If you are starting a bike shop and need to acquire financing, it is very likely that you will need to provide a business plan. A custom business plan for a bike shop considers many factors to outline why it is unique including the location, products/services provided, and capacity. Pro Business Plans has worked with many entrepreneurs to create a plan for investment and strategy. This article provides information about what to include in the plan and how it should be structured,
There are many unique factors that contribute to a bike shop business plan including the business model, marketing plan, and financial projections. A bike shop that also provides repairs in a small rural community will be completely different from an online retail bike shop or one in a dense urban area. The bike shop should effectively communicate its unique positioning in the market relative to other shops. Investors will want to know that risk is low due to strong and sustainable market positioning.
The business model of a bike shop includes what will be sold, the theme of the business, and the full scope of services. Some bike shops specialize in road biking, whereas others in mountain biking or service both categories. A business model should be focused and uniquely positioned against the competition, such that you may avoid directly competing with large bike shops within a small proximity to your location. The business model may also include information about the personnel structure including the number of employees and their roles. For instance, a large full-service bike shop may have several employees working concurrently and a smaller one may be operated by a single entrepreneur with the administrative functions outsourced.
The marketing section of a bike shop business plan typically includes how the company will acquire customers using a combination of digital marketing and local advertisements. Local bike shops should focus on regional advertising campaigns that are highly targeted to both bike enthusiasts and consumers searching to purchase a bike. This may be accomplished by using directories like Yelp! and Google Places to be visible on the search engines, in addition to social media PPC and search engine marketing. The marketing plan purposely avoids traditional mass media promotions that result in poor targeting and result in a very high customer acquisition cost.
The financial projections for a bike shop business plan are forecasted over a three to five-year period and include the income statement, profit & loss projections, and statement of cash flows. This will help potential investors to better understand your company’s profit margins given its operating structure and cost of goods sold. For instance, being in a premium retail location may increase the overhead expenses and require that an unreasonably high amount of inventory be sold. In contrast, your company may have unique purchasing agreements or manufacturing verticals that directly increase your profitability.
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