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Business Plan Outline for Publishers

Here is an article I wrote for the Connecticut Authors Association newsletter. It is a description of a business plan outline that I have used for several years.

My business plan serves two purposes. First, it provides me with a guide to operate my business. Second, it is a sales tool that has impressed bankers. I have also used it to convince distributors that I am serious about what I am doing. My plan describes the following:

  1. Introduction
  2. Current Situation
  3. Objective
  4. Strategies
  5. Tactics
  6. Forecast
  7. Budget

Introduction

Summarize.

Always include a short summary of your business particularly if you intend to use it to woo investors. It also serves as a reminder of where you propose to focus your efforts. Limit the length of the summary to one page and include the following:

Current Situation

  1. Company and industry. This contains background information on your company and describes the nature of your industry. It should include the following information:

    • Your company
    • Date of incorporation
    • Principals and what role each has played in the business to date
    • Business purpose and highlights of progress to date
    • Industry
    • Present what you feel to be the current status and prospects for the overall book business; what are your sources?
    • Describe the major "players" and how they are performing, including growth in sales, profits, and current market share

  2. Product. Completely describe your book, articles, video or skills (design, editing, etc).


  3. Market. This forces you to research your competition and opportunities to create a realistic forecast. Include the following:

    • Market Definition. Describe the potential customers, their locations, their interest in your product and seasonal changes in sales. If your book has a track record, discuss how it is viewed in the marketplace.
    • Market size. Use statistics and other objective data (much of which can be found online).
    • Market Trends. Describe the market's growth potential. For example, if employment is growing, why should a distributor consider my new job search book? (i.e., I demonstrate that college enrollments are growing and that my title is directed toward this growing pool of graduates).
    • Competition. Name and discuss all major competitors. Compare your book with your competitors' books on the basis of price, unique benefits and other important factors.

Objective

What you will accomplish in this period in terms of unit sales, gross revenue and net income.

Strategies

Remember the 4Ps of marketing: product, place, price and promotion. Describe broadly how you intend to manipulate each of them strategically to reach your objectives.

Tactics

These are the details of specific actions you will take to implement the strategies that will ultimately achieve your objective. Again, it is helpful to categorize them by the four P's.

  1. Product. Can you make your book more detailed than competitors' works? More up-to-date? What will you do next? A new book or planned second edition will enhance your stature among publishers and distributors. They are more likely to take you seriously if you can demonstrate you are not a single-title author.
  2. Place. If distributors or sales representatives will be used, describe how they will be attracted, motivated, compensated and what geographic (or markets) areas will be covered.
  3. Price. Always consider the discount the people in your distribution channel will assess.
  4. Promotion. Public relations. Describe how you will generate free publicity through appearances on television and radio shows. How will you stimulate book reviews? Show samples of press releases.

Sales promotion. Give examples of the sales promotional tools you will implement. What kind of promotional literature will you develop? Four color? Black and white?

Advertising. In what media will you advertise? How will you use continuity to create awareness of your new book? How will you use direct mail to reach your targeted lists? Include a description of the trade shows you will attend such as the BEA or regional shows.

Personal selling. Describe how you will stimulate sales through personal presentations, book signings and seminars you will conduct.

Forecasts

If you perform all these tactics, how many books will you sell? Here you will provide an estimate of sales in terms of units and revenue. Identify any major customers who have made or are willing to make purchase commitments.

Budgets

Given the revenue you expect and the costs for implementing all your tactics, create a budget. The amount of financial information presented in your business plan will depend largely on the stage of your financing and the amount of money you are seeking. Your plan should describe in general terms the type and amount of funding you need.

Make sure you allocate for returned books (20%?) and bad debt. Also take into consideration the 90 -120 day payment policies of retailers and distributors.

It will take a considerable amount of time to create this document the first time, but it will be well worth the effort. You will have a prepared list of actions to take to sell more books. Your objective will be there to motivate you to work more, and your budgets will keep you fiscally responsible.

I hope this helps,

Brian Jud
BJud@marketingdirections.com
http://www.marketingdirections.com


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