Simple Guide to Drafting a Business Plan For A Home Based Business

They say failure to plan is to plan to fail. Writing a business plan for your home based business will go a long way to making your business a success. Most owners of home based business make the mistake of having the idea in their head. Just having a great idea in your head is not enough you need to write down the idea. Writing the idea down you will making it easy for a financier to understand it. Even if you aren’t going to be borrowing money for your start up home based business, you still want to guide to assist you execute your plans.

A well written, thoughtful, realistic business plan will go along way in actualizing your dreams.

Defining your goals and objectives

The first step in writing a home based business plan is to clearly define your goals and objectives. Don’t just be vague and say you want to xxx amount of money in two years and be the number one provider in your area. You need to be clear and say something like “By the end of first year I want to have 20 monthly clients bringing in $12,000 a month.” It’s a good to break this into segments. In in the first month target 5 clients. By month six set a target  of 10 clients. A home based business plan that outlines your objectives this way gives you a road map to refer to and will ensure you’re on the right track and that you stay there.

Estimating the Market Size

Many aspiring business people have set up a business only to discover the demand for their service/product is either limited or at worst non existent. If they had a done a market survey before embarking on their entrepreneurial journey they would avoided this disappointing discovery. If your home based business is going to provide business curtain cleaning services, for example, you’ll want to be sure that there are enough homes, and offices in your immediate area that need your service. This information can be gathered from local classifieds, yellow pages and local business council.

Write Down your Expenses

Next, item to consider is all the costs your home based business will incur. The cardinal sin made by people who operate a business from home is they fail to consider the small expenses. Printer ink, paper, postage, long distance phone calls and cell phone bills are easily missed when considering the cost of operating a home based business. These expenses may seem small but they add up over the long term. Another important reason for writing down your monthly expenses is it will help you know how much revenue you need to bring in per month to break even.

Writing Down Your Marketing Plan

Doing a business without marketing is like winking at a girl in the dark. After starting your home based business you need a marketing plan to generate a demand for your business. The best form of marketing a home based business is advertising and direct sales.  Advertising through TV is effective but because of the cost involved it is out of reach for a small home based business.  Radio is a good option but if that is out of your budget, advertise through local classified ads. For those who have no money to advertise, consider free strategies such as flyers, circulars and posters to begin with.  Don’t forget web advertising. Programs such as Google Ad Words are cheap and very effective for targeting local communities.

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