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E-Myth – “Why most small businesses don’t work & what to do about it”

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Virtual CFO | Understanding Who the Target Market of a Business Is


It’s incredibly important for entrepreneurs to understand who the target market of their business is according to Virtual CFO. The reason why is because this information is going to impact the marketing plan of a business, the cash flow projections, the pricing, and the business plan in general. Therefore, business owners need to gain a complete understanding of who the target market for their business is, so that they can create the best business plan to help them grow. If they are not planning on creating a business plan, they may want to rethink this, because the software company, Palo Alto did a survey in order to find out how effective business plans were for entrepreneurs. But their study discovered, was that businesses that had a business plan were 50% more likely to grow the revenue in their business and succeed than any entrepreneur who did not have a plan at all. Therefore, business owners who have business plans are going to significantly be able to grow their business more than their counterparts who don’t have one.

In fact, A business plan is so important, that many Financial agencies such as Banks, lending agencies, and high-level investors will often refuse to loan money to any business that doesn’t have a business plan. It is well worth the time a business owner can put into creating one. If they don’t know where they can go, virtual CFO says starting with our accountant is always an amazing first step. When they do create one, business owners should ensure that not only does their business plan have a marketing plan. But they include their target market in this, so that they can be prepared as soon as they open the doors to their business to hit the ground running on their marketing efforts.

Something else that business owners will want to do, is ensure that their target market is included in the executive summary of their business plan. The executive summary is the synopsis that starts all business plans and is often the most important aspect of a business plan. The reason license virtual CFO, is because bankers and money lenders will often only look at this summary, in order to base their financing decisions. Therefore, if a business owner puts their target market into their executive summary, that will tell the loaning agencies a lot about the entrepreneurs plan to Market and grow their business. They will want to see this, so that it gives them comfort that they will be able to receive their money back if they loan it out to this business.

The next thing that business owner should do, ensures that they are following their business plan, and reading it and updating it regularly. Virtual CFO says the business plan should be considered a living document, however many business owners have the best of intentions but sometimes fall short. This is why having the target market in the executive summary is so beneficial, because even if a business owner is getting too busy to read their business plan, which might be twenty or Thirty Pages. Business owners can read the executive summary, and refresh their memory on what their plan is.

Virtual CFO | Understanding Who the Target Market of a Business Is

Business plans are so important to the success of an entrepreneur says virtual CFO. But they need to ensure that their business plan has a marketing plan attached to it. In that marketing plan, business owners need to ensure that they include their target market, because this is the key to an effective marketing strategy. When business owners open the doors to their business, they don’t want to start figuring out their marketing plan. And in fact, industry Canada doesn’t survey and discovered that out of the 50% of entrepreneurs in Canada that fail, the majority of them fails because they weren’t able to find customers. This illustrates how important a marketing plan is for business.

However, many business owners think that marketing means advertising it to as many customers as possible. And while this might sound like a sound strategy since virtual CFO, the reason why it’s not, is because customers need to see the messaging from a business 4.3 times on average before they are ready to purchase. Is this true even for ideal and likely buyers who are ready to make a purchase? The more familiar they are with a business, the more likely they’re going to be making their purchasing decision with them. Therefore, instead of a business owner trying to get in front of as many customers as they can once, virtual CFO says what they need to do, is get in front of a smaller amount of people more often.

For example, if a business owner is going to send out flyers, they may be tempted to send Flyers one time to 5,000 customers. But a much more efficient strategy according to Virtual CFO, is it sending 1000 customers Flyers five times. Not only is this going to result in more customers calling the business, but it will also allow them to grow their revenue, which will give them the ability to reach more customers in the future. With how effective this is, business owners should include this type of plan into their marketing.

And even though this example was made using Flyers, the same principle shows true for digital marketing as well. For example, if an entrepreneur is going to buy Google AdWords, they need to ensure that their campaign guest in front of enough customers at least five times, so that more customers will call the business and purchase from them.

This kind of well-thought-out marketing campaign sometimes needs help to develop, and business owners should not be shy contacting their business professionals such as accountants in order to develop this plan. They should remember that just like Benjamin Franklin, the Founding Father of the USA has said, if you fail to plan, and you are planning to fail.