You can bore your reader to tears with pages of graphs and charts showing the worldwide consumption of a product or service if this isn’t directly related to what you do and where you sell. The reader of your plan wants a clear understanding of how goods and services are produced, packaged, transported, sold and consumed within that market space that you will operate in. If your product or service deviates from this normal routine, or is being offered into a new space, the reader wants to understand how the consumer will react. You can start out with a broad overview of the industry, but you have to also drill down to the target market you are seeking to satisfy.
Don’t take the reader’s understanding of your market place for granted. Their knowledge level may be very high, or nonexistent depending on their experience. It’s important that you paint a verbal picture of how the consumer buys, uses and maybe even disposes of your product or service. As noted in the opening paragraphs of this guide people purchase goods or service for the benefit they derive from their consumption, but that benefit may change over time. Conveying an understanding of the consumers’ motivation now and into the future and being able to clearly articulating this to the reader is a critical exercise.
Every marketplace undergoes continual change, adaptation and renewal. Consumer preferences change with new advances in technology, the influence of competitor advertising programs and even the simple whims of a consumer following a new trendier concept. The reader of your plan may or may not be aware of the current trends within your market space. They may have outdated, or even erroneous ideas of how the consumers in your space act and react. It is important to convince the reader that your view of the market is correct and that you have the solution to satisfy the customer. You will also need to back these claim with solid market research.
Outlook for the future
Changes in technology
Every industry is impacted by the rapid changes in technology. Sometimes these changes are a boost to the business allowing customers to find them and make purchases. Other times the impact of global competitors is difficult to match. Business people find it hard to stay abreast of the latest technology adaptation and lose market share to a new entrants. How you adapt to the changing landscape is important.
Every competitor in your market space is trying to adapt, modify and/or change to gain market share. It is not enough to know what they are doing right now, but to anticipate what they are likely to do in the future. You may not even know the competitor of the future that is invading your market, but you must be willing and able to anticipate their advances and thwart them with countermeasures of your own.
Rules, regulation and legislation
Local, state, and national leaders at all levels can have an impact on your business by adopting new requirements for your industry. New regulations are often passed without realizing the regulatory burden they place on the business owner. It’s difficult to be on top of every detail, but it behooves the entrepreneur to be on the watch for changes coming down the pipe. The reader of your plan will be very skeptical of your knowledge if they have read or heard of new advances in this area and you didn’t address them in the business plan.