Streamlining Your Business Plan: Writing About Sourcing and Fulfillment
Sourcing and fulfillment are critical factors for any business. In a Lean Plan, these costs may be implied or briefly mentioned in the forecast or operations section. In a full formal plan, they would be included in the operations section. If using LivePlan, sourcing and fulfillment would be added as a topic within the operations section in the Execution chapter. Only include this section if it is necessary for your specific business.
Sourcing refers to where you get the products you sell, while fulfillment refers to how you fulfill the services you sell or how you package, assemble, and ship products for online sales. Sourcing involves purchasing from distributors, vendors, and suppliers, while fulfillment includes working with subcontractors, drivers, analysts, and other necessary resources. Fulfillment also encompasses assembly, packaging, and shipping for online product businesses.
However, whether or not you include a section on sourcing and fulfillment depends on the nature of your business. Sourcing is important for most product businesses but may not be necessary for craftspeople selling handmade goods. Fulfillment is important for most service businesses but may not be required for self-employed consultants. Some product businesses may require both sourcing and fulfillment.
In a traditional plan, the section titles would be "Sourcing" for products, "Fulfillment" for services, and "Sourcing and Fulfillment" for businesses that sell products and services or need to assemble and ship products or deal with packaging and shipping for online orders.
For manufacturing companies, sourcing is likely to be important. Vendors determine standard costs and are crucial for continued operation. Include spreadsheet lists, bills of materials, standard cost breakdowns, and unit economics in the analysis of standard costs and purchased materials or services.
Resellers, such as bookstores, restaurants, and hardware stores, need to purchase their products for resale or use. They should explain how they work with distributors and highlight the most important ones, including discounts and margins involved.
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