Sample Marketing Plan 2.0 Current Market Position

Sample Marketing Plan
The sample plan in this document is provided as a guide only. The statistical and financial
information in this booklet are assumptions for the case study and should not be used for an
actual business plan. Intending and existing business people must undertake their own
research and use reliable data for the preparation of their business plans.
When setting up your business, be sure to find out which legislation, licences and codes of
practise will affect your enterprise.
Sample Marketing Plan
This is a sample marketing plan for a small business, Canterbury Renovations. It’s a guide to
how you can prepare a marketing plan for your business. Your plan may require more or less
information than this sample marketing plan.
As you work through the plan, conduct the appropriate research and planning for your
business to ensure your plan results in effective marketing.
1.1 Mission Statement
The core activity of Canterbury Renovations will be the renovation of kitchens, bathrooms
and laundries. The business will provide a complete service, including free designs and
quotes, supply and installation of equipment and fittings, all associated building services,
after sales maintenance and a seven-year guarantee covering workmanship.
2.0 Current Market Position
It’s important to understand the current position for your business before deciding on how to
market it further. Marketing analysis and research (done in later sections of your plan) form
the basis for identifying your current position.
External and internal business factors need to be considered and planned for.
Example
Canterbury Renovations is a new business and has no existing clients, projects or history to
account for. However, the proprietors are experienced in the industry and have the financial
capacity to conduct business successfully.
2.1 Product
Although it seems obvious, it’s important to identify your products and services in the plan.
You need to consider each product or service in terms of existing competition and for how the
market perceives it. You will need to market new products differently to those well
established in the market.
Example
Canterbury Renovations provides materials such as timber, tiles, paint and plaster as part of
their renovations services. All of the materials selected will be of the best available quality
suitable for the purpose.
1

Competitors: These products are available in many places but at varied qualities. Canterbury
Renovations expertise will ensure only quality materials are selected for use.
Products will also include a wide range of built-in appliances such as ovens, microwaves,
cook tops and dishwashers. These will be reliable products and selected to suit each
individual project.
Competitors: All of these products are available at many places, but Canterbury Renovations
offers them as part of a service rather than as stand alone products. One renovation company
in the western suburbs also offers these appliances as part of their renovations packages but
they don’t service the eastern suburbs at all.
Balwyn Kitchens doesn’t supply equipment to install in new kitchens.
2.2 Place
To sell products and run a business, you need to have premises of some sort. It may be a
home office, a mobile service, a business centre office or a shop, but it needs to be considered
from the customers’ point of view. Consider whether those premises and its location appeal
to customers.
Compare your premises with your competitors’ premises. Think about how you premises can
work to your marketing advantage.
Example
Canterbury Renovations will have a showroom for people to visit. This will allow some
demonstration of work and products available and provide a space where projects can be
discussed, planned and contracts signed.
Alternatively, Canterbury Renovations staff will visit clients’ homes to discuss projects and
sign contracts. This provides a level of customer service that clients like when considering
such large projects and expenses.
Competitors: Various kitchen renovation companies in the neighbouring areas work purely
from a showroom for the sales and planning stages, so Canterbury has an advantage in
service.
Balwyn Kitchens also provides an in home service, but they only offer kitchen make overs
compared to Canterbury’s kitchen, bathroom and laundry focus. This gives Canterbury a
larger target market as well as being able to offer clients more services for their home
upgrades.
2.3 Price
Every business needs to set prices for products and services. A pricing strategy outlines how
prices will be set and how much flexibility there will be for individual prices. It includes
details such as discounts, specials, package deals and moving old stock. Check competitors’
prices and policies to ensure you are being realistic with your policies.
Example
Canterbury Renovations pricing policy includes:
• high margin
2

• priced for traditional customers
• competitively priced against competition for the quality
• discounts offered when pricing three concurrent jobs at once (e.g. a kitchen, bathroom
and laundry renovation)
• no set prices as each job is quoted according to its requirements
• progress payments offered
• discount offered for prompt payments
2.4 Promotion
Consider how you currently promote and market your business and what is and isn’t
working. Look at what your competitors do for promotion, noting what does and doesn’t
work for them as well.
Example
Canterbury Renovations is a new business so there are no existing marketing activities in
place. There is no brand awareness in the renovation market.
A graphic designer has developed a logo, business cards and letterheads ready to promote the
business, and a website is underway.
West Homes advertises in lifestyle magazines with some success but this is an expensive
option. Canterbury Renovations can’t afford this avenue yet and isn’t sure of the returns
anyway.
Balwyn Kitchens sponsors a feature section in the local paper each month and uses signage
and letter box drops t o promote their services.
2.5 People
A business can’t operate effectively without good staff. Each business has different
requirements so you will need to consider the size of your business, what service level is
required and hours or operation to determine how many staff you need. It’s also important to
determine what skills and experience staff require, what training they may need, how you will
recruit new or replacement staff and what roles staff will be required for.
Example
Canterbury Renovations has collected a team of dedicated and qualified staff.
The proprietors have experience in the industry but need training or experience in managing
staff. They are providing training for all staff into the preferred service technique and style
for the business.
The priority areas for staff training will be:
• building and production techniques
• using new products: fittings, materials, equipment
• using new machinery: outputs, operation, efficiency
• marketing skills
• selling
3

• communication skills
• customer service
• estimating and pricing
The proprietors plan to develop their basic business skills by attending an eight week course,
'Planning and Starting a Business', at the Box Hill College of TAFE. They will also join the
Master Builders Association and attend a number of relevant industry courses. Trade shows
will be attended and subscriptions will be made to relevant business and trade magazines. As
staff notice deficiencies in certain areas, these will be identified and addressed through a
formal training strategy.
2.6 Processes
By writing down procedures for business activities, your business can be run more efficiently
and consistently. Procedures can be for activities such as dealing with complaints, preparing
quotes, serving customers, answering phone calls and emails and equipment use.
Example
Canterbury Renovations currently doesn’t have many written procedures. However, they
have written a set of guidelines for all staff outlining expected behaviours such as cleaning a
work site at the end of each day, being helpful and courteous to customers and being punctual
to work sites.
As part of the business planning process, the proprietors made notes of procedures and will
employ the services of a professional writer to create an operations manual.
2.7 Physical Evidence
The appearance of your staff, premises and vehicles can have a large impact on how passers
by and customers perceive your business.
Example
Canterbury renovations staff will all wear a work shirt with the business logo on the left
pocket. This will identify them as part of Canterbury Renovations and present a neat, uniform
team approach.
Initially, staff will not be provided with vehicles but it’s in the business plan to later provide
utes and vans with the business name painted on the side.
Once premises are finalised, they will be set up specifically to suit the showroom
requirements. Showroom staff will be required to keep the showroom neat and tidy at all
times and to be welcoming to customers entering the showroom.
3.0 Market overview
Your business is affected by factors beyond your control, and these need to be taken into
account before making any plans. This part of the marketing plan is an overview of your key
markets and predicted major changes on those markets that will impact on your business
success.
Essentially, you need to consider what opportunities and threats may arise out of the changes
you expect in the next 6 to 12 months or longer.
4

Conduct a PEST analysis ( assess the physical, economical, sociocultural and technological
factors) to determine outside factors that will affect your marketing plans. Allow for factors
such as new regulations under consideration, interest rate fluctuations, changes in market
characteristics and technological advances.
Example
Canterbury Renovations understand that the internet is a powerful marketing tool so they are
creating a website as an electronic brochure. They also make use of email by providing an
email address on all documents and for all staff.
Senior staff, such as project managers, will also be using a palm computer and a mobile
phone to make sure they are contactable and have all required information when visiting
clients.
The building and renovation industry is doing well at the moment with interest rates staying
at manageable levels and no new building regulations are under consideration. There are
many older homes in the area so Canterbury Renovations have a lot of potential for work in
the foreseeable future.
There are other renovation companies and builders in the area as competition but some are
booking projects up to 6 months in advance so the area has work available for a new
business.
Many of the people in the area are double income families where time is a bigger concern
than money. Simplicity and multiple services are seen as advantages to these busy people,
and they will pay extra to save themselves time and worry.
4. SWOT Analysis
A SWOT (strengths, weaknesses, opportunities and threats) analysis can provide a lot of
useful information for a business. It can give direction to the business and its marketing
strategies. The results need to be concise, relevant and interesting. The report should be easy
to read and give a clear understanding of the business aims, and key issues and objectives
should flow from it easily.
Some factors to consider in a SWOT include:
• unique characteristics of the business/product/service
• amount of money available
• existing client base
• suppliers and distributors
• price structure
• profit margins
It isn’t always easy to conduct a SWOT analysis on your own business, but there are outside
businesses and consultants who can help. In a larger business or one offering multiple
products and services, it may be easier to analyse each product or department independently.
5

4.1 Strengths
Example
Canterbury Renovations have a number of marketing strengths, including:
• technical competence of the proprietors
• dedication of the staff
• total agreement between proprietors on their objectives
• financial resources
• good network of contacts for potential clients, suppliers and tradespersons
• ability to respond to the needs of the market
• business is located within the target market
4.2 Weaknesses
Example
Canterbury Renovations has identified areas where improvements are required, including:
• lack of management skills
• small size of showroom premises
• no track record in business
• no current plan for management succession in the short term
• inefficient equipment
• lack of research and development facilities
• proprietors have limited security with which to raise finance for future growth and
development
• business is principally dependent on one person during the formative stages
4.3 Opportunities
Example
There are ample opportunities for quality home renovations in the eastern suburbs which is
why Canterbury Renovations is locating itself in that area. The key opportunities available
are:
• rapidly growing market due to a preference by home owners towards renovation
rather than relocation
• poor reputation of many existing renovation businesses and building tradespersons
• large number of old yet valuable homes within the target market location
• availability of casual staff and tradespersons
• availability of display and manufacturing premises within the area
• high disposable income within the target market
• potential for future expansion of the business into other areas and/or franchising
4.4 Threats
Example
Canterbury Renovations will need to be aware of and try to overcome the following threats:
6

• poor reputation of the industry in the areas of quality and reliability
• potential for economic downturns
• existence of competitors within the industry
• increasing cost of materials, equipment and subcontractors
• difficulties of getting and retaining suitable staff and reliable subcontractors
• possible government regulation
• geographically diverse market
• increased number of DIYs and supported through home TV shows and magazines
• increased interest in travelling and owning new cars rather than spending money on
home improvements
4.5 Key issues
Example
From the SWOT, the important issues to consider are:
• inexperience and lack of brand awareness
• sufficient funds for projections but limited resources for growth
• keeping projects affordable if materials costs increase unexpectedly
• need to gain knowledge in recruiting and managing staff
4.6 Key opportunities
Example
From the SWOT, the key opportunities include:
• providing good customer service that will put Canterbury Renovations ahead of
market perceptions and earn word of mouth advertising
• popularity of renovations in the area
• utilising technology to promote business and keep in contact with staff
• good networks allow good service and joint promotion activities
4.7 Competitor Analysis
Example
Canterbury Renovations’ main competitors are West Homes and Balwyn Kitchens.
West Homes is too far away to threaten Canterbury Renovations’ projected customer base,
but needs to be monitored in case they expand eastwards.
Balwyn Kitchens only renovates kitchens at this stage and have the following strengths and
weakness:
Balwyn Kitchens
Strengths:
• established & well known business
• featured in Home Beautiful magazine
• two apprentices
Weaknesses
7

• only does kitchen projects
• not answering emails and minimal contact with staff during working hours
• no website
• lack of fully qualified staff
• high overheads with large showroom on a main road
Opportunities
• potential to do bathrooms and laundries
• vacant premises next door for expansion
• new housing development in their area - may get contract with builder to do kitchens
Threats
• new car sales yard in area
• increased number of DIYs and supported through home TV shows and magazines
• disgruntled ex-employee suing for unfair dismissal
5.0 Assumptions
It isn’t possible to accurately predict every possible threat and opportunity. However, with
careful research and consideration, you can predict likely changes and prepare for their
impact.
By listing certain assumptions in your plan, it will be easy to see when the plan needs
updating. For instance, if you assume Balwyn Kitchens won’t move into bathroom
renovations and later they do, you can change the plan to allow for that competition.
Example
This plan is based on the following assumptions:
• Balwyn Kitchens only offer kitchen renovations
• interest rates remain fairly low and steady
• the website won’t require much maintenance once it is created
• West Homes won’t expand into the East
• materials and equipment costs don’t change much
6.0 Objectives
Your marketing objectives should be based on understanding your strengths and weaknesses and the business
environment you operate in. They should also be linked to your overall business strategy.
Marketing objectives don't just involve trying to make more sales. Your objectives can be about creating
awareness, developing interest, motivating people to trial your business or getting clients to return to you.
You may have more than one objective, but if so, make sure that they are consistent with each other. If the
objectives aren't well suited, you may want to change one or perhaps delay one until you have achieved the first.
Remember to make your objectives SMART (Specific, Measurable, Attainable, Realistic, Tangible). Make your
objectives with high targets as they can be broken into action tasks in the Action Plan sections of the plan.
8

6.1 Sales
Example
Over the next 12 months, Canterbury Renovations will undertake:
• 25 renovation jobs valued at $12,000 each
• include built-in equipment in 12 jobs
6.2 Revenue
Example
Over the next 12 months, Canterbury Renovations will:
• generate $300,00 in sales
• have a working capital of $41,000 by the end of April
6.3 Customer Base
Example
Over the next 12 months, Canterbury Renovations will:
• have served 30 new clients
• have quoted a further 200 clients
• completed projects of $10,000 plus for 50% of clients
6.4 Ansoff’s Matrix
Ansoff’s matrix is a useful tool for identifying your marketing objectives. Ansoff identified
four possible courses of action for your business:
• sell existing products to existing markets (safest option)
• extend existing products to new markets
• develop new products for existing markets
• develop new products for new markets (most risky option)
Marketing objectives should be about products and markets only.
Example
The Ansoff’s Matrix doesn’t apply to Canterbury Renovations as they are a service based
business.
7.0 Strategy
A strategy statement outlines how you will achieve the marketing objectives.
7.1 Strategy Introduction
The introduction of the strategy statement is a summary of the main strategies outlined in this
section, so it’s easiest to write once you’ve completed the strategy.
Ideally you will use your SWOT analysis and statements of Key Issues and Opportunities to
help you choose the market segments in which you will compete, and determine how to
9

position your business relative to your competition. You need to develop strategies to meet
those objectives.
Example
Market research carried out by the proprietors reveals an increase in home renovation activity
among home owners in their target market. Such owner/renovators, especially in the inner
suburbs, subcontract the more complex work to builders. Market research also indicates that
many existing kitchen, bathroom and laundry renovators do not have a good reputation,
therefore, the proprietors believe they can gain a competitive advantage through the provision
of top quality products and services, access to specialty items and innovative designs.
The proprietors believe the best marketing strategy combines a good network of contacts, the
development of a reputation for quality and reliability and the attainment of personal
referrals. This strategy will be pursued through the distribution of brochures, direct contact
with home buyers in selected areas and a small display in the rented business premises.
7.2 Target market
As small businesses usually only have enough resources to target market segments, it’s
important to select the most relevant segment before launching a marketing plan. Before you
choose, consider the following:
• who are your customers and potential customers
• is there a market niche which has not been catered for
• are customers in this market satisfied or are they looking for a change
• can you offer them something which really meets their needs
• will you generate enough business in this segment to survive
• alternatively, is there too much business Will you overreach yourself
• how will competitors react
• can you communicate to this market effectively How
Example
Our target market includes:
• people wanting larger or more modern living environments who want to stay in the
area and/or avoid moving costs
• people wanting to live in area buying a property based on location not house style or
condition (about one third of renovators in the area)
• home owners (about half of renovators in the area) in the middle to high income
bracket, with at least two sources of income per household and a higher than average
disposable income, which was predominantly spent improving quality of life
• people wanting to upgrade parts of their house in order to sell it for a better price
7.3 Positioning statement
A strong statement outlining your approach to the market and how you will create brand
awareness. Consider these questions in developing your plan:
• which elements of your marketing are essential
10

• which are preferable but optional
• do you have a clear understanding of your customer's needs
• do you understand your strengths
• how will you differentiate your product from competition
Example
Canterbury Renovations - quality renovations without fuss
Canterbury Renovations are professionals caring for clients’ homes by improving their
kitchens, bathrooms and laundries with quality materials and workmanship.
Canterbury Renovations supplies and installs equipment such as ovens and dishwashers,
creates an environment to suit each client and advises on colours and styles.
7.4 Branding strategy
Branding will make you stand out in the marketplace so a branding strategy can be a useful
marketing tool.
It takes time to create a strong brand, but it involves all aspects of your business and
especially all marketing activities. The brand can be for your product, product range or your
business.
Once you have a well established and recognised brand, you may be able to charge more for
your product, have instant credibility to new customers and require less sales effort to make
sales.
Example
Canterbury Renovations will slowly build up brand awareness for their name and logo. This
will be done as part of the overall marketing strategy for the next three to five years.
The branding strategy includes ensuring that any marketing or advertising materials, such as
business cards and staff uniforms, are created in accordance with Canterbury Renovations
corporate identity style guide.
Canterbury Renovations will present its image as trustworthy and reliable.
7.5 Product strategy
This section describes your long-term product strategy in detail. If you are providing a
service then you should consider your service(s) as your product(s).
You will need to consider:
• what features and benefits do you offer
• unique selling point (USP)
• potential products
Example
Canterbury Renovations offers personalised service whereby the design is part of the project
and can be done in the client’s home with discussions. This personalised service is our USP.
11

Currently, they are offering bathroom renovations but they plan on extending into kitchen
renovations and extensions as well.
7.6 Pricing strategy
Determining the price of your goods and services is an important step when developing your
business and marketing plans. The prices you set will affect the number of sales you will
make, who will purchase from you, what service is required and how much profit your
business makes.
Well handled pricing strategies and changes can greatly improve the profitability of your
business.
There are four factors (cost, demand, competition and image) to consider in choosing a
selling price, but there is no clear method of actually determining the correct price for the
item and market. Experience and market research also help in this process.
Example
Canterbury Renovations pricing policy is:
• supply of built in equipment (such as microwaves, ovens) will be done with a 2
percent commission to remain competitive with whitegoods retailers
• each project will be costed as part of the quote process
• each project will include a $200 establishment fee
• the profit margin on labour of constructions and installation, materials and direct costs
will be 25 percent
7.7 Distribution strategy (place)
Your customers will expect to find your products:
• when and where they need them
• in suitable quantities
• in appropriate places where they can choose between products
• with access to other services to help them use the product (such as after sales service)
Distributing your products is part of successful marketing, so making changes to distribution
is something to be considered as part of the marketing plan.
Example
Canterbury Renovations transports the prepared units and equipment to clients directly, rather
than through a distributor.
7.8 Promotional strategy
Regardless of how good your business is, if you don’t promote it and tell people you exist, it’s
unlikely that you will make many sales.
Promotion is more than selling and advertising your business. It’s about attracting the right
people to use and reuse your business. There are a number of techniques to use and they can
be combined in various ways to create the most cost effective strategy for your needs.
12

Each time you prepare a marketing plan, it’s worth doing further market research to
determine customers’ needs, wants and priorities as well as assessing how the market
currently perceives you and your products and services.
Promotion techniques are broken into four main categories:
• public relations
• advertising
• promotion
• packaging or personal selling.
Direct marketing is often added to the marketing mix despite being part of advertising rather
than marketing.
7.8.1 Public relations strategy
Good public relations (PR) generates interest in your business in terms of enquiries and
reminding existing clients of why they have used your business in the past.
PR is a long-term process, to do with developing an image and a reputation with your
customers and the market as a whole. PR strategies can be focused to appeal to particular
market segments and to send a particular message. All of your PR activities should then work
towards promoting that message to the right people.
Your one year marketing plan should include a publicity plan which will capitalise on
‘newsworthy’ events and opportunities. This includes using the press and radio to promote
your message to your marketplace.
Example
Canterbury Renovations wants the reputation of being residential builders who produce
quality results with professional attitudes by:
• always being punctual and leaving worksites clean and tidy
• providing information resources for local media interesting in renovation and design
tips
A PR agency will be considered in two years time once the business has developed and
gained a client base and a good reputation.
7.8.2 Advertising strategy
Advertising is used to attract customer’s attention and interest, create desire for your
products and services, inform customers and prompt customers to purchase form you.
Your business can be advertised in many ways. Be sure you understand the message you want
to send and the audience you want the message to reach. For instance, to reach a young
audience with a ‘our product is fun’ message you will be better to use cinema advertising
rather than advertisements in a business magazine.
Consider how often you will repeat the advertising in the same and different media.
13

Example
Canterbury Renovations will start advertising on a small scale until resources increase. Initial
advertising will be carried out through letter box drops, local paper listings and a direct mail
campaign to new home buyers in the area.
After six months, the advertising strategy will be reviewed and magazine advertising will be
considered along with direct mailing to real estate agents.
7.8.3 Direct marketing strategy
A response is required for your activities to be classed as direct marketing. Many forms of
advertising can be called direct marketing, but the responses received need to be monitored
to assess the value of the strategy.
One of the most common forms of direct marketing, especially for small businesses, is direct
mail. A letter or flyer is mailed to potential customers in order to build awareness, increase
sales, offer a trial or incite them to contact you.
Example
Canterbury Renovations will use a lot of direct marketing to launch the business and will:
• conduct a letter box drop of flyers in the area to offer opening specials
• create a newsletter to go out monthly to customers and interested people as a reminder
of the business and develop a relationship by offering tips and information
• offer business card magnets to real estate agents to offer as promotional gifts for new
home owners
• add a survey to the website asking people to select which topics most interest them
7.8.4 Sales promotion strategy
Sales promotion is a tactical move where you persuade people to act in a particular way that
they otherwise wouldn’t have acted.
The following activities can be supported by a sales promotion strategy:
• introducing new products through a trial
• staying competitive through discounts or added on benefits
• encouraging year round use of products to reduce seasonal slumps
• attracting new customers
• increasing the perceived need for your product
• increasing the number of items purchased in each transaction
Example
Canterbury Renovations will offer some sales promotion tools, including:
• discounts during the first month of operation to attract customers
• discounts for multiple projects (e.g. bathroom and kitchen)
• free design service as part of the project
14

7.8.5 Sales strategy
Selling by one person to another is highly expensive but also the most effective form of
promotion. Obviously, this occurs in every business, with or without sales staff.
You need to develop a strategy outlining how much personal selling is included in the plan
and how important personal sales is to your target market.
Example
Initially, there will be no sales staff, but within three months, at least one sales person will be
working in the showroom to assist customers. This will allow the owners and tradespeople to
concentrate on quotes and projects.
The website includes a contact form to collect information so return contact will be efficient
and informative for the potential customer.
All staff giving quotes and doing designs will be trained is sales techniques to encourage
additional work or appliances without being pushy.
7.8.6 Packaging strategy
Packaging does more than protect and hold your products as it’s an essential aspect of
presentation and branding. Your packaging choices help make your product stand out from
competitors’ products and can create perceptions as well.
Example
The only packaging for Canterbury Renovations is leaving a beautiful renovation in pristine
condition with a bunch of flowers on display.
7.8.7 Partnership
Any partnerships created with another business should have a separate marketing plan
specific to the joint aspects of your business. This marketing plan may allow certain activities
and budget for these additional marketing plans.
Example
A partnership with a local cleaning company will be investigated to ensure clients’ homes are
left clean and tidy after renovation work is complete.
7.9 Services marketing
There are obvious difference between marketing a product and a service.
If your business is a service business, or has a strong service element as part of product
sales, there are additional elements of the marketing mix to consider. These are
• people
• process
• physical evidence
Selling a service can be harder to control and keep consistency, and as it can’t be stored,
may lead to rejecting potential sales in peak times. Customers don’t leave with a tangible
item and as a result may value your service differently.
15

7.9.1 People
Good customer service is always important, but it is crucial in a service business. Any
negative experience will result in customers looking elsewhere or being dissatisfied.
Example
Canterbury Renovations staff will always wear a blue shirt with the logo on the left pocket
and will be instructed to keep equipment and uniform neat and in good condition.
Staff meetings will include discussions on sales techniques and customer service.
After six months of operations, a service staff of the month awards program will be
introduced. A list of award winners will be prominently placed in the showroom.
Feedback forms for customers will always include a question on staff performance and
manner to capture all kinds of feedback.
7.9.2 Process
Strategies for dealing with necessary and customer service tasks are an important way of
ensuring consistency. Procedures make it easy to cope with busy times and when there are
interruptions during a process.
Example
Canterbury Renovations hasn’t yet produced all of the procedure manuals. However,
procedures are being discussed and prepared to include quote processes, sales behaviour, care
of customers’ premises, security and confidentiality, customer service and invoicing
procedures.
7.9.3 Physical evidence
As there isn’t a tangible product, you need to find other ways to brand and present your
business. For instance, staff in uniform or having the premises decorated in certain ways can
not only make your business professional and welcoming but can also create a brand.
Other forms of physical evidence are things your customers can actually take away with
them. Some examples are gift certificates, loyalty cards, business magnets or pens,
certificates of achievement, information sheets or manuals, written warranties or guarantees,
photographs and small gifts.
Example
Canterbury Renovations will take before and after photos of every project and present them
in a folder as a memento for the customers.
All projects will be cleaned up at the end of each day and thoroughly cleaned at the
completion, using a contract cleaner if necessary. A bunch of flowers will be left on the
bench at each project to welcome the customers into their new kitchen/bathroom.
Staff will all wear a blue shirt with the company logo and eventually, company vehicles will
carry the logo as well.
16

8.0 Resource requirements and budgets
In the long term, the business plan projections are usually sufficient to cover the marketing plan as well.
However, the marketing plan should include a mini-plan of one year’s operations. This includes details about how
to achieve the overall objectives and costs for various activities.
The mini plan uses the same format as the main marketing plan without the research and background
information. It basically needs to include the objectives for the year, the strategies for reaching the objectives,
action plans for the strategies and some contingency actions if the plan doesn’t go as expected.
Setting out the action plan in a spread sheet makes it easy to visualise and work with. It also will show up any
points where actions will interfere with each other and take too much time at once.
Example
Action Plan from commencement on 1st March:
Action March April May June July August
Letter box
drop
Direct
mailing to
local real
estate
agents
Present
photos to
customers
Send out a
newsletter
1-7th 10-17th 20-25th
Send out
12th
At end of each and every project
1st 1st 1st 1st 1 st
Ad in local
paper
15 th , 22 nd ,
29th
5 th , 12 th ,
17 th , 24th
5 th , 12 th ,
17 th , 24th
15 th , 22 nd ,
29th
8.1 Evaluation and control
The plan should be regularly reviewed and evaluated so it can be adjusted as required.
Information collected during evaluations can also be used in planning future marketing
strategies and objectives.
Include annual budgets in the one year or mini operational plan.
Example
Canterbury Renovations will review the marketing plan every month to assess progress and
alterations as the business progresses. After six months, this may reduce to every second
month if marketing is under control and working effectively.
17

9.0 Business growth and development
Definition
Outline the future direction of the business. To grow and develop your business, you will
need to optimise the use of business infrastructure, increase your buying power, improve
efficiencies through internal specialisation and continually improve your products and
services.
It’s important that potential investors be aware of your strategies for future growth and
development. Describe here how you intend to develop the business.
Example
Canterbury Renovations will keep abreast of new products, technology and production
methods. They will be in regular contact with local and overseas suppliers. Marketing
techniques will be monitored. Any techniques deemed successful will be expanded and those
which are unsuccessful will be abandoned.
The proprietors are especially conscious of the need to continually monitor the financial
position of the business. Monthly comparisons will be carried out between actual sales,
profitability and cash flow, and their projections. The cost of each job will be compared with
estimates to ensure that future estimates remain accurate and profitability is achieved.
The business will not be profitable in the first year. However, projections indicate it will be
profitable in subsequent years. Profits will be put back into the business in order to aid
growth and development, with a focus on the following areas:
• expansion of production facilities
• expenditure on promotional activities
• reserving cash to pay for the greater volume of materials, labour and subcontract work
associated with a higher level of business activity
All unsuccessful quotations will be analysed. Prospective customers will be asked to provide
comment on why they rejected the quotations, and information gained this way will be used
to monitor the effectiveness of pricing and sales strategies.
10.0 Financial forecasts
Definition
Financial forecasting means making a set of financial projections that will provide the
figures to support the written information in your business plan. This section will include
your break even analysis.
You need to provide fairly detailed forecasts for at least the first 12 months of your
operations. Give careful thought to the initial capital requirements of your business.
Undercapitalisation can have serious repercussions.
Example
*GST has been included where relevant.
18

10.1 Exploratory costs
Accommodation
Accounting fees
Business planning
Consultants
Entertainment
Legal fees
Market research
Publications
Samples
Telephone, fax, letters, photocopying
Translations
Travel
Valuation fees
Total: $2600
10.2 Initial costs
Lease (legal costs, stamp duty, rent in
$2500
advance, bond)
Electricity, gas and phone (connections and
$500
security deposits)
Opening stock $4000
Insurance premiums (property damage,
$800
public liability, vehicle, theft, personal
disability, professional indemnity)
Printing and artwork
Wages
Credit card establishment fee
Initial promotion
Promotional cost
Loan establishment cost
Stationery and office supplies
Computer software
Installation
Training
Statutory charges (licences, permits and
registrations)
Subscriptions for publications
Association membership fees
Subtotal: $1600
Total: $9400
Capital costs
Business structure (registration,
professional fees)
Office equipment (desks, chairs, safe,
computers, fax, telephone system)
$1200
$2800
19

Plant and machinery (purchase price,
delivery, repairs,
installation/commissioning)
$2000
Building costs (shop front, partitions,
$600
electrical wirings and fittings, floor
coverings, toilets, plumbing and
drainage, painting, signs)
Display materials $1500
Purchase price of business
Franchise fee
Training
Shop fittings (counters, racks, shelving,
storage, decorations)
Security system
Trade marks, designs and patents
(registrations and patent attorney
fees)
Reference materials
Land Subtotal: $600
Total: $12,700
10.3 Possible direct/renovation costs for the first year
Subcontractors $103,300
Materials $84,300
Wages $50,400
WorkCover
Group tax/payroll tax
Maintenance and repairs
Waste disposal
Commissions
Royalties
Freight
Subtotal: $12,000
Total: $250,000
10.4 Possible overhead expenses for the first year
Rent $14,400
Outgoings $1600
Interests $2250
Motor vehicle expenses $9600
Advertising and promotion $12,000
Bank charges
Hire purchase payments
Lease payments
20

Insurance payments
Accounting fees
PAYG TAX
Legal fees
Staff amenities
Electricity and gas
Postage
Entertainment
Travel and accommodation
Subscriptions
Subtotal: $10,800
Total: $50,650
Total first year overheads ($50,650) + exploratory and initial costs ($12,000)
=$62,650 overheads for the first year of business
10.5 Initial funding of the business
The owners have $20,000 of their own money to invest in the business, supplemented by a
$20,000 long term interest free loan from Frank's parents. The closing balance in the
projected cash flow (Attachment 2) shows that, in addition to this, some $41,000 will be
required over the first year of the business.
The owners had preliminary discussions with their bank manager and, subject to the
provision of a properly documented business plan and the provision of a mortgage over their
home, they will be provided with an overdraft of $45,000.
An overdraft was agreed to be the most suitable arrangement for the first year as financial
requirements will vary substantially from month to month and there will be no profits with
which to repay capital. After the first year, trading levels will be more predictable and finance
arrangements will be reviewed.
10.6 Break even analysis
The average mark up on direct/renovation costs is 25%. For example, a $10,000 job will have
a direct cost of $8000. Therefore the gross profit will be $2000, (i.e. 20% of the value of the
job).
The projected overheads for the business in the first year will be $62,650. To break even the
business would have to achieve sales of which 80% pays for the direct/renovation costs and
20% pays for the overheads of $62,650.
If sales x 20% = $62,650 then the sales required to reach break even would be $62,650,
multiplied by five, (i.e. $313, 250).
Therefore, the break even point of sales in the first year will be $313,250. This will not be
achieved in the first year. However, in the second year the profit margin of 18% of the
projected sales of $450,000 (i.e. $81,000 gross profit) will cover the overheads of about
$73,150 and produce a net profit of $8350.
11.0 Costing
Definition
21

Show how you have established the price of your products and services.
Example
Canterbury Renovations will be involved in the following activities:
• purchase and supply of equipment
• purchase and conversion of raw or partially finished materials
• provision of manufacturing and onsite labour
• provision of subcontract work
The following assumptions are made when preparing quotations:
Direct costs $368,500
Overhead expenses $73,150
Business profit $8350
Total $81,500
+81,500
Annual turnover in the second year $450,000
Therefore, to cover profit overheads, the average mark up on all direct costs, equipment,
materials, labour and subcontractors' costs will be 25%.
Accordingly, quotations will be prepared on the following basis for a typical job of, for
example, $10,000:
Item Direct Cost $ Mark up % Mark up $
Equipment 2,500 15 375
Material 1500 35 525
Labour 2300 30 690
Subcontractors 1700 25 425
Total $8000 (avg.) 25% (approx.) $2000
Hourly labour rates will be calculated as follows:
Costs $
Hourly rate (according to award or $18.00
workplace agreement)
Add on costs (e.g. WorkCover 5%) $0.90
Medical costs $1.00
Superannuation 6% $1.08
Payroll tax
(N/A)
Sick pay allowance $2.00
Annual leave allowance ($18x52/48)-$18 $1.50
Tools allowance $1.00
Total $25.48
Allowance for non-productive time, e.g $2.55
industrial action, maintenance, travelling,
tool maintenance, training, injuries etc,
22

e.g. 10%
Total $28.03
Therefore, the hourly rate for estimating work will be charged at $28.00 + 25% mark up =
$36.50 per hour.
12.0 Records
Definition
Provide details of the management information systems that will keep your business running.
Outline the types of records you will keep whilst operating the business.
Example
Canterbury Renovations will maintain sufficient business records to demonstrate the financial
position of the business on a monthly basis. Financial records will compare profitability with
projected profit/loss and cash flow statements. Records will also be kept for each job to show
its progress and cost in labour, materials and subcontractors. These will be regularly
compared with estimates for that job.
The following specific records will be kept:
• cash book
• receipt book
• invoices, received and sent
• bank deposits and statements
• petty cash expenditure
• wage, WorkCover, superannuation and long service leave records
• employee details
• capital assets register
• materials purchased and allocated to each job or temporarily as floating stock
• contact details of all enquirers, existing clients, suppliers and subcontractors
• individual job records showing progress
• job estimates
13.0 Supporting documents
Definition
Including certain documents will support the statements you have made throughout your
plan. You should include figures for projected cash flows and profit and loss, as well as a
statement of financial position.
If applicable, you should also attach copies of your references, qualifications, licences,
permits, partnership agreement, research data, current promotional literature and locality
map.
Example
Attached to the business plan are the following documents:
23

Attachment 1: Projected profit/loss for the first year
Attachment 2: Projected cash flow for the first year
Attachment 3: Projected profit/loss for the second year
Attachment 4: Projected cash flow for the second year
Attachment 5: Statement of financial position
24