Most artists and designers don’t want to spend their time creating a business plan. It doesn’t sound very creative. But, it is a necessary exercise and tool to grow and guide your career or business.
While a business plan has the same components no matter what field or industry you’re entering, it can be difficult for to understand. Self-employed artists, freelancers and art business owners are particularly vulnerable because they may not have been trained in business along with their art or design degree. Without education and training on how to start and run a business, it can be difficult to even know the right questions to ask. This article will help you ask – and answer – those questions.
A business plan helps you really know your business, the industry and your competitors so you can anticipate and respond to challenges and opportunities that arise. The plan doesn’t have to be long, but it must be thorough. If done right, it will provide an overview of your entire creative business; how it will work, its potential obstacles, as well as the best avenues for success. A business plan is helpful whether you are starting a new business or want to better understand your existing one.
Business Plans for Creatives Answer:
- What is the purpose of your business?
- Who is your potential market? How big is it?
- What products and services will you offer?
- How will you get your business started?
- What resources do you need?
- How much will it cost?
- What does success look like
Identify Benefits to Customers and Clients
Clearly identify the benefits your business has over others in the market, and develop your core philosophies and business goals. Define your marketing and sales strategies and project your costs and potential income based on concrete assumptions, researched facts, trends and data.
Knowing who your competitors are, what they are doing, what has made some successful and why some have failed. You must also define your target markets and strategies for reaching them. Most importantly: don’t rely purely on your personal knowledge of what you think your market is and what you think it wants. You are only a small sample and despite everything you believe about the logic of your position, there may not be as many people who think this way. Conduct proper market research by looking online – reading articles, industry journals, market reports, U.S. Census Data, U.S. Bureau of Labor Statistics, talk to experts in the field, any and everything you can get to identify and define your target market.
Talk to potential customers to ask them what products or services they want to verify that your business is needed. Don’t lead them though. Your questions need to be unbiased. Find out what can differentiate your company from the competition so that their customers will switch to you. Let’s say you are a wedding photographer and you discover that the main complaint that couples have after their wedding is the length of time it takes to receive their photos for review. In an age where social media and instant gratification is a customer’s expectation, a quick turnaround with a limited number of pictures to be used for social media could be an advantage over your competition. This can be your competitive advantage – one that makes your business succeed.
Define Necessary Resources
The next step is to find a way to make your business happen successfully. What resources will you need and how much will they cost? In your plan, calculate the costs for both time and resources required as well as any costs associated with marketing the service that you’re offering. Add in all the resources that are required to run the business, such as rent, equipment purchases, potential marketing expenses, utilities, insurance, employees, etc. to get a financial picture over the coming years. However, businesses rarely go exactly to plan. The more you know about your business, the easier you can adapt to the situation, capitalize on potential opportunities, and handle any crisis.
Create a Financial Outlook
For a business plan to be an effective tool, you must be honest in your analysis, particularly the financial one. You are going to have to make some assumptions on how much of your services you can sell. That number should be based on research and data from your past, competitors, the market, the economy and other factors.
DON’T FUDGE THE NUMBERS to make their business appear viable on paper. This isn’t always intentional. It’s just that people want the business to work so badly that they subconsciously force the numbers to work in their favor. You need to watch out for it, though. Sometimes, a would-be creative business owner simply doesn’t conduct enough research, thereby skewing the numbers. For example, if sales projections are made based on successful sales without also accounting for potential failures, the result will be unrealistic projections, which may prompt you into buying equipment or a studio space that you really cannot afford. In the end, the business may run out of money before the business had a chance to really take off. By conducting an honest assessment, you may discover that the risk of failure is too high. And that’s ok, too – it’s better to find this out before you put your money, time, and effort into the business.
Business plans can be time-consuming and difficult, even for a small art business. However, there are software packages that making writing plans easier, such as Live Plan or Biz Plan Builder. These software packages ask questions that guide you through the analysis so you won’t feel lost or overwhelmed. You can try online courses like these at Skillshare: Business Planning for Creatives or The 2019 Complete Masterclass On Writing A Business Plan
Engage Your Target Market(s)
Once you know your market and have determined your business is viable, it’s time to engage your target market. Today, it’s all about networking. You are as much a part of your business as the product or service you are selling. Your excitement and enthusiasm will be infectious. You can make your business seem amazing in ways that other people cannot because you’re the passion behind it. Whether you are a wedding photographer or starting your own advertising agency, you are your best asset to sell your product or service.
Of course, not everyone is great at networking, but building an audience as a freelancer or business owner requires your constant attention. Start with the people you know and get them to introduce you to other people that may need your services. Even if these people aren’t your target, they may know other people who are. And those people, in turn, may be important in the art community or have valuable connections that may be able to help you down the road.
You never know who might need your services or who can help catapult your business. Try to find these people. They will be the ambassadors that promote you and your business. They will be the ones who push your business on social media, and the ones who convince their friends and colleagues to hire you. These are the people who will lead you to your future customers. They are worth more than all of your other marketing efforts, especially since they are free. And since you have already written your business plan, you have a good idea of the people you need to meet.
Use it or Lose It
Business plans shouldn’t sit on the shelf or on your hard drive. Your plan is a living and breathing document that can help you create and manage forecasts and budgets, discover whether your business can make money, and how much money you’ll need to get started. If you have team members, you can work collaboratively and then share your progress with advisors or investors. Plus, the software available today provides reports and documents in a beautiful, visual format that are easy to read and understand. Creating a plan lets people know that you are serious about your business, which will make it more likely that people will want to be involved or invest in both you and your company.
The process of crafting your creative business plan is a vital exercise to think through your product or service and determine if you’re really prepared go off on your own. It’s your essential road map and should be followed to arrive at your desired destination. For information on how to incorporate your creative business, read our article, How to Set Up and Protect Your Business.