Like anything in life, setting goals gives us drive and determination. Without a focus or a deadline, us feeble human beings tend to drift along a never ending road of confusion and despair. By setting some well defined and realistic business goals right from the start, you will feel achievement when you have reached them and also get a clear definition of how your business is growing in line with your expectations.
You need to determine where you want your business to be in one year, two years and three years time. Hard as it is to judge, you must try and estimate the number of weddings that you think you may undertake in the first, second and third year. You must also assess where you are going to advertise and how much to allocate to this in these years, who are you going to secure funding from, how much profit you would like to achieve etc.
Below I have shown an example of some typical business goals:
Year 1
- Secure funding in line with the forecasted financial needs
- Purchase all necessary equipment
- Establish website and get it up and running
- Analyse good advertising avenues
- Build relationships with other local wedding providers
- Create 3 distinctive albums for display purposes
- Take on 10 weddings
- Enter 3 competitions for experience
- Achieve 2,000 profit
Year 2
- Take on 20 weddings and put prices up by 50%
- Employ a Digital Imaging assistant to process up weddings
- Undertake 2 wedding fayres
- Rent out own studio and start expanding portrait side of the business
- Build on relationships made with other wedding providers
- Attain LBIPP status
- Achieve a profit of 10,000
Business Plans
A thorough business plan is absolutely vital and the importance of it cannot be stressed highly enough. The business plan is not just something that must be done in order to secure funding; every business venture needs to do one. You need to sit down and construct a well thought out business plan, which details every aspect of your business. You need to do this, not only to focus your minds but it is also a requirement for grant providers and bank lenders who may not take you seriously otherwise.
It is equally important to amend the plan on a regular basis, as time progresses and priorities change. The whole purpose of the written plan is to focus your mind on the key elements and goals of your business. The very act of preparing the plan will make you take a close look at the competition; the services they provide and their pricing structures; yourself and your strengths and weaknesses. This enables you to identify any potential problem areas you may experience and turn them into positives.
You also need to identify all the financial implications and undertake a cashflow forecast. (explained later).
You can certainly guarantee that your Business plan will raise things that you had not even though of. For example, your running costs and expected expenditure and turnover as well as identifying your need for any additional funding.
By preparing a detailed Business Plan you will be aware of market trends, your business objectives and strategies, its place in the market, resources and expected cashflow. This is so vitally important, especially with a new business venture as undoubtedly you will be looking to re-invest your hard earned money back into the business. Being aware of your cashflow can save you from the potentially crippling situation where one can month you can afford that new AppleMac laptop to the next month being unable to put the fuel in your car to get you into work in the first place. The Business Plan will help you to decide what you can afford and when. Remember forewarned is forearmed!
To re-iterate, a good plan is very important:
- If you wish to apply for grant funding/bank loans, as these institutions will usually insist on seeing a well constructed and thought out plan.
- In measuring the success within your business.
- In spotting problem areas before they arise.
- In focusing on the key development areas.
The key elements to a business plan are as follows:
Company Name
Executive summary of your business
This should list the highlights from each of the other sections of the business plan so it is a good idea to leave this part until the rest of the business plan is complete. It is also necessary in this section to detail whether your company is sole trader, Limited etc. The objective of this section is to interest the reader and inform them in a concise way of the whole purpose of your business. If applying for funding, it is sometimes the only part that gets read!
Mission Statement
This is a clear and concise statement of your company's long-term mission. It should incorporate your ultimate aims and aspirations (mission) for the Company.
Products and Services
This section should detail how you are going to brand your company and its products. Are you going to undertake weddings solely or are you planning to offer portraits, commercial etc. You also need to think about and detail which market you are aiming at (eg. low end, high end). You should detail when you started trading, any history (eg. was it an acquired business), and plans for the future etc. Also detail the service you intend to deliver to clientele and how that compares with competition. Do not get tied up with technical jargon - keep it simple because those reading it may not appreciate the industry you are in but still need to be able to understand the concepts.
Sales and Marketing
This section is vitally important and time and effort needs to be put into this area to ensure your business succeeds. You need to think about:
Where to position your business in the market place (eg. top end quality, low end volume etc.) Pricing of your products - this is one of the most important and difficult decisions as you need to set your prices at the right level to be profitable.
You need to analyse competition to see what they offer and what they charge and then establish your own niche. If you charge more, there must be tangible reasons for a customer wanting to pay more for your product or service.
Advertising - it is important to identify the most effective routes for promoting and advertising your products or services i.e. how are you going to reach your potential customers in a cost effective manner and how are you going to monitor the effectiveness of your advertising. Also which mediums do you intend to use for your advertising; is this via websites, editorial, social media sites such as Facebook/MySpace/Twitter, YouTube, adverts in magazine/newspapers, shop windows, wedding fayres, emails, posted fliers and brochures etc.
It is important to identify on the business plan why people would choose your product at that price and why it is different to competition (eg. quality, price, unique, extra benefits or add ons etc).
The Team
Even though initially you may be starting off on your own, due to financial limitations, you will eventually need some help. You need to establish what personnel requirements will be needed and at what stage. You also need to identify skills they will need to possess and any weakness areas that they may need training up in.
Business Premises and Equipment
More often than not, it is best to start your business from home as this keeps your overheads down. This section should detail where the business operates from (home or otherwise), advantages and disadvantages of its location, leased or owned and for how long, equipment bought or investment needed. Also, IT facilities, outsourcing necessary, management and accounting systems required to control the business and any plans for the future to improve in these areas.
Strengths Weaknesses Opportunities and Threats
This is referred to as SWOT analysis and is a useful exercise in analysing exactly what it states: Strengths and Weaknesses, Opportunities and Threats. It is useful to divide a piece of paper into 4 areas and construct a list in each section. Think carefully about all your strengths, weaknesses, opportunities and threats and your goal is eventually turn your weaknesses into strengths.
A few examples:
Strengths:
- Excellent location with potentially an elite client base
- Qualified member of BIPP
- Excellent photography skills
Weaknesses:
- No helper - have to juggle the photography as well as marketing, accounts etc
- Photoshop skills need enhancing
- Not very experienced with Sales & Marketing
Opportunities
- Some lovely wedding venues surrounding us
- Many wedding companies I can affiliate with
Threats
- A lot of photographers after the same business
Competition
Even though competition is included in the Sales and Marketing section, it is a worthwhile exercise to establish the names, locations, prices, products and services, selling tactics of all your main competitors in your niche - basically find out everything you possibly can about them. Ring them up and pretend to be a customer wanting their services. This will give you a real sense of where you are at in the market place and what you can offer that they do not as well as how to sell yourself against them. This is an ongoing process throughout the life of the business.
Goals & Objectives - One and Five-year goals
A written statement of where you see yourself in one years time as well as in five years time, in both financial terms and in market share. Visualisation of where you want to be is the key to success and drives you forward.
