Welcome to the Business adVentures project! Through this

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Welcome to the Business adVentures project! Through this

project you will create your own small business and sell your

products or services. What can you sell? That is completely

up to you! If you want to sell your own products think of

something that you do well, and sell it! It might be sewing,

photography, welding, baking, crafting or anything else you

can imagine. Of course you do not have to sell your own

products. Think of a product already out there, and consider

marketing it in our area. Another opportunity is to sell a

service, such as snow shoveling, firewood cutting & delivery,

lawn mowing, etc. Whatever you decide to sell, it will be a

great adventure with a lot of learning along the way!

Thoughts as you begin…

-NXLevel Guide for Entrepreneurs

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Businesses succeed because they: Have a clear sense of purpose Base their goals on realistic expectations Understand their strengths and weaknesses relative to those of their competitors Target the right group of customers Specialize in solving customer problems, and experiment with new approaches Are organized for maximum flexibility Create customer loyalty and repeat business by offering a unique value Build enduring relationships based on quality, honesty, and responsiveness Develop a new product or service that captures a large market share Keep a close eye on costs, pricing, and profit

Choosing a NameThe first step in establishing a brand is usually taken – sometimes unwittingly – when the owner chooses a name for his or her product. What makes a good name?

It should suggest benefits (e.g., Sunkist, Mr. Clean, or Beautyrest mattresses) It should fit the brand image: Nissan Pathfinder (adventure), Round Table Pizza (cozy

food for friends and families), Ding Dongs (silly, playful food for kids) It should be easy to pronounce and recognize It should not be previously registered with another company

NxLevel Tech TipsThere are many websites devoted to entrepreneurship. Here are a couple that provide a wealth of information:

www.entrepreneur.com www.sstartup.wsj.com

http://www.sstartup.wsj.com/

http://www.entrepreneur.com/

2006-2007 Business Plan

Name of Business:

Address:

Telephone:

Email:

Website:

Owner(s):

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THE BUSINESS PLAN – Description of the Business

Section 1: Business Description

Business Form:

Proprietorship (One owner)

Partnership (Two or more owners)

Corporations (Incorporated business)

Business Type:

Merchandising (selling product)

Manufacturing (making a product)

Services (providing a service)

--------------------------------------------------

Independent Business

Takeover (taking over a business already in operation)

Expansion (expanding existing business)

Franchise (bought rights to use name and concepts of an established business)

What channels of distribution will you use?

Vendor at event

Online

o Own website

o eBay

o Other

Advertising

Consign to store

Other_________________

Goals & Objectives:

Describe why the business will be profitable and any opportunities for growth:

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Section 2: Product/Service

Short description of product or service:

List reasons that your product(s)/service will benefit your customers:

What is unique and/or different about your product(s)/services?

Section 3: The Location

Items you will need for your business sale display:

Product(s)

Information on services (posters, brochures, flyers)

Table cover

Poster or sign with name of business

Business cards

Electricity

Lighting

Music player and music

Stands, boxes, containers on which to display products

___________________________________________________________

___________________________________________________________

___________________________________________________________

___________________________________________________________

___________________________________________________________

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Items you will need if marketing product online:

Computer

Internet access

Digital Camera

Scanner

___________________________________________________________

___________________________________________________________

___________________________________________________________

___________________________________________________________

___________________________________________________________

Other items you will need for the business sale(s):

Business fee

Container for money

Change

Receipts

Accounting worksheets

Bags or wrappings for products

Price tags/signs

Camera

___________________________________________________________

___________________________________________________________

___________________________________________________________

___________________________________________________________

___________________________________________________________

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THE BUSINESS PLAN – The Marketing Plan

I. MARKET ANALYSIS

Target Market – Who are your customers?

A. We will be selling primarily to (check all that apply and indicate total percent of business):

Private Sector ____%

Wholesalers ____%

Retailers ____%

Government ____%

Other ___________________ ____%

Competition

A. Who are your competitors?

Name:

Location:

Price/Strategy:

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Internet Auction Sites for Test Marketing

With the success of Internet auction firms like eBay and Amazon.com, some entrepreneurs are

test marketing their products at auctions in order to see what people are willing to pay, and

how buyers react to their products. You can sell the same item over and over again at an

auction site, varying the pictures, opening bid, and description: this may tell you which

marketing messages get the most response, and which prices are seen as reasonable. This is

an inexpensive means of collecting feedback and gauging your customers willingness to pay,

and unlike many other marketing strategies, it can bring in money while you’re doing it! The

drawback? It can be hard to find rhyme or reason in buying patterns at Internet auctions, and

the information you gain can seem meaningless in the absence of any solid grounds for

comparison with your target population. Still, if you find that every time your offer your product

at an auction, it sells for at least 10% more than your tentative retail price, it’s a good indication

that you can afford to raise your price!


Product/Service Features:

Name:

Location:

Price/Strategy:


Name:

Location:

Price/Strategy:


B. How competitive is the market?

High

Medium

Low

C. List below the strengths and weaknesses of your business as compared to your

competition (consider such areas as location, personnel, service, etc):

Strengths Weaknesses

1. 1.

2. 2.

3. 3.

4. 4.

II. PRODUCT OR SERVICE ANALYSIS

A. Comparison

1. What advantages does your product/service have over those of the competition?

Consider such things as unique features, expertise, special training, pricing, etc.).

2. What disadvantages does it have?

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B. Some Considerations

1. Where will you get your materials and supplies?

2. List other considerations:

III. MARKETING STRATEGIES – MARKET MIX

A. Image – What kind of image do you want to have (cheap but good, exclusive, customer-

oriented, highest quality, convenience, speed, etc.)?

B. Features – List the features you will emphasize:

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C. Pricing

1. We will use the following pricing strategy:

Markup on cost ______% Markup

Suggested price $_____

--------------------------------------------------------

Competitive

Below competition

Premium price

Other________________

2. Are our prices in line with our image? Yes __ No __

3. Do our prices cover costs and leave a margin of profit? Yes __ No __

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Common Pricing Errors Basing price on current, artificially low overhead

costs instead of anticipating how overhead might rise over time.

Assuming that because you are the newest competitor on the block, you must have the lowest prices.

Trying to compete head to head on price with larger competitors. Try instead to offer higher quality, or more attentive service.

Basing prices on manufacturing costs instead of the value of your producers to consumers, which may be quite a bit higher!

Failing to include in the price an allowance for warranty costs, future services, research and development costs, cost of capital, dealer discounts, and sales commissions.

Ignoring the way customer demand for the product will change at difference price levels. Would sales volume increase if you lowered prices by 10 or 20 percent?

Failing to use some form of marketing skimming, in which you enter a marker with a high price until you have satisfied demand or attracted competitors, then lower the price gradually.


Typical Variable Costs Inputs and supplies Overtime wages Depreciation on equipment Sales commissions


Typical Fixed Costs Salaries and wages Vehicle leases and

maintenance Office equipment Marketing expenses Rent Utilities Payroll taxes Office supplies Machinery and

equipment Land Insurance


D. Customer Service

1. List the customer services we

provide:

a. ___________________________________________________________

b. ___________________________________________________________

c. ___________________________________________________________

2. These are our sales/credit terms:

a. ___________________________________________________________

b. ___________________________________________________________

c. ___________________________________________________________

3. The competition offers the following services:

a. ___________________________________________________________

b. ___________________________________________________________

c. ___________________________________________________________

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E. Advertising/Promotion1. These are the things we wish to say about the business:

a. ___________________________________________________________

b. ___________________________________________________________

c. ___________________________________________________________

2. We will use the following advertising/promotion sources:

Television

Radio

Direct mail

Posters/flyers

Signage on streets

Sidewalk chalked

Personal contacts

o Phone

o Email

o Door to door

Trade associations

Newspaper

Magazines

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Customer Service Tricks Know and greet your customers by name! Compile a customer database with (at least) each customer’s name, birthday, special

requests, and usual purchases. Offer free or low-priced delivery. Set up a fax and phone help/information number. Create a “frequent customer” program, with rewards for repeat purchases. Create a colorful, brief, informative customer newsletter. Attach helpful tips and tailored promotional messages to invoices. Have convenient, flexible hours that fit your customers’ schedules. Offer free, convenient parking. Give away free samples. Send birthday greetings and offer birthday discounts. Offer free demonstrations and installations.


Yellow Pages

Billboard

Other ________________________________________________

Other ________________________________________________

3. The following are the reasons why we consider the media we have chosen to be the

most effective:

a. ___________________________________________________________

b. ___________________________________________________________

c. ___________________________________________________________

THE BUSINESS PLAN – The Management Plan

1. How does your background/business experience help you in this business?

2. What strengths do you posses for this business and how will they benefit you?

3. What are your weaknesses and how can you compensate for them?

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4. Who will be on the management team?

5. What are their strengths/weaknesses?

6. What are their duties?

7. What are your current personnel needs?

8. What are your plans for hiring and training personnel?

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9. What salaries, benefits, vacations and holidays will you offer?

10.What benefits, if any, can you afford at this point?

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_____________________________ For the Period _______ to _______ (Your Company Name)

2006-2007 Financial Documents

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INVENTORYDATE MADE/ PURCHASED

DATE SOLD ITEM DESCRIPTION COST

SALES PRICE

GROSS PROFIT

List all your products on this page. Add more pages if needed._____________________________ For the Period _______ to _______

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(Your Company Name)

INCOME STATEMENT

Revenue (Income) + $

Less

Cost of Goods Sold/Services Provided - $

Equals

Gross Profit = $

Less

General & Administrative Expenses - $

Equals

PROFIT OR LOSS = $

PROFIT MARGIN

Profit $

Divided by

Number of Items Produced /

Equals

Profit Margin = $

_____________________________ For the Period _______ to _______

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(Your Company Name) REVENUE (INCOME)

DATE ITEM/SERVICEPRICE EACH QUANTITY TOTAL

TOTAL REVENUE

List all your receipts on this page. Add more pages if needed._____________________________ For the Period _______ to _______

(Your Company Name)

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COST OF GOODS SOLD PAGE 1 OF 2

DATE VENDOR/DESCRIPTIONAMOUNT

PAID NOTES

TOTAL COST OF GOODS SOLD

List all the costs involved in making/purchasing the product/service you sell. Add more pages if need.


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COST OF GOODS SOLD PAGE 2 OF 2

Total Cost of Goods Sold $

Divided by

Number of Units Produced /

Equals

Cost Per Unit = $

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_____________________________ For the Period _______ to _______ (Your Company Name) GENERAL ADMINISTRATIVE EXPENSES

DATE VENDOR/DESCRIPTIONAMOUNT

PAID NOTES

TOTAL EXPENSES

List all your other expenses on this page. Add more pages if needed.

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CASH SHORT/OVER

Beginning Cash $ (Record how much change you have.)

CASH SHORT/OVER CALCULATIONS

Cash at End of Day $ Less

Beginning Cash - $ Equals

Net Cash Receipts = $

LessTotal Revenue (Sales) - $

EqualsCash Short/Over** = $

** If this number is negative, you are missing money.** If this number is positive, you have extra money.

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Resources

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Information Resources

U.S. Small Business Administration (SBA)

The SBA offers an extensive selection of information on most business management topics, from how to start business to exporting your products. This information is listed in “Resource Directory for Small Business Management.” For a free copy, contact

SBAHelena District Office 10 West 15th Street Suite 1100 Helena, MT 59626Phone 406.441.1081

SBA offers a number of programs and services, including training and educational programs, consulting services, financial programs and contract assistance.

Service Corps of Retired Executives (SCORE), a national organization sponsored by SBA of over 13,000 volunteer business executives who provide free counseling, workshops and seminars to prospective and existing small business owners. Locate local offices at www.score.org

Business Information Centers (BIC’s), offering state-of-the-art technology, informational resources and on-site counseling for start-up and expanding businesses to create business, marketing and other plans, do research, and receive expert training and assistance.

Small Business Development Centers (SBDC’s), sponsored by the SBA in partnership with state and local governments, the educational community and the private sector. They provide assistance, counseling, and training to prospective and existing business people. Montana’s SBDC website is sbdc.mt.gov

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Other U.S. Government Resources

Many federal agencies offer publications of interest to small businesses. There is a nominal fee for some, but most are free. Below is a selected list of government agencies that provide publications and other services targeted to small businesses. View their websites for publications or more information.

Federal Consumer Information Center (CIC) o www.pueblo.gsa.gov/ o The CIC offers a consumer information catalog of federal publications.

U.S. Department of Treasury Internal Revenue Service (IRS)o www.irs.gov o The IRS offers information on tax requirements for small businesses.

Government Printing Office (GPO)o www.gpo.gov o Many publications on business management and other related topics are available

from the (GPO).

Consumer Product Safety Commission (CPSC)o www.cpsc.gov o The CPSC offers guidelines for product safety requirements.

U.S. Department of Laboro www.dol.gov o The DOL offers publications on compliance with labor laws.

U.S. Department of Commerce (DOC)o www.commerce.gov o DOC’s Business Assistance Center provides listings of business opportunities

available in the federal government. This service also will refer businesses to different programs and services in the DOC and other federal agencies.

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http://www.commerce.gov/

http://www.dol.gov/

http://www.cpsc.gov/

http://www.gpo.gov/

http://www.irs.gov/

http://www.pueblo.gsa.gov/

NotesNotes……ThoughtsThoughts……IdeasIdeas……DreamsDreams……GoalsGoals

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