A business definition basically tells you ‘what kind of business’ you are in. It is a one-line summarization of your entire business. It helps you clearly communicate what your business is about to others.
A business definition is generally based upon 3 points:
Who? : Who is your customer? To know this look at your customer description from “Understanding your business! (Situation Analysis)”
What? : What customer needs will be satisfied by your business. Remember needs are not only physical needs. There are also other needs like the need for achievement, need for status etc.
How? : What solution does your business offer to satisfy the needs of the customer.
For e.g. if it were a business making snacks the answers to the questions would be:
Who? People who want to “munch” something
What? Need to quickly quench their hunger in an enjoyable way.
How? By providing good tasting between meals food products.
A “sample business definition” using the answers to the above questions would be:
"We will manufacture good and tasty sweet snacks to enable individuals to quickly satisfy their hunger."
After you have your business definition ready, the next step is to formulate your business objectives.
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