While many businesses in the shooting sports industry are run by skilled entrepreneurs who have the knowledge, experience and keen instinct to make wise business decisions that ring their cash registers, there are also times when it pays for all retailers to put pencil to paper and develop a solid business plan. Business plans can become road maps in a wide range of endeavors ranging from securing financing to expanding (or possibly selling) an existing business. A basic business plan can lead to a profitable future. The good news is that putting pencil to paper, or your finger’s tips atop the keyboard, and writing a business plan also helps you better understand many key areas of your business as you look at where you were — and where you are now.
Just as no two businesses in the tactical retailing arena are exactly alike, business plans will also vary based on many factors. A good starting point when developing any plan will be: a broad company overview; market and industry analysis; overview of the leadership and staff; financial details from several sources; focusing on key profit areas; and a summary to include the executive summary. Gathering the details, compiling the facts and completing a summary will take time — but it’s time invested in the future of your business.
This key business plan document is often requested by financial institutions if you seek a loan, by many new suppliers and vendors for lines of credits, and others you do business with. Having a basic plan in your hand — and one that is updated at least annually — means you take a professional approach to business and understand key details of your business, the ever-changing tactical market, and your customers and competitors. Begin building your plan!
Put Your Plan on Paper
Creating a basic business plan can provide many benefits, and the results can far outweigh the expense, time and stress involved with creating a plan. A well-written business plan can help you and your business set clear objectives and establish priorities in what to do now and in the future. Developing a plan can help you better understand how the many parts of the business are interconnected. A business plan can also help to better understand cash flow — in and out. At a minimum, a well-written plan will help you turn educated guesses into focused facts. Sometimes it’s best to create a business plan on your laptop so you can easily read, write, adjust and review it to make ongoing changes.
There are many books on the market touting that you can write a business plan in an hour. Don’t buy into this speed drill. It will take weeks for you to accurately take stock and write the many small but important details. Your business plan creation could take a couple of days, several evenings, or a few weeks as you look at inventories, purchase orders, IRS tax filings, bank loans and other documents. Keep detailed notes as you search so you don’t have to go back or refer to something again.
Building the Big Picture
A well-prepared business plan will help you lay the groundwork for future growth and focus on the overall business — or the BIG picture — and your desired business outcomes in the months and years ahead. A business plan should help with setting future estimates for your company. You must also make considerations of the overall shooting sports industry and the possible effects of local, state and federal regulations. Laws have consequences. A well-prepared business plan may encourage shifting resources into potential growth areas and moving away from items and practices that could be taking away resources or providing little return on investment (ROI).
Another key to a great business plan? Develop a solid mission statement. This answers why your business exists, who the customers are, and how the business operates. Some retail shops serve only the tactical community, while others also cater to hunters or focus primarily on first-time or female gun owners or those seeking a CCW permit. A plan outlines the steps to reach those new business goals when you want to expand.
By many estimates, the cost of starting a solid business plan begins at about $500. This covers your time and possible workbooks or computer software to guide you through the process. A good — and free — business plan guide can also be downloaded from the Small Business Administration (SBA.gov). Nearby colleges with business schools could possibly have students looking for projects, and these may offer assistance. Most local public libraries also have books that can guide you with pointers on developing a business plan.
Focus on Facts
It’s important to remember that a business has influences far beyond the walls of the shop, range lanes or parking lot. As you do detailed market research, consider details about the industry and your competition and on what your customers want. For example, what are the number of concealed carry courses offered in the region, or the number of permit holders near you? Those numbers could help you find customers. Or, what is known about all competing shooting ranges, such as do they charge by the hour or offer annual memberships? Maybe you could offer services that are lacking, such as a classroom? Does anyone hold competitions for engaged firearms owners? All could be growth areas for your business.
Focusing on such details as fees or prices charged by the competition, or firearms ownership in the area, can definitely help you recognize opportunities. Those market numbers can possibly help predict future ammunition and firearms sales, what accessories to place on shelves or racks, and what riflescopes and gun cases to stock and offer customers. Unfortunately, if there is a local rise in crime and home break-ins, maybe it’s time to offer safes and look at the profit margins on selling some models. There are numerous small things that help create a big picture plan. For research starters, the NSSF and ATF provide up-to-date numbers that can become part of a business plan.
While accurate numbers are important, other details can help manage the business’ inventory and assets. Remember to take inventory of employees (their strengths and weaknesses), plus items that regularly sell and generate income to make the business profitable. Be brutally honest for the best results. A business must make a profit, so no sugarcoating things to satisfy others. Can you express or write the primary products/services you sell to customers? This is the type of information that can help you begin to get a clear picture.
Another important plan of a part is determining how your company will grow, the steps to reaching customers and increasing sales to support those growth goals, and more numbers. This is the balance sheet covering profit and loss, cash, and the break-even point. This is also a time to reflect on what sold — or did not sell — in the past season or year, and why that happened. Again, putting details on paper can help to see things much differently.
The more details understood about the business and customers, the easier it will be to develop a solid business plan.
Build a Business Plan
1) The Title Page: Information here includes the legal name of the business, physical address, company logo, owner(s) names, website, email address, phone number, etc.
2) Table of Contents: An overall guide for readers, such as a bank loan officer or someone buying your business. This is a quick guide through the pages or sections that follow.
3) Executive Summary: Covers your best honest estimate of a total company overview. This can include brief summaries of the other chapters in the plan. This is also a place to touch on the backgrounds of all key employees, products, markets and customers serviced, and how you reach customers. If your retail business is growing, include your thoughts on how and why.
4) Business/Industry Overview: This is the place to park your description of the tactical industry, current overall business environment and details on the region/neighborhood where the business operates.
5) Market Analysis and the Competition: Include here the details on your target market, whether it be LE departments, standard firearm customers, or something else, and include information on the products and services you provide for those market segments. Provide details also on any competitor businesses and how you win against them. This section includes sales figures, purchase volumes, values and other numbers.
6) Ownership and Management: This chapter covers your background and experience, plus the key contributions from any employees. Salaries, benefits offered and employee resumes can go here. This is a summary of the team and what each player brings to the table.
7) Operation Information: This section can include store layout details, inventory reports, storage assessments, equipment in place or needed, building security and other items. Including as much detail as possible helps you make day-to-day plans to ensure the doors are open and customers can find and buy merchandise.
8) Financial Facts: This segment of your business plan will probably be the first one looked at by banks, potential partners, buyers, vendors and others. The details of costs, financing, cash flow, income/revenues, growth and profits fall on these pages. Be certain the numbers are accurate and add up correctly.
A) Appendices, Exhibits and Charts: Details to support other parts of the comprehensive plan are based here, including but not limited to: market research, mortgage documents and lease agreements, marketing brochures, website and social media page info, details on product lines and the overall industry research. This is a good place to include photographs of the store front, some aisles and shelving, the warehousing space, the checkout counter and other areas to give outsiders an inside look. These are important facts that help reinforce all the other details previously covered.
