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business-plan-worksh..

  1. 1. ABC COMPANY LIMITED BUSINESS PLAN Strictly Private & Confidential ABC Company Limited UNIEI Nottingham University Notts Tel: 0115 9673 890 Fax: 0115 95673 891 E-mail: ABC@ABC.com
  2. 2. ABC Services Limited (double click to put in your own company) Executive Summary Private and Confidential. 2
  3. 3. ABC Services Limited (double click to put in your own company) Table of Contents Executive Summary..................................................................................................................2 Table of Contents......................................................................................................................3 Introduction to the Business and its Management....................................................................4 Product and Services................................................................................................................5 The Market................................................................................................................................6 Competitive Business Strategy.................................................................................................7 Business Operations...............................................................................................................11 Financing Requirements and Deal Structure..........................................................................12 Key Financial Data and Financial Projections.........................................................................13 Private and Confidential. 3
  4. 4. ABC Services Limited (double click to put in your own company) Introduction to the Business and its Management Introduce the business and what it does / will do. Describe how the project came about and progressed to the present situation. State your vision and mission for the business State what stage the business is at now. Highlight briefly the importamt features of the company’s products and services – their competitive advantage. Explain any evidence of success you may have – from potential customers, market testing, expressions of interest, etc. What are your critical success factors? Explain who is involved, what are there positions, what relevant experience and qualifications do they have. Include a one-paragraph biography on each (full CV in the Appendix). Do you have any advisors or mentors who, through their expertise, will give potential investors more confidence? These might be experts in the market in which you are operating or experienced, successful business people. Provide brief biographies. Outline any skill gaps you still need to fill, and how you intend to do so What is your organisational structure? (Include an organisation chart if appropriate). Outline where you want to go from here - what you want to achieve in 1 year, 2 years, 3 years and 5 years? Organisational Structure Chart (Double-Click to Edit) O r g a n is a t io n a l S t r u c t u r e B ig C h e e s e C E O D ic k y P ic k le T o B e A p p o in t e d N o n E x e c C h a ir m a n N o n E x e c D ir e c t o r H aveasm al L ab u d g et S lic k W ill D o T h in g s w e ll C le v e r C lo g g s F in a n c e D ir e c t o r S a le s & M a r k e t in g P r o d u c t io n R & D D ir e c t o r B e a n C o u n te rs L td S lim y L a w y e r s L t d C o m p a n y A u d ito rs C o m p a n y L a w ye rs D a v id H e lp fu l A c t u a lly D o e s t h in g s L e a d in g U n iv e r s it y M a r k e t in g C o - o r d in a t o r P r o d u c t io n C o - o r d in a t o r R e s e a rc h P a rtn e rs G one W est C o m p a n y B a n k e rs A ds R U s P ro d u c tio n P a rtn e r M a r k e t in g A g e n c y C o n tra c t P ro d u c tio n F in a n c e A s s is t a n t F in a n c e A s s is t a n t F ia n c e A s s is t a n t 1 F in a n c e A s s is t a n t 2 S p in is U s S t r a t e g ic S u p p lie r P R A gency S t r a t e g ic S u p p lie r S a le s R U s D is t r ib u t io n P a r t n e r C o n t r a c t S a le s C o C o n t r a c t D is t r ib u t io n Private and Confidential. 4
  5. 5. ABC Services Limited (double click to put in your own company) Product and Services • What is your product / service? Describe it in clear and simple terms • What need/problem is being addressed by these products/services? • What are the features of your products/services? • What are the benefits of your products/services? • Explain any performance advantages / value advantages over rival products • Intellectual property – are any patents or trademarks involved or required? • What price will your products sell at and what is the pricing strategy behind this decision? How does this compare with competitors? • State the costs of production and distribution for each product /service? • What is the resulting profit and margins on sale? • What is your high level timescale and milestones to take your product/service to market? • If you have further ideas or developments in the pipeline – please outline them. Include any background information relevant to the products or services either in this section or appendix. Private and Confidential. 5
  6. 6. ABC Services Limited (double click to put in your own company) The Market This section should describe the market you will be operating in – generally and specifically in terms of which segments you will be targeting and who your customer is. • Market Definition • Market size and segmentation. What is the size of the market and how can this be segmented or grouped into sectors? Which segments will you specifically be targeting? • Is the market growing or declining? • Target Customer Insightss. Note; this section overlaps with the next section on Competitive Business Strategy and you may choose to combine them. Private and Confidential. 6
  7. 7. ABC Services Limited (double click to put in your own company) Competitive Business Strategy Who are your main competitors both direct and indirect? What is the characteristics of the competitive environment, use the Five Forces model and then a SWOT analysis 1. Analysis of Industry Structure (Porter's Five Forces) • Threat of New Entrants to the Market • Threat of Substitute Products • Power of Buyers • Power of suppliers • Rivalry Amongst Existing Players 2. SWOT Analysis – This is a summary of your company’s internal strengths and weaknesses, and the external opportunities and threats it faces in the market and its competitive environment. How is the company going to compete in the market? How will the company differentiate from competitors? Analysis of Industry Structure – Industry Forces (External) Forces driving industry competition – POTENTIAL ME Porter, 1980 ENTRANTS Threat of new entrants Bargaining INDUSTRY power of COMPETITORS suppliers Bargaining SUPPLIERS BUYERS Rivalry amongst power of buyers existing firms Threat of substitute products SUSBSTITUTES Private and Confidential. 7
  8. 8. ABC Services Limited (double click to put in your own company) SWOT Analysis (Internal & External) The Internal Strengths & Weaknesses of the company, and the External Opportunities & Threats it faces, can be summarized as follows: STRENGTHS OPPORTUNITIES WEAKNESSES THREATS Private and Confidential. 8
  9. 9. ABC Services Limited (double click to put in your own company) Marketing Summary • What is the strategy for marketing your products? • What is your Unique Selling Proposition? • What marketing strategies will you use? • What will be the cost of your marketing activity? How will this breakdown by category? • How will you monitor the effectiveness of your marketing program? Private and Confidential. 9
  10. 10. ABC Services Limited (double click to put in your own company) Sales and Distribution Summary • State market segments to whom you are you selling the products/services • Explain how you will sell your products/services to your target customers. What will be your route to market? • What is the cost of your of your route to market channel? Describe any intermediary margin structures for each sales channel you use through to the final consumer. If you need an internal Sales Force, what will be the cost? • Is there a phased approach to rolling our your sales strategy? Private and Confidential. 10
  11. 11. ABC Services Limited (double click to put in your own company) Business Operations  Describe your operational strategy – will you build a production plant, contract a production plant, contract the entire delivery of a service, or license the technology, etc?  If contracting out, who will undertake this and where?  Describe the physical production/delivery process  Describe processes you have in place to maintain quality  What is your production ‘lead-time’?  How many products can you make/deliver, per month or year?  Identify all direct costs involved in the production of the product/delivery of the service, to arrive at total production costs per product/service unit.  What initial fixed costs are there involved in the set up of your production or deliver of your service (include capital investment if building a production plant)?  What ongoing fixed costs will exist to support your operational activity? Private and Confidential. 11
  12. 12. ABC Services Limited (double click to put in your own company) Financing Requirements and Deal Structure  How much money you need to implement your plan?  What do you expect the sources of this money to be, e.g. Business Angels, Venture Capitalists, Bank Finance, Friends, or a mixture  How will any money be raised be used?  What do you expect investors to receive in return for them risking their money?  What is on offer, in terms of ownership (shares) in the company, for the money?  How do you expect investors to get their investment and return and when. Will this be through a trade sale, a flotation, or a management buy-out? Finance Requirement In terms financial structure, the shareholding structure of the company will be as follows: Shareholders Pre – Financing Stake Post – Financing Stake CEO (Founder) Other Managers Current Investors New Investors Total 100% 100% The investment will be used as follows: Investment Area Proportion Amount Marketing Working Capital (inc. contingency) Development Total 100% £ 650,000 Private and Confidential. 12
  13. 13. ABC Services Limited (double click to put in your own company) Key Financial Data and Financial Projections All potential investors will expect to see a set of financial statements and illustrative projections for the project. Please use the Excel spreadsheets provided, which will enable you to produce Profit & Loss and Cashflow forecast for 3 years. • Profit & Loss Forecast – this is a statement of the company’s trading activities showing the health of the company over a period of time • Cash Flow Forecast – This is a statement of your cash position and the sources and uses of cash going forward. Cash management is the most important aspect of financial management as the company becomes established and grows, and will determine the amount of investment required Investors like to see a graph of the cash balance, with the first year on a monthly basis, to illustrate to them that cash management has been carefully thought out and the rate at which the business uses cash. The projections should be in the way of full statements for the next three years. The statements should be accompanied by Notes to the Accounts covering the assumptions under which the statements have been constructed, including: • The assumptions behind the sales forecasts, perhaps related to market share, customers, conversion rate, etc. What facts/benchmarks have you to support these assumptions? • Assumptions behind fixed and variable costs, including the costs of production, offices, staffing, etc. • Any policies adopted, such as on the depreciation of assets, the number of days credit given to customers, the period of time taken to pay your creditors, etc. • The detail behind any loan or other overdraft facilities and expected interest rates. • Other major budgets, including marketing, legal fees, accounting fees, etc. The figures should demonstrate to the investor that you understand the major financial implications of your business plan, that the assumptions are reasonable, and that you have not been over optimistic. Identify also those critical success numbers, provide scenarios around these. Private and Confidential. 13
  14. 14. ABC Services Limited (double click to put in your own company) Appendix List here the contents of Appendix. This may include: • Key management CV’s • Copies of relevant letters / agreements indicating success – including any orders pending • Copies of any market research or other reports not published Private and Confidential. 14

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