My Plan for a Business Plan

[Pita]

I joined this forum a few weeks ago. I have spent many hours reading the interesting posts on this here - some stretching back years - to be a better informed poster before I started asking questions. All good stuff!

I have developed a new product as an accessory for consumer electronics, specifically for laptop and tablet computers. I don't want to divulge the product yet because I am going through the patent process at the moment. For the sake of the discussion let's just say it's a new kind of computer case.

I've spent a lot of time thinking about the product design, materials, potential producers, packaging, sales and distribution processes, who to market to, etc. I've talked to the local University business outreach center and their standard response for start-up support is to send me a B-Plan template and tell me to complete it and when finished come back to see them. I think this is fine if I were starting a restaurant or convenience store, but I don't see it as being helpful for a company that is developing, producing and marketing its own products.

I've worked in the corporate world and the military for a number of years, and one of my pet peeves is to generate paperwork just for the sake of generating paperwork. I don't intent to go to a bank or to investors to get a loan for this business for now so I don't see any value in completing some of the standard sections of a traditional B-plan.

So my plan is to create a different plan, but one that serves my priorities for the business. I will be starting the business from a spare bedroom for now so I won't have B&M overhead or HR issues to contend with. The focus of my plan will be on the steps and timeline I will need to follow to develop and market my product. In this plan I will flesh out:
1. Proposed marketing channels, such as retail stores, internet, Amazon, Ebay, Wholesalers/Distributors, Tradeshows, etc. and how to reach them
2. Identifying contract manufactures
3. Protecting the product (patent)
4. Packaging, Trademarks, Logo, Branding
5. Website development
6. Sales fulfillment and distribution
7. Acquiring business support systems, such as QuickBooks and/or inventory tracking software.

These are the high-level topics. Is this a sound approach? Am I missing anything? What else should I be considering when introducing a new product.

Thanks,
Pita

[Fulcrum]

I wouldn't rule out including overhead costs for out of home workspace. Yes, you are making assumptions and educated guesses, but no one reading the report wants to see that you haven't accounted for them.

[GoldenGateTradingPost]

3 things I like to see:

1. Who is going to buy from you
2. Why are they going to buy ("at all", if there are no alternative products, OR "from you specifically", if there are alternative products)
3. How do you know they're going to buy from you

Answers should be very specific and based on data.

Best of luck to you :)

[tallen]

I second what GoldenGate says,

You need to think about who your customers ultimately are, what problem you are solving for them, and why they should buy your solution -- what is your unique selling proposition.... Doesn't matter whether you are a restaurant, convenience store, or product developer/marketer.

I also agree with Fulcrum, you need to consider all of your costs (including the costs that you can claim on your taxes for use of your home office).

Finally, I wouldn't discount the local University business outreach center -- they want you to supply a business plan so that they can understand your business in total, and in terms that are familiar, so that they have something to talk with you about. No, you don't necessarily have to follow the standard template, but you should give at least some consideration to all of the sections included there, even if it is only to say that that section doesn't apply to you at the moment (and why). Sure, you are not going to a bank or investor now, but you are going to the business outreach center for advice, which may be just as valuable as the loan or investment.

[Pita]

Thanks for the replies everyone. I really appreciate you thoughts.

I'm fanatical about tracking costs already and have a good accountant who I will rely on to help with the finances of my venture. When the time comes I'll work with him to ensure I've accounted for all of the business expenses.

I'm not discounting the university business outreach center. I plan to go back to them again soon as they also have a veterans business center as well which I can leverage (this is a big military town). I am also looking for other networking opportunities locally to meet other business owners, not so much to generate leads, but to get outside of my little 8-5 world and to expand my business horizons. I'm a big fan of learning from others who have gone before me, which is one reason I have spent so much time reading the posts on this forum.

The question of "who is my customer" is a challenging one and I'm not sure how to define that. The simple answer is anyone who purchases a laptop or tablet computer, but I know there are subsets to that segment. At this point I don't know if it is necessary to drill deeper into that question? If you look at computer case products on the market today in retail stores I'm not sure if they are focused on a narrower customer segment, or are the manufactures simply identifying their target customers as anyone who wants to protect their computer, which can be a very broad segment of the market.

As for the plan itself, I know if/when I decided to publish a B-plan for external consumption by a bank or investor I will have to define the formal segments of the plan, but I think for now if I can use my plan as a tool, or a Plan of Action and Milestones (POA&M, as it's commonly referred to on a military staff) for developing my business it will be a better use of my time rather than laboring over a formal "term paper" that may never be read.

[GoldenGateTradingPost]

I assume there is some identifiable subset of laptop / tablet owners who will benefit more from your product than others. If so, they're your target market. Have you done any test marketing to validate demand for your product, among any segment, or laptop / tablet owners in general?

[Pita]

Thanks for your thoughts, GoldenGate.

I think that people who travel or commute with their laptop or tablet is the target market. This would include business people, college students, or any others who take their machines with them. It's difficult to really segment these people, other that to have different marketing campaigns directed for each area.

I haven't test marketed the product yet. I did create a prototype and used it personally for two years and it worked very well. I have refined the design and am having further prototypes made to see how they will work My first one should arrive early next week.

I'm not sure how to do test a marketing campaign on the product. I have shown it to friends and colleagues and everyone likes the idea. My thoughts are for test marketing is to present the product a few local computer stores. If there is interest from the owners I'll do a production run and see how they sell. I will lose on economies of scale for a limited run, but at least this way I'm not too heavily into production costs up-front.

I also have some ideas for retail packaging, but I don't want to go all-out on a packaging design that can compete with the big computer accessory companies in the Big Box stores just yet because of the costs involved in designing and creating the package. I think I can get by initially with some good quality, but less expensive packaging for the local market.

Does anyone have any other suggestions for ways to test market a computer accessories product?