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38 March 2014 | beautystorebusiness.com Beauty retailers can use the planning process to more effectively meet the needs of whatever market is being served. Whether the business is located in a thriv- ing metropolitan area such as New York or Chicago or in a small town, preparing a business plan can prove extremely beneficial in helping a store to become more efficient and more profitable. And if you are seeking additional outside capital for your business, a business plan is a must to include in the financing package. Here are the 10 key components of a business plan with many helpful hints on how to prepare one. I. Executive Summary The executive summary is used to "hit the high spots" of the business. Not only is it used to help an outsider to understand the basics of your venture, but it also is a good place to summarize for yourself exactly why you are in business. This section of the plan should be concise— three pages or less—and should provide a brief overview of the entire plan. The executive summary is particularly critical if you are using the plan to attract out- side capital, as it will usually tell the prospective investor or lender whether or not to read on. First impressions are critical, so don't rush through this sec- tion. It should provide a concise summary of the main body of the business plan. Components of the executive summary should include the purpose of the plan, background on the store, management and its market, sales strategies, a histori- cal financial summary and funds required (if applicable) and their proposed uses. II. General Background of the Business This section of the plan is used to pro- vide a brief history of the company as well as information on what differentiates the venture from competitors. It is not necessary to go into a great deal of detail since most of the areas will be covered later in the plan. In this section, the business owner should focus on the nature of the busi- ness, the location of the business, the customer base being served, methods used to meet the needs of customers, key personnel involved in the business and significant historical occurrences that have shaped the course of the venture. III. Management This is the section in which you have the opportunity to "toot your own horn." If you are preparing the plan for the purpose of obtaining outside financing, resumes should be included for all key people in your organization. The empha- sis here should be on the unique traits of your key people that mesh together to bring your company success. If you have a board of directors, information on them should also be included. Even if you are writing your business plan for internal strategizing, this section is important. An honest appraisal of the strengths and weaknesses of you and your key employees can help you in capitalizing on the strong points and addressing the areas that need improvement. IV. Products and Services Outlining your products offered may seem rather simple, but it's a bit more complicated than saying, "I sell beauty stuff." You may also offer beauty-related services that your customer needs. You should provide a good bit of detail in this section on the primary categories of all products and services offered. Start out by addressing the needs you are meeting for your customers. Are you trying to focus more on the casual customer who comes in occasionally and purchases some hair color or the serious beauty shopper looking to spend $100 or more each visit? By zeroing in on your target market, you may actually decide to change your product mix—a move that may lead to higher sales levels and increased profitability. V. Marketing For the marketing section, you need to answer the question, "How will my store(s) be publicized and delivered to my customers?" This is often one of the most troublesome planning areas for beauty business owners. Your ad dol- lars are limited, but you've got to find creative ways to get the word out that you are there. This section of the plan allows you to evaluate your marketing strategy as well as your distribution methods. Here you will want to ask your- self questions such as: Am I advertising too much or too little?; Should I consider other advertising channels?; Is my online Continued from page 34 www.MalibuC.com | 1.800.622.7332 PRESCRIPTIVE WELLNESS TREATMENTS HAIR SCALP SKIN 100% vegan gluten sulfates parabens propylene glycol DEA FREE OF: Normal & Dry Skin Hydrate Exfoliators Masques Tattoos wellness solutions wellness solutions wellness solutions Sensitive Skin Acne wellness solutions ink well wellness solutions ness solutions malibu C ® Color Hard Water Blondes Swimmers Hair Repair Scalp T h e I m p o r t a n c e O f A P l a n . i n d d 3 8 The Importance Of A Plan.indd 38 2 / 3 / 1 4 2 : 5 1 P M 2/3/14 2:51 PM