This section of your business plan describes both the strategy and tactics you will use to get customers to buy your products or services.
Sales and marketing is the weak link in many business plans, so take your time with this section. A strong sales and marketing section can
serve as a roadmap for you, or as an assurance to potential investors that you have a workable plan and the resources for promoting and
selling your products and services. The three components of your sales and marketing section include:
Strategy
Your strategy may be only a few sentences in length, or it can be a couple of paragraphs. Important elements for a sales and marketing
strategy include who you are targeting with your initial push and what customers you have designated for follow-up phases. Other elements
of a sales and marketing strategy are:
How you will find your prospects, and once you find them, how you plan to educate them about your product? For instance, if you are using
direct mail, you might want to talk about what kinds of mailing lists you plan to purchase.
What features of your product or service you emphasize to get customers to notice your product.
Any sort of innovative marketing or sales techniques you will employ. For example, you may sell your product by mail order when your
competitors use only traditional retail channels. Or you may be the first in your industry to offer leasing.
Will you focus your efforts locally, regionally, nationally or internationally? Do you plan to extend your efforts beyond your initial
region? Why?
Method Of Sales
Describe available distribution channels and how you plan to use them.
Many entrepreneurs fail to give adequate thought to a method of sales. How you get the products to the end user - your method of
distribution and sales - is one of the most important elements of your plan. In this section you demonstrate the ability and knowledge
to get your products into the hands of your target customers.
You must also elucidate your plan for reaching your distribution channels. Will you be selling directly to your customers? Will you be
using sales representatives, distributors, or brokers? Do you plan to have a direct sales force in place? See the list of definitions for
some help in determining what method of sales to use. Will you use a "ground service"? Will you use a next-day delivery service like
Federal Express? Parcel post? A trucking company? Make sure to include these costs when you calculate your financials later in the plan.
Tips
Don't make the mistake of confusing sales with marketing. Sales focuses on how you get your products into the hands of your customers.
Marketing is concerned with how you educate your potential customers about your product.
If you're using an outside or indirect sales force - like sales reps or distributors - be sure to describe the companies that will be
carrying your products. What are the benefits of using these specific firms? What unique talents do they bring to the table?
Many small businesses assume that a sales effort can be set up with minimal timing, effort and expense. This is not the case. It can
take as long as a year for a sales person to become acquainted with a product and territory. Even if you use sales reps who are intimate
with a territory and market, expect there to be ramp-up time.
Don't assume a distribution network will give your products or services equal sales time. You may need to create an incentive structure
that will encourage your network to push your products or services.
