Part 4: Starting Your Own Business.
There are many types of businesses, some of them overlapping and interlinking, and as a generalist, I have met with an interesting variety of clients. My following list gives readers an idea of this diversity, and is by no means rigid or comprehensive.
- We have what I call the service industry, which covers a multitude of businesses, such as hairdressing, beauty, massage, mind body and spirit, catering, security, tailoring, property management, gardening, handyman.
- The creative industries include art, leather-work, fashion design, jewellery design, even computer games, music, film, entertainment, the media, writing/journalism, inventions / innovations (Dragon’s Den-type ideas)
- Often combined with the creative industries is manufacturing, which takes a multitude of forms.
- Retail – the selling of goods through, for example, shops, on-line, markets, auctions.
- Even not-for-profit or charitable organisations, and social enterprises.
Every business would benefit from prior thought, and although the details may differ, the basic groundwork of a plan can be applied to all.
Over the course of this series, to help readers better to identify with the concepts of the business plan, I will include stories from various types of businesses. I have changed the names and some facts, to protect my clients.
The leather worker
John arrives bursting with an idea, and he can’t wait to start. He has a feel for leather, and has learned the art from a late friend of his father, who passed on his tools to John. He has made a few trinkets and given his girlfriend a dangly love-heart. He has looked at some magazines, and surfed the internet. He’s even tried some leather upholstery work, and gained the interest of a vintage car enthusiast.
John wants to start a proper business. His family are encouraging him to sell his creations, but he’s not sure how to go about it.
No – he’s never heard of a business plan, and wonders if it is even necessary? All he wants to know is when he can start, and what are the legal requirements. Also, he might need some funding, because although he has about a dozen items, he will soon run out of materials, and he cannot rely on his parents forever. He and his partner want to move into a place of their own.
I settle into my introductory spiel.
- A business plan is dynamic; it never ends; it should be revisited at least once a year, and can be tweaked and made to change direction at any time.
- The bare template I have devised has a certain structure, and is, of necessity, laid out in a set of numbered points. But you can go about it in any order you please.
I hand John a double-sided sheet of paper.
This template is the bare bones of a business plan, I tell him. (I will include it at the end of the series).
I have found that the best way to start is by discussing the services offered, or – in John’s case – the goods he wants to sell. This is item number 4 on my business plan template.
In about 5-6 sentences, provide an overview of the major points of your business, including the goods / services you intend to offer
Also at this stage, I touch upon a concept unfamiliar to John: who does he want to sell them to: who are his customers?
Marketing is item number 10 on my plan.
YOUR MARKETING PLAN
How do you intend to advertise/promote your products/services to your customers? What is your USP (Unique Selling Point)? Consider all the possible media. Consider how material will be distributed.
I ask John about his leather work:
Little trinkets, he says.
But exactly what are they?
- Can he show me some; has he made a portfolio? John eagerly gives me the URL of his website. It is in its infancy, and only three items are displayed. Has he built it himself? Yes – but there’s a long way to go.
- Has he looked at other websites? Not really. He knows what he wants. Perhaps it would be advisable to study the websites of other leather-workers, I suggest. He might get some ideas.
- Who is going to buy his goods? The answer is a look of disbelief on his face that I should ask such a question – anybody and everybody, of course.
I need to focus him on the exact nature of each separate type of item, and identify the precise market.
- A love-heart – who would buy one? Easy: young lovers. So, it would be a waste of time trying to sell to middle-aged happily married couples. Except, of course, perhaps on Valentine’s Day.
- Key-rings – he could produce bespoke patterns for business promotions, if he found the right market: yes – corporations!
But he would hardly make a living by selling such inexpensive trinkets, unless he can manufacture them in bulk. And he is a craftsman, who likes to work on original, bespoke items.
- Another thing he’s done, he tells me proudly, is re-upholster an antique chair for the Royal Shakespeare Company. I am overcome with admiration: what a unique niche market! And I hope that it is not just a one-off, and that he’s charged them correctly. John pulls a face, and I understand that he was so bowled over by the opportunity that he accepted their first offer. Everybody does it; but the sooner John learns how to research and evaluate his worth, the better. However, he has a picture of the finished chair in pride of place on his website.
- He’s started repairing and renewing leatherwork on a vintage car collection, owned by a local enthusiast. Another excellent opening, I tell him. But the collector provides all the materials, and only pays John a minimal hourly fee for his services. By this time, John knows what I’m thinking. He’s not an apprentice anymore. He would be better off sourcing the leather himself, and factoring in his expertise for the final charge.
This will come – given time, knowledge of his own worth, and the self-confidence to be able to stand up for himself.
The most effective way to achieve this goal, is by thorough RESEARCH!
John does not want to reinvent the wheel, he needs to learn from other people’s mistakes.
Look out for the next instalment in two weeks’ time!
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