Business plan for wood lovers

The fears you don't face become your walls.

Starting with this article I will give you a quote to inspire you. Today's one sounds very good in English and from my point of view, it is difficult to translate into Romanian. But I would try a translation (an adaptation) as follows "The fears you don't face limit your world." Beyond this world you will not know what it is, you will not know. It is my adaptation. I even challenge those who criticize me on Facebook for not using Romanian to provide a better translation. That's the best I could do. 🙂 The message is very good for anyone, but especially for a future entrepreneur. You must be prepared to face all the problems that will come. Otherwise you won't succeed.

In the previous article I presented you the business ideas. No sooner had I shared it on Facebook than a new idea popped up. Even if it was signaled in a tone that I thought was superior, it caught my attention. So I added this idea to the article presenting business ideas for wood lovers that you can read it in the following link.

The text you are now reading is part of a series of articles that aims to bring information about business and entrepreneurship closer to small entrepreneurs in the wood industry. If you want to know more about where we started, read also this article.

Make your own business plan

First of all, I will not emphasize the structure of the business plan, I don't want to teach you how to make a business plan to access credit, for example. In cases like this you need to turn to consultants, people who specialize in structuring information so that it can be processed properly by those who will analyze it. My intention is to give you a few pointers, mostly from my own experience, to help you realize your own business plan.

Over the years I have read all sorts of texts like "everything you need to know to get off to a good start in business and build a successful business from the ground up". There isn't everything you need to know. There are no recipes for success. The first step in building a business is to make your own plan. Then stick to it and adapt it to the realities and situations you face. That's how I'd like you to think of this business plan. It will primarily be built by you for you. It must represent you and be realistic.

At the same time, your business plan must be easily adaptable to new realities. Because, in general, the business plan contains what you want to happen, not what will actually happen. That doesn't mean that you'd better make it superficial, because you'll have to adapt it along the way anyway. No way! You need to analyze the strengths of your future business, but (especially) also its weaknesses.

Think also about how you will react to possible scenarios in which figures, data, situations analyzed in your business plan will change. If you ask the right questions and give your answers honestly, you are well on your way to building a good business plan, an excellent tool to help you when putting it into practice. The more informed you are about the challenges ahead, the better prepared you will be for them.

The business plan contains the essential ideas, directions and figures for you and your team. Its execution, how it will be implemented or how you will manage the business, are equally, maybe more important.

What the business plan should contain

Most important, in my opinion, is the information gathered to build it, its accuracy. I start from the assumption that if you already have the business idea, you know what you will sell. In this case, the most important chapters your business plan should contain are:

1. Market analysis

You need to know market behavior, market trends. It will be easier to succeed in a growing market, for example, and harder in a falling one.

You need to know your competition. You need to know the price at which a product similar to the one you're selling will sell, and you need to know the costs, the resources you will allocate to produce it.

When I say market, I mean exactly where the sellers (your competitors) and buyers (your customers) of the product you are going to sell are located at any given time. I specify this because, for example, many people confuse and compare retail (retail) selling prices with the costs (allocated resources) of production up to the factory gate. In this way you are comparing apples with pears. Not showing up are all the marketing, transportation and distribution costs that help your product get to the shelf, to the market, to sell. Without those costs he is commodity stock. It will be harder (or not at all) to turn into sales (revenue, in accounting parlance). In most cases these costs are very high, they can double or triple your total costs. I am not exaggerating at all.

2. SWOT analysis

SWOT, an English term, is a widely used tool that allows you to analyze your business from the following perspectives: strengths (Sstrengths), weaknesses (Weaknesses), opportunities (Opportunities) and threats (Threats). Draw a horizontal line down the middle of a sheet. Then, perpendicular to the middle, a vertical one. Fill in the 4 areas with the strengths, weaknesses, opportunities and threats of your future business. In this way you study, analyze, look for ways to enhance your strengths and ways to correct your weaknesses.

3. The team around you and the related costs

The team is very important. This whole plan has to be put into action. How well it will go depends on your team. You need to know how many people you need and what role each one has in your organization, be it small or large. Equally important is the level of costs the company will incur in supporting salaries.

4. Product, marketing, sales

In order to sell your product you need to know it very well, to be able to describe it in the smallest detail, to be able to present the benefits that customers will have when they buy it. Then you need to establish the product variations and pricing policy, how they change with the characteristics of the product. All this and other market-related information will form the basis of your marketing and sales strategy.

5. Budget, cash flow

It is very important to know how much money you will need to get started and where you will get it from. It's important to make a budget that forecasts both the income (sales) you will have and your future expenditure. It's important to predict as accurately as possible how your cash flow will fluctuate so that you don't block your business.

These are the most important topics to think about and include in your business plan. Next time I'll talk about budgeting.

I plan to update the article with information from you, as I do with all other articles for small entrepreneurs. If you would like to add anything, ask me a question or want me to better clarify certain passages in the text, please leave your message in the comments area below.

I hope that the above information didn't scare you, and it all seems harder now. The good news is that being an entrepreneur is a race in which you don't have to be number one to be a winner. You just have to make a profit at it. I'm here to help.