Business Plan Development Creating Your Road Map IMBA Lecture Series (c) 2009 Debra Askanase

Agenda Purpose of a Business Plan Parts of the Plan Criteria by Section Tips (c) 2009 Debra Askanase

Purpose of a Business Plan

Parts of the Plan

Criteria by Section

Tips

Tools Sample Business Plan Questionnaires (to get you started) Detailed Section Outline Contact: Debra Askanase [email_address] (c) 2009 Debra Askanase

Sample Business Plan

Questionnaires (to get you started)

Detailed Section Outline

Contact: Debra Askanase

[email_address]

WHY do we do this? (c) 2009 Debra Askanase

Yes, but WHY ELSE? Know the Industry Find your Competitive Advantage Analyze Risks Develop Your Idea Methodically Acquire Investors Find Support Secure Financing … .SHOULD I START THIS VENTURE?? (c) 2009 Debra Askanase

Know the Industry

Find your Competitive Advantage

Analyze Risks

Develop Your Idea Methodically

Acquire Investors

Find Support

Secure Financing

… .SHOULD I START THIS VENTURE??

Business Plan Sections (c) 2009 Debra Askanase

Business Plan Sections Narrative Section Business Description Products and/or Services Industry Analysis Operations Clientele/Target Markets Competition Marketing Plan Personnel/Management Long-term Goals Risks and Contingencies (c) 2009 Debra Askanase

Narrative Section

Business Description

Products and/or Services

Industry Analysis

Operations

Clientele/Target Markets

Competition

Marketing Plan

Personnel/Management

Long-term Goals

Risks and Contingencies

Business Plan Sections Financial Projections Financial Narrative Start-up Expenses and Worksheet Revenue Assumptions Financial Assumptions 3-5 Year Financial Projections Statement of Cash Flows Income Statement Balance Sheet Relevant ratios (c) 2009 Debra Askanase

Financial Projections

Financial Narrative

Start-up Expenses and Worksheet

Revenue Assumptions

Financial Assumptions

3-5 Year Financial Projections

Statement of Cash Flows

Income Statement

Balance Sheet

Relevant ratios

Business Plan Sections Supporting Documents Resume/CV Relevant documents/contracts Past 3 years of tax returns (if seeking conventional financing) Academic research Marketing research results Other (c) 2009 Debra Askanase

Supporting Documents

Resume/CV

Relevant documents/contracts

Past 3 years of tax returns (if seeking conventional financing)

Academic research

Marketing research results

Other

US vs. Israeli Style All presentations, section questionnaires in US format Sample outline in combined style Lecture series suggests: create in US format, then convert to any other style (c) 2009 Debra Askanase

All presentations, section questionnaires in US format

Sample outline in combined style

Lecture series suggests:

create in US format, then convert to any other style

Products and Services Clear, concise descriptions Divide into separate sections Products Services Further subdivide into categories Value proposition Price menu Pricing approach/structure (c) 2009 Debra Askanase

Clear, concise descriptions

Divide into separate sections

Products

Services

Further subdivide into categories

Value proposition

Price menu

Pricing approach/structure

Industry Analysis Your Goal: Give a comprehensive understanding of the industry Defend your business relevance! How? Describe current situation Relevant trends Intervening factors Size of industry/market potential (total # businesses, annual revenues, etc.) Growth potential (c) 2009 Debra Askanase

Your Goal:

Give a comprehensive understanding of the industry

Defend your business relevance!

How?

Describe current situation

Relevant trends

Intervening factors

Size of industry/market potential (total # businesses, annual revenues, etc.)

Growth potential

Industry Analysis Where? Academic sources (trade journals, academic journals, Google scholar) Economic census (USA) http://www.census.gov/econ/census/ or http://factfinder.census.gov Trade Associations Online databases/sources: Emarketer.com, bizstats.com,hoovers.com/free GALE database Articles, studies, etc. (c) 2009 Debra Askanase

Where?

Academic sources (trade journals, academic journals, Google scholar)

Economic census (USA) http://www.census.gov/econ/census/ or http://factfinder.census.gov

Trade Associations

Online databases/sources:

Emarketer.com, bizstats.com,hoovers.com/free

GALE database

Articles, studies, etc.

Operations Straightforward (If retail) “paint a picture” of the space (as you walk in you will see/experience etc.) Procedures and controls Distribution channels Payment procedures (in/out) Business-specific details (c) 2009 Debra Askanase

Straightforward

(If retail) “paint a picture” of the space (as you walk in you will see/experience etc.)

Procedures and controls

Distribution channels

Payment procedures (in/out)

Business-specific details

Clientele/Target Markets Primary Clientele (>= 50%) Secondary Clientele (>= 20%) Tertiary Clientele Detailed descriptions Demographics Psychographics Spending Total market size per market segment Use for Revenue Projections (c) 2009 Debra Askanase

Primary Clientele (>= 50%)

Secondary Clientele (>= 20%)

Tertiary Clientele

Detailed descriptions

Demographics

Psychographics

Spending

Total market size per market segment

Use for Revenue Projections

Clientele/Target Markets Consumer B2B Tourist Religious Example: Witch Tee’s (Salem, MA) (c) 2009 Debra Askanase

Consumer

B2B

Tourist

Religious

Example:

Witch Tee’s (Salem, MA)

Competition Match Apples to Apples: Segment your competition Your Value Proposition Your Competitive Advantage 2 Types of competitors: Direct Indirect Discuss each significant competitor in depth, can group others Identify potential threats and talk about them directly (c) 2009 Debra Askanase

Match Apples to Apples: Segment your competition

Your Value Proposition

Your Competitive Advantage

2 Types of competitors:

Direct

Indirect

Discuss each significant competitor in depth, can group others

Identify potential threats and talk about them directly

Step Back from the Project! SWOT Analysis/PEST Analysis (next lecture) Do you have a real Value Proposition? USP? Do you want to start this business? Begin financial projections (c) 2009 Debra Askanase

SWOT Analysis/PEST Analysis (next lecture)

Do you have a real Value Proposition? USP?

Do you want to start this business?

Begin financial projections

Marketing Plan Your Goal : you understand your market, industry, competitive and competitive advantage Within the narrative, consider and describe Marketing channels Personnel Geographic reach and richness Tools 4 (or 5) Ps Pricing strategy related to marketing (c) 2009 Debra Askanase

Your Goal : you understand your market, industry, competitive and competitive advantage

Within the narrative, consider and describe

Marketing channels

Personnel

Geographic reach and richness

Tools

4 (or 5) Ps

Pricing strategy related to marketing

Marketing Plan Quantifiable Goals/Objectives = specific deadline dates, and numerical goals Specific, detailed activities Complete budget Metrics Several plans: Start-up/awareness First year First three years Marketing calendars are useful tools (c) 2009 Debra Askanase

Quantifiable Goals/Objectives = specific deadline dates, and numerical goals

Specific, detailed activities

Complete budget

Metrics

Several plans:

Start-up/awareness

First year

First three years

Marketing calendars are useful tools

Personnel and Management Organizational Chart Responsibilities Salaries Professional Advisors Advisory Board (c) 2009 Debra Askanase

Organizational Chart

Responsibilities

Salaries

Professional Advisors

Advisory Board

Long-Term Goals (c) 2009 Debra Askanase

Risks and Contingencies Shows you understand your business Deals with investor concerns up front Make them real Address at least two real risks (c) 2009 Debra Askanase

Shows you understand your business

Deals with investor concerns up front

Make them real

Address at least two real risks

Financial Narrative (c) 2009 Debra Askanase

Recommended Reading Good to Great & Built to Last Jim Collins Blue Ocean Strategy W. Chan Kim Getting to Yes: Negotiating Agreement Without Giving In Roger Fisher, William Ury and Bruce Patton The E-Myth Revisited Michael E. Gerber The Tipping Point Malcolm Gladwell The Little Red Book of Selling Jeffrey Gitomar Groundswell Forrester Research The Wisdom of Crowds James Surowiecki (c) 2009 Debra Askanase

Good to Great & Built to Last Jim Collins

Blue Ocean Strategy W. Chan Kim

Getting to Yes: Negotiating Agreement Without Giving In Roger Fisher, William Ury and Bruce Patton

The E-Myth Revisited Michael E. Gerber

The Tipping Point Malcolm Gladwell

The Little Red Book of Selling Jeffrey Gitomar

Groundswell Forrester Research

The Wisdom of Crowds James Surowiecki