Introduction
Customer research is needed to determine what customers want from what they say. Small businesses need to conduct market research to study the marketplace and prospective customers using either formal or informal methods, depending on the organization. Understanding this is helpful to the business, and it is important to consider cultures since target markets may vary depending on a community. Through marketing research, a business can obtain relevant information needed for decision-making. Preparing a business plan is also very important when starting a business since it helps entrepreneurs to realize both short- and long-term goals while focusing on making the business idea thrive. Writing a business plan enables one to raise money for investment, make sound decisions, help in identifying any possible weaknesses and communicate ideas to stakeholders. Small businesses have a specific nature in their marketing research and are required to prepare a business plan to overcome the challenges of starting the business.
Product Description and Distribution
Product description in a business plan helps explain the product that a business sells with reasons why it needs to buy it. This supplies customers with the information needed concerning the features of the product together with its usefulness, thus compelling them to buy (Gonzalez, 2017). In the Chocolate Chip Cookie business, the product is cookies that are of high quality. They will contain ten chocolate chips in each, making them superior to those from competitors. Product distribution involves dispersing the product to make it available for purchase in the market, thereby playing a key role in business sales (Gill et al., 2018). The cookies can be shipped all over Canada and the United States. In Chocolate Chip, they will be made near campus in the kitchen of a friend’s apartment and be sold fresh to college students.
Product Differentiation and Competition
Products in Chocolate Chip will be differentiated to ensure they stand out in the market and survive the competition. The cookie will have ten chocolate chips that distinguish it from what competitors have, making it superior since this feature is irresistible to the target market. The product will be delivered fresh since it is made from fresh ingredients and will be sold at an affordable price. This will boost sales, increase customer loyalty and result in profits and growth in the business.
Marketing, Sales, and Pricing
Pricing helps determine the value obtained from the exchange of products by an entrepreneur, and it involves setting the price. The price set for cookies is $1 each or $10 a dozen, thus affordable enough for college students; therefore, the business will have increased sales that help realize huge returns (Turner & Endres, 2017). Chocolate Chip business will use advertising to market by placing ads about the product in the college newspaper. This will help in launching the product into the market, and consumers will be aware of its availability, thus increasing demand that leads to increased sales even though there are six bakeries within the college.
Revenue Projection & Financials
Including revenue projections in a business plan helps in estimating incomes for the business (Carroll, 2018). Chocolate Chip is projected to have sales of $6000 in its first year of operation with a net income of $1500. Selling this product will be the primary source of revenue since I will bake and sell cookies to college students. The finances required to commence the business are $600, and after that, an expense of $100 will be incurred weekly for the vice president’s salary.
Conclusion
Preparing a business plan is important when starting a business since it enables entrepreneurs to outline their goals and keep track of the progress in the process of growth. This acts as a roadmap to reducing the chances of getting lost by providing guidance. Formulating a plan enables one to identify the target audience, their needs, and how to differentiate products from competitors. One can also gauge their skills in making the business a success and how money for starting the business will be raised.
References
Carroll, K. R. (2018). Business Plans in minority-owned businesses: Examining the impact of business plans (Doctoral dissertation, Capella University).
Gill, A., Dana, L. P., & Obradovich, J. D. (2018). Financial risk management and financial performance of new small business ventures: Evidence from Indian Survey Data. Journal for International Business and Entrepreneurship Development, 11(2), 75-95. Web.
Gonzalez, G. (2017). Startup business plans: Do academic researchers and expert practi-tioners still disagree. Muma Business Review, 1(15), 189-196. Web.
Turner, S., & Endres, A. (2017). Strategies for enhancing small business owners’ success rates. International Journal of Applied Management and Technology, 16(1), 3-4. Web.