Marketing Plan Outline

Summary

A marketing plan is designed to assess client needs, develop a product or service to meet those needs, communicate to the customer the attributes of the product/service, establish distribution channels to make products/services available to consumers, and to ensure that the company makes a profit.

Introduction

WHO	is the company, the community?  Who are the principals, the employees?
WHAT	is the product/service, what is the company's goal in the short-term and long-term?
WHERE	is the plant, the offices from where the service will be offered?
HOW	does the company intend to meet its objectives, production levels, sales volumes?
WHY	was the product/service developed, what are its attributes or qualities, and how is it superior to existing products?

Target Markets

• What is the initial proposed market of the business?
  • local
  • provincial
  • Western provinces
  • national
  • international
• How does the company fit in the chain of basic markets?
  • consumer
  • industrial
  • government
  • international
  • supplier
  • manufacturer
  • wholesaler
• What are the target market boundaries?
  • by consumer group demographics
  • by geographic region
• Define the dollar value of total potential sales within the proposed target market.
• Describe the targeted user groups by age, gender, lifestyle, values (major customer groups).
• Define the company's sales level objectives and what percentage of total market share they represent.
• Describe how planned production capability compares to proposed market demand.
• Outline any outside influencing factors which may affect the marketability of the product, and how they can be overcome:
  • packaging/labelling regulations
  • GST/PST (impact on consumer price acceptance)
  • buyer preferences (health food vs. junk food)
  • technology changes to production (extrusion method)
  • environmental preservation considerations
• Describe when the product/service is usually purchased; on impulse or as a regular grocery shopping item. Does the proposed marketing strategy address these trends?
• Who usually does the purchasing of the product/service? Who makes the purchasing decision? Is the marketing strategy properly directed to this group?
• Describe the varieties of the product available:
  • by flavour
  • by size or colour
  • by options available
  • by price
• What are the markets for each of the above?
• Where is the product normally purchased?
  • supermarkets
  • retail chains
  • convenience stores
  • snack bars
  • gas bars
  • schools
  • factory outlets
  • catalogue
  • Internet
• Are the marketing efforts properly targeted to these locations?

Market Demands

• Who are the competitors (i.e., domestic or foreign)?
• What are their products/services?
• How does this product/service compare by quality, price, packaging and variety?
• What percentage of the total market does each competitor enjoy?
• What can this company realistically expect to obtain as market share (provide sales forecasts)?
• What does the public normally demand from this type of product/service? Does it meet these demands?
• Does the packaging (sales aids/point of purchase displays) emphasize the qualities of the product/service?
• What level of sales growth is anticipated over the next three years? Can the plan deliver the production levels necessary to support this growth?
• What are the company's long range plans?

Product Pricing

• What is the consumer acceptance price range for this type of product/service?
• How does the proposed product's/service's price compare?
• Is there sufficient margin between the manufacturer's cost and the consumer acceptance price level to provide for markups at the wholesale, distributor and retail level?
• Does the price allow for freight, projected profit, price fluctuations in the marketplace and consumer interpretation of value?
• Are coupons or discounts being considered to encourage consumers to try other flavours, etc.?
• What is the product cost breakdown?
  • Costs of goods sold
    • direct labour
    • direct materials
  • Operating expenses
    • selling expenses
    • communications expense
    • general and administration expenses (including freight)
• What markups are allowed at each level of distribution (markup chain and channel pricing)?

For example:

Manufacturer		Wholesaler		Retailer
Cost	90%	Cost	80%	Cost	60%
	+		+		+
Markup	10%	Markup	20%	Markup	40%
	=		=		=
Selling Price	100%	Selling Price	100%	Selling Price	100%

• Are the most economical/cost effective methods of processing and packaging being used (including raw materials input) to keep product/service costs down?

Distribution Channels

• How does the company plan to get the product/service to the end-user?
• What channel of distribution is to be used?
  • contests
  • direct - manufacturer to consumer
  • traditional - manufacturer to wholesaler to retailer to consumer
  • multi-stage - manufacturer to broker to wholesaler to retailer to consumer
  • one-stage - manufacturer to retailer to consumer
• Who/what company will carry out the distribution?
• Are commissioned salespersons to be used?
• What are the costs associated with the proposed distribution channels?
• How do these channels affect delivery/production timeframes?
• What are the delivery terms?
• How are products to be packaged for shipping? Are end-user displays available? What physical handling is required?
• Are display aids (clip racks, bins, etc.) to be provided to retailers?
• Does packaging meet regulatory agency requirements (labelling, seals, etc.)?
• Is packaging eye appealing, complementary to product, portraying universal labelling, coded, priced?
• Is there a method for feedback on customer satisfaction, quality control?
• What minimum shipping orders are required? (cost efficient)
• What minimum inventory levels must be maintained to ensure no loss of sales due to late deliveries, back orders, split shipments?
• What system is to be used for processing orders, shipping, billing?
• What trade terms will be offered?

Promotion

• Describe the company's communications approach:
  
  • advertising
  • selling
  • sales promotion
  • publicity
• How much is budgeted in Year 1 for each category?

Advertising 

• What percentage of each media is to be used in your overall advertising package?
  • television
  • radio
  • newspapers
  • magazines
  • billboards
  • business cards
  • co-operative advertising with wholesalers/retailers
  • Internet
  • other (i.e., transit advertising)

Selling

• What type of sales force is to be used - brokers, commissioned salespersons, etc.?
• What tools are to be provided to salespersons to assist getting orders (volume discounts, purchasing shelf space, etc.)?
• Will a sales training program be offered?
• How will sales effectiveness be measured?
• What incentives will be offered to salespersons for new accounts, achievements?
  

Sales Promotion

• What sales promotion activities are planned?
  • point-of-purchase displays/sales aids
  • samples
  • coupons
• What costs are associated with each?

Publicity

• How does the company plan to "kick off" the introduction of the product using publicity?
  • endorsements (place of origin)
  • testimonials
  • referrals
  • truck and bus signs
  • consistent visual theme

Source: U.S. Small Business Administration
Originally prepared by the Government of Saskatchewan