According to the most recent JLL Singapore research reports, Singapore is seeking to be the economic hub of Southeast Asia. With the city-state nurturing innovation and investing in startups, the next 5 years promise to be very beneficial for new businesses and employment. With that being said, there is also a huge focus on a startup business plan. Therefore, for those aspiring entrepreneurs who want to be a part of this new progressive economic change, here is some information that explains how to put together a business plan.
Purpose of Writing a Business Plan
Even though the research studies from Barclays show that most businesses do not have a business plan (statistics reflect 1 in 4 without plans), there are still many different advantages to writing one. Actually, if you want your business to succeed, you can increase your chances significantly by writing a business plan for your startup. Here are 3 of the primary reasons for placing these plans on your list of top priorities.
- The business plan is considered to be a proactive measure since it identifies potential threats, coping strategies, and keys for basic survival.
- These plans are usually an excellent measurement of how things are going and where the business should be by a certain time.
- When people read the business plan, it gives them an opportunity to see the company’s business idea, mission, vision, and financial requirements. So, it also helps to assist in securing a business loan or a financier to back the business.
Understanding the Different Types of Business Plans
Writing a business plan is a skill that you should master if you plan to start your own business in the future. The document will help entrepreneurs and financial institutions to understand your business model. If well written, you will get funding to support your operations. In addition, the business plan will be the blueprint of your business.
6 Primary Different Types of Business Plans in Singapore
Unknown to most entrepreneurs is that there are six different types of business plans. Let us briefly look at each of these business plans and how each is different from the other.
Start-Up Business Plan
As the name suggests, this is a business plan prepared by a new entrepreneur who intends to start a business. The document covers every detail of the company such as the location, market demographics, products, services, strengths, and weaknesses. When writing this kind of a business plan, you have to carry out an extensive market evaluation to ascertain that there is a gap in the market that your business will fill. You also need to have a project management team to help you implement the plan and ensure that the business succeed.
If presenting the plan to investors for funding, you will need to provide a financial analysis spreadsheet detailing various fundamental areas such as income, projected profit and cash flow. The information has to be accurate for the investors to be convinced that they can trust you with their money. The same case applies to banks, you will not get a loan if the financial analysis document is incomplete or inaccurate.
Internal Business Plan
An internal business plan is written for a specific audience within the company. For instance, the IT department that needs to evaluate the proposed new computer systems or machine learning software to help carry out data analysis.
The document will highlight the current state of the company in terms of profitability and operational costs. It also goes an extra mile to highlight how the company will get the capital to purchase the new software and repay on time. Some plans are detailed and explain the technical costs, the hiring process and project marketing.
If unsatisfied with the document, the head of department and other employees enjoined in the plan review will request for additional information such as demographics, current market size, and the positive effect that the new software will have on the revenue.
Strategic Business Plans
Unlike the start-up and internal business plans, the strategic business plan is meant to provide a high-level view of what the company’s objectives. It also highlights the specific steps that the company is going to take to achieve the goals.
Picture it as a foundational plan that will guide the company to more success. While different companies have varying structures, the five primary elements in the document are mission statement, business vision, clear definition of each success factor, strategies to be used to achieve the goals and the implementation schedule or plan.
Concisely, this document helps guide the company to the next level by highlighting all the levels of the business and inspiring the employees to work as a team to ensure that the goals are achieved. Its like a morale booster to help revamp the company.
Feasibility Business Plans
Feasibility business plans is meant to guide an existing company in the right direction by answering two questions namely;
- Who will purchase the product or service that the company intends to start selling?
- If the new venture is profitable
The business plan has to be detailed to convince the stakeholders that indeed the company should consider investing the resources available towards expansion. Since the product or service will be new, the stakeholders will need information on whether there is a ready demand for the aforementioned.
The target market and amount of capital that will be required for implementation should also be highlighted. At the end of the document, you are required to provide recommendations of the way forward to ensure that the plan does not fail.
Operations Business Plans
Just like the strategic business plan, the Operations Business Plan is an internal document that highlights specific elements of the company operations. The main objective of coming up with this kind of a plan is to ensure that the operations of the company are achieved on time. For example, the plan will specify the deadlines and markers for the next financial year. It also outlines all the responsibilities of the employees especially those who will be overseeing the tasks.
Growth Business Plans
Growth business plans are also referred to as expansion business plans. As the name suggests, the plan provides detailed descriptions of the proposed growth of the company. The plan can be prepared for both external and internal purposes. It is served internally if the people who will be working on the expansion project are already working in the company.
On the other hand, the plan can be written for external if there are third party stakeholders involved. For example, if the company requires funding to support the expansion, the business plan may be submitted to financial institutions. In that case, all details of the company such as management, employees, past success, plan for the future and any other information that would encourage the investors to provide funding will be included.
However, if the company does not need funding, you don’t need to go into details about the company, though you may be required to include the expense, sales projection and financial statements.
Choosing the Right Format for the Business Plan
Most people assume that their business plans will be a huge set of documents that contain lots of big words and complicated business terms that are difficult to read and understand. Quite the contrary, these plans are meant to be easy to read documents for everyday people. In fact, this information must be simple to review and understand by anyone who needs access to them in the future. Though these plans may consist of a diversity of facts and figures, the data that is written should only pertain to what’s really needed to operate the company smoothly, from the start to the finish. For instance, a business plan will answer questions like:
- How much money will be needed to buy equipment for the business?
- Where does the business owners expect the funding to come from when it is required?
Therefore, when a business plan is designed, it should be customized to that specific business. So, the best format should be written in a format that follows these basic guidelines:
1. Format that You will use Continuously
In a nutshell, the format that you should choose for your business plan is one that can be used on a day to day basis. On the other hand, there are also some formats that are highly discouraged. In particular, these are the formats that you will most likely put away in the file drawer or never refer to again. So, it really does not matter if the plan is presented in a format that can be posted on the wall, shown in a mind map or a visual guide. It’s simply the format that works best for you.
2. Format that Simple to Express Your Views
Some people like to write, and they can design a format that allows them to be creative. If this is the case, you can write a plan in a form that excites and inspires you. Whatever the case or situation, this is a working document that helps you to keep the business on track.
3. Format must be Shareable
When writing your business plan, you should also keep others in mind. Specifically, if you are depending on securing funding from sources outside of the company or your scope of responsibilities. For instance, if you are planning on securing funding from an investor, the investor will need to see your business plan.
What to Include in the Company’s Business Plan
Though all business plans are not the same, there are some common elements that should be included in almost every plan that is written. Some of the more notable are provided for you below.
Overview of the Business
The overall is used to give a brief description or explanation of what the company will do and how it will be distinctive from others in the same or similar industry.
What the company expects to achieve within a certain period of time.
Marketing Plans for the Start-up and Its Projections for the Future
Today, the business plan should outline how they will target their customers and what type of marketing campaign that they will deploy. For instance, digital marketing campaigns are very effective in ensuring the business takes off in the right direction. The beginning of these campaigns normally starts with designing a website, optimizing the site with the best SEO and SEM techniques and strategies, and launching a social media campaign that focuses on building the company’s brand.
Where to Seek Help for the Business Plan
Unless you have designed and documented a business plan before, you will most likely need help to start the process and complete it accurately. Fortunately, this is not a process that has to be tackled and completed alone. As a general rule of thumb, there are also common resources that you may want to reach out to in order to make sure that your document will be exactly what you are looking for. Here are a few resources that can help you to put it all together.
- An accountant can assist you with getting through the financials
- Small business experts can be contacted via a local bank institution
- Business plan templates can be found for free online
Expert Tips for Writing A Strong Business Plan
Now that you know the six different business plans, the next thing that we need to discuss is how to write one well. The plan should be strong enough to convince the investors that they should invest in the company. If its an internal plan, it should be accurate and enough to convince the employees that they should work towards the set objectives.
Here are tips on how to write a strong business plan.
1. Understand your Competition
When writing a business plan to encourage investors to fund the company, you need to have a clear understanding of the competition. Be prepared to not only mention them by name but also offer in-depth information about their current position in the market.
More importantly, you need to tell the investors why your business plan is better than them. However, as you do that, be careful not to disparage your competition.
2. Get to Know your Target Audience
Understanding your target audience is important if you are to come up with a feasible business plan. Remember that this are the customers who will be purchasing your product or using your services. You may also have to prepare different plans if you intend to approach banks, individual investors, and venture capitalists.
The main reason why you may have to write different plans is because each investor that you approach will have different needs. For example, the individual investors will need to know how you are going to repay the money and the portion of the company that you will give them.
3. Back-Up Every Claim
As mentioned earlier, one of the main reasons why business plans are rejected is due to inclusion of false or inaccurate information. If your projection is to become the first company to operate in a particular way, you will need to convince the investors how you will become a leader. Be specific about the timeframe and explain why you settled on it.
If you mention you will manage to be the authority provider of tree care services in the next six months, indicate how you are going to achieve that goal. If your business plan is about a new product that will take the market by storm, you have to provide information on how you will do it.
Concisely, every statement should be supported facts that you collected when doing market analysis. If it’s a strategic business plan, you need to show that the management team is qualified and capable of ensuring that the project is completed within the given timeframe.
4. Financial Projections and Estimates Should be Conservative
Financial projections and estimates get a lot of attention and criticism especially if you are launching a new product or the company does not have any track record. If you are sure that you will dominate 60% of the market within the first year of doing business, go ahead and indicate that in the plan.
However, if you are not sure, you would rather be conservative and give a percentage. For instance, if you are venturing into a competitive market and you are confident that the product will garner traction, say “My company will manage to capture at least 10% of the market share within the first 6 months.” You get the point, right?
Either way, be prepared to support your claim or projection with facts. You could mention that during your research, you realized that the main competitors don’t have robust digital marketing strategies. You intend to hire a full-service agency such as MediaOne Marketing to help you create a responsive website, create social media marketing campaigns as well as email marketing. Since the agency is credible, you stand a better chance of getting your plan approved and getting the funding you need to actualise your plan.
5. Be Realistic and Real
One of the common mistakes that entrepreneurs make when writing business plans is to exaggerate instead of sticking to the facts. When planning to introduce a new product that is different from the competitors, you have to make sure that you consider the unique selling points. Even so, you cannot afford to go overboard, otherwise, the investors will question your ability to enter the market and dominate within such a short period of time.
If you are writing an internal business plan and you are an employee of a big company, and propose that the operations of the company will be better if you manage everything, the management team will not be convinced that you can handle all tasks.
Being overly optimistic with resources and time will do you more harm than good. Strive to remain as realistic as possible to show you are credible and worth of guiding the company in the right direction. The rule of the thumb is assuming that any new project or recommendation with take or require at least 15% more time or more resources to complete. So, if you expect the project to be completed in 100 days, indicate 115 days in your business plan.
By doing so, if you manage to complete the project in 100 days, you will have shown the stakeholders that you have the skills and expertise required to get the job done. Otherwise, if you stretch yourself too thin, you will compromise your performance and in the long run your credibility.
6. Put Together a Management Team
The management team will be instrumental in helping you stay on course. You will not have to do everything yourself, some of the tasks such as finance can be delegated to the accountant or financial advisor in the team.
When forming this group, make sure that you put into considerations the members expertise and credentials. If you are not confident about the skills but still feel you should still have them in your team, consider bring on board an advisory team of experts who are skilled in the fields. Make sure that you attach their resumes when going to meet with the investors.
7. Provide Investors with Details About the Payout
Investors need to know how you are going to repay back their money and dividends. Some of the investors may present names of associates that they want added to your board of directors to ensure that their interests are considered in the decision-making process.
Briefly describe the payout options but if you are not sure mention that you are open to a discussion about it.
How to Conduct Market Research Analysis for Businesses in Singapore
When starting a business, you need to plan and research various strategies, or else you risk losing your investment. This is why many entrepreneurs in Singapore are spending lots of time on research analysis.
What is Market Research Analysis?
Market research is the process of gathering information about your prospective audience and their buyer personas, your existing customers, and your competition. Its objective is to find out market dynamics, such as level of competition and buying patterns, and other important factors.
How to Conduct Market Analysis
Here are the steps you need to follow when conducting market research analysis.
Define Your Purpose
Before anything, define your purpose. For instance, it might be finding out about your customers, assessing risk factors, or the level of competition.
The amount of research you conduct depends on the purpose of your analysis. If you’re looking to improve your business internally, you’ll conduct less research than a person conducting external research.
Analyse the Current State of Your Industry
It is vital to assess the current state of your industry when doing market research. Precisely, look at where your industry is heading by analysing trends and projected growth rates. Ensure that you use data from reliable sources.
Knowing the current state and the future of your industry helps you know if the investment is worth your time and money.
Define Your Buyer Persona
You must understand the preferences of your target audience if you want to run a successful business. This underlines the importance of defining buyer persona.
A buyer persona is a hypothetical representation of your ideal customers. It shows the product they like, the times they like to shop, what they would like improved, etc.
Buyer personas help in audience visualisation, informing your strategy and streamlining your communications. Some of the key qualities you need to include in your buyer persona are:
- Level of income
Your buyer personas should act as a guideline for how to reach and learn more about the real customers in your industry.
Research Your Competition
Understanding your competitors is vital to succeeding in business. You need to know how saturated your industry is, the strategies implemented by your rivals, and their strength and weaknesses.
Start by listing your direct competitors, then assess what makes them different from you. Think like a customer – what makes a particular business outstanding? What features would draw you to it?
After this, rank your competitors according to the level of competition they offer. This will help you in devising strategies for differentiating your products and services.
Analyse Your Data
Once you collect all the information you need, you need to analyse it to make it useful. However you choose to organise the data is up to you, but ensure that include sections that define your purpose, target audience, and level of competition.
Implement Your Findings
The next step after data analysis involves implementing your findings. Look at the ways you can use what you learnt to improve your business, whether internally or externally.
It’s worth noting that market dynamics are always changing. For this reason, it’s advisable to revisit your market analysis frequently and make the necessary adjustments.
Benefits of Conducting Market Research Analysis
Since it gives you a better understanding of your target audience and competitors, a market analysis report is an integral part of your business plan.
Here are some of the top benefits of investing in marketing research.
When you know the preferences of your target audience, you can improve your service delivery significantly. Because creating buyer personas is a crucial step in market research, the process helps you build a more targeted more strategy. This means that customers are more likely to buy from you.
Market research is an excellent way of reducing the potential risk that could hurt your business. It enables you to know the prevailing trends in your industry, your main competitors, and the strategies you need to implement to become successful. All of these are helpful in making informed decisions.
If you want better success for your businesses, you can conduct a SWOT analysis. This identifies the strength, weaknesses, opportunities and threats in your industry.
With lower risk, you are guaranteed higher profits.
Conducting market research ensures that you’re always aware of the prevailing trends in your industry. Coincidentally, being ahead in business requires you to be the first person to spot the latest trends.
You can take advantage of market research to learn new trends and develop products and services that appeal to your target audience before your completion catches up.
Less Recurring Mistakes
Everyone makes mistakes at least once in their marketing journey. However, you can reduce the chance of repeating them by conducting market research.
For instance, research can show you what hurt the sales of a particular product. If it was poor design, you would focus on improving this aspect.
Forecasting market trends gives you an idea of the profits and challenges to expect, allowing you to make suitable adjustments to your business strategy. It also shows you if you should put more time and money into your marketing campaign.
Although metrics such as conversion rates and the number of products sold are useful in gauging the progress of your business, you can’t exclusively rely on them. A detailed marketing analysis report provides benchmarks that can help you evaluate your company and how you compare to your rivals.
The most significant benefit of market research analysis is that it enables you to optimise your marketing strategies for better results. When conducted regularly, market research can inform your ongoing campaigns and show you the areas that need improvement, the ones that are performing well and where you are compared to others in your industry.
Challenges Faced by Market Researchers
Market research has several potential benefits to your business, but it’s worth saying it’s not an easy process. Here are the top challenges faced by market researchers today.
Existing Market Research Methods
Currently, companies use several approaches when conducting market research. This means that it can be difficult, especially for beginners, to identify the best method to use.
Nowadays, there is an abundance of tools and platforms for data visualisation, analysis and mining. While this gives you freedom of choice, you might end up picking a tool that doesn’t deliver on its promises.
The solution to this challenging is ensuring that your teams know the pros and cons of each tool, and more importantly, how to use it.
Integrating Multiple Data Sources
Using multiple data sources enable you to gather as much information as possible during market research. However, it can prove challenging to consolidate this information.
Experts recommend using a hybrid methodology when collecting data. By fusing multiple sources, you will get a detailed picture of consumers and the market.
Effective Data Management
Although using multiple tools in your market research is insightful, this approach has its challenges. First, every business has unique needs, and finding the right tools to work with requires innovativeness.
For instance, large organisations collect huge volumes of data, and it is usually difficult to manage it effectively. You need to find the right tools that will analyse and consolidate the data to give a holistic view of your target audience and the market.
The Human Dimension
Despite the increased use of technologies like automation, artificial intelligence and big data, the human dimension is still vital to effective market research. The more you what drives people to take a certain action, the more you need to know what consequences their actions might have.
One of the key objectives of market research is understanding consumer behaviour and how it affects your business. Today’s marketers are overemphasising technology and overlooking the human dimension. To ensure that your marketing campaign doesn’t fall victim to this, focus on the following.
- Use human insight to interpret data from your research.
- Find the story in your results and communicating it in a way that leads to action.
Common Mistakes Made by Market Researchers
The first mistake when it comes to market research is thinking that you don’t need training – well, you do. That said, even trained marketers do make errors.
Here are the mistakes you need to avoid when doing market research.
If you target the wrong people, your entire research will be flawed. While the right audience can point out an inappropriate question instantly, it isn’t the same if you sample the wrong consumer group.
Always start your market research by defining your sample – write down who you want to talk to, why, and the questions you’ll ask. Then, decide if you will divide your target group into segments for detailed analysis and cross-comparison.
Some marketers in Singapore do research without a plan or setting realistic goals. Every member of your team should be on the same page before starting, and you should also set achievable objectives. Failing to do this often causes misunderstandings and is a waste of time and resources.
When creating objectives, make them short and clear. For example, you could write what you hope to achieve by asking a particular question.
Ensure that your aims are not ambiguous or vague. Define the purpose of the research and how its findings will impact your business.
Surveys are an effective method for collecting data from your target audience – however, they are often overused. This is because many people see them as easy to create. Yet, they are often too complicated or too long to be answered in time.
Before creating a survey, identify the layout that your respondents will find most appealing. While surveys are easy to run, they aren’t always the best choice for collecting data.
If surveys are the best for your situation, limit their length to avoid before being boring. Many people are free to respond to surveys, provided they have few and simple questions. Also, avoid using complex layouts. Instead, gamify your surveys – this approach involves issuing rewards to those who complete the surveys.
Using Secondary Research Only
The two forms of market research analysis are primary research and secondary research. In the primary research, marketers use information gathered directly from their target audience. On the other hand, secondary research involves gathering information from existing resources, whether online or offline.
Ideally, you should combine both approaches during your research. Using secondary research is usually tempting because the data is readily available, but it often results in inconclusive findings.
Another mistake concerning secondary research is relying exclusively on the internet. For small businesses, this might seem like a smart way to save money, but you should combine it with published information from a nearby library or college for more comprehensive results.
If you act ambiguous questions, you won’t get accurate results. Even worse, you might end up using this wrong data in making vital decisions that can hurt your business.
Try using non-ambiguous words when asking questions. For example, you should avoid asking the following question: ‘Have you bought anything in the past three months?’ – This has many possible replies. Most people have bought something in the past few days, let alone three months. Instead, you should ask where they bought it, the product they purchased or how they paid for it.
By avoiding ambiguity, you reduce the chance of confusing your respondents.
Big Company Attitude
After spending years on market research and yielding its benefits, some business people abandon the practice. Even if you feel like you have attained your initial goals, it’s unwise to stop doing market research. Even big companies invest heavily in this practice because it often presents new opportunities for growth.
Asking Questions to Close Associates
Never limit yourself to asking questions to your friends and family. Besides the obvious bias, because they don’t want to hurt your feelings, they don’t provide the diversity you would have got by engaging a larger audience.
Best 10 Tools for Market Research Analysis
Market research tools make your work easier, as they streamline every step of the process, from data collection to analysing the findings.
Here the best market research tools available to your business.
As the name suggests, Google Trends focuses on the hottest topics on the internet. It allows you to refine results by location or go worldwide.
When you type in a term on this platform, it shows you its trending history and assigns it a percentage score. You can also compare different terms to see how they fare against each other.
Make My Persona
If you’re struggling with creating buyer personas, you should try using Make My Persona. This platform allows you to create a name for your persona, set their age, their occupation, and identify their challenges and other defining characteristics.
Make My Persona is ideal for companies that do B2B transactions, as it prompts you to provide the career objectives of your persona, as well as their role-specific challenges. This means that your product is intended for solving a problem they face at their workplace or help them in achieving revenue goals.
Notably, this product is free.
Statista is an invaluable tool if you’re looking for reliable data on various aspects of the global economy. Its most impressive feature is the ability to present data in a way that is easy to understand.
Regardless of how industry-specific the data you want is, Statista will help you find it. Moreover, the platform updates its data charts at least once yearly, ensuring that the information you get isn’t outdated.
Regarding pricing, this platforms offers three plans – Free, $39 monthly (billed annually), and $19.50 one-time 30-day access.
Heartbeat Ai is a platform that uses machine learning to discover the emotions behind written content. Its developers believe that human emotion is a vital element of market research that many business owners usually overlook. According to the official website, the tool generates concrete about how different trigger varying emotions among consumers.
UberSuggest is an easy-to-use keyword research tool. If you are looking for keywords to enrich your content, type in a relevant phrase, and it will generate a list of possible keywords. It also displays top-performing articles and pages related to your keyword.
This platform adds value to your market research by showing you your top competitors, search volumes, and the level of competitiveness for the product you’re launching.
You can also discover the questions that your target audience is likely to ask about your products and services. Each of these questions can help you create blog posts that provide solutions, increase brand authority and boost conversion rates.
Pricing starts at $29 and $49 monthly for Individual and Business plans, respectively. Enterprises have to pay $99 monthly to access this service.
Temper prompts you to create a question relating to your brand and post it on your website, then get responses from your visitors. The answers are presented in emoji formatting, ranging from a smiley to a frowned face, depending on the level of satisfaction.
A smart way of using this platform is by placing it alongside a blog post launching a new product or service. That way, you can know what they feel about your new offering before it hits the market. You can also Temper in email newsletters and landing pages.
Userlytics is useful for analysing the usability of your website and mobile apps. It allows you to define buyer persona, target different platforms, and disqualify participants by screening questions.
Furthermore, you can structure questions in several ways – you can leave them open-ended, provide multiple choices, or ask for ratings. The platform supports screen and webcam recording. You can compare the answers provided with visual reactions to see how users feel when using your platforms.
Pricing starts at $49 per participant for the Quick & Easy plan. There’s also an option for custom pricing upon request.
Answer the Public
Answer the Public prompts you to enter a search query and returns every useful question and phrase that users have typed relating to that topic. These are organised in a way that makes the information easy to digest. For instance, if you search ‘SEO’, you will get answers like ‘SEO best practices and ‘Challenges faced by SEO marketers in Singapore.’
By knowing the type of phrases used by your customers, you can provide relevant solutions.
If you want to create detailed market research surveys that will help you understand your target audience better, SurveyMonkey is a viable option.
On this platform, you can create specific and targeted surveys that help you collect answers about your company. Its standout advantage over other data collection tools is that it gets granular insights from customers.
Additional features include dedicated market research solutions and services like a survey translation tool, a global survey panel and a dashboard that allows you to peruse through results.
Artificial intelligence is integral to today’s market research campaigns because it makes it easier to analyse vast volumes of data. Remesh is a tool that leverages this technology to gather the qualitative insights that define your marketing strategy.
Specifically, this tool allows you to hold a live conversation with up to 1,000 people. As you interact with your audience, it breaks down all the qualitative insights and present in an understandable format.
Writing a business for a startup in Singapore can be a challenging experience. However, if you understand its overall purpose, how to choose the correct format, and what these plans should entail, you can be successful in completing it properly. Make sure that you follow all the writing tips and hacks highlighted to increase your chances of getting funding from investors. If its an internal business plan, involve other employees in the research and writing process.
Market research is vital for your success because it gives you a better understanding of your prospective customers, particular what they like and their pain points. With this information, you can create offerings that appeal to consumers and drive up your sales.
Lastly, market research is useful for knowing more about your competition. By knowing the strategies they implement, strength and weaknesses, you can implement tactics that make you outstanding from a consumer’s perspective.