Why you need to have a business plan
We outline 5 reasons why you need to have a business plan for your convenience store.
The number of convenience stores in the UK has risen by 17% since 2012 and is expected to rise by a further 22% in the next five years. If you are planning on opening a new convenience store or expand an existing operation, you will need a business plan.
Whilst it may seem like an unnecessary burden, a business plan is crucial to your success and will help you avoid stress, financial loss and a lot of heartache in the future.
Below we outline 5 reasons why you need to have a business plan.
It may be that you have savings, or a relation is willing to provide your start-up capital, however if you do need to borrow money, no financial institution is going to entertain you without a solid, well thought out revenue model for the next three to five years.
Include projected sales and costs including all staffing costs in your financial summary.
Break down your sales forecast into separate categories such as drinks, newspapers/magazines, snacks, general grocery items etc.
If it is an existing store, complete a profit and loss statement, cash flow analysis, balance sheet and personal financial statement.
Define your market
Identify who your customers are and who you would like them to be. Millennials are driving the rise in convenience stores, is there anything additional you can do to attract them?
Research your competition and include statistics on your market share. Identify your store’s strengths, weaknesses, opportunities and threats.
Define the products and services that your convenience store will provide and highlight any areas you plan to expand such as ATMs, lottery tickets or ready meals.
Set and review milestones
You need to have clear goals and know when you are going to hit them. It gives you focus and benchmarks to measure against to see whether your business is successful or not.
Review your plan quarterly to see if you are on target. If sales figures are down on what was expected, ask why. It may be something as simple as bad weather but may be due to increased costs from certain suppliers. Look into whether you can make up the losses in the next quarter by negotiating with existing suppliers or finding new ones.
Summarize your marketing and sales strategy detailing pricing, place, promotion and products.
Highlight any advertising or marketing you have planned, whether print or online, and which category of shopper you are aiming to attract whether it is regular customers or passing trade.
Are you planning Point of Sale advertising or external signage?
Include costs of advertising and marketing in your financial summary.
An Executive Summary at the front of the document highlights the key points of the business plan for your convenience store.
Creating a business vision will provide clarity on where your store is now and where you expect it to be in the future.
Identifying an overall vision for your convenience store(s) gives a sense of purpose and a clear idea of what you wish to achieve. Essential for attracting investors or partners, or when negotiating with suppliers.
I hope we have highlighted why you need to have a business plan for your convenience store. It is more than a piece of paper, it is a roadmap to your future success.