Starting a new business
Remember to check the territory you want to open your business in with your suppliers before you sign a lease. Not all areas are open to new store accounts.
The following checklists are meant to assist you in assessing each point against your business plan.
Marketing
Nature of the Market
• number of potential buyers, by region
• number of existing buyers, by region;
• profile of buyers ... age, income, occupation, education, sex, family size, etc. by region
• profile of users (if buyers and users are different) by region;
• where buyers and users live ... region, city size, urban, suburban, rural;
• where buyers buy ... urban, suburban, rural, trading centre, local, type of store;
• size of purchases;
• when buyers buy ... time of day, week, month, year, and frequency of purchase;
• how buyers buy ... name brand specifications or not, impulse, planned, comparison, personal inspection, cash/credit;
• why buyers buy ... attitudes, motivation, trends, styles;
• who influences buying decisions ... type of product and brand, uses of product;
• unfavourable attitudes of buyers and brand;
• indications of changes in buying habits.
Structure of Your Market
• number of competitors;
• number of brands ... national, regional, local;
• share of market by brands ... total, regional, city size, type of store;
• characteristics of leading brands;
• differentiation of own brand from leading brands ... strength / weakness / opportunity / threat analysis;
• policies, presentation, methods and tools of principal competitors.
Product Profile
Product
• quality ... materials, design, durability, safety, method of manufacture and workmanship;
• models, sizes, colours, flavours, etc.;
• luxury, standard, essential;
• convenience of shopping.
Package
• protection ... shipping, handling, theft, tampering, spoilage, etc.;
• utility ... measures, closure, reseal, disposable, reusable, etc.;
• identification ... universal product code, visual exposure, colour, label;
• display ... versatility for stacking, hanging, filing, etc.
Name Brand
• legal ... logo, trademark, copyright, industrial design, song;
• image ... memory value, goodwill value, recognition, suggestiveness, pleasingness, generic original.
Service
• installation ... who, when, cost, delivery;
• maintenance ... who, when, cost, convenience;
• repair ... who, when, cost;
• warranty ... who, when, how long;
• accessories ... after-market, compatible.
Place in the Market
Distribution Channels
• number of retailers ... each type by region;
• number of wholesalers ... each type by region;
• per cent of retailers ... each type, handling brand by region;
• aggressiveness of retailers, co-operation by region, store type and city size;
• indications of shift in relative importance of channels.
Promotion
Personal Selling
• recruiting and selection ... methods, qualifications, standards;
• training ... methods, skill development, motivation;
• supervision ... performance reviews, development;
• compensation ... commission, bonus, benefit plans.
Advertising
• effectiveness ... comparison of spaces purchased, timing, appeals and themes, black and white vs.. colour;
• cost effectiveness ... various media, style, background, placement;
• product effectiveness ... feature products, merchandising.
Sales Promotion
• co-operative advertising;
• deals, premiums, coupons, discounts, bonus gifts, displays.
Publicity
• announcements, press releases, mentions.
Price
• from factory ... volume capacity vs.. demand;
• to wholesalers ... by type, size and region;
• to retailers ... by type, size and region;
• discounts ... functional, volume, cash, other;
• allowance and deals;
• service charges;
• price stability ... commodity influences such as energy, labour, weather, technology.
Strategy
• selection of a target market(s);
• development of a marketing mix [product/price/place/promotion];
• implementation and monitoring strategies.
Operation
Location Facilities Operating Systems Operating Assistance
- traffic patterns - lease/
purchase - production - lawyer
- parking - utilities - inventory - accountant
- zoning - storage - record keeping - management consultant
- local development trends - expansion potential - job procedure - engineering services
- installations - maintenance - financial services
- fixtures and equipment - manpower services
- layout
- leasehold improvements
Finances
Capital Structure Operating Forecast Financial Services
- equity (25%); - sales; - bank/credit union;
- current assets; - cost of sales; - mortgage lender;
- current liabilities; - gross margin; - insurance coverage;
- fixed assets; - general operating expenses; - bonding;
- long term debt. - net profit / loss; - trade credit;
- income tax payable; - venture capitalists;
- cash flow analysis; - background equity;
- contingency analysis; - government programs.
- risk analysis;
- inflation impact analysis;
- interest rate impact analysis.
Organization
Legal Structure Registrations General Arrangements
- proprietorship; - trade names / copyrights; - contracts;
- partnership; - trademark / logos; - business forms;
- private corporation; - business license; - personal will;
- public corporation; - permits; - buy/sell agreement;
- cp-operative. - Provincial Sales Tax (PST); - cross insurance;
- Excise Tax; - key man insurance;
- Goods and Services Tax (GST); - occupational health and safety.
- professional or trade licenses;
- memberships.
Staff
• skilled;
• unskilled;
• professional;
• supervisory;
• qualification standards;
• job descriptions;
• wages and salaries;
• performance standards;
• staff benefits;
• staff training;
• employee evaluation and appraisal standards.
Management
• Can management prepare and implement a sound business plan?
• Does management have adequate authority and control to fulfill its responsibility?
• Do training programs encourage personal skill development towards increased responsibility?
• Can management change be introduced as required to benefit the business? Even if the changes require a new manager?
• Does the manager have the qualities of time, character, stamina, planning, control, development, leadership, decision-making, confidence, practical realism? And commitment?
Preparation and Commitment
• Have you obtained independent legal advice on all contracts?
• Are all financial commitments finalized? In writing ?
• Does the business plan have time in its favour?
• Are you prepared to lose your business investment?
• Are you prepared to succeed?
Prepared by: Saskatchewan Regional Economic and Co-operative Development
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