6 Essential Parts of a Retail Business Plan
A business plan for a retail store can be a complex multi-page document created using special software, or it can be a page torn from a notebook. The purpose of your business plan will determine how much information should be included and what format to use. For financing, you'll have a better chance of convincing someone to fund your company if there are plenty of details provided. If you don't know what goes into a successful business plan, here are the essential elements of what to include and why.
An Executive Summary is the first and most critical part of the success of the business plan. The Executive Summary offers a synopsis of your business plan and highlights the key points you want to address in the rest of your document. This component of your business plan is crucial because it is where you must capture the reader's attention so that he or she will be compelled to continue reading.
The next section is the Business Analysis. This section describes the nature of your retail business. It should include your business structure, legal name, location, and the goods or services offered. It also includes an analysis of your customers and competition. Don't try to get creative when writing this section. Use easy-to-read, common terminology that people can relate to. You never want to assume that those reading your business plan have the same level of technical knowledge that you do.
The Marketing Strategy section should explain how your retail business will penetrate your target market. This is the area where you detail the company's desired image and branding strategy. You should provide an overview of the company's pricing strategies, current, and potential marketing partnerships and provide documented research to support your plan.
This part of the business plan is most important to retailers in the midst of developing a business. The Products and Services section describes the goods and services offered, how they are provided, information about the vendors, and any plans for the future growth of your product lines.
In the Management section, the information included should show that your retail business has the necessary human resources to be successful. This part answers questions about your key management personnel and their backgrounds, explains how the store will be staffed and details all personnel compensation and benefits, including employment policies and procedures.
One of the more difficult parts of the business plan, the Financial Plan, involves the company's revenue and profitability model. This part of your business plan assesses the amount of capital the retail business needs. It also addresses the proposed use of these funds as well as their expected future earnings. The financial plan includes Break-even Analysis, Sales Forecasts, balance sheets, and cash flow statements. Make sure you break down the financial on a monthly basis for the first year and then annually for the next two to five years.