PEST Analysis. (free marketing lessons)

What is PEST Analysis?
(free marketing lessons)

It is very important that an organization considers its environment before beginning the marketing process. In fact, environmental analysis should be continuous and feed all aspects of planning. The organization's marketing environment is made up of:

1. The internal environment e.g. staff (or internal customers), office technology, wages and finance, etc.

2. The micro-environment e.g. our external customers, agents and distributors, suppliers, our competitors, etc.

3. The macro-environment e.g. Political (and legal) forces, Economic forces, Sociocultural forces, and Technological forces. These are known as PEST factors.

Political Factors.

The political arena has a huge influence upon the regulation of businesses, and the spending power of consumers and other businesses. You must consider issues such as:

1.How stable is the political environment?

2.Will government policy influence laws that regulate or tax your business?

3.What is the government's position on marketing ethics?

4. What is the government's policy on the economy?

5. Does the government have a view on culture and religion?

6. Is the government involved in trading agreements such as EU, NAFTA, ASEAN, or others?

Economic Factors.

Marketers need to consider the state of a trading economy in the short and long-terms. This is especially true when planning for international marketing. You need to look at:

1. Interest rates.

2. The level of inflation Employment level per capita.

3. Long-term prospects for the economy Gross Domestic Product (GDP) per capita, and so on.

Sociocultural Factors.

The social and cultural influences on business vary from country to country. It is very important that such factors are considered. Factors include:

1.What is the dominant religion?

2.What are attitudes to foreign products and services?

3.Does language impact upon the diffusion of products onto markets?

4.How much time do consumers have for leisure?

5.What are the roles of men and women within society?

6.How long are the population living? Are the older generations wealthy?

7.Do the population have a strong/weak opinion on green issues?

Technological Factors.

Technology is vital for competitive advantage, and is a major driver of globalization. Consider the following points:

1. Does technology allow for products and services to be made more cheaply and to a better standard of quality?

2.Do the technologies offer consumers and businesses more innovative products and services such as Internet banking, new generation mobile telephones, etc?

3.How is distribution changed by new technologies e.g. books via the Internet, flight tickets, auctions, etc?

4.Does technology offer companies a new way to communicate with consumers e.g. banners, Customer Relationship Management (CRM), etc?

Strengths, Weaknesses, Opportunites and Threats (SWOT).

Strengths, Weaknesses, Opportunites and Threats (SWOT).
(free marketing lessons)

SWOT analysis is a tool for auditing an organization and its environment. It is the first stage of planning and helps marketers to focus on key issues. SWOT stands for strengths, weaknesses, opportunities, and threats. Strengths and weaknesses are internal factors. Opportunities and threats are external factors.
In SWOT, strengths and weaknesses are internalstrength could be: factors. For example:A

* Your specialist marketing expertise.
* A new, innovative product or service.
* Location of your business.
* Quality processes and procedures.
* Any other aspect of your business that adds value to your product or service.

A weakness could be:

* Lack of marketing expertise.
* Undifferentiated products or services (i.e. in relation to your competitors).
* Location of your business.
* Poor quality goods or services.
* Damaged reputation.

In SWOT, opportunities and threats are external opportunity could be: factors. For example: An

* A developing market such as the Internet.
* Mergers, joint ventures or strategic alliances.
* Moving into new market segments that offer improved profits.
* A new international market.
* A market vacated by an ineffective competitor.

A threat could be:

* A new competitor in your home market.
* Price wars with competitors.
* A competitor has a new, innovative product or service.
* Competitors have superior access to channels of distribution.
* Taxation is introduced on your product or service.

A word of caution, SWOT analysis can be very subjective. Do not rely on SWOT too much. Two people rarely come-up with the same final version of SWOT. TOWS analysis is extremely similar. It simply looks at the negative factors first in order to turn them into positive factors. So use SWOT as guide and not a prescription.
Simple rules for successful SWOT analysis.

* Be realistic about the strengths and weaknesses of your organization when conducting SWOT analysis.
* SWOT analysis should distinguish between where your organization is today, and where it could be in the future.
* SWOT should always be specific. Avoid grey areas.
* Always apply SWOT in relation to your competition i.e. better than or worse than your competition.
* Keep your SWOT short and simple. Avoid complexity and over analysis
* SWOT is subjective.

Total Quality Management - TQM

Total Quality Management - TQM

The “Body of Knowledge” for Total Quality Management embraces:

* The concepts of Total Quality;
* Application of the concepts of Total Quality to:
o products and services
o processes
o people
* through the provision of appropriate
o values, policies and objective
o planning
o processes and measurement
o leadership, training and motivation
o organisation

Total Quality is a way of life. Total Quality is not a programme with a defined end point. A total Quality strategy will be effective only through long-term commitment and dedicated application by executive management and all employees. It requires the consistent application of the appropriate human and technical processes, tools and techniques.
Concepts:
Definition

The Institute of Management Services defines Total Quality Management as:

"A strategy for improving business performance through the commitment and involvement of all employees to fully satisfying agreed customer requirements, at the optimum overall costs, through the continuous improvement of the products and services, business processes and people involved."

The concept of Total Quality Management can be expressed as “Achieving success through delighting our customers”.

Customers being the internal user, the external customer or end-user, together with the other stakeholders, i.e.

* shareholders
* employees
* suppliers

It also requires consideration of the environmental needs of the community.
Key concepts of Total Quality

Total Quality Management is a strategy for business success, based on the following concepts:
Total Quality means:

* achieving strategic goals through customer focus and continuous improvement
* delighting the customer, satisfying needs and expectations
* anticipating the needs of the market
* understanding and managing customer expectations
* understanding the aims and capabilities of the your own organisation
* all employees taking ownership of the products and services delivered

Total Quality requires:

* management leadership and long term commitment
* managers to act as role models who lead and empower change
* a management culture of partnership, learning together, guidance and support for employees
* clearly defined business objectives communicated by managers and supervisors, understood and “owned” by all employees. “Ownership” can be viewed as the “acceptance of accountability”.
* Encouraging and empowering all employees to adopt “ownership” behaviour. Ownership of their outputs, ownership of customers problems, ownership of improvement actions.
* A focus on success through people
o solutions by consensus
o recognition of success
o a “no blame” attitude
o education and training based on defined user needs
o teamwork
o effective communication including listening, providing feedback and provision of visual communication

Total Quality Management is an organisation wide process based on:

* best use of the resources of the total organisation
* organisational flexibility and response to change
* defined internal and external customer/supplier relationships embracing:
o external customers
o internal customers
o external suppliers
o internal suppliers

bound together in long term business relationships

* measurement of performance. The standard is the “agreed customer requirement”and the required performance is
o absolute conformance to agreed customer requirements
o customer satisfaction
o process efficiency
o anticipating customer needs and expectations
o delivering products and services that delight customers
o benchmarking - identifying and adopting world-wide best practice
o measuring and monitoring continuous improvement

The focus for Total Quality

is continuous improvement aimed at achieving total “customer delight”, perceived “value for money” at optimum cost to the organisation. This requires everyone within the organisation to:

* use a defined process for Quality delivery
* continuously identify improvement opportunities
* deliver improvement through structured problem solving
* identify and use error prevention and corrective feedback mechanisms
* focus on Process design, reduction in variability and capability assurance
* develop Cross-Functional Process Management

TQM and BS 5750/ISO 9000/EN 29000

The standard provides a basic guideline for Quality Management and Quality Systems.

TQM and BS 5750/ISO 9000/EN 29000 are complimentary, whereby the Standard provides a structure which can underpin continuous improvement - the philosophy of TQM.

Part 0 of the Standard refers to Total Quality Management whilst the remainder is concerned with Quality Assurance.

Traditionally certification has been limited to specific areas for organisation, but recent development permits Company Wide registration.

This is a logical progression towards Quality Systems and Total Quality Management.
Organisation

Adopting Quality as the fundamental principle by which the organisation will conduct its business, requires that it organises itself to support this objective. This involves developing an appropriate organisation structure and a Quality function appropriate to the needs of the organisation.

Business organisation structure: spans of control, reporting lines, work group missions and outputs should be reviewed to ensure that these support management leadership, teamworking and effective communication.

Quality support organisation: the functions of the support organisation might include:

* training of the senior management and other groups of employees in Total Quality
* providing “facilitation” and support in the application of the Total Quality process
* supporting management in the development of strategy, objectives and goals in the respect of the implementation of the Total Quality process
* co-ordinating the application of the Quality management process and the production of Quality plans
* establishing and operating cross-functional process management in conjunction with the individual process owners
* providing direct support for business-wide improvement projects
* tracking cost of Quality
* establishing initial and ongoing Quality training needs, developing training material and training Quality trainers
* developing specific new processes and process applications to support Total Quality, e.g.: statistical process control (SPC)
* co-ordinating, where necessary, the development of Quality management systems by departments, providing a company response to vendor assessments by potential customers
* integrating safety, product liability and consumer considerations into products, services and business processes

SUMMARY

Total Quality is a customer focused improvement process, a strategy for business success involving every employee within the organisation.

References:
Total Quality Management, Institute of Management Services, Philosophy, Concepts and Fundamental Processes

by http://www.marketingpower.gr

Business Planning

Business (Corporate) Planning is the process of deciding what tactical action and direction to take, in all areas of business activity, in order to secure a financial and market position commensurate with the strategic objectives of the organisation. To put it another way, it is the comprehensive planning for the whole of the business and involves defining the overall objectives for the organisation, and all the actions that must be adopted in order that those objectives are achieved.
Illustration:
If only we spent as much time doing our jobs, as we waste in these budget meetings, we would be a lot better off. This planning stuff is all very well, but has anyone ever worked out how much it costs? Anyway, all we can ever do is write down what we think will happen, then wait until it hasn’t happened, and finally argue about why it didn’t. Sometimes I wonder if it is all worthwhile.

Statements like these occur because:

* No one has taken the trouble to explain the purpose and benefits of planning;
* The planning methods are wrong;
* Plans are imposed from above, rather than worked out and agreed with the people who are going to have to carry them out;
* So-called planning is often no more than totalling up the various departments’ forecasts, and calling them the company plan.

In general it can be assumed that FIVE important features of Corporate Planning prevail, they are:

1. Objectives and objective setting;
2. Flexibility - the ability to be adaptable within the plan;
3. Growth - anticipating opportunities for new markets;
4. Synergy - the sum of joint efforts being greater than either one;
5. Time span - the critical length of the plan - long termism is increasingly risk managed in today’s business environment.

Corporate planning is, like most business activities, only as good as the people who do it. Its methods and approach do, however, stack the cards in its favour. In nearly every business, competition and technical change has increased, is increasing, and will continue to increase, and won’t stop. It cannot be ignored, so better to be part of a success story through effective corporate planning than flounder with those competitors who have failed to grasp the nettle.

by http://www.marketingpower.gr

Pareto Analysis (the 80:20 rule)

The Pareto effect.

In practically every industrial country a small proportion of all the factories employ a disproportionate number of factory operatives. In some countries 15 percent of the firms employ 70 percent of the people. This same state of affairs is repeated time after time. In retailing for example, one usually finds that up to 80 percent of the turnover is accounted for by 20 percent of the lines.

This effect, known as the 80 : 20 rule, can be observed in action so often that it seems to be almost a universal truth. As several economists have pointed out, at the turn of the century the bulk of the country’s wealth was in the hands of a small number of people.

This fact gave rise to the Pareto effect or Pareto’s law: a small proportion of causes produce a large proportion of results. Thus frequently a vital few causes may need special attention wile the trivial many may warrant very little. It is this phrase that is most commonly used in talking about the Pareto effect – ‘the vital few and the trivial many’. A vital few customers may account for a very large percentage of total sales. A vital few taxes produce the bulk of total revenue. A vital few improvements can produce the bulk of the results.

The Pareto effect is named after Vilfredo Pareto, an economist and sociologist who lived from 1848 to 1923. Originally trained as an engineer he was a one time managing director of a group of coalmines. Later he took the chair of economics at Lausanne University, ultimately becoming a recluse. Mussolini made him a senator in 1922 but by his death in 1923 he was already at odds with the regime. Pareto was an elitist believing that the concept of the vital few and the trivial many extended to human beings.

Much of his writing is now out of favour and some people would like to re-name the effect after Mosca, or even Lorenz. However it is too late now – the Pareto principle has earned its place in the manager’s kit of productivity improvement tools.

This method stems in the first place from Pareto’s suggestion of a curve of the distribution of wealth in a book of 1896. Whatever the source, the phrase of ‘the vital few and the trivial many’ deserves a place in every manager’s thinking. It is itself one of the most vital concepts in modern management. The results of thinking along Pareto lines are immense.

For example, we may have a large number of customer complaints, a lot of shop floor accidents, a high percentage of rejects, and a sudden increase in costs etc. The first stage is to carry out a Pareto analysis. This is nothing more than a list of causes in descending order of their frequency or occurrence. This list automatically reveals the vital few at the top of the list, gradually tailing off into the trivial many at the bottom of the list. Management’s task is now clear and unavoidable: effort must be expended on those vital few at the head of the list first. This is because nothing of importance can take place unless it affects the vital few. Thus management’s attention is unavoidably focussed where it will do most good.

Another example is stock control. You frequently find an elaborate procedure for stock control with considerable paperwork flow. This is usually because the systems and procedures are geared to the most costly or fast-moving items. As a result trivial parts may cost a firm more in paperwork than they cost to purchase or to produce. An answer is to split the stock into three types, usually called A, B and C. Grade A items are the top 10 percent or so in money terms while grade C are the bottom 50-75 percent. Grade B are the items in between. It is often well worthwhile treating these three types of stock in a different way leading to considerable savings in money tied up in stock.

Production control can use the same principle by identifying these vital few processes, which control the manufacture, and then building the planning around these key processes. In quality control concentrating in particular on the most troublesome causes follows the principle. In management control, the principle is used by top management looking continually at certain key figures.

Thus it is clear that the Pareto concept – ‘the vital few and the trivial many’ – is of utmost importance to management.

by http://www.marketingpower.gr

Pareto Analysis Step by Step

Pareto Analysis is a statistical technique in decision making that is used for the selection of a limited number of tasks that produce significant overall effect. It uses the Pareto Principle (also know as the 80/20 rule) the idea that by doing 20% of the work you can generate 80% of the benefit of doing the whole job. Or in terms of quality improvement, a large majority of problems (80%) are produced by a few key causes (20%). This is also known as the vital few and the trivial many.

In the late 1940s quality management guru Joseph M. Juran suggested the principle and named it after Italian economist Vilfredo Pareto, who observed that 80% of income in Italy went to 20% of the population. Pareto later carried out surveys on a number of other countries and found to his surprise that a similar distribution applied.

The 80/20 rule can be applied to almost anything:

• 80% of customer complaints arise from 20% of your products or services.
• 80% of delays in schedule arise from 20% of the possible causes of the delays.
• 20% of your products or services account for 80% of your profit.
• 20% of your sales-force produces 80% of your company revenues.
• 20% of a systems defects cause 80% of its problems.

The Pareto Principle has many applications in quality control. It is the basis for the Pareto diagram, one of the key tools used in total quality control and Six Sigma.

In PMBOK Pareto ordering is used to guide corrective action and to help the project team take action to fix the problems that are causing the greatest number of defects first.

Pareto Analysis

Seven steps to identifying the important causes using Pareto Analysis [1]:

1. Form a table listing the causes and their frequency as a percentage.
2. Arrange the rows in the decreasing order of importance of the causes, i.e. the most important cause first.
3. Add a cumulative percentage column to the table.
4. Plot with causes on x-axis and cumulative percentage on y-axis.
5. Join the above points to form a curve.
6. Plot (on the same graph) a bar graph with causes on x-axis and percent frequency on y-axis.
7. Draw a line at 80% on y-axis parallel to x-axis. Then drop the line at the point of intersection with the curve on x-axis. This point on the x-axis separates the important causes on the left and less important causes on the right.

This is a simple example of a Pareto diagram using sample data showing the relative frequency of causes for errors on websites. It enables you to see what 20% of cases are causing 80% of the problems and where efforts should be focussed to achieve the greatest improvement.

The value of the Pareto Principle for a project manager is that it reminds you to focus on the 20% of things that matter. Of the things you do during your project, only 20% are really important. Those 20% produce 80% of your results. Identify and focus on those things first, but don't totally ignore the remaining 80% of causes.

Time Management

Πώς πρέπει να διαχειριζόμαστε τον χρόνο μας?Γιατί κάποιοι τα προλαβαίνουν όλα, ενώ άλλοι κοιτάζουν πίσω τους και δεν μπορούν να καταλάβουν πώς πέρασε τόσος καιρός χωρίς να έχουν ξεκινήσει το hobby που θέλαν, το ταξίδι που σχεδίαζαν, το μεταπτυχιακό που χρειαζόταν κτλ κτλ.

Θα προσπαθήσω λοιπόν να σας μεταφέρω κάποιες από τις σκέψεις και τις ιδέες που μου φάνηκαν χρήσιμες, έπειτα από αρκετά χρόνια πειραματισμών με τεχνικές, εργαλεία και πολλών συζητήσεων με φίλους, συμφοιτητές, συναδέλφους μου.

Βήμα 1: First Things First

Σκεφτείτε όλους τους διαφορετικούς ρόλους που έχετε: μπορεί να είστε φοιτητής, γιος, αδερφός, φίλος, σύντροφος, μαθητής (π.χ. μουσικής), αθλητής, υπάλληλος. Ο καθένας μας φοράει ταυτόχρονα περισσότερα από 5-6 διαφορετικά "καπέλα" ρόλων και προσπαθεί έστω και υποσυνείδητα, να ανταποκριθεί σε όλους. Φυσικά, κάποιοι από τους ρόλους μονοπωλούν ανά περιόδους το ενδιαφέρον μας, αλλά αυτό δεν σημαίνει πως επειδή εργάζομαι ή διαβάζω πολλές ώρες κάθε μέρα, θα πρέπει να ξεχάσω τα hobbies μου, ή τους φίλους μου κτλ. Απλά πρέπει να θέσω τις σωστές προτεραιότητες στον κάθε ρόλο.

Πώς θέτω τις προτεραιότητες λοιπόν? Στο παρελθόν έχουν χρησιμοποιηθεί κυρίως τρείς τεχνικές:

1. ABC analysis: Κάνω μια λίστα με όλους τους στόχους που έχω για κάθε ρόλο και έπειτα θέτω Α=υψηλή προτεραιότητα, Β=μεσαία προτεραιότητα C=χαμηλή προτεραιότητα

2. Pareto analysis: Σύμφωνα με την ανάλυση Παρέτο, το 80% των tasks μπορούν να γίνουν στο 20% του χρόνου μας. Το υπόλοιπο 20% των tasks θα απαιτήσουν το 80% του χρόνου μας. Με την μέθοδο αυτή, ξεκινούμε πρώτα με τα tasks που γίνονται γρήγορα και μπορούμε να τα τελειώσουμε στο 20% του χρόνου μας.

3. Fit: Έχω την λίστα με τα tasks που πρέπει να γίνουν και επίσης το ημερολόγιο μου με τον διαθέσιμο χρόνο. Εαν μεταξύ δύο δραστηριοτήτων μου έχω 30 λεπτά διαθέσιμα, θα προσπαθήσω να βάλω ένα task που απαιτεί 30 λεπτά (όχι 5 λεπτά task αλλά ούτε 2 ωρών task) οπότε να έχω το μέγιστο Utilisation του διαθέσιμου χρόνου μου.

Σας προτείνω να δοκιμάσετε μια 4η τεχνική, την οποία πρότεινε ο Stephen Covey στο βιβλίο του "First Things First". Στην τεχνική αυτή, προτείνεται να κάνετε μία κατάταξη των goals (ή tasks που απορρέουν από goals) σε έναν πίνακα "Importance and Urgency".

Σύμφωνα με την τεχνική αυτή δημιουργείς έναν πίνακα με δύο στοιχεία: Urgency και Importance των tasks σου. Όπως καταλαβαίνετε, δημιουργούνται 4 τεταρτημόρια:

Q1: Urgent and Important, Q2: Important Not Urgent, Q3: Urgent Not Important, Q4: Not Important, Not Urgent

Q1: Εδώ μπαίνουν tasks τα οποία πρέπει να γίνουν άμεσα και είναι σημαντικά. Π.χ. έχει χτυπήσει το παιδί μου και πρέπει να το πάω στον γιατρό, πρέπει να διαβάσω 5 ώρες σήμερα γιατί αύριο είναι οι εξετάσεις για το μάθημα κτλ.

Q2: Εδώ μπαίνουν tasks τα οποία είναι σημαντικά αλλά όχι επείγοντα. Εδώ είναι και όλο το κλειδί του time management, μιας και οι περισσότεροι αγνοούν τα tasks αυτής της περιοχής λόγω του χαμηλού urgency. Εδώ είναι το να ξεκινήσω π.χ. ένα νέο hobby, να κανονίσω το τριήμερο που συζητούσαμε με τους φίλους μου, να περάσω να δω τους γονείς/συγγενείς μου, να ξεκινήσω το μεταπτυχιακό μου, κτλ.

Q3: Εδώ είναι όλα τα μικροπράγματα που πρέπει να γίνουν άμεσα αλλά δεν είναι τόσο σημαντικά στην όλη εικόνα των στόχων μου σε οποιονδήποτε ρόλο.

Q4: Εδώ είναι όλα αυτά με τα οποία δεν θα πρεπε κανονικά να ασχολούμαι γιατί δεν είναι ούτε σημαντικά ούτε επείγοντα (π.χ. να σερφάρω παραπάνω στο ίντερνετ, να κάνω τσατ με τις ώρες, κάποια τηλεφωνήματα που δεν χρειάζονται κτλ).

Το σωστό λοιπόν είναι να ασχολούμαστε με τα important items (Q1 και Q2) να κάνουμε delegate σε άλλους τα items του Q3 και να περιορίζουμε στο ελάχιστο τον χρόνο μας στο Q4. Όσο περισσότερο αφιερώνετε τον χρόνο σας στα Q1 και Q2 τόσο περισσότερα θα πετύχετε από αυτά που είναι πραγματικά σημαντικά. Το κλειδί με το Q2 είναι πως απλά πρέπει να αποφασίσετε να τα ξεκινήσετε άμεσα και να μην περιμένετε να περάσει ο χρόνος και να τα αναβάλετε διαρκώς.

The Marketing Plan Section Of The Business Plan

When writing the business plan, the Marketing Plan section explains how you're going to get your customers to buy your products and/or services. The marketing plan, then, will include sections detailing your:

• Products and/or Services and your Unique Selling Proposition
• Pricing Strategy
• Sales/Distribution Plan
• Advertising and Promotions Plan

The easiest way to develop your marketing plan is to work through each of these sections, referring to the market research you completed when you were writing the previous sections of the business plan.

Products and/or Services

This part of the marketing plan focuses on the uniqueness of your product or service, and how the customer will benefit from using the products or services you're offering. Use these questions to write a paragraph summarizing these aspects for your marketing plan:

What are the features of your product or service?

Describe the physical attributes of your product or service, and any other relevant features, such as what it does, or how your product or service differs from competitive products or services.

How will your product or service benefit the customer?

Remember that benefits can be intangible as well as tangible; for instance, if you're selling a cleaning product, your customers will benefit by having a cleaner house, but they may also benefit by enjoying better health. Brainstorm as many benefits as possible to begin with, and then choose to emphasize the benefits that your targeted customers will most appreciate in your marketing plan.

What is it that sets your product or service apart from all the rest? In other words, what is your Unique Selling Proposition, the message you want your customers to receive about your product or service that is the heart of your marketing plan? The marketing plan is all about communicating this central message to your customers.

Pricing Strategy

The pricing strategy portion of the marketing plan involves determining how you will price your product or service; the price you charge has to be competitive but still allow you to make a reasonable profit.

The keyword here is "reasonable"; you can charge any price you want to, but for every product or service there's a limit to how much the consumer is willing to pay. Your pricing strategy needs to take this consumer threshold into account.

The most common question small business people have about the pricing strategy section of the marketing plan is, "How do you know what price to charge?"

Basically you set your pricing through a process of calculating your costs, estimating the benefits to consumers, and comparing your products, services, and prices to others that are similar.

Set your pricing by examining how much it cost you to produce the product or service and adding a fair price for the benefits that the customer will enjoy.

How does the pricing of your product or service compare to the market price of similar products or services?

Explain how the pricing of your product or service is competitive. For instance, if the price you plan to charge is lower, why are you able to do this? If it's higher, why would your customer be willing to pay more? This is where the "strategy" part of the pricing strategy comes into play; will your business be more competitive if you charge more, less, or the same as your competitors and why?

What kind of ROI (Return On Investment) are you expecting with this pricing strategy, and within what time frame?

Sales and Distribution Plan

Remember, the primary goal of the marketing plan is to get people to buy your products or services. The Sales and Distribution part of the marketing plan details how this is going to happen.

Traditionally there are three parts to the Sales and Distribution section of the marketing plan, although all three parts may not apply to your business.

1) Outline the distribution methods to be used.

How is your product or service going to get to the customer? For instance, will you distribute your product or service through a Web site, through the mail, through sales representatives, or through retail?

What distribution channel is going to be used?

In a direct distribution channel, the product or service goes directly from the manufacturer to the consumer.

In a one stage distribution channel it goes from manufacturer to retailer to consumer. The traditional distribution channel is from manufacturer to wholesaler to retailer to consumer. Outline all the different companies, people and/or technologies that will be involved in the process of getting your product or service to your customer.

What are the costs associated with distribution?

What are the delivery terms?

How will the distribution methods affect production time frames or delivery? (How long will it take to get your product or service to your customer?)

If your business involves selling a product, you should also include information about inventory levels and packaging in this part of your marketing plan. For instance:

How are your products to be packaged for shipping and for display?

Does the packaging meet all regulatory requirements (such as labelling)?

Is the packaging appropriately coded, priced, and complementary to the product?

What minimum inventory levels must be maintained to ensure that there is no loss of sales due to problems such as late shipments and back orders?

2) Outline the transaction process between your business and your customers.

What system will be used for processing orders, shipping, and billing?

What methods of payment will customers be able to use?

What credit terms will customers be offered? If you will offer discounts for early payment or impose penalties for late payment, they should be mentioned in this part of your marketing plan.

What is your return policy?

What warranties will the customer be offered? Describe these or any other service guarantees.

What after-sale support will you offer customers and what will you charge (if anything) for this support?

Is there a system for customer feedback so customer satisfaction (or the lack of it) can be tracked and addressed?

3) If it's applicable to your business, outline your sales strategy.

What types of salespeople will be involved (commissioned salespeople, product demonstrators, telephone solicitors, etc.)?

Describe your expectations of these salespeople and how sales effectiveness will be measured.

Will a sales training program be offered? If so, describe it in this section of the marketing plan.

Describe the incentives salespeople will be offered to encourage their achievements (such as getting new accounts, the most orders, etc.).

Advertising And Promotion Plan

Essentially the Advertising and Promotion section of the marketing plan describes how you're going to deliver your Unique Selling Proposition to your prospective customers. While there are literally thousands of different promotion avenues available to you, what distinguishes a successful Advertising and Promotion Plan from an unsuccessful one is focus - and that's what your Unique Selling Proposition provides.

So think first of the message that you want to send to your targeted audience. Then look at these promotion possibilities and decide which to emphasize in your marketing plan:

Advertising - The best approach to advertising is to think of it in terms of media and which media will be most effective in reaching your target market.

Then you can make decisions about how much of your annual advertising budget you're going to spend on each medium.

What percentage of your annual advertising budget will you invest in each of the following:

• the Internet
• television
• radio
• newspapers
• magazines
• telephone books/directories
• billboards
• bench/bus/subway ads
• direct mail
• cooperative advertising with wholesalers, retailers or other businesses?

Include not only the cost of the advertising but your projections about how much business the advertising will bring in.

Sales Promotion - If it's appropriate to your business, you may want to incorporate sales promotion activites into your advertising and promotion plan, such as:

• offering free samples
• coupons
• point of purchase displays
• product demonstrations

Marketing Materials - Every business will include some of these in their promotion plans. The most common marketing material is the business card, but brochures, pamphlets and service sheets are also common.

Publicity - Another avenue of promotion that every business should use. Describe how you plan to generate publicity. While press releases spring to mind, that's only one way to get people spreading the word about your business. Consider:

• product launches
• special events, including community involvement
• writing articles
• getting and using testimonials