2. Planning as Part of The Business
Operation
• Planning is a process than never ends for a business.
• As the venture grow up to mature business, planning will
continue …
3. What is a Business Plan?
• A business plan is a written document
prepared by the entrepreneur that describes
all the relevant internal and external elements
and strategies for starting a new venture.
• It is a integration of functional plans such as
marketing, finance, manufacturing, sales and
human resources.
4. Who should write the plan?
• The business plan should be prepared by the
entrepreneur.
• The entrepreneur may consult with many other
sources in its preparation, such as lawyers,
accountants, marketing consultants, and engineers.
5. Who Reads The Plans?
• The business plan may be read by employees,
investors, bankers, venture capitalists,
suppliers, customers, advisors, and
consultants.
• There are three perspectives should be
considered in preparing the plan :
• Perspective of the entrepreneur
• Marketing perspective
• Investor’s perspective
6. Why Have a Business Plan?
• The business plan is valuable to the entrepreneur,
potential investors, or even new personnel, who are
trying to familiarize themselves with the venture, it
goals, and objectives.
• It helps determine the viability of the venture in a
designated market
• It provides guidance to the entrepreneur in organizing his
or her planning activities
• It serves as an important tool in helping to obtain
financing.
7. Presenting The Plan
• It is often necessary for an entrepreneur to
orally present the business plan before an
audience of potential investors.
• In this typical forum the entrepreneur would
be expected to provide a short (perhaps 20-
minutes or half-hour) presentation of the
business plan.
8. Information Needs
• Before committing time and energy to
preparing a business plan, the entrepreneur
should do a quick feasibility study of the
business concept to see whether there a any
possible barriers to success.
• Internet can be a valuable resource.
9. Outline of a Business Plan
• Introductory Page
• Name and address of business
• Name(s) and address(es) of principal(s)
• Nature of business
• Statement of financing needed
• Statement of confidentially of report
10. Outline …
• Executive Summary – Three to four pages
summarizing the complete business plan
• What is the business concept or model?
• How is this business concept or model unique?
• Who are the individuals starting this business?
• How will they make money and how much?
11. Outline …
• Environmental and Industry Analysis
• Future outlook and trends
• Analysis of competitors
• Market segmentation
• Industry and market forecasts
• Description of Venture
• Product(s)
• Service(s)
• Size of business
• Office equipment and personnel
• Background of entrepreneurs
12. Outline …
• Production Plan
• Manufacturing process (amount subcontracted)
• Physical plant
• Machinery and equipment
• Names of suppliers of raw materials
• Operational Plan
• Description of company’s operations
• Flow of orders for goods and/or services
• Technology utilization
13. Outline …
• Marketing Plan
• Pricing
• Distribution
• Promotion
• Product forecasts
• Controls
• Organizational Plan
• Form of ownership
• Identification of partners or principal shareholders
• Authority of principals
• Management-team background
• Roles and responsibilities of members of organization
14. Outline …
• Assessment of Risk
• Evaluate weakness of business
• New technologies
• Contingency Plans
• Financial Plan
• Pro forma income statement
• Cash flow projections
• Pro forma balance sheet
• Break-even analysis
• Sources and applications of funds
15. Outline …
• Appendix (contains backup material)
• Letters
• Market research data
• Leases or contracts
• Price lists from suppliers.
16. Using and Implementing The
Business Plan
• The business plan is designed to guide the
entrepreneur through the first year of
operations.
• Implementation of the strategy contain
control point to ascertain progress and to
initiate contingency plan if necessary.
• Business plan not end up in a drawer
somewhere once the financing has been
attained and the business launched.
17. Measuring Plan Progress
• Entrepreneur should check the profit and loss statement,
cash flow projections, and information on inventory,
production, quality, sales, collection of accounts
receivable, and disbursements for the previous month.
• Inventory control
• Production control
• Quality control
• Sales control
• Disbursements
18. Updating the Plan
• The most effective business plan can become
out-of-date if condition change.
• If the change are likely to affect the business
plan, the entrepreneur should determine what
revisions are needed.
• In this manner, the entrepreneur can maintain
reasonable targets and goals and keep the
new venture on a course that will increase
probability of success.
19. Why Some
Business Plans Fail
• Goals set by the entrepreneur are unreasonable.
• Goals are not measurable
• The entrepreneur has not made a total commitment to
the business or to the family.
• The entrepreneur has no experience in the planned
business.
• The entrepreneur has no sense of potential threats or
weaknesses to the business.
• No customer need was established for the proposed
product or service.
20. • How to write a Business Plan?
• Let's revisit the typical structure of a business plan:
• 1- Cover Page and Table of Contents
• Not a lot to add here.
• 2- Executive Summary
• The Executive Summary is usually a one-page summary of the contents of the business plan; as I mentioned above, some business plans only consist of this section.
• 3- Mission and Vision Statement
• A mission statement summarizes a company's purpose in one or two paragraphs: why it exists. It's usually made up of a general description of the organization, its function, and its objectives. The
vision, on the other hand, talks about what the company aspires to be in the future.
• Here's an excellent article from Hubspot on how to write your mission/vision.
• 4- Business Description
A more detailed description of the company, what it will do and how will it make money.
• 5- SWOT analysis
The Strength-Weaknesses-Opportunites-Threats summary is a famous exercise used in business to assess the state of the industry, the market, and the competitor environment.
• We have a SWOT analysis template that you can try out here.
• 6- Competitor Analysis
Very much related to the SWOT Analysis mentioned above, the competitor analysis should provide a more personal review of what the company is doing, their traction and state and how the
company intends to differentiate.
• 7- Market Analysis
A market analysis is a review of the state and maturity of the market the venture intends to attack, as well as an assessment of the market size or market potential.
• 8- Marketing Plan or Go-To-Market Plan
Defining a marketing strategy early on is very hard, but it's important to note the first and second plans the company intends to experiment with.
• Summarize two or three core customer acquisition and growth strategies and a basic overview of how you plan to implement them.
• 9- Operations Plan
The operations plan is mostly a summary of your plans for the company operation: How many offices will it have? How do you plan to hire? How will you expand the productivity?
• 10- Financial Plan
• The financial plan should be a detailed 12 month projection of the business cash flow, and a simpler 4-5 year projection.
• One important thing to note here is that is NOT a fundraising document, so avoid adding fundraising or round information.
•
• We hope this article had given you a clear idea of what Business Plan is. If you are ready to create yours click on the link below to use Slidebean's Template:
