Essentials Of A Furniture Business Plan
Are you an entrepreneur who is passionate about designing and building innovative furniture pieces? Are you someone who is constantly thinking of how the present day furniture designs can be changed and made more ergonomic and space utilising. If you are a designer who is constantly thinking about creating new furniture designs and adding a stylish or artistic touch within a space, whether a house or an office or any other commercial space, with the furniture itself, then turning an entrepreneur within the furniture business is a recommended step forward. Starting a furniture business will help creative and passionate designers turn their dreams and unique designs into reality while making a significant profit from it at the same time too.
Furniture is an inevitable part of our everyday lives – it is difficult to imagine a house without a sofa or to sleep without a bed or imagine eating food without a table and chair. A house will not attain its true meaning without furniture inside the house to define it. Similarly in an office, the desk, chairs and cabinets give character to the office without which it would just be an empty space. Therefore furniture is vital irrespective of the type of business or space, whether commercial or residential and owing to this reason, the furniture business is an evergreen business that will be in demand forever, while being profitable too.
However, starting a business, especially a furniture business, is not limited to just making the furniture. There are other aspects of the business that need to be considered and worked on when you’re wondering how to start a furniture business, such as the management of the business, financial aspects of the business, marketing of the business, etc. Often entrepreneurs feel that they will spend the majority of their time in the workshop, designing and building furniture pieces when they start the business, but the case will be quite the opposite because the management and financial aspect of the business along with marketing and day to day handling of the business also need to be paid attention too, along with the manufacturing. There are other assumptions too regarding the business that entrepreneurs make or might make, which can affect the success of the business. For instance, entrepreneurs might create furniture items based on their unique ideas and aesthetic sense, and believe that these pieces will be a hit with the crowd. However, these pieces might not be user friendly or ergonomic or not what customers want. Thus, entrepreneurs must make what the customers want and not what they themselves like in order to sell furniture. Also, many entrepreneurs feel that starting the business means it will start making money immediately but if the other aspects of the business are ignored, such as marketing and planning, the entrepreneurs will often face disappointment. In order to create a niche sector for their designs and the furniture and for the business to bring in the crowds, entrepreneurs need to plan every step and aspect of the business, before actually starting it. Business planning is essential for every business, since it acts like a road map that chalks out the entire directions for the business that the entrepreneur must take for the business to be successful. A furniture business plan will include a detailed report on market analysis study which is necessary to understand the needs of the market (especially what items and designs the customers are looking for), along with other details of the business such as setting up the workshop and retail store for the business, managing the logistics and delivery of the furniture, planning for meeting the financial requirements of the business, etc.
Business planning is thus essential for every business, especially for businesses like the furniture business. Entrepreneurs can always refer to a business planning checklist to ensure that all the factors vital for a furniture business are included in the business plan.
Furniture Business Plan
Some of the necessary details that need to be included in a furniture shop business plan are discussed herewith.
The basic elements that comprise a business plan include –
- The executive summary
- The business overview and description
- The operation and management description
- The market analysis
- The competitive analysis
- The marketing and sales summary
- The financial summary
The executive summary is roughly a one page synopsis of the furniture business plan, which includes the vision for the business, the mission statement of the business, basic information regarding the founders of the business, a description of the kind of furniture items the business will deal in or specialize making, along with a summary of how the entrepreneur envisions the business to grow in the future.
Overview And Description
The overview and description comprises of the exact nature of the business in detail, including who will make the furniture, where will the workshop for making the furniture be located, where will the products be displayed and sold- whether in a store or supplied to other shop owners or at galleries or at exhibitions and events only or sold exclusively online via an e-store. Additionally, in case of owning a store then the details regarding the location of the shop- why the particular location was chosen, did it fit into the budget, the demographics and locality of the store location must also be mentioned. The details regarding the type of furniture that the business will specialise in must also be mentioned in the business plan, for instance only beds or only kitchen furniture or only office furniture or only wooden furniture or iron furniture or mixed materials furniture or outdoor furniture, etc.
Additionally, the business entity that the entrepreneur opts for, whether a sole proprietorship or a partnership or a limited liability partnership or a one person company or any other entity must also be included in the business plan along with the other necessary registrations required for the business, such as a Shop Act License, a GST registration, etc.
Operations And Management
The description of the operation and management of the furniture business is an extension of the business overview. This part elaborates on how the business will operate, the day to day functioning of the business, how many employees the business will need to hire, what the roles of each of the employees will be, for example, who will manage the store, who will manage the manufacturing unit or the workshop, the number of staff to show around at the store, along with other operational details such as the logistics of getting the finished goods to the store and delivering the furniture to the customer, etc. These operational and management details along with the organisational structure must be included in the furniture shop business plan.
The market analysis throws light on the details of the targeted market, such as the identification of the exact audience, the size of the market for the specific products, the previous history of the market with regards to specific products or the furniture business in general, the forecasted growth rates of the business with respect to the market, etc. The market analysis helps the business prepare according to the needs of the market and thus aid capturing the market successfully.
The furniture business plan must also include details regarding the study and analysis of the competition for the entrepreneur’s business plan. The information can be regarding the competitors in the market their product range and pricing, their weaknesses and strengths, their marketing strategies, how the entrepreneur’s business needs to plan to beat the competition, in which way the business can benefit from the competition, the barriers to overcome, etc. This planning will help the business stay ahead of the competition and get noticed as a business that knows what it is offering.
Marketing And Sales
The marketing of the furniture products is the end goal for the business to be successful. In order to draw in the customers and stand out from the competition, the furniture business plan must have a thoroughly planned strategy for marketing and advertising, in order to improve or increase the sales. The marketing can include the various mediums that can be used to spread the word about the business, such as print media, digital marketing, social media platforms, community events, etc. Similarly the sales plan can include tactics to be employed to attract customers, such as discounts on special days, combination deals such as table and chair if bought together then at a special rate, or bedroom furniture in a package for a discount, etc.
The furniture business requires financial investment for manufacturing or sourcing the furniture, to buy or rent a shop, for transportation of the furniture, for procuring the materials for the manufacturing and packaging of the furniture, for upkeep of the store including salaries of the employees, the electricity bills, the day to day expenses, etc. All of these expenditures for the business must be taken into consideration and mentioned in the business plan. Also, the method to meet these financial requirements, such as loans from banks or NBFCs, or borrowings or potential funding from investors, etc must be mentioned in the business plan.
The furniture business plan helps the entrepreneur chalk out all the details of the business beforehand and even help them be prepared for any possible hurdles in the future. The business plan aids the entrepreneur in factoring in all the aspects of the business, apart from just designing good furniture, and therefore the business plan must be prepared with the help of experts, such as those at deAsra, to help ensure that all the vital factors are considered and included in the business plan. A thoroughly written business plan is one of the keys for a successful furniture business.