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Business Plan 101: Sales & Marketing
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The sales and marketing section of your business plan is especially crucial because it determines how you’ll plan on generating profit and describes how you intend to create exposure to best sell your product. It’s in this area of your business plan that you’ll hone the key elements of your marketing strategy. The actual implementation of your sales and marketing initiatives actually occurs before you launch, when you’ve set your go-to-market date so strategize the components of your sales and marketing plan early on. Here’s a quick guide on what your key sales and marketing considerations should be:

This section should contain the following elements and should be no more than four pages.

  • Unique Value Proposition
  • Pricing Strategy
  • Sales/Distribution Plan
  • Marketing Plan
  • Budget

Unique Value Proposition

Your unique value proposition is what market need you’re planning to solve. Think of it as your secret ingredient – your “special sauce.” This may be a combination of factors including customer service, technology, or a twist on a product or service, or just one of those. Create the case for why your product deserves to have a sustainable business built around it.

Pricing Strategy

Determine your pricing scheme. First, check what your competition is charging. This should give you an indication of what customers are willing to spend. Then, determine how you can add value. Until you get your product out there, it’s hard to know for sure how much your added benefit is worth in the customer’s mind. The key word here is “reasonable.” You can charge any price you want to, but for every product or service there’s a limit to how much the consumer is willing to pay.

Remember, even if you’re trying to be the lowest-cost provider, give a higher perceived value to your ideal customer to stand apart from the competition. Competitors can slash their prices to meet or beat yours, so be very careful if you decide to compete on cost.

Sales & Distribution Plan

This section describes how you intend to get your product to customers and how you’ll measure the effectiveness of those methods. For example, once you figure out where you’ll be selling your product – online, at a retail outlet, door-to-door – determine the type of sales team you’ll need and how you’ll compensate them.

In terms of distribution, think about how you’ll actually get the product or service into the hands of the customer. Ultimately, you’ll want to sell your product or service in as many ways as make sense for your company: online, at a retail outlet, via house parties or mail order, or through other companies. Initially, however, focus on selling through just one of these channels so you can build your business before comfortably extending to others.

Marketing Plan

You’re going to need customers to buy your product. How do you plan to get them? There are many free or low-cost strategies such as referrals, word-of-mouth, public relations, and marketing partners to help cross-promote or sell your product, so I would avoid any expensive print, TV, or radio advertising campaigns at these early stages. Create your strategy for attracting customers.

Before you start actually executing on your marketing strategy, however, think about “branding.” This is the look and feel of your business, what customers experience when interacting with it, from the fonts, colors, and text of the website and your business cards to the overall image you portray in the product itself. This branding will be reflected in the execution of your marketing strategy.

Describe how you want customers to experience your product or service. Take a look at products or companies that you really like, and think about why you like them. What makes you feel good about them? Do these characteristics permeate all aspects of the product, from website to packaging to letterhead?

Budget

After you document the marketing plan activities, calculate the costs that you expect to incur. For example, if referrals are part of the strategy, then calculate how much you’re willing to pay a referral partner for each new customer they bring your way. Will it be $1, $20, $50, or more? Let’s say, for example, you expect a referral partner to refer 100 clients to you, and each of those referred clients spends $10, giving you a total of $1,000. You’ve agreed to pay this partner $1 for each referral, so you’ll spend $100 on referrals for your marketing strategy. In this example, your cost of acquisition – the cost you pay for each new customer – is $1. You’ll need to know this number, especially when you draft your financial plan.

Bryan JaneczkoFounder, Wicked Start
Bryan has successfully launched multiple startups. His latest venture, Wicked Start, provides tools to plan, fund, and launch a new business. Also author of WickedStart: Guide to Starting a New Venture with Passion and Purpose, Bryan is committed to helping small businesses grow and succeed.
www.wickedstart.com | Facebook | @WickedStart | LinkedIn | More from Bryan

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Discussion (2) Comment


  1. NeilAdvaniVisitor

    Hi,
    You have written quality article. I agree with you as I am business man in California. after reading this, I am remembering one thing that is “quality is not an act, but it’s a habit”. Every business man should follow this article. Thanks and keep it up.


  2. Colin DawsonVisitor

    After reading this article, I must say that you have included a lot of rewarding information. I believe that creating a business plan is integral to the progression and success of that business. Years ago, when I opened my catering business, I didn’t have a clue on how to create or implement a business plan. So I did a little research for an online business planning tool that will guide me every step of the way. And thankfully, I came across a great online planning tool called PlanAnything. It is an online planning tool that guides you through every stage of a business plan, whilst providing you with guidance information, examples and other online resources that can help you. It made my business planning process ten times easier to complete and massively reduced the time it took to complete. I couldn’t recommend it anymore, visit http://www.plananything.com and check it out for yourself, I’m sure you won’t be disappointed.

 

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