your sales reps probably rely on a variety of tools and productivity hacks to help them get more done. But, if you’re not also using content marketing to help, you’re missing out on a major opportunity. In fact, the right content can enable every member of your sales team to spend more time selling and less time answering the same questions and addressing the same objections again and again. To get your sales team those resources, you need to bring marketing and sales together to create sales enablement content.

Advantages of alignment

I’ve heard a lot of different sales speakers over the years, and a trend they all preach is the importance of aligning sales and marketing. When they’re aligned, sales teams see 38 percent higher win rates, and marketing teams see a 200 percent increase in marketing-generated revenue. These are huge wins in themselves — but what’s especially valuable is the fact that both teams can do less work to earn those wins.

Sales reps benefit from the right content because it does much of their jobs for them. If a prospect has a question about your company’s solution, sales can send a blog post or case study that goes into detail. If reps receive common objections or questions about specific parts of the process, they can pass along fact sheets and whitepapers that overcome those objections.

These responses minimize the amount of time members of your sales team have to spend nurturing a prospect, whether it’s on the phone or via email. At the same time, they’re providing helpful, high-value content that their prospects can then send around to promote buy-in at their own organizations.

And by working with the sales team, your marketers can create more specific, effective content that helps their colleagues overcome traditional barriers to conversion. This means less time spent creating content for the sake of publication and more time spent producing high-impact resources.

No matter your industry, sales reps are some of a company’s most informed individuals when it comes to the customer. They interact with prospects on a daily basis, and they know what works and what doesn’t to meet those prospects’ needs. To be effective, your content has to appeal to your audience. With their firsthand experiences and expertise, your salespeople can help marketing create that exact kind of content.

Five steps for putting marketing alignment into action

Aligning sales and marketing teams is a commendable objective, but it can also be a lofty one. Effective collaborative won’t happen overnight, but the sooner you start the journey, the sooner you’ll start reaping the benefits. To bring together your sales and marketing teams, start with these five steps.

1. Get both teams in the same room and on the same page.

Before any two teams can become best friends, they need to get to know each other, and that starts with getting together. Have your marketing and sales teams meet, either in person or virtually, to start the conversation about their shared goals, the struggles they’re facing and what solutions could help to overcome those challenges.

This is important as marketing sets out to create a content strategy. Your strategy guides everything, and if sales enablement is a goal, the strategy needs to reflect that. So, set common goals at the outset, collect ideas for content, and put a plan together to get these resources to the right people at the right time.

2. Collaborate on content.

Content creation shouldn’t happen behind closed doors. The sales team has valuable insights that can transform a piece of content into exactly what the prospect (and, therefore, the sales rep) is looking for, so invite your salespeople to collaborate.

Sometimes it can be most effective to have sales reps byline their own content, and then your marketing team can refine copy so that these details are consistent with the rest of your messaging. Having content bylined by your salespeople also helps them build their brands and their credibility in the industry, making them more respected resources that prospects can easily approach and trust.

3. Keep the channels of communication open.

An annual meeting isn’t going to help sales and marketing remain aligned. Instead, keep the lines of communication open at all times. Create channels on Slack or other communication platforms that allow ideas to flow back and forth. Marketing can check out conversations the sales team is having about a tricky situation, and sales can hop over to the marketing channel to share content ideas and questions.

Take it a step further by encouraging marketers to shadow sales calls or inviting salespeople to attend and contribute to meetings about marketing strategy. When you’ve established fluid communication between the two groups, collaborative efforts will come about organically.

And don’t forget to account for differences in communication styles, especially if your teams are made up of members from different generations. In a recent keynote, which you can see here, I talked about how my daughter is growing up much differently from how I grew up and how interacting with and observing her is teaching me more about the value of understanding different generations.

So, if your sales and marketing teams are comprised of people from different generations, you may need to make an extra effort to understand these preferences so everyone on these teams can keep communication open and effective.

4. Create a resource library.

Almost 80 percent of highly aligned teams reported having a central location where content marketers store their assets so they can be utilized by sales personnel. This could be as simple as creating a spreadsheet in your shared Google Drive folder with blog posts, guest posts, infographics and whitepapers organized by topic. The point is that you’re able to get the right resources in the right hands at the right time.

This is especially important if you’ve been creating content for a while or you plan to continue consistently producing content. Eventually, you’re going to have hundreds of pieces of content to sift through. A bank of your team’s best resources for addressing the most common questions and discussions throughout the sales process can save everyone time and make sure your content is being maximized.

5. Share feedback early and often.

Refinement is a crucial part of any new process. When you’re establishing alignment between formerly siloed teams, not all of your initiatives will be successful. The key is to record what works and what doesn’t so that you learn from your mistakes.

If you don’t bother to track your mistakes and learn from them, you run a very real risk of making them over and over. If you follow step two, then the lines of communication will be open; encourage honest and constructive feedback to flow back and forth between both departments. That includes feedback about the overall process, as well as individual pieces of content and components of your messaging.

Aligning your sales and marketing teams isn’t an easy endeavor, but it’s one that can have profound and lasting benefits. Each of these departments has something important to offer to the other. Your sales reps know your audience better than anyone, and they know what it takes to convert prospects into customers. The marketing department knows how to reach these audience members and can produce and deliver the content necessary to get them down the marketing funnel toward a sale.

Both departments have untapped expertise that’s just waiting to be shared. Follow the above steps, and your business will benefit from an exciting collaboration that optimizes your efforts and delivers the results you’re looking for.

(By John Hall)

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Start With an Initial Assessment

initial assessment business planning

Get all your ducks in a row with an initial assessment of your business opportunity.

This article is part of our Business Planning Guide—a curated list of our articles that will help you with the planning process!

Start your business planning with a quick assessment.

Even an established business should take the time to step away from daily operations and look at the basics. Do your business numbers make sense? One of my business school professors used to refer to this process as finding out, “Is there a there there?”

There’s no single right way to do an initial assessment, and the words and phrases vary. My favorite is the Lean Business Plan, a collection of bullet-point lists and tables that lay out strategy, tactics, milestones, and essential numbers. People also like a one-page business plan, which is a really brief summary. For LivePlan users, the LivePlan summary is called the Pitch Page.

All of these are valid ways to approach assessing your business and its current health or potential viability; the difference is mainly a matter of preference. Focus on following through, keeping your eyes open, and being honest with yourself about what you find.

The Lean Business Plan

In its pure form, the Lean Business Plan is simple, just bullet points and lists and tables. Here’s a downloadable template: it’s a good alternative to the business model canvas. It includes a very simple definition of essential strategy, plus a list of tactics, milestones, and essential numbers.

Strategy is about focus and, in many cases, what you aren’t doing. What problem you solve, what solution you offer, your target market, and what makes you and your business qualified and different.

Tactics are the things you’ll do to achieve your goals, like the way you’ll talk about product benefits, how you’ll structure and test your pricing, methods for distribution, marketing activities, and so on. In a Lean Plan as a simple assessment, you keep this to simple lists.

Milestones are what is supposed to happen. Where do you start? What are the steps to follow? You answer these questions with a simple list.

Essential numbers or your financial plan might be simpler for an initial assessment than the projected sales, spending, and cash flow that are normally part of a Lean Business Plan. For an initial assessment, just do a sales forecast.

The one-page business plan

There’s really not much difference between a “one-page business plan, ” a Lean Plan, and a good executive summary. The only real possible difference is the that the “one-page plan” must absolutely fit on one page in a font that most people can still read, while a traditional executive summary can extend to two or three pages, but really should never be longer than that.

If you can condense your executive summary to one page, that’s great. Investors don’t have lots of time to read and a one-page executive summary will get the idea of your business across succinctly. It’s actually a very good exercise to reduce your executive summary to the absolute minimum. This will force you to trim needless words and communicate your business idea clearly and with minimal clutter.

The Lean Business Plan Template

The LivePlan summary

The LivePlan pitch page isn’t just about the pitch—it also serves as a strategy summary or an initial assessment. It’s a standardized one-page description including a logo, a short tagline, a market summary, bullet points for main business activities, a summary of financials, and the team.

The LivePlan summary business planning

Yes, I’m biased on LivePlan because it’s our product, but I see it used as a business summary now in the programs of several of the most prestigious business plan competitions, and my angel group is now using it to summarize some of the companies that submitted for our annual community event.

In my work on Lean Planning, I recommend that a Lean Business Plan includes just a brief strategy summary. That’s just a few bullet points for most people, but for LivePlan users I recommend using the LivePlan pitch. And I use it as a business summary, despite the name pitch page.

I can’t resist adding that LivePlan also includes some features designed to help with the real business pitch, the one I refer to as the pitch, the presentation for investors. It has graphics and summaries you can export as visuals for your slide deck for that first kind of pitch.

Market analysis

It’s hard to imagine an initial assessment that doesn’t include a market analysis. In the Lean Business Plan, it’s part of strategy, and it includes identifying your target market. Most one-page business plans include a brief market summary. So does the LivePlan Pitch. This section applies to any and all of them.

Whichever way you go with your initial assessment, determine if there is a sufficient market to support your business. You don’t need to do major market research for this initial market analysis. You may want, and even need, to do real research later on. For now, however, you want to get a good educated guess about how many potential customers you might have.

What you want at this point is a reality check. You’ve already developed a quick break-even analysis that ties your initial business numbers to your required sales. Now you’re going to look at how many customers you might have so you can think about the importance of breaking even.

Develop a basic market analysis table. This table gives you a simple list of market segments. Each segment is a group of customers. Define the groups according to what needs you supply, demographic characteristics, buying habits, preferences, or whatever other classification system works for your plan. Fill in the total potential customers estimated and the annual growth rate expected for each segment.

The following illustration shows a summary market analysis. You can also use a market analysis chart as a visual guide to your market segments.

business plan market analysis

Pause for reflection

Now it’s time to give your planning an objective appraisal.

At this point, you’ve defined your business, your financial break-even point, and your total potential market. How does your business look from this viewpoint? Does it make sense? Can you make the sales you need to break even? Is the market big enough? Are your projections realistic? Can you bring together the keys to success?

Especially for potential startup companies, a moment of reflection is critical. Many people dream of starting a business, but that dream turns into a nightmare if the new business isn’t successful. If you think you can make your break-even numbers work and you believe you have enough customers to make it, then go on to develop your full business plan. If not, either do more research and revise the idea, or give it up and try something else.

Short on time and need a business plan? Have an MBA write your business plan in five business days with LivePlan’s business plan consulting.

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Ditch the Sales Script and Do This Instead

Sales frameworks are a key stepping stone to building better relationships with customers.


7 min read

Opinions expressed by Entrepreneur contributors are their own.


We’ve all been there: Your phone rings. You pick it up. Before you even utter “Hello?” you’re bombarded with a pitch. “It’s your lucky day, because … ” You’re hearing about a special discount. The person on the other end is talking fast and with confidence, but you can tell he has no interest whatsoever in what you actually need.

Related: 7 Key Selling Habits All Sales Professionals Must Develop

Perhaps you ask a question. Suddenly the call feels even more stilted, because the answer you’re given has nothing to do with what you actually asked. Maybe this person does have something of value to bring to your business. But, it’s painfully clear that you were just the next faceless name on a list of a thousand names. A drop in a bucket. You hang up the phone. Maybe the next person that calls is actually interested in what you need.

Using a sales script is a conventional way for a business to scale a branded sales approach. It may allow a business to execute a sale with those who don’t notice or don’t care that it’s using a script. Ultimately, however, sales scripts will time and time again fall short of creating a personal and emotional connection.

The value lost in doing so cannot be understated. A study by the Harvard Business Review found that emotionally connected customers are more than twice as valuable as highly satisfied ones. They buy more products and services, exhibit less price sensitivity and are more likely to recommend a business to others.

In other words, creating an emotional connection is the secret formula to not only making the initial sale, but also beginning a lasting relationship with a customer that will yield unexpected dividends. And there’s no better way to establish an emotional connection than by implementing a sales framework to close deals.

Frameworks: the science which enables the art

Frameworks have long been used in other facets of business to great effect. They’re commonly used by developers when building new programs or applications. They provide guidance while still enabling a level of creative freedom, often resulting in efficiently built and intuitively run digital platforms.

In the context of sales, frameworks are step-by-step guidelines for sales reps on how to structure a pitch. They are the scientific building blocks which give sales reps the freedom to leverage their strongest personal traits, build genuine relationships and master the art of closing deals. They allow sales reps to be authentic and build up a rapport with a prospect during the conversation, which is crucial.

Related: AI Is Taking the Art Out of Sales

In turn, organizations can overcome some of the major issues facing their sales teams today. Consider, for example, that in a survey of 1,289 salespeople by The Miller Heiman Group and CSO Insights only 53 percent of respondents made their quotas in 2017. Not to mention the challenge it is to hire quality salespeople in the first place: Salespeople remain one of the top three most difficult jobs to fill.

The numbers show that building and maintaining a successful sales team can be difficult. Nevertheless, a quality framework — based on authenticity — that steers salespeople through conversations without imposing a uniform approach is the first step to growing a company’s bottom line.

Closing deals with the art of authenticity

To close deals and build an emotional connection, sales reps have to come across as genuine. It’s all too easy for a prospect to decline a sale or simply hang up if they feel that the person speaking to them isn’t taking their needs into account. Scripts fail every time at personalizing a pitch to suit those needs.

This is something that renowned sales advisor and bestselling author Ian Altman also hints at, writing, “The major mistake [that kills sales scripts] is that the salesperson is reading the script, but not paying attention to the answers.”

Related: 11 Ways to Boost Your Sales Performance

Frameworks are effective because the relationships they foster are built on genuine, naturally developed trust. According to a new survey from HubSpot Research, just 3 percent of respondents consider salespeople trustworthy. The lack of trust is often due to a lack of authenticity on the part of the salesperson, and that often appears to be the case when they are reading from a script.

A rep can spend 30 minutes detailing the benefits of a product, but if the prospect isn’t made to feel like her specific problems can be solved by using that product, the sale has no chance of happening. Word-for-word scripts don’t leave any room for personalizing a solution to solve a prospect’s problems. They stand in the way of a genuine emotional connection.

Simple frameworks fare so much better than detailed scripts because they create an environment where both the salesperson and the prospect are comfortable. It empowers the sales rep to have a normal, natural conversation. They can pick up on character traits, adapt their pitch to meet the prospect’s specific needs, and provide credible answers on how the company can help solve their problems.

Not unlike the way they’re used in the world of coding and developing, frameworks allow sales reps get creative, try out different approaches, and hone their sales technique. As a result, they provide the playing field for sales reps to learn, practice, and ultimately excel at the art of closing a deal.

Related: The 15 Characteristics of People Who Succeed at Sales

A practical framework for businesses

So, what would a sales framework look like in practice? Here’s an example of a framework a company could use to provide standardized, guided steps for pitching a prospect on a first call:

Step 1: The problem (80 percent of first call)

  1. Identify the prospect’s problem.
  2. Expose the pain associated with this problem.
  3. Expound on the monetary, physical, mental and emotional ripple effect of not fixing the problem.

Step 2: Envisioning two realities (15 percent of first call)

  1. Envision a reality without this problem.
  2. Expose the pleasure that can be associated if a solution is provided (a solution; not your solution).
  3. Expound on the monetary, physical, mental and emotional ripple effect of fixing the problem.

Step 3: The Solution (5 percent of first call)

  1. Pitch the next step in solving the solution (i.e. the next, more in-depth call)

As this example shows, a framework requires a sales rep to have a strong, working knowledge of the company’s core principles, vision, products and team mentality, which are communicated to the prospect during the pitch. Frameworks illustrate a clear process, but unlike spelled-out scripts, sales reps are free to tackle each step however they see fit. Improvisation is not only allowed, it’s encouraged. Sales reps need to improvise, be creative and figure out exactly what resonates with the individual human being on the other end of the line.

At the same time, sales reps need to operate in line with a company’s principles, know what they are selling inside-and-out, and be able to explain exactly how that product can solve a prospect’s problems in a way that communicates clearly. Sales frameworks do just that, while enabling salespeople to facilitate personal connection in a way that best fits with their personality. In short, it can accelerate a team’s ability to master the fine art and science of closing deals.

The end result? Far more than just a dramatic increase in conversions and ROI. Sales frameworks are a key stepping stone to creating a more effective team that runs on integrity and, most importantly, customer relationships that are fostered with trust and built for the long haul.

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How to Write a Business Plan for a Subscription Box Service

starting a subscription box business

The subscription box industry is growing rapidly thanks to a steady revenue model and tapping into people’s love for surprises. Ipsy, Birchbox, and Dollar Shave Club are the premier companies doing exactly this and therefore reach the 15 percent of online shoppers signing up for subscription boxes.

But with so many people trying to get their share of the growth, many subscription box businesses fold within a year or two. Lots of new box companies have trouble ironing out the kinks in their process: their customer can’t easily unsubscribe, their boxes just aren’t exciting or well-curated, and more. Any of these can lead to failure.

There are several different types of business plans that can help you stay on track. If you’re seeking a bank loan or outside investment, you probably need a traditional business plan. But if you’re writing a plan as an internal guide for strategic growth, you should consider a lighter version—a Lean Plan. A Lean Plan can also serve as an initial plan that helps you think through all the aspects of starting your business.

This guide to writing a subscription box business plan will help you through the process either way. If you’re writing a traditional plan, you’ll provide more details and it will be more comprehensive. If you’re writing a Lean Plan, keep it shorter and think about making it easy to revisit and revise often.

A subscription box business plan will include the following components:

  1. Executive summary
  2. Your problem and solution
  3. Target market (intended customers)
  4. Marketing and sales plan
  5. Operations
  6. Team
  7. Company overview
  8. Financial plan
  9. Appendix (optional)

To help you get started, you can download this free business plan template for writing a traditional business plan for a loan or investment, or this Lean Plan template for a more nimble, easy to update plan.

1. Executive summary

The first element of every business plan is the executive summary. But, don’t write your executive summary first—it’ll be quite a bit easier to write after you’ve written the rest of the plan. It provides an overview of your business plan by compiling the most important information from the sections that come after.

Investors will read your executive summary first, so give enough information that they’re intrigued enough in your business to be interested in seeing your full plan.

This is what you’ll include:

  • Problem: State the problem your subscription box will solve.
  • Solution: How does your box and the products it contains solve that problem?
  • Target market: What groups of people will want your box?
  • Competition: What other subscription box companies target the same niche?
  • Team: Who are your coworkers and what’s their business experience?
  • Financial summary: Project your revenue for the first few years.
  • Milestones: List major long-term goals you hope to achieve.

starting a subscription box business

Opportunity: Proving there’s a market for your subscription box

Because you complete the executive summary last, you will begin your actual business plan writing process with the problem and solution section of your business plan.

Think of the opportunity as including the problem you’re solving, the solution to that problem, who you plan to sell to, and how your business fits into the existing competitive landscape.

2. Problem and solution

Defining the problem you’re trying to solve is an important part of your business plan because it’s the first place where you’ll demonstrate that idea is viable—that you can actually make money with your business model and idea. Your subscription box service could solve any number of problems.

Here are a few examples (but definitely not an exhaustive list):

  • Other boxes appealing to your niche are too expensive.
  • No box exists for your niche.
  • Online shopping for your product is difficult to some extent (hard to find, can’t return it, often doesn’t fit, so on).

Then, explain how your subscription box company solves the problem.

For example, if your box service will be cheaper than others in your niche, talk about your business model and how you’ll keep your box more affordable.

3. Target market

The target market section of your subscription box business plan identifies which subset of people you will focus your marketing and sales plan on. You can’t target everyone. If you’re selling a box that curates hair products for wealthy, curly-haired men, you probably don’t want to use your marketing dollars to advertise to people outside of your demographic.

Even narrower, not everyone who’s in your niche will want your box. A majority of men with curly hair probably have a product they always use, or they don’t use a product at all. The example box should, therefore, target men with that hair type who are looking for a new product.

Doing a formal market analysis can help you valid the assumption that people will actually pay for your box, as well as identify which people have the best chance of purchasing a subscription.

Additionally, you’ll want to have done some market research or analysis before you attempt to secure outside funding. Banks and investors will be looking to you to prove that you’ve had some initial sales success, but they’ll expect you to prove that you can continue to build your customer base in service of growing a profitable business.

The target market section of your business plan should include your TAM, SAM, and SOM, a brief buyer persona, your key customers, competition, and your pie in the sky future plans.

TAM, SAM, SOM

TAM, SAM, and SOM are three indicators that can help you think through how big your opportunity really is. In the beginning, your SOM is the most important number to think about. Most products aren’t really marketable to every single person with a credit card.

It can be tempting to think that you’re going to advertise to everyone everywhere—but that’s a huge and fairly unnecessary expense. Figuring out who can can really reach and get to pay for your product will save you time and money in the long run.

Understanding TAM, SAM, and SOM:

  • Total Addressable Market (TAM): If you’re selling a men’ hair product subscription box, you might say that every man with hair is your TAM. That’s probably not completely accurate. Maybe your TAM is actually every man in a certain income bracket that is fashion conscious and has his hair styled by a professional.  
  • Segmented Addressable Market (SAM): This is how much of the TAM you’ll target. The SAM for our example might be men with curly hair because you curate products specific to that style.
  • Share of the Market (SOM): Your SOM is who you will reach in your first few years of business. The example’s SOM would, therefore, be a percentage of men with, curly hair based on the number of orders your business model can handle. It could also narrow the SAM by selecting specific regions that its box will be available in.

Buyer persona

Creating a buyer persona puts you in the customer’s shoes to guide marketing and sales decisions. You can see what your customer needs out of your subscription box, and why they need it.

It also gives you an edge over competitors without one. Keeping your buyer persona in mind can help you as you develop your marketing and sales plan, and think through crafting messages to potential customers that will compel them to convert, or subscribe to your box.

Key customers

This section is for businesses that sell to enterprise customers, not consumers. Companies that become a big subset of your revenue are likely strategic alliances, though, which is a later section. A key customer for a subscription box might be a large organization that contracts with you as an exclusive provider of something they need.

Maybe your subscription box is a monthly curated selection of comic books. If you partner with a large, wealthy private school district who wants you to provide comic book packages to all their eighth-grade students every month, that contract might be key your business survival for a period of time. They’re a key customer because without their business, you’d be in trouble.

Competition

Name the other subscription boxes that appeal to your niche. The men’s hair product example would list Birchbox, Dollar Shave Club, Bespoke Post, and Luxury Barber. Describe their pricing, what sort of products they include, how many items are in each box, and so on.

An easy and visual way to do this comparison is with a competitive matrix. A competitive matrix lists the company names down the left column and particular features across the top row. Check marks indicate which company has which feature—you should construct yours to highlight why your box is different and better.

Then, explain how your subscription box service differs, and how those differences appeal to your target market.

Future plans

This section is for your hopes and plans for scaling your business. Maybe your comic book subscription plan eventually wants to branch into comic book merchandise curation in the future. Maybe you want to start marketing your subscription boxes at different price points to increase your available market share. Put those ideas here.

starting a subscription box business

Execution: How you’ll do it

Now that you explained your opportunity thoroughly, it’s time to describe how you plan to take advantage of it. Now, you’ll describe your marketing strategies, sales plans, operations information, milestones, your team and company basics, and your financial plan.

4. Marketing and sales plan

For many businesses, marketing and sales effort stops once a particular customer purchases its product or service.

Subscription boxes are nice because they’re designed to retain customers. But a lot of subscription companies bill on a period basis, like monthly, so you’re always thinking about how to retain the customers you have while you seek new customers.

Your marketing and sales plan should include a positioning statement, your initial pricing tests, tactics for promoting your brand, and information about any strategic alliances that are critical to your success.

Positioning statement

Your positioning statement should explain how your subscription box is different than competitors. Most statements follow this template:  

“For [target market description] who [target market need], [this product] [how it meets the need]. Unlike [key competition], it [most important distinguishing feature].”

Pricing

Next, it’s time to determine your box’s pricing.

There are a lot of factors to consider when determining your monthly price:

  • Product itself
  • Fulfillment
  • Packing materials
  • Transaction and platform fees
  • Labor
  • Postage and shipping

With the total cost of each box in hand, calculate a price with at least a 40 percent profit margin, as suggested by CrateJoy. Cratejoy also has other resources for calculating the best price for your subscription box.

There’s one final aspect of pricing to consider. Established subscription box services generally offer different rates depending on the length of subscription. For example, the men’s hair product box might cost $39.95 per month, but if you commit to subscribing for a year, its monthly cost will drop to $36.95.

If you do this, make sure the annual plan with cheaper monthly payments still generates a profit.

Promotion

Most of your outreach will happen during the pre-launch stage. Subscription box services primarily use social media (Instagram, Facebook, Pinterest, and influencers) to show off some of its curated products and give offers prior to official launch.

Get the email addresses of interested customers by advertising email sign-ups rather than pre-orders on your website and social media. You can then personalize your pre-launch marketing plan with emails to these interested people. This will keep your leads warm and encourage a higher percentage to subscribe once you launch.

Consider landing page design, easy email sign up, and potential deals for pre-subscribers during the pre-launch promotion as well.

One thing to be cautious of: how you advertise the products in your box. Not getting permission from the manufacturers on their product limits how much you can advertise it.

Strategic alliances

What vendors can you partner with to give you discounted or free sample products for your box? Let them know that they get cheap advertising by sponsoring your box.

Your business has a lot of potential if you can attain such partnerships. They save time by lessening your product curation efforts, and they make the overall product cost cheaper.

The example box might reach out to popular hair product brands like American Crew, Baxter of California, or Kevin Murphy to get free samples. Customers try each one in their box and decide if any are worth buying a full bottle of. If none work perfectly, they wait until the next month’s box, plus they don’t waste any product because the samples are small.

You should also explore other types of strategic alliances, like brick and mortar locations or selling through Amazon. These, among other ideas, can help your store reach new target markets, expand business operations, and improve profit margins.

Finally, an overlooked alliance is the one with each of your customers. Subscription models depend on customers staying for a while and increasing their lifetime value. Make the boxes personal and provide reliable customer service to grow your business and retain customers.

5. Operations

The operations section includes the logistics, technology, and other behind-the-scenes pieces of your business. For a subscription box service, this section will primarily focus on product curation and box distribution.

Sourcing, fulfillment, and distribution

Where will you get your products? How you will assemble them in your box. What packing materials will you use and how will you make the inside of your box aesthetically pleasing?

Then, talk about the box itself. Will you have a custom box designed, or will you keep it super simple at first? Will you outsource your packaging and shipping?

Once your business can’t run out of your garage anymore you’ll probably want to consider outsourcing some of the work. If you don’t plan on outsourcing initially (as most don’t), explain how you will handle box distribution. Your explanation should include how you will ship boxes, keep track of shipments, and any other logistics for getting your product to the customer’s door.

Deliver your boxes on a regular schedule—customers should receive their order within the same time frame each month (or whatever time period) to avoid confusion. Also, offer tracking information so they can see where their package is in the shipping process.

Startup costs

There are several expenditures you need to address before starting your business operations. Your startup costs will include acquiring your initial inventory, or the products you plan to include in the first edition of your box service.

You’ll probably also want to include your first round of shipping materials: filling, boxes, and labels. Say where you will get these and why that’s the cheapest option—you’ll likely buy these supplies in bulk. And if you’re paying for space for storage or packing operations, you’ll want to include that too.

Away from the box itself, you will pay for a website to process payments and advertise your service. Will you need an app? Think that through from the beginning too. You’ll want to think through which tool is essential from the beginning.

At first, you might get away with manually billing each of your customers each month, but it probably won’t be long until you’ll need tools to help with automated re-billing, order management, shipping label generation, customer management and more. The key for startup costs is to decide what you can’t live without from day one.

Milestones

Set milestones to show your business plan’s audience where you realistically see your company going long term. Add the milestone’s name, due date, budget, and person responsible to a calendar to put “some bite into your plan and management.”

Stay up to date with these milestones once your business gets off the ground; they will keep you and your coworkers on track toward your original goals. Schedule monthly review meetings within your team (or schedule time to review by yourself, if you’re starting out solo) every month to monitor your progress on each milestone.

Traction

No investor will give away money to an unproven business idea. Even if you haven’t launched your subscription box yet, run a minimum viable product (MVP) to demonstrate that people will pay for your box. This can be as simple as selling a beta version of your boxes to verify that people will pay for it.

If your business is already up and running, include the milestones you already achieved. “Traction” shows that your subscription box is heading in the right direction and is important to investors as proof that your business is viable.

Key metrics

Going smaller, use key metrics to ensure that your business is on track to reach your milestones.

The five key metrics to judge your subscription model’s success are:

  • Churn and churn rate
  • MRR (monthly recurring revenue)
  • ARPU (average monthly revenue per user/customer)
  • LTV (lifetime value)
  • CAC (customer acquisition cost)

Most business owners would be terribly concerned their sales stagnated. That’s one benefit of the subscription pricing model—a slower sign up rate isn’t always bad for your business. Use these five metrics to track how many people are continuing their subscription and to know when you need to address stagnated sales.

Key assumptions and risks

State the key assumptions and risks of your subscription box service.

Knowing your assumptions helps maintain the business’ consistency because the subscription box industry is always changing. They become even more important when you revisit and update your business plan in the future.

Additionally, acknowledging potential risks can guide your business to reduce its susceptibility to them. Investors want to know that you’ve thought about situations that could negatively affect your service business, plus ways to avoid them.

Issues related to credit card fraud is a big risk with any ecommerce business model. Address the security risk with your website, as well as how you plan to stop any sort of fraud.

6. Team

You want to make your management team attractive and credible to investors. If they know your subscription box idea will get customers, show them why you and your team are the ones to make it happen.

Name the people involved with your subscription box service. Your team might change as the business grows, though. You might outsource packaging, shipping or both instead of hiring more people to work with you directly. 

Explain your business qualifications, along with any business partners or key team members. Also, describe why they are passionate or knowledgeable about the niche your box specializes in. Why do they know how to curate products that will surprise and satisfy customers?

The Lean Business Plan Template

7. Company overview

In the company overview section, you’ll explain what your company values, how it will legally protect its products, follow certain regulations, and structure ownership. Include your business’ history and location as well.

Mission statement

The mission of your subscription box is what you ultimately want people to recognize the brand name for. A generic template for a mission statement is:

“The mission is to provide X (services) by doing Y (methods) for Z (target market).”

Keep it as short and meaningful as you can.

Intellectual property

Trademarking your business name, logo, and so on are the main intellectual property issues for a subscription box.

But if you have some sort of new technology or method that improves an aspect of your service, make sure to protect it with patents. That could be anything from improved packaging methods to automated product curation.

Legal structure and ownership

Each legal structure has its own pros and cons, so do your research so you can make in informed decision.

Location

Where is your distribution center? Is it in an optimal location for reaching your target market without expensive shipping costs? This might change at some point in the future if you choose to outsource it.

History

If you’re writing this business plan as a strategic guide and your startup is already up and running, talk about how it began. Highlight any major achievements you have already reached.

8. Financial plan

With so many fluctuating expenses to account for in the curation and distribution of your boxes, you need to make sure that you are still making a profit.

For a subscription box company, like any other business, there are eight elements you need to include in the financial section of your business plan.

Here are the components of the financial plan that you’ll need to include:

  • Sales forecast: There are two parts involved with your sales forecastannual revenue projections and cost of goods sold (COGS).
  • Personnel plan: How much will you pay each employee. Include “employee burden” costs as well—the cost of an employee beyond their salary.
  • Break-even analysis: Calculate when your business will break even and begin making a profit. Show what your profit numbers will look like from that point forward.
  • Profit and loss statement: Compare the revenue projections by time period with your expenses. The bottom line of a profit and loss statement is net profit, or how much money you’re making after all expenses are paid. Here’s a template to help you get started.
  • Cash flow statement: The cash flow statement helps you recognize what your startup’s cash position is—profit isn’t the be-all-end-all metric for the money you have. This statement tracks how much cash you have, where it’s coming and going from, plus on what schedule. Here’s a cash flow template you can use in Excel.
  • Balance sheet: Make sure your assets and liabilities balance out to show financial health. Your balance sheet is a snapshot of your businesses’ financial health. Here’s a balance sheet template you can use to get started.
  • Use of funds: Talk about where potential funding from investors or the bank will go and why the money is necessary there. Omit this bullet if you’re not seeking any funding.
  • Exit strategy: Name a few other subscription box services or outside companies who might want to take over if you decide to exit the industry down the line. Omit this bullet as well if you’re not seeking funding.

Appendix

Like with any appendix, add any charts, tables, pictures, or other necessary information that didn’t fit neatly into the business plan.

This section is not necessary—only include it if you have supplemental information that you need to cover.

Conclusion

Subscription-based business models are growing exponentially in all industries because people are figuring out how to maximize the profit margins, and subscription box businesses are one of the premier industries taking advantage of this new and popular business model. They supply customers with unique, curated products, and provide the excitement of the unboxing experience that no other industry can.

Before you enter this lucrative industry, ask yourself these seven questions to make sure it is right for you. Then, start working on your business plan—keep it as short and concise as you can so that it’s easier to use it as a tool to guide your business.

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Nate Mann
Nate Mann

Nate Mann recently finished his second year at the University of Oregon. He is pursuing a major in journalism, along with minors in business administration and computer science. He is currently a content marketing intern for Palo Alto Software. Outside of school and work, Nate is an avid basketball fan and writes about the Portland Trail Blazers for Rip City Project. He is also a data reporting intern for the University of Oregon’s School of Journalism and Communication.

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Make the Most of Holiday Shopping With These 3 Tips


3 min read

Opinions expressed by Entrepreneur contributors are their own.


It’s the busiest time of the year for retailers, and from influencer marketing to social ads, the holiday campaigns are in full-force. Entrepreneur Network partner Emily Richett shares three tips for making the most of the holiday shopping season.

First, work smarter, not harder. It’s not enough to just leverage ads or only focus on an influencer strategy. Make sure to get all of your departments working together for a cohesive plan to drive marketing results that will compound.

If you really want to level up your holiday ecommerce game, take a page from the marketing playbook of Digital Trends, the largest independent technology review site with 30 million unique monthly visitors, and leverage live video.

During Prime Day, Digital Trends utilized live video but not just to promote big sales and offers. Instead, it offered genuine reviews from guest hosts, which resonates better with consumers and goes a long way in building trust.

This goes for all your content — think value over promotion. Use humor, offer insights or takeaways and be collaborative. Of course, have a call-to-action but remember, consumers are smart and crave connection, not just ads.

Influencer marketing is where its at this year for holiday promotions, but if you want to leverage these relationships to the fullest, have influencers do more than just the standard posts and shout-outs. This is another strategy I took from Digital Trends’ Prime Day success. The outlet had influencers create their own curated shopping lists/guides, which allowed them to be more authentic to their audiences. They drove traffic with Instagram takeovers that linked right to each influencers’ personal shopping page.

Once you get your teams and departments working from the same playbook, incorporate live video and impactful influencer campaigns that go beyond the standard sponsored posts — and see your brand loyalty and holiday sales increase.

Related: The One Question Super Bowl Star and Serial Entrepreneur Rod Smith Uses to Create His Success

Entrepreneur Network is a premium video network providing entertainment, education and inspiration from successful entrepreneurs and thought leaders. We provide expertise and opportunities to accelerate brand growth and effectively monetize video and audio content distributed across all digital platforms for the business genre.

EN is partnered with hundreds of top YouTube channels in the business vertical. Watch video from our network partners on demand on Amazon FireRokuApple TV and the Entrepreneur App available on iOS and Android devices.

Click here to become a part of this growing video network.

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Why You Should Update Your Business Plan Regularly to Drive Growth

business planning for growth

I started an insurance agency two years ago. I had some friends who were all very successful in the industry, which led me to think that I would be blessed with the same fortune.

My business was in a highly competitive industry, rated as one of the best industries to start a new business in. Around 58 percent of businesses in the insurance sector survive longer than four years.

Things went well in the beginning, but just as I approached my first year, business started to slow down dramatically. It was like my business came to a halt.

The problem: Insufficient planning

My business came to a standstill.

I didn’t know what was wrong.

It was obvious that the market was saturated, but the insurance industry is evergreen and wasn’t going anywhere—I knew a significant number of people who were very successful with their own insurance firms.

I started to take a close look at my business.

After getting out an old document that was my business plan, I realized that I had reached the full potential of the plan I drafted when I first started the business. I also noted that I didn’t really leave room for further expansion, which explained a lot.

This was when I realized that I had to continuously plan for the future if I wanted my business to continue growing.

Even though life is unpredictable, many business-related aspects can be forecasted—often successfully.

The Lean Business Plan Template

Tips to help your business grow with a solid business plan

Because as my business became more established I basically ignored the business plan that I relied on when I started my business, I felt lost when everything started to slow down.

I was confused about what I could do to gain new customers. Thankfully, I wasn’t losing customers.

After a lot of research and dusting off my business plan, I was able to reverse the downtrend.

Below, I’ll share a couple of the lessons I have learned along the way.

1. Keep your business plan alive

Your business plan is not something that should be written once and then buried away.

Instead, it is a document that you should refer to frequently. Something that should be updated regularly and then compared to the actual results you’re achieving.

Keep your business in line with what is currently going on, as well as what you plan to come.

When you reach a goal, then mark it on your business plan and set out to reach the next goal. Sometimes these goals are called milestones and they can help you keep your business on track.

At least twice a year, schedule a day or two to plan ahead of time.

Ask yourself:

  • What worked in the last quarter? (Note: Do more of that!)
  • What didn’t work and why?
  • What can you do differently?
  • What goals would you like your business to reach in the next six months?
  • Where do you see your business in three years?

Focus on the short-term goals, but also plan for the long game. If you’re using a business dashboard, that can make it easier to see how your actual performance compared to your projections, and to model possible future scenarios.

2. Let your business plan be the light

As business owners, we are sometimes faced with an endless road of darkness.

I remember how much more effort it took to stay motivated and keep hustling. At times, it felt like things were over—there was little I could do.

When times are tough, you can quickly lose your motivation to rise to the top – or even to get back up and fight to keep your business alive.

Some businesses choose to give up at these times and I wouldn’t blame them. 

In these dreadful times, your business plan should be the light at the end of that dark tunnel. When you look at your business plan, there is a good chance that you will find some useful information that could reveal to you why you are going through your current situation. At the same time, you might just discover solutions you have been looking for by analyzing the data in your business plan.

3. Keep things organized for better decision making

A study that was published in the Personality and Social Psychology Bulletin explained how a clinical trial found being organized leads to improvements in cortisol levels, stress, anxiety, and even depression.

Especially in the business world, being organized will make a huge difference in your effectiveness.

When things are organized, it is easier to spot problems, as well as to make more accurate forecasts based on your company’s current situation.

4. Track your progress

How would you know how well your business is doing (or how poorly) if you don’t track your results and progress?

I was also a victim to this problem: When things were going great, I didn’t make time to look back and track how well I was heading toward my short or long-term goals.

Write S.M.A.R.T. (specific, measurable. action-oriented, relevant, and timely) goals in your business plan—dedicate an entire section to short-term goals and a separate section to long-term goals.

Add documents, scribbles, and anything else that has to do with your progress with your business plan.

Make some time every quarter to sit down and see how well you are really tracking so you can plan your next moves accordingly.

5. Keep it simple

A lot of people tend to overcomplicate a business plan.

While the document is important and will be extremely valuable for the future of your business, there is no need to compile an entire book.

Many businesses are turning toward a one-page business plan or Lean Plan to simplify things.

The single-page document would contain all of the most important elements of your business—a summary. I personally like to keep a one-page summary pinned at my desk, and keep the detailed information in the main document on my laptop.

As your business grows, so will your business plan and all the documents that go with the plan. Here’s a link to a downloadable template you can use to get started.

6. Consider your competitors

An often overlooked element of a good business plan is a thorough analysis of competitors.

You can learn a lot from watching your competitors. Competitor data allows you to see what they are doing, so you can decide if you should do the same or take a different approach.  If your competitors are doing something that works, consider copying them.

I used a variety of tools to help me gain valuable insight into how my competitors are marketing their products, who their target audience is, and what makes them unique.

Google is always a good starting point. Getting ahold of your competitor’s marketing material is another. If you come across a competitor’s customers, take a moment to ask them why they chose to do business with your competition.

By studying your competition, you may be able to pick up a few ideas to help grow your business.

Final words

Even though my business came to a standstill at one point and even caused me to lose some money, I did not regret starting my own company.

What I do regret, however, is that for a long time I didn’t pay enough attention to my business plan.

Only when my business seemed to be standing still did I revert back to my business plan, only to discover that the plan I had for my business mapped out all the success I had been riding all along.

Never underestimate the power of a business plan.

Frequently updating your business plan and comparing your real results to your forecasts will give you valuable insight to help your business grow into the future!

If you’re looking for sample business plans to give you a better sense of what you should include, check out Bplans’ examples specifically for insurance companies.

You can also download a free business plan template or even a Lean Plan template (it’s an alternative to a business model canvas) if you’re looking for a shorter version of a plan that can be updated quickly and easily on a regular basis.

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John Catibog
John Catibog

John Catibog is a business insurance broker and founder of Indagard Insurance Services. Based in Melbourne, Australia, John has an education in computer science, business and marketing and logistics. Combined with his insurance broking experience, he works closely with local business owners to cover the many risks they face in business today. John’s is a regular presenter on cyber insurance to protect against cyber risks. Over the years, John has worked in the healthcare, retail, and transport industries.

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The Simple Reason Content Is Still Integral to Your Business’s Marketing

With so much published every day, here’s why you should keep digital content in your marketing toolbox.


2 min read

Opinions expressed by Entrepreneur contributors are their own.


In this latest video with Entrepreneur Network partner Business Rockstars and Hawke Media’s Erik Huberman, the marketing guru discusses the purpose of publishing content.

Huberman describes content as a means for your customers to get more familiar with your brand and to visit your website in order for them to purchase your product. Moreover, with your customers coming to your website more often, you will be able to increase your conversion rate. From there, a higher conversion rate can lead to more purchases along with a higher likelihood a one-time customer will become a life-long customer. 

To hear more about the benefits of creating content for the marketing side of your business, click the video.

Related: Don’t Wait to Launch Until Your Product Is Perfect

Entrepreneur Network is a premium video network providing entertainment, education and inspiration from successful entrepreneurs and thought leaders. We provide expertise and opportunities to accelerate brand growth and effectively monetize video and audio content distributed across all digital platforms for the business genre.

EN is partnered with hundreds of top YouTube channels in the business vertical. Watch video from our network partners on demand on RokuApple TV and the Entrepreneur App available on iOS and Android devices.

Click here to become a part of this growing video network.

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How to Start a Business in 30 Days

how to start a business in 30 days

There are a lot of steps that go into starting a business. It can seem overwhelming to try to tackle them all at once, but it with a few simple tools and this 30-day roadmap, you’ll have everything you need to lay the groundwork for a thriving, profitable business.

We’ll cover everything: validating your business idea, writing a business plan, seeking funding, and setting up accounting tools, and setting goals and milestones.

Remember: you don’t need any “special” training to run a business. You just need an idea, a good plan, the desire to learn and adapt, and the ability to take action!

So what are you waiting for? Let’s get started!

Days 1 to 3: Lay the personal groundwork for starting a business

First, get a notebook or open a file on your computer, and answer these foundational questions. We’re getting an overall idea of what skills and resources you have now, and where you might want to seek out some education. There are no right or wrong answers here, only the answer that works best for you.

Will you keep your day job?

If so, how many hours does that realistically leave you each week to work on your business? And if not, how many months of living expenses can you cover?

Do you understand all the risks of starting this business?

Will you be taking on debt? Investing savings or retirement funds? Write down all the risk factors you can think of. If you get stuck, try an online search for “risks of starting a [type of business].”

Is your family ready?

Sit down with your family for an honest conversation. Do they understand the financial risks you’re about to take on? Are they ready to support you through the effort of getting this business off the ground? Are there ways they’d be willing to help in running the business day to day?

Have you thought about funding sources?

Do you have a ballpark idea of how much financing your business idea might need? If not, that’s okay—that will become clearer in future steps. But for the moment, let’s assume you’ll need a fairly substantial amount of starting funds. Where might you go for these—a bank or SBA loan? Investment from friends and family? Outside investors? Or, can you bootstrap? Make a list of potential sources now, and we’ll come back to it later.

What are your personal strengths that might be essential to starting your business?

What are your personal weaknesses or skill gaps that might make it difficult to start a business?

One great way to consider these questions is to perform a SWOT analysis on yourself, focusing on your role as an entrepreneur in your industry.  “SWOT” stands for Strengths, Weaknesses, Opportunities, and Threats. You can do a SWOT for your business, but at this stage, try a personal one and see what you learn. We have a free PDF template to help you.

How committed are you to starting your own business and being self-employed? How committed are you to this specific business idea?

These last questions are important. It probably goes without saying that starting a company requires a strong commitment. You’ll find the hard work and sacrifices much easier if you’re passionate about your business idea, or about being a business owner.

How will you build your business skills and your network?

It can be helpful to contact your local SCORE or SBDC office and look into business mentorship programs and startup incubators in your area. Chatting through your questions and ideas with someone who’s been there before and wants to support you can be invaluable, especially if you’ve never started a business before.

Day 4 to 7: Validate your business idea and get to know your market

It’s time for a fresh notebook page/computer file—or download our free Idea Validation Checklist. There are several questions that set the stage for all the planning and execution you’ll be doing going forward, so take the time you need to write down your answers. If you’re feeling stuck, you might try talking with some potential customers, or visiting your local library or SBDC office to do some initial market research.

What is your business idea?

Imagine that you have only 60 seconds (or 140 characters) to explain your idea to an investor. Keep it short and sweet. Some people call this an elevator pitch.

What’s the problem, and what’s your solution?

Every business needs to solve a problem. Don’t overthink this—the “problem” is simply the reason a customer buys your product or service. What need do they have that your company fulfills? That need is the problem, and your product or service is the solution.

As an example, think about a hair salon. Customers go there with a variety of needs: maybe their hair has grown out and requires a trim. Maybe they need a special hairstyle for a big event. Maybe they need an affordable color treatment. All of these are problems that the right hair salon can solve.

Who is your target market?

If you understand the problem your business solves, then you’re well on your way to being able to answer this question. When you think about the customers who will buy your product or service, what do they have in common? Their income level? Their geographic location? Their particular type of need? That’s your target market. Once you’ve identified your target market, think about how the current state of the economy is affecting them.

Can you estimate how many customers your business might be able to reach, either locally or online? And, do you have an idea of how much they typically spend on your product or service each year? A little market research will help you understand whether there’s enough of a market—or people who will pay—for what you want to offer.

Who is your main competition?

Find the companies you’ll soon be competing with, and become a customer. Make purchases, spend time in their stores or on their websites, look for their marketing, and communicate with them as a customer. Learn what they do well, and what you can do better. Every business has competition—putting together a simple comparison table (competitive matrix) can help you see how your business stacks up against the others.

Why and how much do you think people will pay for your solution?

What is your competition charging? Are there reasons you’d charge more or less? Here’s a quick guide to how to think strategically about pricing.

What do potential customers think about your solution?

Here’s where talking with some potential customers can really be helpful. You may have a friend or family member who matches your target market. If not, put the word out that you’re looking for people to interview. Use your social media networks, if you have them.

You don’t have to get deeply personal here; just ask them about how often they buy something like what you plan to sell, and whether their spending has changed in the past few years. Talk to several people, and take their thoughts into account as you consider your target market and how much potential income they represent.

When you’ve pulled all this information together, be sure to congratulate yourself. You’ve set a strong foundation for planning your new business!

Day 8 to 11: Take a first look at the numbers

Now, let’s do a financial feasibility forecast for your business. Don’t let the sound of that intimidate you–this is a simple, straightforward process. You’ll learn what the general financial picture of this business will be, and we’ll take it one step at a time.

Do a sales forecast

Refer back to the target market research you did in the previous section, and use this data to build a simple sales forecast. A spreadsheet program or business planning software can make this process faster.

Estimate your startup costs

Now, make a list of all the one-time expenses you’ll have in order to start this business. Will you need to buy or lease a physical location? Hire a website developer? Buy any special tools or equipment? Start with a big brainstorming list, and then narrow that to what will be essential for your company’s first day of business. Don’t forget additional costs like legal fees to set up your company’s business structure, professional licensing, or franchise fees.

Sketch out a monthly expense budget

Next, make a list of the ongoing expenses your business will have. Will you make monthly lease payments? Utilities? Business insurance? Supplies? Staff? Again, start with brainstorming and then narrow the list down to essentials. Make rough estimates, based on your experience and online research, of how much each item will cost each month.

Do a break-even analysis

How much revenue will it take to break even—to cover your expenses? How many sales will you need to make in order to cover your monthly costs? The results of your analysis might inspire you to adjust your sales forecast a bit.

Once again, congratulations! You’ve taken the first steps to build your financial forecast, and you’re that much closer to having a concrete business plan.

Download the Business Plan Template today!

Day 12 to 14: What about funding?

Now that you have a better picture of how much cash you’ll need to get this business started, it’s time to start considering your funding options. Start with your own available funds—do you have savings to invest or cash you can liquidate?

From there, look at outside sources. Our Business Funding Guide is an excellent starting point. Learn about business lending requirements from local banks. Look for business and investment networking events to attend in your area. Approach your local SBDC or business incubators to ask about funding options.

We’ve budgeted some time later in our 30-day process for completing funding applications. For now, go ahead and collect any forms and instructions you’ll need.

Day 15: Identify your unique value proposition

Also known as the UVP, your unique value proposition will be key to your marketing efforts. You’ve already done the groundwork by identifying the problem, solution, and target market for your business. You’ve likely learned a few new things in your market research, so now it’s time to put all that information together into a statement that describes how your business is different from its competition, and why it’s the obvious choice for your target customers.

Don’t worry, you’re already more than halfway there. We have a helpful guide and some examples to help you craft your UVP.

Day 16: Make some 30,000-foot decisions and start your business plan

At this point, you have all the raw materials to write a business plan. So today, you’ll make the last few decisions you’ll need in order to get started.

Why do you need a business plan? Businesses that have one grow faster, for one thing. Plus, any lender or investor will expect to see one before they consider your funding ask. If you’ve never written a business plan before, Bplans has a library of over 500 sample business plans in a wide variety of industries that you can view and download for free.

Decide how you’ll write your business plan

Depending on your needs, there are a lot of options:

  • Microsoft Word and Excel (or Google Docs and Sheets) are great if you know what you want your plan to say and you want maximum flexibility to express it. Our downloadable business plan template can help too.
  • Business planning software like LivePlan goes a step further and guides you through writing each section—including the financials.

Will you start solo or bring on a partner or employees?

Will you be building this business alone, or with one or more co-founders? Is there any staff you’ll need to hire immediately, to help you with getting started? (If so, then one nice thing about LivePlan is that it’s web-based, so you can invite your colleagues to work on your business plan with you in real time.)

A second question goes hand-in-hand with this one: if you do need to bring on any colleagues at this point, what arrangements will you make for their compensation, whether that’s salary, shares, trade, or something else?

Make your business name official

You may have decided on this a long time ago, but take another look at your company name in light of your UVP. Does the name communicate something of your unique value?

While you’re at it, do a business name search to make sure this name isn’t already registered by another company. It’s also wise to do a web domain search to make sure the web address you need is available. This page from the SBA will walk you through those steps. Then register your name to make it official.

Create a logo

You might need a little time to complete this task, but for now, do some research into what makes a good logo, and common logo mistakes to avoid. You might hire a professional designer, or try using a crowdsourced option. Your logo is a piece of your company’s branding—start thinking about what impression you want people to have of your company at first glance.

Day 17 to 19: Getting concrete—your website and location

These next few days are about building a “home” for your business to live. As with the logo design, it might more than a couple days to complete, but now’s the time to get the ball rolling.

Build a website, and/or look for a physical location

Depending on the business you’re building, you might need only one of these things or both.

Start with your website, because it’s wise to start growing your online presence as soon as possible. We have a complete guide to creating a business website, and some recommendations on how to make it well-branded.

If your business also needs a brick-and-mortar location, check out our guide to choosing one, and these out-of-the-box ideas as well. Make a list of what you need. With that list in hand, start contacting commercial real estate firms in your area.

Make your business official

Every business involves some necessary legal filings:

  • You’ll need a business license, and the required paperwork to establish your legal business entity. Will your company be a partnership, an LLC, or something else?
  • Do you need any licenses or permits to conduct business?
  • You’ll also need a business tax ID number, or EIN.

This is also a good moment to look for a local business attorney, which every business also needs. Find one you feel comfortable with, who can advise you on legal business matters going forward.

Set up your accounting software

It may seem a little early for this, but soon you’ll be in the throes of your first days doing business, and then you’ll have a lot to think about. Give your business a great head start by taking a little time now to find an accounting solution and get its initial configurations done. Why keep your books using accounting software rather than in Excel spreadsheets? For one, you’ll reduce the amount of time you’ll spend doing data entry—and the likelihood of making errors.

If you use LivePlan to write your business plan, you’ll be able to connect it with QuickBooks Online or Xero down the road and compare your business plan forecast against your actual performance in real time—a powerful way to track the health of your business. It also makes it much easier to model financial scenarios, so you can see how different tactics might affect your bottom line.

Day 20 to 23: Come up with an MVP

We’re big believers in the “minimum viable product,” or MVP. All this means is, instead of making a large investment in designing the most perfect version of your product or service before you go live, you start leaner. Instead, create a simpler, easier-to-launch version that will still demonstrate the value you bring to your target market. So if you’re building a food delivery app, maybe build a simple version of the app and do some of the back end work manually, rather than coding the best version first. If you’re hoping to start a restaurant, before you build or outfit your space, first set up at your local farmer’s market and see what the response is to your food and prices.

You can launch your MVP quietly and let your target customers interact with it. You’ll gain valuable feedback which will refine your idea, and make your product or service better before you invest in the final version.

Think about the business idea you’re working on. What’s the minimum viable version, and what are some simple ways you might get it in front of your target customers? Eric Reis’s book The Lean Startup (we feature it in this reading list for entrepreneurs) is a great place to learn more about the MVP concept.

Day 24 to 25: Finish up that business plan

The work you’ve done to this point has given you the foundations of a great business plan–all that’s left to do is get it on paper. So get out the planning tools you chose back on Day 16, and get writing. We’ll tackle your sales and marketing plan soon, but for now, focus on the business plan itself. Remember, if you need some guidance on this step, we have a free downloadable template and a full guide on how to write a business plan.

If you aren’t planning to seek a loan or investment, then consider doing a lean business plan, which comes together quickly. We have a Lean Plan template and a guide.

You’ll also want to take the initial sales forecast numbers you pulled together on Day 7, and refine them based on the additional research you’ve done in the meantime. Your financial plan should include the following key elements—and this article will guide you through them and offer some free downloadable Excel templates. 

The elements of the financial plan:

Plug all of these into your business plan. Remember, if you’re feeling at all intimidated about your financial plan, a tool like LivePlan can walk you through it step by step. Sometimes it makes sense to hire a professional business plan writer—here’s an article that shares a little more about what that process is like. Your accountant can also help you with your ongoing business planning and strategy.

Day 26 to 27: Set up your sales and marketing plan

Now it’s time to formulate your sales and marketing plan.

Build your sales and marketing plan

This plan doesn’t have to be as detailed as your business plan, but it should definitely cover:

  • How you’ll spread the word about your product or service in your first year of business
  • What sales channels you’ll use to deliver that product or service to your customers

The research you did on your target market will help you decide which kinds of marketing will reach them best.

Our company founder Tim Berry offers a quick overview of the components of a successful marketing plan. As you’re formulating your list of sales channels and marketing activities, consider these questions:

  • Did you estimate enough monthly expense in your business plan forecast to cover the activities in your sales and marketing plan?
  • Will you need any additional start-up funding to cover your sales and marketing efforts?

Identify how you’ll measure success

This is also a good time to think about the ROI, or Return On Investment, of your marketing activities. How will you know which ones create the most sales? Here’s where the idea of milestones comes in. A successful marketing plan contains specific targets for marketing activities, and for measuring the sales that happen afterward.

As a starting point, decide on some specific marketing activities you’ll do in the early days of doing business, such as an ad placement or a local event. Schedule these in your calendar now. Then schedule a second milestone a few days or weeks later to check in on your sales and see if they increased.

Day 28 to 29: Apply for funding

Earlier in this project, you made a list of potential funding sources and pulled together some application forms. Pull those materials back out now, because now you have all the data you need for completing those applications. Look back at our funding guide if you want to revisit the different types of funding options.

If you’re in need of a small business loan, we have a guide to preparing a loan application that gets results. You might approach local banks, or your local SBA office, or look into online lenders. Keep in mind that the process of obtaining a loan can take weeks or even months, though online lenders tend to move more quickly. You’ll find some tips on securing loans here.

If you want to seek investors, we have a guide to help with that as well. Keep in mind that most investors won’t fund an idea—they’ll be looking for some initial proof that people buy your product or service, as well as some evidence that your business model can be scaled quickly. They’ll also be interested in your exit strategy—investors make their money when you sell.

Day 30: Get ready to track your progress

As the last step, you’ll set up a framework to grow your business. Did you know that companies that pay regular attention to their numbers are 30 percent more likely to grow? You’ve done the work of building your projected forecast, and now it’s time to put it to work in helping you build a successful business.

Set goals and milestones for your business as a whole

What milestones do you need to schedule for your business? Milestones are key to making your business plan useful and keeping your momentum going. Do you need to order business cards? Put together some job listings for hiring staff? Decide on a payroll service? Give these tasks due dates, so you stay organized and make sure everything gets done.

Set up a business dashboard

As your business starts operating, you’ll want to compare your actual results against that forecast regularly. You can set up your own financial reporting spreadsheets, or use a business dashboard tool like LivePlan that does this work for you.

Schedule monthly strategic and financial reviews

This is also a good time to schedule your first business plan review meeting. Remember, your business plan shouldn’t just be a document you put together once and then file away. Use it as a tool to help you assess your progress and make good strategic decisions.

Right now, set up a monthly appointment in your calendar to look at your business as a whole:

  • Review your actual numbers against your forecast. Did performance line up with your goals?
  • If your actuals are significantly over or under your projections, look for causes.
  • Use this data to decide whether you need to make any adjustments to your strategic forecast. Or, do other changes need to be made, like cutting costs or increasing marketing?
  • Review any milestones you’d set for the month, and make sure they’ve been achieved.
  • Set some milestones with deadlines for the coming month.

You can do this review by yourself or with your co-founders. If this review feels intimidating or you find yourself avoiding it, consider working with a strategic advisor. They have the financial expertise to help you understand what the numbers are saying, and make plans accordingly.

At this point, you’re either ready to open for business or very close. Be sure to celebrate all the progress you’ve made! And hopefully, that progress has also created plenty of momentum. No matter where you are in the process now, you’ve gained some confidence that you can tackle any new learning you need to do. You’ll get better and better at your new skill set with practice. And if you make a few mistakes along the way, hey—they’re really the best teachers.

You’ve got this. Now keep going!

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3 Lessons From Recent Big Brand Fails

Through watching the stumbles of national brands, smaller businesses can learn what to do — and not do — to move up to the next level.

Opinions expressed by Entrepreneur contributors are their own.


It’s never been easier to build a brand. Right now with a little effort you can build a following on Instagram or Shopify, start selling stuff and create a nice small business for yourself. But, if you want to move things to the next level and become a real enterprise, you need to learn to market like the big guys.

Related: 3 Marketing Mistakes That Kill Tech Startups

Ironically, one of the best ways to do that is to watch what happens when they screw up. Branding failures aren’t just entertaining. By illustrating just how terrible the fallout can be if you get things wrong, they illustrate the importance of having the right principles and systems in place. Through watching the stumbles of national brands, smaller businesses can learn what to do — and not do — to move up to the next level.

Helpfully, some of America’s biggest companies have obliged with some pretty spectacular brand fails lately.

1. Amazon selling sugary cereals at Whole Foods

Like lots of other people, I was excited when Amazon bought Whole Foods. The whole premise of the deal was that the scale of Amazon would enable more people to access the quality, healthy food on offer at pricey Whole Foods. But, then recently I spoke to a few friends who reported seeing things like Honey Nut Cheerios on the shelves of their local Whole Foods.

Let me be clear: You’re not supposed to be able to buy Honey Nut Cheerios at Whole Foods. The brand experience is all about health and quality, not processed, sugar-laden junk. Opening up a premium brand to more consumers can be a great move, but that’s not what Jeff Bezos and Amazon appear to actually be doing with Whole Foods so far. Instead, they’re violating the basic promise of the Whole Foods brand, and risking diluting it beyond all recognition.

This isn’t just a temptation for behemoths like Amazon. Smaller brands face similar questions all the time as they start to grow and add new revenue streams. Is that new sponsorship or partnership actually in line with your values? Are you broadening the appeal of your brand or are you selling out? Adding new customers is great. Losing your own core identity isn’t.

Lesson: Never forget your core mission. Filter all new revenue streams and partnerships through the lens of your values.

Related: The 5 Biggest Marketing Mistakes and How to Avoid Them

2. IHOP’s half-baked IHOB stunt

I’m all for clever, disruptive marketing. Stunts can get people talking about your brand. But, not if you do them in the half-baked way IHOP recently did when it briefly changed its name to IHOB (for International House of Burgers) to highlight its new menu options.

I understand what IHOP was going for — these days lots of carb-conscious customers aren’t excited about sitting down to a giant stack of starchy pancakes and IHOP wanted to get the word out that they offer alternatives. But, its execution of the idea was just really weak. If you’re going to go and disrupt the market in a radical way, you need to go all in.

Wendy’s is a good example of a brand that succeeds. Its logo might be a sweet looking little girl, but on Twitter that little girl deals out some serious shade. It’s outrageous, hilarious and consistent.

You get that level of execution the same way you do in any other area of business — you know what you’re aiming for and then hire the right people to execute it. If you’re going for humor, bring in a stand-up comedian, for instance. Don’t rely on the same old advertising agency.

Lesson: Wishy-washy won’t get you anywhere. Go all in on your concept and make sure you hire the right people to get you there.

Related: 11 Disturbingly Offensive Ads That Landed Big Brands in Trouble

3. Starbucks’ one-day diversity training

When a national scandal erupted over a racist Starbucks barista who called the cops on two black customers who were just sitting in a store waiting for a meeting, the company actually did a lot of things right. Chairman Howard Schultz immediately came out with a strong and unequivocal statement that the company doesn’t tolerate racism. He didn’t hedge his words and he didn’t delay. Second, the company demonstrated a real commitment to change by closing its stores and missing out on a day of revenue to train its employees to avoid bias. Again, bravo.

But, the problem is that brand building isn’t about one-off gestures. It’s about creating structures to make sure you brand is executed consistently over time. A crisis is an opportunity not just to make an authentic apology but also to change the way you do things long-term. Update your website underscoring your values. Develop a crisis response plan for the future. Create new training that happens not just once but on an ongoing basis. Set up policies that nudge your customer-facing employees to always behave in ways aligned with your brand.

To the best of my knowledge, Starbucks hasn’t done any of that. Which creates a huge risk of a similar incident happening again in the future, and if it does there will be no way to rebuild a brand that’s all about community and safe spaces for people to gather.

Lesson: Responding to a crisis isn’t just about on-off gestures. The more important work is setting up an architecture that ensures problems don’t happen again in the future.



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