A Business Plan is more than Cashflow & Forecast
Comprehensive Business Proposals are Critical for Business Operators
Mar 27, 2009
When Layla Robinson, 30, decided to follow her dream of establishing her own business, she took care to arm herself with a comprehensive business plan. Selecting the best location for her new DVD rental store, MovieTime™, was a crucial component of structuring the business plan.
A Range of Research Tools can Contribute to the Effective Business Plan
MovieTime™ operates from Ngongotaha, a growing community on the outskirts of Rotorua, one of New Zealand’s premier tourist destinations. “Ngongotaha is far enough away from Rotorua to be its own entity,” says Ms Robinson, “but close enough for locals to use city amenities. It’s a picturesque little village with the potential to grow much bigger. There are currently three large subdivisions being developed, with space still available for more expansion.”
Ms Robinson implemented a range of research tools to contribute to the development of MovieTime™ ’s business plan, including the New Zealand statistics website and various industry-reporting websites. She discovered that her target market was aged between 15 and 35, that they generally came from a lower socio-economic dynamic and many of them have younger children. This married with what she knew about the Ngongotaha community.
Understanding that there would be significant differences between her own outlet and the larger franchised retailers, Ms Robinson contacted privately owned DVD rental stores throughout the country. This provided her with a good understanding of strategies used by smaller operators to deal with competition from the much larger chains.
She also formulated a telephone survey. Some of the questions she asked were:
· Do you rent movies?
· How often do you rent movies?
· What store do you rent from?
· Do you use online rental services?
Her research told her that the movie industry is large and ever-changing, providing scope for continual growth over a period of several years. “People watch movies for various reasons,” she says. “In tough times movies are an escape. In good times people love to share movies with families and friends.”
Layers of Experience Contribute to a Comprehensive Business Plan
Leaving her job as marketing manager for a Rotorua manufacturing company entailed some anxiety, explains Ms Robinson. “I worried that I wouldn’t get such a good job again. My skills look good on paper, but I had no letters after my name or any tertiary education.”
However, her marketing role had been built on layers of experience that included a previous position with a DVD chain and a passion for movies spanning several genres. This knowledge and experience added value to the credentials she included in her business plan before seeking financial assistance.
Choosing a Name Contributes to an Effective Business Plan
Choosing a name, says Ms Robinson, was integral to her business plan. “I needed a name that was catchy and easy to remember; something that didn’t limit me to only renting DVDs. With the advent of DVDs, branding names with words such as ‘video’ have become outdated. Movies will always be movies, whatever format they’re in. MovieTime™ had a good ring to it and the domain name was available.”
Cashflows and forecasts were indeed critical to her business plan, but Ms Robinson believes her additional research was essential. She says that while she has experienced many of the hiccups common to new business owners, her business proposal went beyond its primary purpose of securing financial support. It has been her foundation document and guided her towards business growth. Unlike other businesses that have closed within a few months of opening, MovieTime™ is heading towards its first anniversary and is a well-recognised entity in both the Ngongotaha and wider community.
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