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 How to strengthen your business plans?
If your business is a startup or a restart you may be thinking that the historical financials are the weakest part. You may be the only senior executive and be concerned about the management team section. Perhaps the market size and customer target analysis has not been fully thought through. All of these are very important. But, the most often overlooked and the weakest part of the majority of business plans is the Per Customer Economics section.
Per Customer Economics is the one section of the business plan where everything comes together. It is the section where it becomes painfully obvious if an entreprenuer truly knows their business or simply loves their business. In this part of the plan broad statistics and trends are replaced by a highly focused view of one customer. How much does it cost to acquire this customer? How much revenue is generated? At what operating cost? By focusing the market research and business financials on one customer transaction, decisions regarding the go-to-market strategy, market positioning, pricing, operations model, liquidity, and capital round requirements and valuation become clear. A well done per customer economics analysis is the mark of a quality business plan and an intelligent executive team.
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