Strategic planning series
Most strategic plans begin with the development of a business plan, a methodical process where all aspects of the business are defined and analyzed against the company’s business objectives. Food processing companies develop business plans at different stages of their life cycle, especially in preparation to launch a new product line, invest in a facility expansion or to identify new growth opportunities.
Larger companies often establish internal teams to develop a business plan, while smaller and mid-size companies may choose to outsource the process. Engaging an outside business planning consultant provides a critical, objective view of the organization that can be beneficial in uncovering new opportunities for business growth, as well as areas of inefficiencies.
Ideally, functional leaders within all key areas will participate in the business planning process to provide input and establish a holistic view of the organization before planning begins to include manufacturing, marketing, sales, finance, logistics and the executive team.
The key areas that a business plan should include are:
- Company description — What is the nature of your business and how will your product serve the market’s needs? Who are your target customers? What sets your company apart from other food processing companies in the marketplace offering similar products
- Industry analysis — In this section, your business plan should address both the specific market segment you’ll serve and customer wants/needs. Is the market climbing the bell curve or well saturated? Who are the current market leaders and what is their brand strategy? What profit margins are typical in the industry? Are there seasonal or geographic limitations or opportunities? In the plan, you’ll want to explore market share, growth potential and profit margins in depth with your finance team.
- Product mix — This section will detail each product your company will manufacture and its contribution to meeting sales goals. Each individual SKU will fill a unique customer desire and have its own price and profit margin, in addition to competitive advantages, such as ingredients, packaging or price. What similar products are on the market and what share of the market do they own? Are there product lines the company may add in the future? It’s important that the plan address any future growth plans.
- Marketing & sales — This section of your business plan will lay out your sales goals and determine your marketing strategy to meet those goals. Is this a new market you’re hoping to penetrate or are there existing product lines in the market? Could your product target an entirely new demographic and if so, how will you reach them? How you will you meet your sales goals – through organic growth, a business acquisition or a vertical growth strategy? What channels of distribution will you use to meet these sales goals?
Regardless of how your company develops a business plan, internally or using an outside consultant, it’s important to invest the time in getting this step right as it drives every other process in the strategic plan.