“Question & Improve”
THE BUSINESS PLAN
“The act of planning This business plan consists The real value of creating a business
of a narrative and several plan is not in having the finished
helps you to think financial worksheets. The product in hand; rather, the value
narrative template is the lies in the process of researching
body of the business plan. and thinking about your business
thoroughly” It contains more than 150 in a systematic way. The act of
questions divided into several planning helps you to think things
sections. This business plan through thoroughly, study and
although completed for the research if you are not sure of
SME Consulting strategic the facts, and look at your ideas
planning project, is also critically. It takes time now, but
an important resource for avoids costly, perhaps disastrous,
operating a consultancy mistakes later.
such as SME. This therefore
This business plan is a generic
is also a template on which
model suitable for all types of
you may rely on, to define
businesses. However, you should
your client’s business model,
modify it to suit the particular
or re-aligning their strategy
circumstances. Before you begin,
to reflect their customer’s
review the section titled Refining
the Plan, found at the end. It
To use this Business plan as a draft suggests emphasizing certain
for your future you should skip any areas depending upon the type of
questions that do not apply to your business (manufacturing, retail,
client’s type of business. When service, etc.). It also has tips for
you are finished writing your first fine-tuning the plan to make an
draft, you’ll have a collection of effective presentation to investors
small essays on the various topics or bankers. If this is why you’re
of the business plan. Then you’ll creating the plan, pay particular
want to edit them into a smooth- attention to the writing style. It
flowing narrative using the template will be judged by the quality and
provided on your “SME Consulting appearance of the work as well as
brand resource DVD”. by the ideas behind it.
TABLE OF CONTENTS
EXECUTIVE SUMMARY 4
GENERAL COMPANY DESCRIPTION 6
PRODUCTS AND SERVICES 8
MARKETING PLAN 10
Products and Services 14
Competitive Analysis 16
Distribution Channels 1
Managing Your Accounts Recievable 4
MANAGEMENT AND ORGANIZATION 5
PERSONAL FINANCIAL STATEMENT 7
START-UP EXPENSES AND CAPITALIZATION 7
FINANCIAL PLAN 8
REFINING THE PLAN 1
“Strategically generic SME Consulting is a ready and secondary cities. Research has
to run branded complete shown good interest in locations
in nature, SME consultancy. within the Wairarapa, Kapiti Coast,
Palmerston Horowenua regions.
Consulting has been It was established to be a packaged
It is therefore to be assumed that
brand company, meaning that the
designed in a way initial hard work of developing a
this business model and brand could
easily be developed into a licensed
to enable it to be brand and completing the required
national company or as a locally run
pre-entry market research has
consultancy anywhere in the more
developed to the already largely been completed.
suburban/rural parts of the country.
next preferred level Strategically generic in nature, SME
Generally, when developing a
Consulting has been designed in a
market you find that you have to
with ease” way to enable it to be developed
re-educate your actual market
to the next preferred level with
targets to your ideas and methods.
ease. All forms of media have been
To do this in the geographical areas
carefully developed by professional
defined by our research, face to
graphic designers to ensure a
face cold calling is required to
professional and modern brand.
achieve the essential networking
The resources included have
needed. As any experienced sales
been developed by experienced
rep will tell you, the first impression
Investment Bankers and Sales/
is the last impression. Therefore
Marketing Consultants, whilst
where most consultancies go wrong
carefully packaged inline with
are that they believe you have to
the brand by experienced Brand
have a good client network before
good, brand awareness, and this
assumption is totally incorrect.
The market is currently well
developed for consulting services A complete modern and essentially
within metropolitan areas. This fact relative brand is the key to these
leaves the more rural and suburban initial contacts. SME Consulting
market wide open to be targeted therefore provides that professional
with few suppliers to the market and vision and focus to gain that crucial
growing demand as urban property first time impression. Although
prices force more and more small the brand is free to be developed
to medium businesses to move in which ever way the operator
out to the more rural townships chooses, many key resources
have been provided and designed
to compliment the brand keeping
inline with the concept by utilising
the logo and colour schemes and
specially designed templates.
In brief, a well designed and ready
to run consultancy free to be
developed into which ever niche
market the operator chooses. Below
are some examples of market
niches that fit into the brand:
• Brand Development
• Process Improvement
• Financial Planning
• Strategic Marketing
• Business Finance Broking
• IT Consulting
• Web Development
Economically we are now entering
a cycle in which small business
finance and consulting will become
essential with the rising cost of
money, as interest rates are steadily
increasing on a global scale. Due
to this, now is the time to establish
a professionally trusted brand to
reap the rewards in the near future
as the market moves through this
phase of the macro-economic cycle.
GENERAL COMPANY DESCRIPTION
SME Consulting is a In a recent research on the saves the entrepreneur time and
suitable investment for aspirations of today’s teenage therefore money, but also by having
any of the following populace, the question was posed the brand professionally designed
experienced professionals of “what do you want to do for and pre-packaged by several facets
looking to start their own work when you leave school?” in of the business consultancy areas
business: results of over 70%, the test group this entrepreneur will be able to
answered that they wished to own leave a lasting impression of quality
Sales Marketing Executive
their own small business and work professional service during the
Accountant from home. The reality is that a initial client contact.
large portion may at some stage of
Banker Mission Statement:
their lives actually attempt this, but
SME Consulting’s mission is to
Entrepreneur with odds of 1:9 of them actually
provide a cost effective way to build
managing to survive the first year
Business Analysts a brand whilst reducing the time
of trading, very few will actually
frame of setting up a business to
IT Professional succeed.
Six Sigma Qualified Many of those failed start-ups did
not portray the true essence of the Company Goals and Objectives:
Importers Exporters firm’s mission through a correct SME Consulting’s goal is very simply
branding strategy. Branding is a to be a ready branded package for a
crucial part of starting a company. budding entrepreneur, whose skills
Human Resources Manager It’s what defines the character, the lay outside of building a brand. This
nature of what you are trying to gives the entrepreneur time to focus
achieve and how you are trying to on building his or her client network
Commercial Lawyer achieve it. Whether that is through from the outset with virtually no
a conservative colour scheme and distractions from building the
discrete logo, for say a consultancy marketing side. SME being a
or a stylish and modern one to very generic brand was carefully
portray an upmarket hotel chain. designed to be exactly that, generic.
Giving the operator freedom to add
Therefore this research has now
their own fine touches or to perhaps
proven the need for ready branded
to even refine it in line with their
company set-ups, for those types
particular skill sets.
of people looking to move on from
their 9-5 bank jobs in the city for Business Philosophy: In business
example. Having a ready packaged trust from the outset is what
brand from the outset not only makes or breaks a consultancy. A
professional brand gives that air of out on their own who can provide FASTEST GROWING
quality service and professionalism niche skills such as sales, process, BUSINESS DISTRICTS
to build lasting relationships from marketing, website development
that crucial first contact. and many more aspects of
managing a successful company.
The market research carried
Most small businesses cannot afford
out has shown that currently
to employ experienced staff in only
non-metropolitan areas are
one role of their firm, commonly QUEENSTOWN-LAKES
underserviced by business
referred to as multi tasking, most
consultants in nearly all facets. The median age of people in the
employees are required to cover
Queenstown-Lakes District is 34.5,
several positions and responsibilities
With rising competition, and the
compared with 4.8 for all of New
within their day to day employment.
cost of borrowing, refining business
This creates a sense of “Jack of all
practices will be crucial to the future
trades, but master of none” which
of the small business market for the The most common language after
is not beneficial to the operation’s
foreseeable future. As prices rise English in the Queenstown-Lakes
long term growth prospects.
in the cities, more and more of the District is Japanese, spoken by
SME Consulting is therefore a
operations will relocate to the more .7% of people. For New Zealand
professional brand for someone
suburban areas and rural centres. as a whole, the most common
looking to exploit this skill shortage
Adding in the existing market language after English is Mäori
as a form of outsourcing.
in these locations, makes it a (4.5%).
sufficient economy of scale for small All Resources have been developed
,688 households or 44.1% in the
consultancies who manage to keep by experienced professionals within
Queenstown-Lakes District have
their overheads low and therefore the following fields:
access to the Internet, compared
their pricing inline with demand. Finance, Banking, Service, Graphic
with 7.4% for all of New Zealand.
Design, Website Development
The strength of SME Consulting as
Queenstown is New Zealand’s
a brand is not only in the modern Legal form of ownership: Currently
fastest growing city.
aesthetics of the marketing material a sole trader operation, this has
(Website, Logo etc), but also in the been the easiest form of operation, Abundance of SME’s, mainly based
material provided. Although the although it is recommended that a in the tourism sector.
material is not the business itself, company formation be completed.
that is the operators abilities in a By leaving it as a sole trader
field of business. Therefore SME enables the brand to be sold with
Consulting is a fantastic opportunity no legal or financial obligations
for an experienced business pending.
professional looking to branch
PRODUCTS AND SERVICES
SME Consulting has found to freelancers as they no longer have
“...the brand itself
date, that the geographical areas to deal with the client relationship
is generic enough targeted as test cases, were very portion of the project. So not only
responsive to web development can the freelancer design quicker,
to be adapted to and re-branding projects. Using but SME Consulting is able to feed
relationships with Graphic Designers the pipeline more business as they
and a Website Developer, this have more time to focus on sales
expertise with area is to be considered a highly and service. This also has a major
profitable and productive avenue impact on client satisfaction.
complete ease...” to be explored . The business
model used was that as a sales With all the benefits of the above,
and service outsourcing agent for it’s also important to understand
freelance designers. Therefore by the possible issues that can arise
using several of these partners SME from such a structure and in the
Consulting is able to confidently event of them arising, be prepared
produce several websites at a to deal with them effectively. The
time due to the construction major issue is with timing. This
being done externally whilst also means that with external parties
having more time to focus on the working on the same project timing
‘Business to Client’ relationship is of the essence. SME Consultants
more effectively. If this as to be need to be able to provide accurate
completed internally rather than time frames by understanding the
through external third parties exact productivity ratios for their
the costs would rise dramatically partners. This would enable all
due to employing several high parties to be able to accurately
income specialists. As Such, there keep the pipeline full but not over
are no major overheads required full as that will lead to a damaged
and in fact in a tax sense there brand image of SME Consulting
are even major financial benefits and not the freelancers as SME is
in outsourcing the construction responsible for the contract, just
of any website developments. like a project management company
Another major benefit of this type operates. Pricing for this is usually
of structure is that it improves a commission of between $1000
not only the productivity of the to 100% of the cost and should
sales pipeline for SME Consulting, be completed within 6 weeks (i.e
but also the productivity for the total cost to construct $1,500 =
total price $,000 and $1,500 exercise for the founders who FASTEST GROWING
profit that’s a margin of 100%!). typically have no time to give to this BUSINESS DISTRICTS
Therefore managing the sales area which is also often confusing
pipeline is the key to positive cash for them. Pricing for this form of
flow from this enterprise project work can be charged at
$100 - $150 per hour carrying very
Another great new market is the Six little overheads.
Sigma process improvement area.
Although there are just two MACKENZIE
Although normally a large corporate
profitable areas outlined above, The median age of people in
the brand itself is generic enough the Mackenzie District is 38.3,
methodology, it can very easily be
to be adapted to any professional compared with 4.8 for all of
adapted to medium business and at
expertise with complete ease and New Zealand.
a very profitable rate. Most of these
with no need to alter the branding
types of medium businesses have The most common language after
grown rapidly and to date are to English in the Mackenzie District is
be considered successful start-up’s French, spoken by 1.6% of people.
and probably are trying to move For New Zealand as a whole, the
from the embryonic phase into a most common language after
more mature established service English is Mäori (4.5%).
provider. This is a very crucial stage
The most popular occupational
to the long term growth prospects
group in the Mackenzie District is
for these firms. Most are often
agriculture and fishery workers. The
owned and operated on a day to
most popular occupational group in
day basis by the founders who due
New Zealand as a whole is service
to the rapid growth have a need of
independent and subjective analysis
to be able to move the firm into Increase in property development
the next phase of growth. Usually and net migration from Europe
the founder is unprepared for the leading to increasing property
success of the operation, and the values and therefore property
firm is starting to lose its drive services.
and direction. Six sigma methods Fast becoming the new place of
usually are able to point out through choice for people, looking to obtain
process mapping and other tools, the typical kiwi lifestyle.
the areas of process which need to
District Includes the Mt. Cook area.
be addressed. A time consuming
”...the venture MARKET RESEARCH MARKET RESEARCH
- WHy? - HoW?
cannot succeed No matter how good your product Market research has been
and your service, the venture performed more on identifying
cannot succeed without effective the market target profile, than on
marketing” marketing. And this begins with the market as whole due to the
careful, systematic research. It is fact of SME Consulting trying to
very dangerous to assume that you retain a generic nature for future
already know about your intended development. It’s therefore difficult
market. you need to do market to define an exact market as
research to make sure you’re on that would be dependent on the
track. operators, particular skill set.
In terms of the market in general,
the ideal market target has
proven to have the following
• Location is suburban to rural
• Staff of -10
• Established operations, possibly
fallen behind competition
• Brand seen as stale
• Trades related business
• New management
• Need to diversify services
• Location has an increasing
populace from outside the area
Due to the nature of the target
areas, it’s important to have an
ability to prospect for clients by
cold calling. Before doing this, in Start with your local library. Most FASTEST GROWING
depth research should be performed librarians are pleased to guide BUSINESS DISTRICTS
on the brand awareness of the you through their business data
prospect and its services offered. collection. You will be amazed at
More often than not, the SME what is there. There are more online
Consultant finds themselves in a sources than you could possibly
position of educating the prospect use. Your chamber of commerce
to the options available. Due to has good information on the local
nonexistent consulting services area. Trade associations and trade
The median age of people in the
offered to these areas within New publications often have excellent
Central Otago District is 4.6,
Zealand, the prospects usual answer industry-specific data.
compared with 4.8 for all of
to a cold call is “I just don’t have
Primary research means gathering New Zealand.
time to think about things like
your own data. For example, you 93.8% of the population in the
that” which is exactly why SME
could do your own traffic count at Central Otago District (1,4)
Consulting is needed. To make those
a proposed location, use the yellow speak only one language, compared
options available without placing the
pages to identify competitors, with 8.1% for New Zealand as a
customer under stress.
and do surveys or focus-group whole.
Below are some useful marketing interviews to learn about consumer
1,740 households or 0.8% in the
ideas for the eventual operator to preferences. Professional market
Central Otago District have access
use, there are also resources on the research can be very costly, but
to the Internet, compared with
DVD supplied. there are many books that show
7.4% for all of New Zealand.
small business owners how to do
There are two kinds of market Fastest growing wine district in
effective research themselves.
research: primary and secondary. New Zealand leading to rapid
In your marketing plan, be as increase in tourism based services.
Secondary research means
specific as possible; give statistics, Highest sunshine count in
using published information
numbers, and sources. The New Zealand providing a unique
such as industry profiles, trade
marketing plan will be the basis, lifestyle “Creating industry cluster
journals, newspapers, magazines,
later on, of the all-important sales groups with a view to developing
census data, and demographic
projection. their specific capabilities, economic
profiles. This type of information
contribution and export potential.”
is available in public libraries,
Central Otago District’s Economic
industry associations, chambers of
Strategy opens many opportunities.
commerce, from vendors who sell to
your industry, and from government
“SME Consulting ECONOMICS looking for a change in direction
Facts about the SME industry: or lifestyle, the opportunity to hit
gives someone the ground running. With having
Fastest growing business districts
a well developed and presented
looking for a with the top 10 being as at the end
brand already built and designed,
of financial year 2005:
change in direction the operator has only to begin
1. Queenstown-Lakes 9.1% prospecting within that area with no
or lifestyle, the delays due to brand creation.
2. Mackenzie 7.5%
opportunity to hit Although it is also important to
. Central Otago 6.8%
consider that as of February 006
the ground running” 4. Selwyn 6.5%
more than 75% of all businesses
5. Chatham Is. 5.8% within New Zealand were based in
the North Island, 5% of them in
6. Waimakariri 5%
7. Tauranga 5%
• Business and Property Services
8. Ruapehu 4.7% are the largest industries in
New Zealand, not Agriculture as
9. Porirua 4.6%
perceived. Construction is now
10. Southland 4.5% New Zealand’s second largest.
Now this may not really seem so • In 006 77% of all companies
wonderful when looking at these use broadband.
small percentages, but when
• Large untapped markets in
compared to the national average of
locations offering unique
3.3% growth and Auckland at 2.7%,
Wellington .7% and Christchurch
at 4.6% its then obvious which • Barriers to market entry for
locations in New Zealand are in both the operator of SME
need of independent small to mid Consulting and the competitors
sized business consultants. are: Business specialisation,
general business acumen,
Also due to their isolation, these
sales experience, knowledge
areas are in general harder
of internet development,
to attract top staff. Therefore
small business networks.
SME Consulting gives someone
* (These barriers are actually a • Change in your industry: The
benefit to the business model, consultancy will not only be up
as it restricts market entry to to date on the latest methods,
those few with the true ability but will actually invent and
to deliver.) create some of their own. A
How could the following affect
improvement and creative
thinking, therefore they must
• Change in technology: SME also follow their own teaching.
Consulting was founded to
identify client prospects that are
behind in the latest methods
and systems, therefore change
is the lifeblood of the model.
• Change in government
regulations: At this stage TAURANGA 5%
there are no plans for
the government to change
regulations on business
consulting. All the regulations
are the same for all. Regardless
of type (i.e. the privacy act.) PORIRUA 4.6%
• Change in the economy:
Business consulting is one of
the few industries that benefits
from all economic cycles. Due WAIMAKARIRI 5%
to the nature of the business, SELWYN 6.5%
a bad economy is sometimes
better than a good one.
CENTRAL OTAGO 6.8% CHATHAM IS. 5.8%
“...using the PRODUCTS SERVICES COMPETITION
Below is a table of possible services
fastest growing that fit into the brand. It’s important
The Small Business Consulting
market is well developed within the
that the eventual operator of SME
business districts more metropolitan areas of New
Consulting has a clear selection of
Zealand. Although, as discussed
as a geographical the following and the experience
earlier in this piece, the small
and knowledge required to deliver
market guideline professionally on these services.
business market maybe moving
away from these currently well
would allow SME Website Development entrenched consultancies due to a
Graphic Design demographic shift for small business
Consulting to find
in general as they seek to reduce
IT based sales
untapped markets Financial Broking
overheads and/or change of lifestyle
for the owners.
for whichever niche Legal Consultancy
Process Improvement SME Consulting therefore is about
skill set is required” taking a professional brand actually
to the client, as outlined above
in the fastest growing business
districts. With well established
consultancies in the larger cities
Credit Control like Wellington and Auckland for
Branding example, it is currently very difficult
Client Development to set up a brand new operation
due to market oversaturation in
these places. So by following the
demographic shift as outlined
above, it is to be assumed therefore
Please see the resource DVD for
that using the fastest growing
material relating to some of the
business districts as a geographical
market guideline would allow SME
Consulting to find untapped markets
for whichever niche skill set is
The type and therefore amount of
competition the eventual operator
will have is dependent on several How will your products or services FASTEST GROWING
variables such as the niche services compare with the competition? BUSINESS DISTRICTS
that the operator will decide to focus
To understand the strengths
on. our marketing research shows
and weaknesses of a business,
us that currently there is large
it’s important to do a quick
demand for branding expertise and
SWoT (Strengths, Weaknesses,
web development within the target
Opportunities, Threats) analysis
locations as outlined in a previous
to have a general overview of SELWYN
chapter. This is due to reluctance of
where your business or operation The median age of people in the
the larger firms who are currently
needs to improve. This has been Selwyn District is 5., compared
embedded within in the main
completed as an example only and with 4.8 for all of New Zealand.
centres, to actually target the
this template can also be found on 95.2% of people (25,353) in the
smaller end section of the market.
the ‘Resources DVD’ as this is also Selwyn District said they belong
This therefore leaves potential to
a very important part of assessing to the European ethnic group. For
owner operators to exploit with
your future client’s competitive all New Zealand 80.1% said they
little to no competition in locations
position if so required. belong to the European ethnic
Indirect competition will also
The median income of people in
remain in the form of lawyers
the Selwyn District is $1,000,
and accountants, although their
compared with $18,500 for all of
consulting skills are generally New Zealand.
focused on the broader horizon than
1.0% of people aged 15 years and
what is necessary for the day to
over in the Selwyn District have
day running of a successful firm. In
an annual income of more than
the modern market, a full range of
$50,000, compared with 11.5% for
professional services are paramount
New Zealand as a whole.
and that has created a need to
The most popular occupational
have specialists in several niche
group in the Selwyn District is
areas such as process improvement
agriculture and fishery workers. The
and web development that the
most popular occupational group in
enterprising business consultant
New Zealand as a whole is service
can target effectively with very
high rates of return but as always
Small business growth seen mainly
dependent on the operators own
around the tourist trail near Arthurs
skill sets as to what area of service
pass the lakes.
TABLE 1: CoMPETITIvE ANALySIS
FACTOR ME COMPETITOR A COMPETITOR B
PRICE 5 1 5
QUALITY 4 5 5
SERVICE 5 4
RELIABILITY 5 4
STABILITY 4 4 4
EXPERTISE 4 5
LOCATION 5 1 4
APPEARANCE 5 5
SALES METHOD 4
4 4 1
IMAGE 5 4 4 5
TOTALS 50 41 40 5
5 = very strong This assessment was based on network. The target being at all
1 = weak the current positioning of SME times, the customers expectations.
Consulting. The table shows us that This is a brief overview of a
having a professionally presentable business’s current brand positioning
brand when working within the as compared against internal
business services industry is an assumptions, competitors and the
essential ingredient when trying most important being what the
to establish that crucial client customer expects in return for
their money. This table is a useful within New Zealand (i.e. Invercagill) FASTEST GROWING
quick insight into assessing the and start their own business, it’s BUSINESS DISTRICTS
clients (and SME Consultings) actual probably logical to expect that that
current brand perception from person has many skills learnt as
several different angles. a Business Banking rep that could
easily be applied to their own clients
The SME Consulting brand therefore
needs. This person therefore would
gives that air of professional
logically move into the business
experience needed to be successful CHATHAM IS.
finance consulting market.
The median age of people in the
Some disadvantages do remain
Example 2; a Marketing executive Chatham Islands District is .8,
however, as it is still apparent that
within a large corporate company compared with 4.8 for all of New
a lack of advertising does make
in Auckland, wishes to raise their Zealand.
it hard to generate leads quickly.
newborn child away from the cities
Therefore the eventual operator Very Sparse population
and closer to their own family
will need to define the best source
(i.e. Central Otago)whilst having a Fishing is the main industry
of marketing dependent on the
more relaxed lifestyle at the same
operators chosen location and field 6.7% of people aged 15 years
time, would easily find that the
of expertise. and over in the Chatham Islands
skills learnt in the corporate world
District said they have no formal
which the person has probably until
NICHE qualifications, compared with 27.6%
now taken for granted as standard
Now that we have systematically of people aged 15 years and over in
business practice, are in desperate
analyzed the industry, the product, New Zealand.
shortage in the locations outlined as
customers, and the competition,
being New Zealand’s fastest growing
51 households or .% in the
you should have a clearer picture of
business districts. This person would
Chatham Islands District have
where your future consultancy can
then logically look to move into the
access to the Internet, compared
fit into the market.
branding and strategic marketing
with 7.4% for all of New Zealand.
The particular niche of the nice of the industry.
Although there has been a slight
consulting market is entirely
These are just two examples of
increase in tourism, there is still too
dependent on the operator’s skills,
how the often taken for granted or
small a population (800 apx) for it
experience and chosen lifestyle.
overlooked skills of the operator can
to be considered a viable option.
Example 1; if a business banking be used to exploit the exact niche
representative who currently within the market to become a very
is working in one of the large successful consultant.
institutional banks but wishes to
perhaps return to their place of birth
“Development STRATEGY Internet: Currently the strongest
As above, giving an exact detailed and most effect form of internet
of the current marketing strategy is dependent on marketing is via Google Adwords.
knowing the right niche to target.
website should be Google Adsense enables the
Although some marketing tips and advertiser to pay as much per
done inline with ideas are as follows: month as needed (min $50) and
have a link placed onto hundreds if
whichever niche the Cold calling: Door to Door, calling
not thousands of different websites
in on small businesses within the
operator targets” area. Use of the resources on
which have something in common
with the advertisers particular
the DvD is the key to this as a
market segment and products/
professional presentation is required
from the offset. It’s Important to
keep the time short but effective Once the funds have been paid
as the objective is to gain a first via credit card, a simple link and/
name basis with the potential client or pictorial advertisement will be
and arrange a more suitable time placed on any websites that have
to do a proper presentation as placed Google’s code enabling this
to the services offered, how they link to be shown. This also works
can benefit the client and more both ways, as by enabling the
importantly… why you. Google Adsense product, the cost
of Google Adwords can be negated
Referrals: Establish a relationship
via page impression click through
with an accountant, lawyer, graphic
advertisements placed on the SME
designer, business broker etc within
your area and feed off their client
Both Products only require a simple
list. Leave brochures in their offices
registration at no cost and are
or even in the office of a local hotel
highly recommended as one of the
that caters to businesspeople. Use
most cost effective way to advertise.
a client fidelity program to keep
your brand at the forefront, using Development of the current
a dedicated mailing list and post website should be done inline
sale follow up... remember their with whichever niche the operator
birthdays! Referrals are the life targets. Resources for the clients
blood of a consultant as they will should become downloadable
add in future goodwill. from using a logon and password
system and then a download page
with .pdf links attached so that or local school with the correct Local Newspapers: These generally
the client can then obtain copies technology (projector etc). Use your are not suitable for BB (business
of any material required whenever accountant, lawyer etc to obtain to business) as these are targeting
they require it (possible passive potential mailing lists and names of the consumer market and therefore
income opportunity i.e. charge per attendees as well as a local radio/ are suitable for BC (business to
download). newspaper advertisement combined consumer). Again this is heavily
with posters strategically placed dependent on the actual location to
Seminars: Arrange a seminar
around areas that attract small be chosen by the eventual operator.
type presentation. The objective
business owners like the post office Local Radio: This is in general
for the seminar is to create public
or local bank. a very effective way to create
awareness of the SME brand,
create the ‘need’ (realisation Small high street office: As the awareness of the brand. Most
that the client needs to use your geographical locations identified businesses in New Zealand have
service) and generate leads by are more or less all semi-rural or the local radio station playing
arranging appointments during rural districts (see fastest growing somewhere on the premises.
the coffee break (also at the end, business districts), it’s not out of Although some leads can be
but this strategy is more effective the question to eventually look at generated by this form of media,
during the seminar). Seminars opening up a highly visible high it is mainly about creating brand
should cover the following: current street office. This will add overheads awareness.
market situation on a global to the operation but due to the
local scale, trend of that market, general nature of the commercial
SME Consulting mission statement, lease expenses being lower than
services offered, how those the national average, it’s therefore
services can benefit the client, an important mid growth step to
facts figures on the success consider. Remember, for every dollar
rate of your services, examples of you put into the operation… how
situations where a company should many will you get back? This would
bring in a consultant, disaster be ideal for when the business
examples of where they didn’t, moves past the embryonic stage
give names of existing or past and has a need to distribute some of
clients (with permission) and lastly the more mundane responsibilities
cost. Seminars of this type are by delegating this to employees.
usually a - hour affair and light
refreshment should be provided.
It is important that the seminar
is held at a proper venue such
as a conference room of a hotel
How important Sponsorships: Quite often people • Should you have a system to
think this means giving some money identify repeat customers and
is price as a to the local sports club to have then systematically contact
the logo included on team shirts. them?
But the most effective form for a • How much will you spend on the
Do your intended business such as SME Consulting items listed above?
is to sponsor a business planning/
customers really innovation competition such as the
“Cable Car Challenge” sponsored by
make their purchase For most small businesses, having
Rod Drury the founder of Xero Ltd.
the lowest price is not a good policy.
decisions mostly Again, this is very effective brand
It robs you of needed profit margin;
customers may not care as much
on price? This is all very dependent on the about price as you think; and large
location and niche to be targeted, competitors can under price you
but the above can be used to define anyway. Usually you will do better
the exact mix required. to have average prices and compete
Important questions to be asked on quality and service. Therefore
when defining that mix are as the following questions must be
follows: asked by the operator:
• How will you get the word out to Does your pricing strategy fit
customers? with what was revealed in your
• Advertising: What media, why, competitive analysis?
and how often?
Compare your prices with those of
• Have you identified low-cost the competition. Are they higher,
methods to get the most out of lower, the same? Why?
your promotional budget?
How important is price as a
• Will you use methods other
competitive factor? Do your
than paid advertising, such as
intended customers really make
trade shows, catalogues, dealer
their purchase decisions mostly on
incentives, word of mouth (how
will you stimulate it?), and
What will be your customer service
network of friends or
and credit policies?
• How do you want customers
to see you? Is that inline with
Proposed Location DISTRIBUTION CHANNELS FASTEST GROWING
How are you going to sell your BUSINESS DISTRICTS
Once the geographical location has
products or services?
been selected, it’s important to
remember that metropolitan based • Retail
clients don’t care so much about
• Direct (mail order, Web,
where you are based but more
about the quality of service and
reputation. If you have selected • Wholesale CHATHAM IS.
one of the districts (or similar) • Your own sales force The median age of people in the
outlined in this plan then where Chatham Islands District is .8,
your operation is actually based compared with 4.8 for all of
• Independent representatives
does become an important factor for New Zealand.
many prospective clients. • Bid on contracts
Very Sparse population
Generally this particular market • Sales Forecast
Fishing is the main industry
segment will trust locally run
Use the sales forecast database
businesses over the larger city 6.7% of people aged 15 years
(Resources DVD) to prepare a
based ones due to accessibility and over in the Chatham Islands
month-by-month projection. The
and convenience of the service District said they have no formal
forecast should be based on the
provider. Again this may also raise qualifications, compared with 27.6%
marketing strategies that have just
the question of the actual premises of people aged 15 years and over in
been described and industry data, if
of the operation. It’s important New Zealand.
that if a client does come to you
you may want to do two forecasts: 51 households or .% in the
for a meeting, that there is an
1) a “best guess”, which is what you Chatham Islands District have
actual ‘place of business’ feel to the
really expect, and ) a “worst case” access to the Internet, compared
premises whether that be a room
low estimate that you are confident with 7.4% for all of New Zealand.
in your own home used as an office
or an actual leased office space. For you can reach no matter what
Although there has been a slight
example, is there off street parking? happens.
increase in tourism, there is still too
Are there any family pets? These
Remember to keep notes on your small a population (800 apx) for it
can all easily damage the image of
research and your assumptions as to be considered a viable option.
you build this sales forecast and all
It could be prudent to ask “is subsequent spreadsheets into the
it what your customers want plan. This is critical if you are going
and expect”? to present it to funding sources.
“Do you know what LEGAL ENVIRONMENT PERSONNEL
• Licensing of several software • Type of labor (skilled, unskilled,
it will cost you to packages is a must such as and professional)
MYOB or XERO (recommended)
extend credit? Have • Where and how will you find the
• If you will be offering Financial right employees?
you built the costs
Planning services then you
• Quality of existing staff
into your prices?” should check to make sure you
have the relevant qualifications • Pay structure
• Health, workplace, or • Training methods and
environmental regulations are requirements
• Who does which tasks?
• Currently there is no compulsory
regulation to have any formal • Do you have schedules and
qualification to be a business written procedures prepared?
consultant. (Does not apply to
• Have you drafted job
all services i.e. law)
descriptions for employees?
• Please speak to your local If not, take time to write
business insurance some. They really help internal
representative to understand communications with
your requirements or we employees.
recommend speaking to your
• For certain functions, will you
use contract workers in addition
SUPPLIERS CREDIT POLICIES FASTEST GROWING
Identify key suppliers: • Do you plan to sell on credit? BUSINESS DISTRICTS
• Names and addresses • Do you really need to sell on
• Type and amount of inventory
furnished • How will you check the
creditworthiness of new
• Credit and delivery policies
applicants? We recommend Waimakariri
• History and reliability www.creditconsultants.co.nz
The median age of people in
Should you have more than one • What terms will you offer your the Waimakariri District is 37.4,
supplier for critical items (as a customers; that is, how much compared with 4.8 for all of
backup)? credit and when is payment New Zealand.
The population of the Waimakariri
Do you expect shortages or short-
District contains a smaller
term delivery problems? • Will you offer prompt payment
proportion of Pacific peoples (0.5%)
Are supply costs steady or and smaller proportion of Asian
fluctuating? If fluctuating, how • Do you know what it will cost people (0.8%) compared with the
would you deal with changing costs? you to extend credit? Have you whole of New Zealand (at 6.5% and
built the costs into your prices? 6.6% respectively).
(Help with pricing is offered as
9.2% of people aged 15 years and
part of the sale agreement)
over in the Waimakariri District have
an annual income of more than
$50,000, compared with 11.5% for
New Zealand as a whole.
The most popular occupational
group in the Waimakariri District is
service and sales workers. This is
also the most popular occupational
group in New Zealand as a whole.
4,60 households or 4.7% in the
Waimakariri District have access to
the Internet, compared with 7.4%
for all of New Zealand.
“We recommend MANAGING YOUR through outsourcing or factoring
ACCOUNTS RECEIVABLE them on. They also would make a
a reputable credit If you do extend credit, you should very useful partner for the operator
do an aging at least monthly to of SME Consulting for future clients
track how much of your money is consulting packages.
be brought on tied up in credit given to customers
Managing Your Accounts
and to alert you to slow payment
You should also age your accounts
Accounts Receivable Aging
payable, what you owe to your
You will need a policy for dealing
suppliers. This helps you plan whom
with slow-paying customers: (see
to pay and when. Paying too early
depletes your cash, but paying late
• When do you make a can cost you valuable discounts and
phone call? can damage your credit. (Hint: If
you know you will be late making
• When do you send a letter?
a payment, call the creditor before
• When do you get your attorney the due date.)
to take legal action?
Do your proposed vendors offer
We recommend a reputable credit prompt payment discounts?
consulting agency be brought on
board such as Credit Consultants
Ltd. By doing this you will be able
to collect debts owing without
having to waste valuable time
and resources chasing them.
Credit Consultants have an array
of policies and products that can
benefit a small business selling
on credit. They also can help to
manage your accounts receivable
MANAGEMENT AND ORGANIZATION
PROFESSIONAL AND ADVISORY SUPPORT FASTEST GROWING
Support type: Name Name
Board of directors
Management advisory board
Support type: Name Name
Insurance agent The most popular occupational
Banker group in Tauranga District was
Consultant or consultants Service and Sales Workers (16.8
Mentors and key advisors percent). The most popular
occupational group for New Zealand
In the tables above, list the support www.net24.co.nz (Current as a whole was Service and Sales
people you wish to use. reseller agreement in place) Workers (14.8 percent).
Thriving economy, driven by
The following are our recommended Net4 is one of New Zealand’s
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future needs) centre and find out why thousands month creating demand for all retail
of businesses trust Net4. services
www.1stdomains.co.nz Papamoa is expected to become a
Credit Consultants provides a wide city itself within 15 years
range of credit management and See Net 4.
New Motorways are almost near
related services throughout New www.webdeveloper.com
completion which is expected to
Zealand and Australia. Our clients
A web developer forum and lower the drive time to Auckland
include private and public sectors
resources, database. Links web significantly and result in a much
organisations, large corporate and
developers from all over the world higher influx of new residents.
small/medium sized businesses.
to solve any coding issues. Also
provides useful, free educational
Graphic Solutions www.buildwebsite4u.com www.business.govt.nz
Web page templates are ready- You’re at the New Zealand
is a graphic design
made Web pages created to use government business site. The
business based in as a basis for fast and high-quality information and tools here are
website development. All you need designed to help you start, manage
Wellington which is to add your text and pictures to or grow your business and deal with
your Web design template - and the day-to-day challenges along the
you’ll get a functional and individual way.
innovative branding site ready for upload.
and marketing www.graphicsolutions.co.nz
You don’t have to be a big business
solutions. Graphic Solutions is a graphic to enjoy the benefits of leasing
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branding and marketing solutions. business friendly leases and enjoy
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This New Zealand Government
website provides information on
patents, trade marks and designs.
Here you can search the registers,
pay renewal fees, file trade mark
applications, and find forms and
guides on intellectual property in
PERSONAL FINANCIAL STATEMENT
You should also complete personal FASTEST GROWING
financial statements (See Resources BUSINESS DISTRICTS
DVD) for each owner and major
stockholder, showing assets and
liabilities held outside the business
and personal net worth. Owners
will often have to draw on personal
assets to finance the business, and
these statements will show what
is available. Bankers and investors The most popular occupational
usually want this information as group in Ruapehu District was
well. Agriculture and Fishery Workers
(.5 percent). The most popular
occupational group for New Zealand
START-UP EXPENSES as a whole was Service and Sales
AND CAPITALIZATION Workers (14.8 percent).
Increasing amount of tourism
It’s important to estimate expenses it destroys the accuracy of your development due to the ski fields
accurately and then to plan where carefully wrought plan. The second
Strong Hospitality industry with
you will get sufficient capital. approach is to add a separate
festivals held at ohakune every
This is a research project, and line item, called contingencies, to
year for the start of the ski season.
the more thorough your research account for the unforeseeable. This
This creates more demand for new
efforts, the less chance that you is the approach we recommend.
bars and cafes.
will leave out important expenses
or underestimate them. (See Talk to others who have started The tourist towns of Whakapapa,
Resources DVD) similar businesses to get a good National Park and ohakune are also
idea of how much to allow for located here.
Even with the best of research, contingencies. If you cannot get
Population is decreasing due to
however, opening a new business good information, we recommend
rising property values as more
has a way of costing more than a rule of thumb that contingencies
city based investors are buying up
you anticipate. There are two ways should equal at least 0 percent
holiday homes around the main
to make allowances for surprise of the total of all other start-up
tourist spots of ohakune and
expenses. The first is to add a expenses.
little “padding” to each item in
the budget. The problem with
that approach, however, is that
FINANCIAL PLAN (SEE RESouRCES DVD)
The financial plan consists of a 12- so that you can explain them later if
“If the profit
month profit and loss projection, a necessary, and also so that you can
projection is the four-year profit and loss projection go back to your sources when it’s
(optional), a cash-flow projection, time to revise your plan.
heart of your a projected balance sheet, and a
break-even calculation. Together
business plan, PROjECTION (OPTIONAL)
they constitute a reasonable
The 1-month projection is the
cash flow is estimate of your company’s financial
heart of your financial plan. This
future. More important, the process
the blood...” of thinking through the financial
section is for those who want to
carry their forecasts beyond the first
plan will improve your insight into
the inner financial workings of your
company. of course, keep notes of your key
assumptions, especially about
1-MONTH PROFIT AND things that you expect will change
LOSS PROjECTION dramatically after the first year.
Many business owners think of the
12-month profit and loss projection PROjECTED CASH FLOW
as the centerpiece of their plan. This If the profit projection is the heart
is where you put it all together in of your business plan, cash flow is
numbers and get an idea of what the blood. Businesses fail because
it will take to make a profit and be they cannot pay their bills. Every
successful. part of your business plan is
important, but none of it means a
Your sales projections will come
thing if you run out of cash.
from a sales forecast in which you
forecast sales, cost of goods sold, The point of this worksheet is to
expenses, and profit month-by- plan how much you need before
month for one year. start-up, for preliminary expenses,
operating expenses, and reserves.
Profit projections should be
you should keep updating it and
accompanied by a narrative
using it afterward. It will enable you
explaining the major assumptions
to foresee shortages in time to do
used to estimate company income
something about them—perhaps cut
expenses, or perhaps negotiate a
Research Notes: Keep careful notes loan. But foremost, you shouldn’t be
on your research and assumptions, taken by surprise.
There is no great trick to preparing And of course, depreciation does FASTEST GROWING
it: The cash-flow projection is just not appear in the cash flow at all BUSINESS DISTRICTS
a forward look at your checking because you never write a check
account. for it.
For each item, determine when you
actually expect to receive cash (for
OPENING DAY BALANCE
sales) or when you will actually
A balance sheet is one of the
have to write a check (for expense Porirua
fundamental financial reports that
any business needs for reporting The most popular occupational
you should track essential operating
and financial management. A group in Porirua City is clerks.
data, which is not necessarily part
balance sheet shows what items
The population of Porirua City
of cash flow but allows you to track
of value are held by the company
contains a larger proportion of
items that have a heavy impact
(assets), and what its debts
Pacific peoples (26.7%) and
on cash flow, such as sales and
are (liabilities). When liabilities
smaller proportion of Asian
are subtracted from assets, the
people (4.0%) compared with
you should also track cash outlays remainder is owners’ equity.
the whole of New Zealand (at
prior to opening in a pre-start-up 6.5% and 6.6% respectively).
Use the start-up expenses and
column. You should have already
capitalization spreadsheet as a The median age of people
researched those for your start-up
guide to preparing a balance sheet in Porirua City is 0.8,
as of opening day. Then detail how compared with 4.8 for all
your cash flow will show you you calculated the account balances of New Zealand.
whether your working capital is on your opening day balance sheet.
8.0% of people (1,87) in
adequate. Clearly, if your projected
optional: Some people want to add Porirua City are aged under 15,
cash balance ever goes negative,
a projected balance sheet showing compared with .7% for all of
you will need more start-up capital.
the estimated financial position of New Zealand.
This plan will also predict just
the company at the end of the first Rapid expansion of SME’s
when and how much you will need
year. This is especially useful when seeking to lower their costs by
selling your proposal to investors. moving away from Wellington.
Loan payments, equipment
Again property inflation can be
purchases, and owner’s draws
usually do not show on profit and
High Internet usage and
loss statements but definitely do
excellent modern transport.
take cash out. Be sure to include
TO BE FOUND ON THE ‘RESOURCES DVD’
“A break-even BREAK-EVEN ANALYSIS ü Brochures and advertising
A break-even analysis predicts the materials
analysis predicts the sales volume, at a given price,
required to recover total costs. In ü Industry studies
sales volume, at
other words, it’s the sales level
ü Magazine or other articles
a given price, that is the dividing line between
operating at a loss and operating at
required to recover a profit. ü Copies of any contracts
total costs” Expressed as a formula, break-even ü Any other materials needed to
is: support the assumptions in this
Breakeven Sales =
Fixed Costs ü Market research studies
ü original files specific to SME
Consulting (logo etc)
ü Brand Manual
ü Stationary (invoices, letterhead
REFINING THE PLAN
The generic business plan presented FOR INVESTORS FASTEST GROWING
here in should be modified to suit Investors have a different BUSINESS DISTRICTS
your specific type of business perspective. They are looking for
and the audience for which the dramatic growth, and they expect to
plan is written. This can be done share in the rewards:
in collaboration with the current
operators of SME consulting at an • Funds needed short-term
extra cost to be negotiated as part
• Funds needed in two to Southland
of the sale agreement.
The median age of people in the
FOR RAISING CAPITAL • How the company will use Southland District is 6.8, compared
You will need to supply the following the funds, and what this will with 4.8 for all of New Zealand.
information in a professional format. accomplish for growth.
3,030 households or 29.7% in the
• Estimated return on investment Southland District have access to
FOR BANKERS the Internet, compared with 7.4%
Bankers want assurance of orderly • Exit strategy for investors
for all of New Zealand.
repayment. If you intend using this (buyback, sale, or IPo)
plan to present to lenders, include: The Southern Institute of
• Percent of ownership that you
Technology offers free education.
• Amount of loan will give up to investors
This brings net youth migration,
• How the funds will be used • Milestones or conditions that leading to an increased demand for
you will accept all services hospitality.
• What this will accomplish—
how will it make the business • Financial reporting to be Stewart Is. is becoming a major
stronger? provided tourist attraction.
• Requested repayment terms • Involvement of investors on the Currently one of the fastest
(number of years to repay). board or in management growing property markets left in
New Zealand due to economic
You will probably not have
much negotiating room on
interest rate but may be able to
negotiate a longer repayment
term, which will help cash flow.
• Collateral offered, and a list
of all existing liens against
MANAGING THE BRAND
“Don’t try to COLOURS
There are 3 main colour spaces, RGB, CMyK and PANToNE. you will find the
reinvent the wheel, SME Consulting logo supplied in all of these formats on the Resources DVD.
Below are the explanations and SME brand colour information.
keep ‘it’ clean and
RGB (red, green, and blue) refers to a system for representing the colors
to be used on a computer display. Used in basically anything intended to be
viewed on screen(note Microsoft applications also use RGB).
R:159 G:39 B:41 R:181 G:176 B:173
CMYK (cyan, magenta, yellow and black) This most common colour space
used for professional level print. Also called full colour, and is used for any
printed work using photographs. (Digital Printing only uses CMyK)
C:25 M:96 Y:90 K:21 C:30 M:6 Y:8 K:0
PANTONE A set of standard colours for printing, each of which is specified
by a single number. Pantone Colours are also sometimes referred to as
corporate colours and are mostly used for printing of company stationery or
in one or two colour print runs.
PANTONE 704 PANTONE Cool Gray 6
Logo Font: Trade Gothic
General Use Font: Verdana
OPENING DAY BALANCE SHEET
ASSETS LIABILITIES NET WORTH
Current Assets Current Liabilities
Cash in Bank $-
Accounts Payable $-
Inventory $- Taxes Payable $-
Prepaid Expenses $- Notes Payable (due within 1 months) $-
Other $- Current Portion Long-term Debt $-
Total Current Assets $- Other current liabilities (specify) $-
Total Current Liabilities $-
Machinery Equipment $- Long-term Liabilities
Furniture Fixtures $- Bank Loans Payable
Leasehold Improvements $- (greater than 1 months) $-
Property / Buildings $- Less: Short-term Portion $-
Other $- Notes Payable to Stockholders $-
Total Fixed Assets $- Other long-term debt (specify) $-
Total Long-term Liabilities $-
Specify $- Total Liabilities $-
Owners’ Equity (Net Worth) $-
Total Other Assets $-
Total Liabilities Net Worth $-
Total Assets $-
STRENGTHS, WEAKNESSES, OPPORTUNITIES AND THREATS ANALYSIS
My Company Competitor 1 Competitor Competitor
What are your business
What are your core
Where are you making
the most money?
What are you doing well?
What areas are you avoiding?
Where do you lack resources?
What are you doing poorly?
Where are you losing money?
What needs improvement?
Any beneficial trends?
Niches that competitors
New needs of customers?
obstacles to overcome?
Negative economic conditions?
Changing business climate?