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  • 1. Business Planning for the Food-Based Business Presented by: Nora Gillespie Director Central Virginia SBDC Hosted by Thomas Jefferson Partnership for Economic Development
  • 2. Central Virginia Small Business Development Center Sponsors <ul><li>U.S. Small Business Administration </li></ul><ul><li>Thomas Jefferson Partnership For Economic Development </li></ul><ul><li>University Of Virginia – Office of Economic Development </li></ul><ul><li>Counties of Albemarle, Fluvanna, Louisa and Orange </li></ul><ul><li>City of Charlottesville </li></ul><ul><li>Nelson County EDA </li></ul><ul><li>Greene County EDA </li></ul><ul><li>Local Banks </li></ul>
  • 3. SBDC Small Business Development Center <ul><li>Existing &amp; Start-up Businesses </li></ul><ul><li>One-on-One Counseling </li></ul><ul><li>Business Planning </li></ul><ul><li>Strategic Planning </li></ul><ul><li>Marketing </li></ul><ul><li>Financial Analysis </li></ul><ul><li>SBA Loan Assistance </li></ul>Free &amp; Confidential
  • 4. Central Virginia SBDC <ul><li>City of Charlottesville </li></ul><ul><li>Greene County </li></ul><ul><li>Albemarle County </li></ul><ul><li>Louisa County </li></ul><ul><li>Nelson County </li></ul><ul><li>Fluvanna County </li></ul><ul><li>Orange County </li></ul>
  • 5. Nuts and Bolts <ul><li>Business Plan </li></ul><ul><li>Legal Structure </li></ul><ul><li>Licenses, permits </li></ul><ul><li>Recordkeeping </li></ul><ul><li>Pricing for Profitability </li></ul>
  • 6. Why Do I Need A Business Plan? <ul><li>Understand the market and the competition </li></ul><ul><li>Forecast possible outcomes </li></ul><ul><li>Understand profitability </li></ul><ul><li>Define capital required </li></ul><ul><li>Will the business support my expected return? </li></ul>
  • 7. Business Planning <ul><li>Isn’t it only for “big business”? </li></ul><ul><li>I can hire someone to do this, can’t I? </li></ul><ul><li>I don’t know all the answers. </li></ul><ul><li>I have all the answers – in my head. </li></ul><ul><li>O.K. Got it done! Put it aside!? </li></ul>
  • 8. Where to Start <ul><li>Business Planning Resources </li></ul><ul><ul><ul><li>Publications </li></ul></ul></ul><ul><ul><ul><li>Web-sites </li></ul></ul></ul><ul><ul><ul><li>Templates </li></ul></ul></ul><ul><li>SBDC Business Consultants and Classes </li></ul><ul><li>Business Planning Courses </li></ul><ul><ul><ul><li>Local - SCORE </li></ul></ul></ul><ul><ul><ul><li>Online - SBA </li></ul></ul></ul>
  • 9. Business Plan Basics <ul><li>General Description of the Business </li></ul><ul><li>Product or Service – Operations </li></ul><ul><li>Location &amp; Facilities </li></ul><ul><li>Current Environment &amp; Industry Trends </li></ul><ul><li>Marketing Strategy </li></ul>Details, Details, Details
  • 10. Business Plan Basics <ul><li>Competitive Analysis </li></ul><ul><li>Management &amp; Staffing </li></ul><ul><li>Application &amp; Effects of Loan </li></ul><ul><li>Financial Projections </li></ul><ul><li>Contingency Plans </li></ul>Details, Details, Details
  • 11. Legal Structure <ul><li>Sole Proprietorships </li></ul><ul><li>LPs, LLPs, LLCs, S Corps </li></ul><ul><li>C Corporations </li></ul><ul><li>Implications of your decision: </li></ul><ul><ul><ul><ul><li>Ease of formation </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Taxes </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Liabilities </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Continuation &amp; Dissolution </li></ul></ul></ul></ul>
  • 12. Market Analysis <ul><li>Industry Trends </li></ul><ul><li>Target Market(s) </li></ul><ul><li>Competitive Analysis </li></ul><ul><li>Your product positioning and pricing </li></ul>
  • 13. Market Analysis <ul><li>Business to Business Marketing </li></ul><ul><li>Business to Consumer Marketing </li></ul><ul><li>Geographic Considerations </li></ul><ul><ul><ul><li>Size of Market </li></ul></ul></ul><ul><ul><ul><li>Distribution Costs </li></ul></ul></ul><ul><ul><ul><li>Product preservation </li></ul></ul></ul>
  • 14. Operations Plan <ul><li>Location/Physical Facility/Hours of Operation </li></ul><ul><li>Labor </li></ul><ul><li>Equipment/Supplies </li></ul><ul><li>Packaging Process </li></ul><ul><li>Method of Distribution/Warehousing/Shipping </li></ul><ul><li>Future Plans (long run) </li></ul>
  • 15. Management Profile <ul><li>Who will manage the business &amp; what are their qualifications and responsibilities? </li></ul><ul><li>Who are other key people or advisors in your management team? </li></ul>
  • 16. Staffing <ul><li>Who will you need to hire? (Full-time/part-time) </li></ul><ul><li>Where will these people come from (locally)? </li></ul><ul><li>Will they need training? </li></ul><ul><li>How much will you pay them? </li></ul>
  • 17. Financial Analysis <ul><li>Historical Financial Statements or Start-up Budget </li></ul><ul><li>Cash flow and P&amp;L projections 1 to 3 years &amp; Assumptions </li></ul>
  • 18. Financial Analysis <ul><li>Projected Profits or Losses – 1 to 3 years </li></ul><ul><li>Estimate best case, expected case, &amp; worst case contingencies </li></ul><ul><ul><li>Understand Seasonality and Production Cycle </li></ul></ul><ul><ul><li>Understand the financial impact of regulations </li></ul></ul>
  • 19. Application and Loan Expectations <ul><li>If seeking financial assistance, how will loan proceeds be used? </li></ul><ul><li>What conditions are necessary to ensure your ability to repay your loan? </li></ul>
  • 20. BEYOND VDACS, FDA, USDA, LOCAL HEALTH <ul><li>Commerce Regulations </li></ul><ul><ul><li>Professional Licenses </li></ul></ul><ul><ul><li>Local Business Registrations / Licenses / Permits </li></ul></ul><ul><li>Employee Regulations </li></ul><ul><ul><li>Payroll Tax Withholding </li></ul></ul><ul><ul><li>Unemployment Taxes </li></ul></ul><ul><ul><li>Wage &amp; Hour Regulations </li></ul></ul><ul><li>General Business Taxation </li></ul><ul><ul><li>Personal Income Tax </li></ul></ul><ul><ul><li>Business Income Tax </li></ul></ul><ul><ul><li>Sales Tax / Meals Tax </li></ul></ul><ul><ul><li>Property Tax </li></ul></ul>
  • 21. <ul><li>BEYOND VDACS, FDA, USDA, LOCAL HEALTH </li></ul><ul><li>Insurance </li></ul><ul><ul><li>General &amp; Product Liability </li></ul></ul><ul><ul><li>Business Interruption </li></ul></ul><ul><ul><li>Worker’s Compensation </li></ul></ul><ul><ul><li>Employee Benefits </li></ul></ul><ul><li>Consumer Protection </li></ul><ul><ul><li>Warranties and Consumer Credit Issues </li></ul></ul><ul><li>Zoning and Environmental Regulations </li></ul>
  • 22. Record Retention <ul><li>Tax Requirements </li></ul><ul><li>Maximize profitability </li></ul><ul><li> </li></ul><ul><li>Monitor progress and improve productivity </li></ul><ul><li>Future loan requests </li></ul>
  • 23. <ul><li>Receipts </li></ul><ul><li>Purchases </li></ul><ul><ul><ul><li> </li></ul></ul></ul><ul><li>Expenses/Asset Purchases </li></ul><ul><li>Debt and Equity Investments </li></ul>Record Retention
  • 24. Methods of Recordkeeping <ul><li>Manual Systems </li></ul><ul><li>“ Shoebox” </li></ul><ul><li>Dome books </li></ul><ul><li>Computer-based Systems </li></ul><ul><li>Excel spreadsheets </li></ul><ul><li>QuickBooks </li></ul><ul><li> Specialized accounting software </li></ul><ul><li>e.g. farm accounting </li></ul><ul><li> Business Owner/Bookkeeper/Accountant </li></ul>
  • 25. What to Track? <ul><li>Revenues Minus Expenses = Profit (Loss) </li></ul><ul><li>UNDERSTAND YOUR CASH FLOW! </li></ul><ul><li>Timing of cash going out and coming in! </li></ul>
  • 26. Tracking Revenues <ul><li>Revenues - Regardless of size </li></ul><ul><li> Revenues by Product </li></ul><ul><li>Revenues by Customer/Customer Type </li></ul><ul><li>Retail sales, e.g. farmers’ market </li></ul><ul><li>Sales to restaurants </li></ul><ul><li>Sales to grocers </li></ul><ul><li>Sales to caterers </li></ul>
  • 27. Tracking Expenses <ul><li>Expenses - Regardless of size </li></ul><ul><li> Expenses by Product </li></ul><ul><li>Helps to establish pricing and </li></ul><ul><li> measure profitability </li></ul><ul><li>Understand what it takes to break-even </li></ul>
  • 28. Tracking Expenses <ul><li>Expenses - Regardless of size </li></ul><ul><li> Expenses by Product </li></ul><ul><li>Helps to establish pricing and </li></ul><ul><li> measure profitability </li></ul><ul><li>Understand what it takes to break-even </li></ul>
  • 29. Tracking Expenses <ul><li>Expenses - Regardless of size </li></ul><ul><li> Cost of Goods Sold </li></ul><ul><li>Includes: </li></ul><ul><li>Cost of raw materials </li></ul><ul><li>e.g. seeds, feed </li></ul><ul><li>Direct labor costs </li></ul>
  • 30. Tracking Expenses <ul><li>Expenses - Regardless of size </li></ul><ul><li> Other Expenses </li></ul><ul><li> Includes: </li></ul><ul><li>All Other Except Direct Costs </li></ul>
  • 31. Other SBDC Course Offerings <ul><li>How to Start a Business </li></ul><ul><li>Develop a Targeted Marketing Strategy </li></ul><ul><li>Understanding Cash Flow Projections </li></ul><ul><li>Introduction to QuickBooks </li></ul><ul><li>Resource and SBA Program Update </li></ul><ul><li>April 22, 2009 </li></ul>
  • 32. Central VA SBDC <ul><li>We can help you start or grow your business! </li></ul>Thank you for joining us!

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