As a new business owner – or as a business owner starting a new business – you need to understand the rationale, process, and pitfalls of business planning.
Hence, the reason why it is crucial to be the only one (or a significant contributor) in the writing process.
The process of writing a business plan for your massage business should follow a predefined format. This format allows you to explore the financial risks, benefits, and alternatives that are present and projected when planning your new business.
I have discovered during my years of financially guiding massage business owners that those who take an active role in developing their business plan gain knowledge about the financial side of operating their business. business. These new massage business owners are often not struck by the element of surprise when unforeseen expenses arise.
Here’s why you need a business plan
Writing a business plan will help you as an owner gain clarity, stay focused, and justify your resources. A well thought out business plan will allow you to convey a concise and cohesive story about your business, giving a roadmap for how you will be successful in the often uncertain future of your new business.
If you are good at writing your business plan, you will have a competitive advantage because you will be able to:
Formally analyze the risks and alternatives; estimate potential income and expenses; and identify the resources and tasks needed to implement a new service you might want to offer in your massage business.
Your business plan should include the following parts:
• The executive summary
• Business concepts
• Market analysis
• Competitive analysis
• Commercial strategy
• The financial plan
• The operating plan and
• Implementation plans
The executive summary is a concise one-page document at the start of your business plan, the job of which is to create a positive first impression of your business. It’s akin to an elevator pitch, a brief pitch for your business to potential investors or anyone you’re looking to get funding from.
The elements of the summary are taken from the business plan itself and will often include excerpts from the list mentioned above. Although the summary is at the start of the business plan, it is often written last after you have completed the business plan itself.
We should try to have the following things in their summary:
• Business concept: Types of services. In this case, a massage therapy service. You can also include any unmet needs that the business hopes to meet. For example, cupping massages or prenatal massages in the greater area of your city.
• Brief Market Analysis: Answer the question of how many massage spas are in your potential area. This will include carrying out market research.
• Competitive analysis and what will be your business strategy to attract new customers.
• Financial requirements and what will be needed for operations. This will include how much investment and working capital is required.
• Summary of the qualifications or accomplishments of the business owner.
This section will look at what service you provide and how you try to meet an unmet need. This can be to better create a roadmap for your business or to help you justify obtaining financing.
This section of your business plan will aim to answer the following three questions: what value is created or delivered, how that value is created or delivered, and to whom the value is delivered.
This section should generally begin with an overview of the industry. It aims to convey the following elements:
• A general state of the economy of the place where you hope to do business. It is best to address economic trends and forecasts that may impact your business. The question to ask yourself is: Will the inhabitants of the neighborhood or surrounding areas support my business?
• An estimate of the size of the market you want to target with the proposed services you want to provide.
• The estimated growth rate of your target market, if such data can be obtained. This portion is essential, especially if one seeks funding from both traditional and non-traditional sources.
While it is imperative to be part of the business plan process, this part tends to be the most difficult, and you may often need to collaborate with other people to achieve this.
In a world of limited resources, competitive analysis is an essential part of the business plan. This helps to better target your business for maximum return by assessing who you will be competing with and at what prices your competition is. The competition can be other companies or even other competing technologies.
Think of competitive analysis as a comparison of your competitor’s strengths and weaknesses with your brand’s strengths and weaknesses. Do you offer sports massages and not your competitors? Are your competitors open for more hours than you? Are your prices much higher than those of your competitors?
This part of the business plan will look at how your business will position itself from an organization’s perspective and what services you will provide.
The business strategy works well once you have performed a competitive analysis, as the competitive analysis will generally place you and your peers into one of the following categories: a low cost, high volume massage therapist or a more differentiated and more expensive massage. therapist. The source of differentiation reflects the perception of unique services, better quality and improved service delivery.
Your business strategy must be able to respond to the following elements:
• Range of services provided.
• Benefits of these services for the local community.
• The volume of services required to achieve financial equilibrium.
• Target market or audience. You might also want to respond to how you target your market.
• Print or non-print advertising.
A financial plan will consist of listing all the sources of income for your new business and the strategies for obtaining that income. The income that a new service can be expected to generate is the difference between the income received and the expenses incurred by that income-generating activity. Typical expenses include salaries, benefits, rent, utilities, taxes, furniture, supplies, equipment, amortization, and debt repayment.
It is often a good idea to come up with estimated projections of income and expenses over a period of three to five years. It’s more difficult for new businesses, but established businesses would use past performance while looking at market performance and future trends to make projections.
Estimates can be quickly done on a spreadsheet. These projections would help your business estimate how much money might be needed in the business, if you are a new massage business; or invest in a new service or get a return on business expansion if you are already operational.
Operation and implementation
The operating plan will cover the day-to-day management of the business. The operating plan will take into account the personnel, space, and equipment required to run your business well, and how each of these components interacts with each other.
Regarding the choice of equipment, you have to try to justify one brand over another, especially when there is a cost differential between the two. The implementation plan goes hand in hand with the operations plan, as it will highlight how one plans to deliver the services highlighted in the other sections, using the personnel, space and equipment put in place. evidence in the plan of operations.
One final note to consider: The act of writing a business plan is dynamic. It is a journey and not a destination. Your business plan will ideally go through several updates and revisions as you get more information and get closer to your start date.
The only thing that will be important on this journey of writing your business plan, however, will be having clarity and focus on what you want your massage business to look like – and the job you’re ready for. to do to achieve it.
About the Author:
Lozelle Mathai, MBA, CFEI, is an accountant with over 18 years of experience in financial management and accounting. She is the owner of Closing Your Books LLC, as well as The Body of Accounting, a virtual educational accounting consulting firm that teaches massage and bodywork business owners how to manage, maintain and understand their business finances. His articles for MASSAGE magazine include “4 Steps to Financial Power: Create a Massage Business Budget” and “Your financial skills are as important as your touch. “