A young woman considers the contents of a piece of paper as she sits in front of a laptop.
There are a lot of questions to ask yourself and others when you're starting a business. One of the biggest questions is that of feasibility. — Getty Images/fizkes

In our Startup2021 series, we're helping aspiring entrepreneurs navigate the new business climate of the COVID-19 era. Each week, we'll share an in-depth look at one step you can to take toward launching your business in 2021.

So, you have your business idea, you've researched it and you've conducted a competitor analysis—now what? Starting a business takes time and effort from the very beginning, even before you open your doors. It's time to collect information and feedback so you can develop a plan accordingly and set yourself up for future success. Here’s how to do it.

[Read more: SWOT Analysis: What It Is and How to Do It]

Test your business idea

Testing your business idea before launching your company will help mitigate potential risks. After you develop a basic business plan, testing your idea will bring you closer to your ideal market and give you a good idea of how and why you’re selling it.

First, you must analyze your competition by determining who your competitors are and how their products or services differ from yours. This will tell you what sets you apart from others in your industry or market.

The next step is to talk to family, friends and potential customers for feedback on your business idea, then implement their advice in your business model.

Finally, put your business on a crowdfunding website. Whether it’s Kickstarter, Indiegogo or another popular site, find one that best supports your work to measure how much interest there is in your idea. Launch the campaign on social media and promote it to your family and friends so that there’s a wide outreach.

When writing your company description, ask yourself: What problem does my company solve?

Create your business plan accordingly

After you do some market research and have a general idea of what your audience is looking for, it’s time to create a more detailed business plan. A strong business plan includes why you’re passionate about your company and exactly why you believe it will succeed.

[Read more: 7 Common Business Plan Mistakes]

Executive summary

The first step to creating your business plan is writing an executive summary, which explains the purpose of your company. The summary also includes a mission statement that relays your company’s main message. Additionally, an executive summary should provide some basic financial information and overview of you, your team and company facts.

Market summary

The next part of your business plan should include a market summary where you’ll clearly define and show an understanding of your target audience. You’ll also need to establish why your idea is better than your competition.

A few questions to ask yourself include:

  • What problems does my service or product provide solutions to?
  • Who is my target audience or ideal client?
  • Is it realistic for my idea to retain revenue?

In your market summary, you’ll also include industry-related trends and themes, a description and size of your target market, pricing targets, industry risks and key personnel. It also may help your business plan to have a five-year projected revenue to focus on growth within the company.

Company description

When writing your company description, ask yourself: What problem does my company solve? This will give you a greater advantage over competitors while expressing your passion for the company. An organization and management section will show exactly how your company is laid out and should include an organizational chart, resumes and the legal structure of your business.

Marketing and sales

Your business plan should also include a marketing and sales section where you’ll brainstorm how to advertise, how and when you’ll introduce new products or services and what can be considered as potential new territories for your company to enter. Your marketing and sales section will grow as you gain more market research.

Financial reports

The next section of your business plan is your financial section where you’ll compile all your current financial data and data from the last three years as well as the company’s debts and a five-year forecast of expenses and earnings. You will also include financial information about your actual product or service line, going into detail about how your product impacts the bottom line.

Appendix

Finally, the appendix of your business plan will have any supporting documents, such as permits, product photos, ideas, credit histories or resumes.

Stay tuned for our next Startup2021 article.

CO— aims to bring you inspiration from leading respected experts. However, before making any business decision, you should consult a professional who can advise you based on your individual situation.

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Watch the replay from our latest Roadmap for Rebuilding event, where the panel discusses ways to expand your customer base into new markets and use technology to grow.



Published January 04, 2021