Table of Content

    New product launch business plan for starting your own business

    Clueless on how to add a new product line to your enterprise? Well, adding a product line is not a simple process. It isn’t just hiring a few more people and acquiring additional equipment.

    Establishing a new product line needs adjustments on all organizational levels, operational plan & strategic plan. It may require you to carry out marketing analysis and overall risk assessment again. And therefore, you require a comprehensive business plan to launch a new product no matter how established your business already is.

    A good practice is to get developed a business plan online or by industry experts near you so that all features of the new product launch can be taken care of.

    To help you fathom how a new product launch in market is introduced we are providing a sample business plan guide adopted by NYC House Cleaners when they added construction debris cleanup to their services.

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    Executive Summary

    2.1 The Business

    NYC House Cleaners was a cleaning company founded in New York. The company was established in 2009 and in 2021, the enterprise owner decided to add a new product line and broaden his services to the city’s construction sector. In this sample, we will provide some segments of the business plan for launching a new product following which the owner successfully launched new product.

    2.2 Management of new product launch

    Management of new product launch is just as complicated and expedient as that of initiating a new startup. Only by properly following the steps for launching a new product can you ensure better management.

    In this business plan for franchise (https://www.ogscapital.com/business-plan/franchise-business-planning/) we will explain how to launch a product line and how to adjust all the segments of your previous business plan according to the new needs.

    2.3 Customers of new product launch

    The buyers of your new product line depend on the type of your basic business. In the case of NYC House Cleaners, they were contractors, construction managers, disaster management organizations, and construction firms.

    2.4 Business Target

    Presenting a new product, you would have certain fiscal and social expectations. In your business plan for new product launch it is expedient to pen them down so you can remain focused on achieving them.

    The business targets of NYC House Cleaning are demonstrated in the graph below.

    3 Years Profit Forecast - New Product Launch Business Plan Sample

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    Company Summary

    3.1 Company Owner

    NYC House Cleaning is owned by Frank Max. Max is a Harvard graduate with passion to provide unparalleled services to consumers and make profits.

    3.2 Why the new product launch is being started

    In almost 10 years, Max was able to strengthen the business working with which he started. To bring innovation, and explore more opportunities, he decided to launch a new product.

    3.3 How the new product launch will be started

    Step1: Create Business Plan New Product

    The foremost step is to study as many business plans for new products as are available. They will help you understand the process for different types of businesses. After that you should delineate launching a new product plan.

    In case, you lack a professional business diploma or degree, you should consider hiring business consulting firm to make for you a new product business plan sample. You can have a great deal of insight into how that plan would look like by reading this sample product business plan.

    Step2: Execute the Plan

    The second step is to execute and administer each part of your business plan. You have to recruit more persons with qualification to match your product specification. You will have to develop sales strategy and marketing strategy accordingly.

    Step3: Use the Web

    The forthcoming step is to make your consumers aware of the new product or service. Using web and social media will be the best choice as your reach can grow multiple times using them.

    Step4: Manage and Grow

    After you have integrated the new product in all the business features, you will have to develop a brief strategy on how to grow your business even further by capitalizing on the new product.

    Startup Cost - New Product Launch Business Plan Sample

    Start-up Expenses  
    Legal $110,000
    Consultants $0
    Insurance $19,000
    Rent $20,000
    Research and Development $10,000
    Expensed Equipment $45,000
    Signs $2,600
    TOTAL START-UP EXPENSES $206,600
    Start-up Assets $202,000
    Cash Required $199,000
    Start-up Inventory $32,000
    Other Current Assets $230,000
    Long-term Assets $245,000
    TOTAL ASSETS $908,000
    Total Requirements $1,114,600
    START-UP FUNDING
    Start-up Expenses to Fund $206,600
    Start-up Assets to Fund $908,000
    TOTAL FUNDING REQUIRED $1,114,600
    Assets
    Non-cash Assets from Start-up $1,142,000
    Cash Requirements from Start-up $115,000
    Additional Cash Raised $43,000
    Cash Balance on Starting Date $32,000
    TOTAL ASSETS $1,332,000
    Liabilities and Capital
    Liabilities $17,000
    Current Borrowing $0
    Long-term Liabilities $0
    Accounts Payable (Outstanding Bills) $45,000
    Other Current Liabilities (interest-free) $0
    TOTAL LIABILITIES $62,000
    Capital
    Planned Investment $1,114,600
    Investor 1 $0
    Investor 2 $0
    Other $0
    Additional Investment Requirement $0
    TOTAL PLANNED INVESTMENT $1,114,600
    Loss at Start-up (Start-up Expenses) $155,400
    TOTAL CAPITAL $1,270,000
    TOTAL CAPITAL AND LIABILITIES $1,332,000
    Total Funding $1,114,600

    Strategic/Operational Business Plan

    Services of new product launch

    When you have concluded which product or service you want to add, the forthcoming step is to thoroughly investigate how to launch a product line. For systematic approach, you should discuss all the features of new product in very specific terms in your business plan for product launch.

    If you don’t know how that can be accomplished, you can study business plans for new products available online like this one. In this business plan sample for new product we will explain what type of new products are usually added by enterprises.

    • Extension of Service

    Enterprises whose model is based on service provision usually extend the service line. This includes either providing the same set of services to other areas or increasing services on the list.

    • New Product

    This include adding an entirely new product to your business. This needs a proper business plan sample for new product since the areas to consider are the same as they were when you launched your business.

    • Product Mix

    This category caters for the scenario when a startup entirely shifts its range of products.

    • Changing Product Features

    This include adding new features or bringing innovation to an already existing product or service.

    In this product business plan sample we will explain how NYC House Cleaners extended their services. You can also see the new arrangement and staff in the later segments of this product business plan example.

    Marketing Analysis of new product launch

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    Even if you have already carried out a flawless market analysis in your operational plan, you are required to do it again when making marketing plan for launch of new product. It includes understanding market statics and dynamics and taking them down in your business plan for new product launch.

    For micro trends, you should include a portfolio of your business rivals, their offerings, services and sales. In your new product marketing launch plan, you should outline how you can outperform your competitors. Macro trends such as interest rates and inflation can also impact your earnings profoundly, that’s why it is expedient to consider them as well in your marketing launch plan new product.

    In this sample business plan for new product we will explain marketing steps to launch a new product. Based on your type of business, you may also benefit from business plan for video game (https://www.ogscapital.com/article/video-game-business-plan/) or Mexican restaurant business plan.

    5.1 Market Trends

    In the United States, it is quite common that businesses keep on adding new product and service lines. It is because technological changes are happening at a pace never witnessed before. Either it is needed to bring innovation to the service or product or drop the prior product altogether.

    5.2 Marketing Segmentation

    When you are marketing for launching a new product, you are actually adding customer segments to your business. To make sure you meet the new criteria, it is incumbent to mention the new consumers groups in your sample marketing plan for new product launch. This will help you in reaching a wider audience as well as gathering best business ideas.

    If you are marketing new product launch, your consumer groups would depend on your niche. For instance, in case of tobacco shop business plan (https://www.ogscapital.com/article/tobacco-shops-business-plan-sample/), they will mostly be adults and seniors. If you make oyster farming business plan, they can be youngsters, teens, adults as well as seniors.

    In this new product launch marketing plan example, we are listing generic list of groups that can be your consumers for new product.

    Marketing Segmentation - New Product Launch Business Plan Sample

    5.2.1 Individuals

    If you are a restaurant, a gym, or a service provider whose prior consumers belonged to individuals of all ages, it is likely that your customer groups remain the same.

    5.2.2 Small Businesses

    In case you run a business that offered services like hardware or software outsourcing, office management, office cleaning, business consulting, then your consumers will mostly belong to small enterprises.

    5.2.3 Large Businesses

    Based on services, large and already established businesses can be a customer group as well.

    5.2.4 Manufacturing Industries

    If your new product line provides raw materials for manufacturing industries whether they deal in food, chemicals, or technical products, then your consumers will fall in this category.

    Market Analysis
    Potential Customers Growth Year 1 Year 2 Year 3 Year 4 Year 5 CAGR
    Individuals 19% 25,000 30,000 36,000 43,200 51,840 10.00%
    Small Businesses 31% 45,000 54,000 64,800 77,760 93,312 10.00%
    Large Businesses 26% 35,000 42,000 50,400 60,480 72,576 10.00%
    Manufacturing Industries 24% 29,000 34,800 41,760 50,112 60,134 11.00%
    Total 100% 134,000 160,800 192,960 231,552 277,862 10%

    5.3 Business Target

    By adding a product line, NYC House Cleaners intended to:

    • Acquire a CSAT score of 90+ with respect to the new product
    • Make at least $55k in monthly profits by the end of the first five years

    5.4 Product Pricing

    NYC House Cleaners decided to keep the prices of construction debris cleaning in the same range as their competitors.

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    Marketing Strategy of new product launch

    if you are presenting a new product, you have to look for marketing strategies for new product launch so that your consumers learn about it. You can meet your monetary expectations from the new product only if you successfully carry out your product launch marketing strategy.

    In this business plan for new product sample, we are providing NYC House Cleaners’ marketing strategy to launch a new product.

    6.1 Competitive Analysis

    • Our biggest competitive advantage is that we have built the name and reputation of our brand by providing excellent customer service during the past years.
    • We have been in contact with enterprises and contractors who will hire us for professional cleanup.
    • We are situated in a location where construction cleaning service is not offered by most startups.

    6.2 Sales Strategy

    • We will contact our target consumers by sending our sales executive and digital business cards.
    • We will offer a 20% discount to our consumers for the first two months of our launch.
    • We will promote us through web and social media.

    6.3 Sales Monthly

    Sales Monthly - New Product Launch Business Plan Sample

    6.4 Sales Yearly

    Sales Yearly - New Product Launch Business Plan Sample

    6.5 Sales Forecast

    Sales Forecast      
    Unit Sales Year 1 Year 2 Year 3
    Extension of Service 1,500 1,590 1,685
    New Product 2,500 2,650 2,809
    Product Mix 1,200 1,272 1,348
    Changing Product Feature 2,300 2,438 2,584
    TOTAL UNIT SALES 7,500 7,950 8,427
    Unit Prices Year 1 Year 2 Year 3
    Extension of Service $100.00 $116.00 $134.56
    New Product $250.00 $290.00 $336.40
    Product Mix $260.00 $301.60 $349.86
    Changing Product Feature $220.00 $255.20 $296.03
    Sales
    Extension of Service $150,000.00 $184,440.00 $226,787.42
    New Product $625,000.00 $768,500.00 $944,947.60
    Product Mix $312,000.00 $383,635.20 $471,717.84
    Changing Product Feature $506,000.00 $622,177.60 $765,029.58
    TOTAL SALES $1,593,000.00 $1,958,752.80 $2,408,482.44
    Direct Unit Costs Year 1 Year 2 Year 3
    Extension of Service $35.00 $38.50 $40.43
    New Product $120.00 $132.00 $138.60
    Product Mix $130.00 $289.00 $335.00
    Changing Product Feature $100.00 $110.00 $115.50
    Direct Cost of Sales
    Extension of Service $52,500.00 $61,215.00 $68,132.30
    New Product $300,000.00 $349,800.00 $389,327.40
    Product Mix $156,000.00 $367,608.00 $451,687.20
    Changing Product Feature $230,000.00 $268,180.00 $298,484.34
    Subtotal Direct Cost of Sales $738,500.00 $1,046,803.00 $1,207,631.24
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    Personnel plan of new product launch

    For putting forward a new product, you need to have a team that is acquainted with the new production procedure. While drafting your business plan for launching a new product, you should clearly define the personnel you would require carrying out additional responsibilities.

    In this business plan sample for new product, we are providing the general staff that you can need to hire to incorporate a fresh product line. You may need to hire more people according to the product specification and adjust your business plan to launch a new product accordingly.

    7.1 Company Staff

    • 1 Operation Manager to manage the distribution
    • 1 Social Media Manager to make the product known
    • 1 Sales Executive to reach out to enterprises
    • 1 Web Developer to develop website for new product launch
    • 1 Customer Care Executive to assist consumers about the new product
    • 1 Business Strategy Consultant to help integrate the new functionality
    • 2 Technical Assistants

    7.2 Average Salary of Employees

     Personnel Plan      
    Year 1 Year 2 Year 3
    Operation Manager $33,000 $36,300 $39,930
    Social Media Manager $24,000 $26,400 $29,040
    Sales Executive $23,000 $25,300 $27,830
    Web Developer $20,000 $22,000 $24,200
    Customer Care Executive $15,000 $16,500 $18,150
    Business Strategy Consultant $30,000 $33,000 $36,300
    Technical Assistants $20,000 $22,000 $24,200
    Total Salaries $165,000 $181,500 $199,650

    Financial Plan of new product launch

    Even if you had done accurate fiscal planning for your enterprise at the initiation time, you will need to still do it again to incorporate the new product. New product launch will have its risks, investments and profits associated. To make sure you are able to generate profits and strengthen your business by putting forward the new product, it is expedient to renew financial planning in your business plan for a new product launch.

    Sometimes, financial planning for a new product line is considered more complex than the one for startup. It is because for the new product launch, you have to carefully analyze if and how you can use your prior resources to build manpower and funding for the new venture.

    In this new product launch business plan template, we are documenting the financial plan of NYC House Cleaners. These segments are taken after Max had incorporated revised figures for the product launch in his new product launch business plan.

    If you are looking for legal assistance or document destruction business plan (https://www.ogscapital.com/article/document-shredding-business-plan-sample/), you can have a general idea from here.

    8.1 Important Assumptions

     General Assumptions      
    Year 1 Year 2 Year 3
    Plan Month 1 2 3
    Current Interest Rate 8.11% 8.22% 8.26%
    Long-term Interest Rate 8.26% 8.25% 8.47%
    Tax Rate 23.52% 24.23% 24.60%
    Other 0 0 0

    8.2 Break-even Analysis

    Break-even Analysis - New Product Launch Business Plan Sample

     Break-Even Analysis  
    Monthly Units Break-even 5329
    Monthly Revenue Break-even $129,500
    Assumptions:
    Average Per-Unit Revenue $231.00
    Average Per-Unit Variable Cost $0.62
    Estimated Monthly Fixed Cost $161,420

    8.3 Projected Profit and Loss

     Pro Forma Profit And Loss    
    Year 1 Year 2 Year 3
    Sales $16,002,000 $19,676,059 $24,193,682
    Direct Cost of Sales $15,642,600 $18,278,958 $20,599,717
    Other $0 $0 $0
    TOTAL COST OF SALES $15,642,600 $18,278,958 $20,599,717
    Gross Margin $359,400 $1,397,101 $3,593,965
    Gross Margin % 2.25% 7.10% 14.85%
    Expenses
    Payroll $165,000 $181,500 $199,650
    Sales and Marketing and Other Expenses $120,300 $148,000 $156,000
    Depreciation $2,200 $2,350 $2,500
    Leased Equipment $0 $0 $0
    Utilities $2,700 $3,000 $3,100
    Insurance $1,900 $2,100 $2,100
    Rent $2,500 $2,600 $3,200
    Payroll Taxes $13,000 $15,000 $18,000
    Other $0 $0 $0
    Total Operating Expenses $307,600 $354,550 $384,550
    Profit Before Interest and Taxes $51,800 $1,042,551 $3,209,415
    EBITDA $51,800 $1,042,551 $3,209,415
    Interest Expense $0 $0 $0
    Taxes Incurred $10,360 $208,510 $641,883
    Net Profit $41,440 $834,041 $2,567,532
    Net Profit/Sales 0.26% 4.24% 10.61%
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    8.3.1 Profit Monthly

    Profit Monthly - New Product Launch Business Plan Sample

    8.3.2 Profit Yearly

    Sales Yearly - New Product Launch Business Plan Sample

    8.3.3 Gross Margin Monthly

    Gross Margin Monthly - New Product Launch Business Plan Sample

    8.3.4 Gross Margin Yearly

    Gross Margin Yearly - New Product Launch Business Plan Sample

    8.4 Projected Cash Flow

    Projected Cash Flow - New Product Launch Business Plan Sample

     Pro Forma Cash Flow      
    Cash Received Year 1 Year 2 Year 3
    Cash from Operations
    Cash Sales $52,000 $56,160 $60,653
    Cash from Receivables $23,000 $24,840 $26,827
    SUBTOTAL CASH FROM OPERATIONS $75,000 $81,750 $88,290
    Additional Cash Received
    Sales Tax, VAT, HST/GST Received $0 $0 $0
    New Current Borrowing $0 $0 $0
    New Other Liabilities (interest-free) $0 $0 $0
    New Long-term Liabilities $0 $0 $0
    Sales of Other Current Assets $0 $0 $0
    Sales of Long-term Assets $0 $0 $0
    New Investment Received $0 $0 $0
    SUBTOTAL CASH RECEIVED $76,000 $82,000 $89,000
    Expenditures Year 1 Year 2 Year 3
    Expenditures from Operations
    Cash Spending $43,000 $46,000 $48,000
    Bill Payments $21,000 $22,000 $23,000
    SUBTOTAL SPENT ON OPERATIONS $64,000 $68,000 $71,000
    Additional Cash Spent
    Sales Tax, VAT, HST/GST Paid Out $0 $0 $0
    Principal Repayment of Current Borrowing $0 $0 $0
    Other Liabilities Principal Repayment $0 $0 $0
    Long-term Liabilities Principal Repayment $0 $0 $0
    Purchase Other Current Assets $0 $0 $0
    Purchase Long-term Assets $0 $0 $0
    Dividends $0 $0 $0
    SUBTOTAL CASH SPENT $64,000 $69,120 $74,650
    Net Cash Flow $20,100 $22,500 $23,600
    Cash Balance $26,510 $27,000 $29,000

    8.5            Projected Balance Sheet

     Pro Forma Balance Sheet    
    Assets Year 1 Year 2 Year 3
    Current Assets
    Cash $255,000 $285,600 $314,160
    Accounts Receivable $23,000 $25,760 $28,954
    Inventory $4,200 $4,704 $4,900
    Other Current Assets $1,000 $1,000 $1,000
    TOTAL CURRENT ASSETS $278,000 $311,360 $349,969
    Long-term Assets
    Long-term Assets $10,000 $10,000 $10,000
    Accumulated Depreciation $18,200 $20,384 $22,932
    TOTAL LONG-TERM ASSETS $23,200 $25,984 $29,232
    TOTAL ASSETS $291,200 $326,144 $366,912
    Liabilities and Capital Year 4 Year 5 Year 6
    Current Liabilities
    Accounts Payable $17,500 $19,600 $22,030
    Current Borrowing $0 $0 $0
    Other Current Liabilities $0 $0 $0
    SUBTOTAL CURRENT LIABILITIES $20,000 $22,400 $25,178
    Long-term Liabilities $0 $0 $0
    TOTAL LIABILITIES $14,200 $15,904 $17,876
    Paid-in Capital $29,000 $30,000 $31,000
    Retained Earnings $51,000 $55,590 $61,149
    Earnings $191,000 $208,190 $229,009
    TOTAL CAPITAL $284,000 $309,560 $340,516
    TOTAL LIABILITIES AND CAPITAL $298,200 $326,144 $366,912
    Net Worth $289,000 $315,010 $346,511

    8.6            Business Ratios

     Ratio Analysis        
    Year 1 Year 2 Year 3 INDUSTRY PROFILE
    Sales Growth 7.23% 8.01% 8.88% 3.00%
    Percent of Total Assets
    Accounts Receivable 9.20% 10.19% 11.29% 9.80%
    Inventory 5.26% 5.83% 6.46% 9.90%
    Other Current Assets 2.13% 2.36% 2.61% 2.40%
    Total Current Assets 148.60% 149.00% 152.00% 158.00%
    Long-term Assets 11.56% 11.58% 12.01% 12.00%
    TOTAL ASSETS 100.00% 100.00% 100.00% 100.00%
    Current Liabilities 4.88% 4.92% 4.96% 4.34%
    Long-term Liabilities 0.00% 0.00% 0.00% 0.00%
    Total Liabilities 7.54% 7.60% 7.67% 7.38%
    NET WORTH 100.41% 101.21% 102.14% 110.00%
    Percent of Sales
    Sales 100.00% 100.00% 100.00% 100.00%
    Gross Margin 93.25% 95.77% 98.45% 99.00%
    Selling, General & Administrative Expenses 92.35% 94.84% 97.50% 97.80%
    Advertising Expenses 1.49% 1.53% 1.57% 1.40%
    Profit Before Interest and Taxes 40.26% 41.35% 42.50% 33.90%
    Main Ratios
    Current 34 35 36 32
    Quick 32.2 33 33.825 33
    Total Debt to Total Assets 0.18% 0.18% 0.17% 0.40%
    Pre-tax Return on Net Worth 73.26% 74.03% 74.50% 75.00%
    Pre-tax Return on Assets 95.50% 100.28% 105.29% 111.30%
    Additional Ratios Year 1 Year 2 Year 3
    Net Profit Margin 32.15% 33.15% 34.17% N.A.
    Return on Equity 54.23% 55.91% 57.64% N.A.
    Activity Ratios
    Accounts Receivable Turnover 7.7 7.8 7.8 N.A.
    Collection Days 100 100 100 N.A.
    Inventory Turnover 33.12 34.776 35 N.A.
    Accounts Payable Turnover 15.26 16 16.3 N.A.
    Payment Days 26 27 27 N.A.
    Total Asset Turnover 2.5 2.5 2.6 N.A.
    Debt Ratios
    Debt to Net Worth -0.04 -0.03 -0.04 N.A.
    Current Liab. to Liab. 1 1 1 N.A.
    Liquidity Ratios
    Net Working Capital $237,000 $250,272 $264,287 N.A.
    Interest Coverage 0 0 0 N.A.
    Additional Ratios
    Assets to Sales 0.86 0.87 0.88 N.A.
    Current Debt/Total Assets 1% 0% 0% N.A.
    Acid Test 29 29.11 29.13 N.A.
    Sales/Net Worth 2.1 2.2 2.2 N.A.
    Dividend Payout 0 0 0 N.A.

    Components of a New Product Business Plan

    No, there is no particular business plan for new product format your company should follow. Organizations mostly choose what suits them or leave the formatting on the new product business plan template writer’s hands. The things you discuss in your document depend entirely upon your discretion, but according to several experts, every entrepreneur must implement a list of components in their business document.

    new product business plan template

    Download New Product Launch Business Plan Sample in pdf