Once you have settled on the decoration processes to offer, a business model, and a marketing strategy you will want to organize all your thoughts into a business plan. A business plan is a detailed explanation of every aspect of your business that is organized into several sections, outlining how you plan to put your business into motion. A business plan is an extremely useful document, especially when trying to obtain financing for your business. For a product decoration business, your business plan will actually help you to actualize your business. In essence, it is a step-by-step guide to starting your business.
A typical business plan is organized into approximately 10 sections: the Executive Summary, Company Overview, Industry Analysis, Customer Analysis, Competitive Analysis, Marketing Plan, Operation Plan, Management Plan, Financial Plan, and Appendix. Here is a brief explanation of each section:
Executive Summary: The executive summary is in many ways the most important section of a business plan, not least because it is the first section a potential investor will read. The Executive Summary introduces your business idea, explaining what it is your business will do, and how it will do it. Although the Executive Summary is the first part of the finished business plan, it is actually recommended that it be written last. Having already written out the rest of the plan, you will have a more complete picture of the business as a whole and how it will operate.
Company Overview: In this section you will want to include the date of the company’s inception, its legal structure, business partners, employees, assets, funding received to this point, and any other important facts about the business in its current state. You may also want to list out key dates in the formation of the business.
Industry Analysis: In this section you will need to include statistics related to your industry, and analysis of those statistics. For instance, investors will want to know the annual sales of your industry in both units and dollars. Other relevant statistics about your industry to include are the level of competition, the amount of people employed by the industry, the average expenditure on the industry (per capita or per household), and industry trends.
Customer Analysis: This section should include all the relevant details about your customers: age, income, gender, location, primary language, level of education, occupation, and more. Explaining your customers’ needs shows great attention to detail and illustrates the value of your products and/or services in the market.
Competitive Analysis: In this section, you will need to detail the significant direct and indirect competitors to your business. For both direct and indirect competitors, you will want to detail their product offerings, price points, revenue, strengths, weaknesses, and any other relevant information. After analyzing your competition, you should illustrate the ways in which you believe you can be better than your competition.
Marketing Plan: The first component in a good marketing plan is actually a breakdown of the products and/or services that your business will offer. Include a detailed description, prices points, component quality, and strengths and weaknesses of the products and/or services you offer. The next part of the Marketing Plan should be an explanation of how you plan to promote your products and/or services.
Operation Plan: This section should begin with a detailed breakdown of all the daily processes that your business utilizes to decorate products or otherwise run the business. Be sure to include all product development, sales, marketing, customer service, management, payroll, human resources, and legal processes, as well as any others that may not be listed here.
Management Plan: This section should begin with a description of your board members, business partners, managers, and/or supervisors. Include their names, titles, duties, and relevant qualifications that they have for their position. Also describe any unfulfilled management positions, their responsibilities, and the qualifications that you desire for the position.
Financial Plan: The first part of the Financial Plan should be a description of the revenue model or models of your business. You will also want to provide an introduction to your financial projections, briefly explaining them and where to locate the relevant graphs and charts (in the final section, the Appendix). Lastly, state the amount of funding that the business needs and how that funding will be put to use by the business. Only include those aspects of the business that absolutely require outside funds.
Appendix: This final section is where you append any supporting documents that you may have referenced throughout your business plan. Your Appendix should include all financial projections (income statements, cash flow statements, balance sheets, etc.), product/service detail sheets, and any relevant product or equipment technical information. In addition to these documents, you may want to include industry and market analyses, any partnership agreements, and even copies of sales literature.
A business plan should be a living document, one that grows and changes with the business over time. It is important to revisit it from time to time to update and expand upon your original. Once you have completed your business plan, and are prepared to finally start your product decoration business, the next step is to file all the necessary paperwork to become a legal business. This includes all legal filings as well as licenses and/or certifications.
First, you must register your business name with your state as either a Doing Business AS (DBA), Limited Liability Company (LLC), or Corporation (as a sole proprietorship, partnership, or S or C corporation). The next step is to register for a federal tax ID number (FIN or EIN) with the IRS. This can be done rather easily through IRS.gov. The final legal filing necessary is to apply for a vendor’s license through your secretary of state’s office. There are many types of vendor’s licenses, and they can vary from state to state. So be sure to research them all to see which one or ones apply to your business. For instance, many states offer a “transient” vendor’s license that allows you to sell products across the state. This is useful for selling decorated products at events, conventions, and other places outside of your business location.
Starting a business is a complicated process, but one that can be made significantly easier with a solid business plan. A good business plan acts almost as a startup guide, laying out the steps and information necessary to start your product decoration business. Once you have completed your business plan, the next step to take is to make your business legal. Filing the right legal documents may seem like a scary proposition, but in truth there are only a few key documents you need to get started. Once you file these documents, all you have to do is follow your business plan and before long you will be running your own product decoration business.
