Now that you have considered the various strategies to ensure the success of your venture, it is important for the reader of your plan to understand how you intend to meet these objectives. Your operations plan is another term for the ‘nuts and bolts’ of your business. It is the behind the scenes work that is needed to make your business successful.

Choosing Your Channels Of Distribution

In an ideal world all of your clients would come directly to you, eliminating all your distribution costs. Deciding which method of distribution to use would not even be an issue. However, whatever the size of your business, you can assume at some point you will have to address the issue of distribution. How you intend to distribute your product or service to your clients will depend on a number of factors, including your profit margin and selling price.

There are three methods of distribution for you to consider:

• indirect distribution
• direct distribution
• third party distribution.

Indirect Distribution

If your product will be sold through the retail and wholesale sectors then this is considered to be indirect distribution as your clients will be purchasing your product from a business other than yours. Only products with a large profit margin and mass appeal tend to be sold in this way. With a large profit margin you will be able to attract good distributors with a generous discount whilst still keeping a percentage of the profits for yourself.

Direct Distribution

Products which are sold straight from yourself to your clients are described as being distributed directly. This is usually achieved when you use the telephone for selling and then back it up with a mail order method of distribution, or when the client comes to your premises.

Third Party Distribution

Appointing an agent to sell your products on your behalf is another method of distribution. This method is favoured by businesses such as double glazing and insurance companies, but their heavy handed, hard sell techniques have brought door-to-door selling a bad name, and the introduction of new legislation to cut down on cowboy companies.

A softer approach has been made by party plan organisations which have proved to be very successful over the last few years. Kleeneze, Dorling Kindersley and Avon are examples of successful party plan companies. The Direct Selling Association (DSA) is the regulatory body for party plan and direct selling businesses and can be contacted at 29 Floral Street, London WC2E 9DP. Tel: (020) 7497 1234.

Finding The Right Premises

The location of your business will partly depend on what you are selling, and who to. For example if you have a restaurant or a retail store then your clients will be coming to you. However, the manufacturing industry will generally discover its potential market and then go out and sell to it. In this case your channels of distribution will have an effect on where your business is located as will the possibility of obtaining a grant.

There are a number of grants available if you locate your business in a rural or underdeveloped area. The Development Commission will be able to provide you with further information and can be contacted at Countryside Agency, John Dower House, Crescent Place, Cheltenham GL50 3RA. Tel: (01242) 521381.

Positioning Your Business

Your market research data will show where the best position of your business is in relation to your intended market. In reality, this can be easier to discover than to put into practice. Retail stores generally prefer to be in the middle of a busy high street, whilst a manufacturing business might favour a purpose-built unit on an industrial site. A new business may find it difficult to meet the running costs of being in such a prime position.

Where you are positioned in relation to your competition will affect your success. Will you be attracting trade away from your competitors by competing close to them? Or will the fact that you are the only type of business in a particular area be one of your benefits? Only you will be able to discover the answers to these questions.