Product Description with Customer Benefits

As with all the other sections in your plan, start simple. “ABC Eateries is a restaurant focusing on family-friendly American cuisine and value pricing.” Many plans start their product or service description with how they differ from the competition. This is a mistake – the reader first needs to know exactly what you do. You can draw more subtle distinctions later. Do you own a spa, a hair salon, a coffee bar, manufacture heart valves, leather goods, or service computers? Make your business recognizable to the reader, even if you feel that what you do is like no other business. Help the reader put you and your business into a broad category that they can relate to.

Think of describing your product or service under these circumstances: You have just stepped onto an elevator on the 5th Floor of an office building. Another person in the elevator strikes up a conversation by saying, “What do you do?”. You have until the elevator doors open on the first floor (about 30 seconds later) to describe your business in enough detail that the person will want to become your customer or may know someone else who could use your product or service. At most, you might have time for 50 words of explanation. This becomes the first paragraph of the product or service description.

Each paragraph beyond the first describes the attributes of your product or service in more detail. Do you have just one product or service, or a whole line of products or services, each of which merit some description? It is usually smart to group these products into product lines and describe those. If you want the reader to understand the offering in full, list them in the appendix. For instance, restaurant menus or a list of hair salon services could be included in the appendix.
Paint a picture using all five senses if possible for the reader: if you are selling a product, discuss its size and shape, color style, and quality. If you perform a service, you might describe the quality, value, speed, flexibility, and competence of the service professionals. For a retail business, describe the look of the location, its surroundings, and the hours the business will be open. You may want to include actual pictures or diagrams of your product, or your location.
Another piece of a compelling description is what gave you the idea for this product or service in the first place. Did you need it yourself, were you solving a need you consistently saw in the marketplace, or did you get the idea in some other way? How long have you been working on this idea? Or, if you have an existing business, what have you learned that has helped you refine your product or service?

Remember, your readers are possible customers of your product, and they will read the plan as if they were. They will ask themselves, “Would I buy this product or service? Can I see where it will fill a need?” It is easier to make the case that your product or service is needed if you are producing a well-known, easily understood product or service such as a clothing manufacturer or dry cleaner. All readers will understand that there is a bona fide need for these, even if they disagree with you about the location of your business or the amount of money you think you need to get started.

If your product or service is of a new type, or more sophisticated than the average person might be aware of, it is important that you establish the need for what you are doing in a way that the reader can relate to. Be careful not to talk down to readers or insult their intelligence, but don’t assume that they have more than the basic knowledge about what you do. For example, you might start this way: “Smith & Associates helps businesses better use their computer hardware by designing software for order-taking and inventory maintenance.” Or “Cohen Medical produces medical devices that make kidney dialysis more effective and more comfortable for the patient.” The next paragraphs can go into more depth, and paragraphs after that can get more technical using industry jargon.

You can also use statistics and information from industry trade journals or other sources to establish the need for your product or service. For example: “ Accordingly to Restaurant Journal, the number of people eating at Indian restaurants went up by 20% last year, although the number of restaurants stayed almost constant.” “With bicycle ownership among individuals age 50 and over up by 14% over the past two years, there is a need for a comfortable helmet designed for adults and not children.”

Some benefits to customers that might apply to your business are: more features, a product directed to specific previously unmet needs, better price, better quality, better service provided by better prepared professionals.

Writing a Description of Your Product or Service for Your Business Plan

What is it exactly that you are selling? It may take some time to come up with a succinct answer to what seems to be an easy question. Are you in the business of selling shampoo, or are you in the business of helping the customer achieve radiant good looks with sparkling hair? Does American Airlines sell airplane tickets or are they in the business of getting people from home to exotic locations around the world as quickly, comfortably and safely as possible?

ATT&T may be in the communications business, but they are going to have to be a lot more specific than that for me, when I’m the customer and they want me to plunk down my money to buy something they are selling.
If your business or product is new, you have an even more fundamental question to answer: How do you know this product or service is needed? What problem does this product or service solve? What outside validation do you have about the need for the product?

When you write your product or service description, do it in several paragraphs up to several pages. Start from the very simple (you are describing it to a high school student) and get increasingly detailed. It will be very important to the success of your business to have an easily understandable description of what you do. You will use it in brochures, in advertisements, and when you introduce yourself at business meetings.

Many business plan writers are so familiar with their subject matter that they forget their readers may know nothing about their industry. It will be important for you to clearly describe all products and services from a layperson’s point of view. This is especially a problem for people in high tech industries. At least the opening paragraph of each section of the business plan must be in non-tech language. If your subject requires the jargon of your industry to be completely understood, use that in the final descriptive paragraphs.

There are three basic elements to the product or service description for every business. First is the clear, concrete description of what you are offering. After the initial description, there are two other descriptive elements: What benefits does your product or service offer customers or clients, and what is special or unique about what you are offering that will give you a strategic advantage over your competitors? And don’t forget that whatever you describe as part of your product or service has a cost associated with it. The reader will expect to see costs that match this description when they get to the financial section.