Prepare a detailed business plan and research financing options. Identify possible locations and negotiate lease arrangements.
GOAL: To prepare a specific and detailed business plan.
WHAT TO DO: At this stage, it is vital for your group to invest time and money in a detailed and thorough business plan.
Preparing a business plan:
- A business plan should covers all aspects of the co-op’s operations: who is involved, who the customers are, what the co-op will sell, how it will operate, how it will be capitalized and what the costs of operation will be. The plan should include a market study that justifies projections.
- A business plan needs to be very detailed and specific about every facet of the co-op’s potential business and operations.
- Preparing a business plan is a good exercise for anyone involved in a new business, even if things don’t work out exactly as planned. The discipline of documenting your ideas and assumptions, projecting financial and operational figures, and pulling all of these elements together into one complete plan is invaluable.
- The assistance of consultants and resource people experience in w business startups and preparing business plans will be essential.
- Economic development programs and grants can be useful both for startup funding and for developing a business plan.
When the business plan is prepared:
- The steering committee or board of directors should prepare a report that summarizes the business plan.
- Conclude the report with the board or committee’s recommendation to proceed or not to proceed with the co-op.
- This report should be made available to all members, and a summary should presented at a membership meeting.
KEEP IN MIND:
Deli, bakery, and juice bar operations are highly appealing and generally viewed as desirable features of a new co-op. However, food production requires specialized equipment, facilities, and expertise. Consider leasing these facilities to other operators, at least initially, in your new co-op.
KEY DECISION: DOES THE CO-OP MAKE SENSE FROM A BUSINESS PERSPECTIVE? Are the co-op’s plans and ideas justified by market studies and reasonable sales projections? Does a business plan prove the co-op’s viability?