The Entrepreneurial Mind blog post entitled "Know How Your Customer Thinks and How They Act" brings to light why entrepreneurs and small businesses must regularly evaluate, update, and revise their business plan as it relates to their products, services, and customers.
In this post, Jeff Cornwall discusses how there may be a difference between what your customers say and what your customers may actually believe or how they will act. Even though this post concerns businesses and their stance on environmental and health related issues, I believe that it is relevant for other features as well.
Let’s say you have watched the movie The Jerk with your friends. At the end of the movie, all of your friends express a desire to have a cup of pizza (it’s in the movie). The discussion among your friends leads you to believe that there may be a demand for cup of pizza. You conduct market research and decide that there is enough demand for the product to open a business based on the concept. You form a business plan based on your research and open a Cup-of-Pizza kiosk at the mall.
A few months after opening your business, it becomes evident that the actual demand for the product was much less than you anticipated. If you are completely dedicated to your initial business plan, you may have to eventually close your business if the sales of Cup-of-Pizza are not enough to sustain your business.
However, if you routinely evaluate, update, and revise your business plan, you may have discovered that there is demand for other products that can be offered with the infrastructure you already have in place.
For instance, you may have noted that people frequently ask if you sell noodles in a cup, which is an established and popular product in some parts of the United States. If you regularly evaluate your business plan, you would have identified noodles in a cup as a product for which there is demand and that your business could sell without any additional investment except ingredients. The combined offering of Noodles-in-a-Cup and Cup-of-Pizza could bring in enough sales to make your company profitable.
By evaluating, updating, and revising your business plan, you have identified a change in your target market ("exclusively pizza that is offered in a cup" to "food offered in a cup") that will help increase the likelihood that your firm will prosper.