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Business plan

  1. 1. EL CENTRO COLLEGE: SMALL BUSINESS OPERATIONS (BUSG 2309, SECTIONS 5426INET) FALL 2011CONTACT INFORMATIONProfessor: Kevin S. Wiley, Sr., M.A., J.D.Office: 400 S. Zang Blvd., Suite 1305, Dallas, Texas 75208E-Mail: KEVIN.WILEY@JOHNSONPRODUCTS.COMPhone: 214-537-9572 (mobile, the best way to reach me)Fax: 972-298-1447Office Hours: By appointmentCOURSE DESCRIPTIONAs more and more people are considering “taking the plunge” into the worldof entrepreneurship, this course immerses the participants in thefundamentals and dynamics of launching and growing a business. Thecourse is designed to identify and develop the knowledge, skills, andawareness of what it takes to create and grow a new venture.COURSE OBJECTIVESAt the end of this course participants will be able to answer the following keyquestions:  What does an entrepreneurial career take?  What is the difference between a good idea and just another idea?  Is the opportunity I am considering the right opportunity for me, at this time?  Why do some firms grow quickly, but then stumble and never grow beyond a one-product firm?  What are the critical tasks and hurdles in seizing an opportunity and building a business?  How much money do I need to start a venture, and when, where and how do I get it?  What are the minimum resources I need to gain control over an opportunity, and how can I do this?  Is a business plan needed, and if so, what kind, and how do I develop one?  What is my venture worth and how do I negotiate what to give up?SBM SUPPLMENT - updated 9/27/2011 Page 1 of 13
  2. 2.  What are the critical transitions in entrepreneurial management as a firm grows from $1 million to $5 million to $25 million in sales?  What are some of the pitfalls, minefields, and hazards I need to anticipate, prepare for, and respond to?  How can I develop a personal “entrepreneurial game plan” to acquire the experience and knowledge I need to succeed? In order to answer these questions, the student at the completion of the course will develop nine (9) critical skills with the following SCANS emphasis: 1. How to develop financial pro forma and models essential to the business plan and the business plan. SCANS 1c, 2a-2e, 6a-6d, 7b, 8a-8c. (SKILL 1) 2. How to locate capital for your venture. SCANS 2a-2e, 6a-7d, 8a- 8c.(SKILL 2) 3. How to structure your venture and master the governance issues.(SKILL 3) 4. How to develop your exit strategies, e.g. private placements; going public. Scans 5a-5f.(SKILL 4) 5. How to master the international issues. SCANS 6a-6d.(SKILL 5) 6. How to develop strategic management skills and infuse them in your organization—mastering “SWOT” analysis. SCANS 2a-2e, 3a- 3e; 5a-5f, 6a-6d, 7a-7d, 8a-8d.(SKILL 6) 7. How to lead your organization. SCANS 3a-3e, 5a-5f.(SKILL 7) 8. How to handle the inevitable adverse event and master downside planning for turnarounds, bailouts, restructurings and reorganizations. SCANS 4a-4e. (SKILL 8) 9. How to plan for growth through mergers and/or acquisitions. SCANS 2a-2e, 6a-6d, 7a-7d, 8a-8d. (SKILL 9)REQUIRED TEXT Title: Effective Small Business Management,10th Edition Author: Norman M. ScarboroughINSTRUCTOR BIO ISBN: 13: 978-0-13-615270-5 Publisher: Publication Date: 2006Kevin S. Wiley, Sr. is an Adjunct Professor at El Centro College where heteaches contract and real estate law, and at the University Of DallasGraduate School Of Management where he teaches strategic management.Kevin has over 30 years of experience as an attorney, corporate officer,management consultant, and business manager for businesses based in theUnited States, Brazil, and South Africa. In the course of his career, he hasSBM SUPPLMENT - updated 9/27/2011 Page 2 of 13
  3. 3. advised business executives of both start-up and established businesses withrespect to development of strategic plans for domestic and internationalsales and distribution; acquisition and development of companies and/orassets; negotiation of key agreements for manufacturing and otheroperations; arrangement of private equity capital in excess of $100 million inclosed transactions; mergers and consolidations; recaps and restructurings;and valuation of the going concern.Kevin‟s achievements include the following highlights: 1. Successful restructuring of $78 million in debt owed from Commonwealth Oil Refining Corp. to Transocean Gulf Oil Corporation when the latter off-loaded a super-tanker at the former‟s Puerto Rican refinery, only to be met with a midnight filing of Chapter 11 prior to the wire transfer as contracted. 2. Member of the litigation team that settled the then largest federal lawsuit ever brought between Westinghouse Electric Corporation and forty-seven utility plaintiffs, each claiming that Westinghouse‟s repudiation of Uranium supply agreements would result in damages exceeding $10 billion dollars. The settlement created a successful subsidiary of Westinghouse fully engaged in uranium mining, milling, and processing of enriched uranium that supplied the utility plaintiffs with their long term contractual uranium supplies at cost. Although this cost was materially higher than the contract price, rate regulators throughout the United States allowed the settlement delta to be part of rate structures under the theory that there was substantial risk that the utility plaintiffs could lose their breach of contract claims based on impracticability of performance under U.C.C., §2-615. This settlement saved both Westinghouse and private utilities from bankruptcy from an adverse decision against either party. Westinghouse then pursued a successful anti-trust action against General Electric, and private uranium cartels in South Africa and Australia, which had cornered the uranium market, drove up uranium prices, and thus forced Westinghouse‟s anticipatory repudiation in the first instance. 3. Led teams in connection with closings of $100 million in private placement capital in connection with merger, acquisition and consolidation strategies in the ethnic health & beauty aids industry. Principal investors included Patricof & Co., LLP. This private placement firm placed the original seed money for Apple Computer. Led teams in implementing a strategy of a “reverse” merger that led to the creation of Pro-Line International, a wholly owned subsidiary of Alberto-Culver, Inc. (“ACV”), now the second largest health and beauty aids company in the world focused on peoples of African descent. This transaction was in excess of $75 million.SBM SUPPLMENT - updated 9/27/2011 Page 3 of 13
  4. 4. 4. Chief operating officer of the team that leveraged a $350,000 investment in 1991 to create the then largest ethnic television syndication company in the United States, The Heritage Networks. This company at its apex in 2004 had gross revenues of over $50 million, and controlled over ½ of all .30 second commercial units targeting African-American households; produced and distributed the longest running and highest rated African-American television series utilizing the variety show format, “Showtime at the Apollo”; and acted as advertising unit sales representative with all major Hollywood studios, including Sony/MGM, Warner Bros., and Paramount with respect to popular television series, such as “the Steve Harvey Show”; “Judge Hatchett”; “the Bill Cosby Show”; and “the Parkers”. Kevin also acted as the Chief Restructuring Officer for the Company when adverse industry conditions forced a substantial restructuring and reorganization, drawing on his fifteen-year experience as a reorganization attorney. This restructuring effort led to a successful $8 million exit capital injected by First Bank & Trust of Louisiana and the Louisiana Economic Development Agency. 5. Currently, Kevin is Director, Business Development with Johnson Products Company, Inc., an acquisition that closed in March of 2009. The acquisition was a divestiture of the “Gentle Treatment” and “Ultra Sheen” brands by The Proctor & Gamble Company in a transaction in excess of $20 million dollars. In this position, Kevin oversees the global business development activities of Johnson Products. 6. Kevin received his B.A. cum laude from St. Mary‟s University, San Antonio in 1970; his M.A. in Urban Studies from Trinity University in San Antonio in 1975; and his J.D. from Harvard Law School in 1975.COURSE TOPICS: (Note: All “Assignments” are due to me by email by7:00 p.m., Sunday, at the end of each Week Unit. All date referencesare to 2011)SBM SUPPLMENT - updated 9/27/2011 Page 4 of 13
  5. 5. WEEK/UNIT COURSE TOPICS (2011) ASSIGNMENTS 8/29-9/4 Telephone Review Orientation.(Please Syllabus and Small Business call cell phone for eCampus Operations time and Materials; Orientation appointment) Introduction Small Business: An Lesson 1-Are You − Reading Overview an Entrepreneur Assignment: 9/5-9/11 Scarborough: Small Business Chapters 1 Management and 2 (Skill 1) − Assignment: Complete Lesson 1- “Homework”, ECampus Starting a New Lesson 2-What is − Reading Business Your Business? Assignment: 9/12-9/18 Scarborough: (Skill 1,3,5 & 9) Chapters 4-5 − Assignment: Complete Lesson 2- “Homework”, ECampus The Business Plan Lesson 3-What is a − Reading Business Plan? Assignment: (Skill 1,2,5, 9) 9/19-9/25 Scarborough: Chapter 6 − Assignment: Complete Lesson 3- “Homework”, ECampus PERSONAL FINANCES, Lesson 4- − Reading DEBT Introduction to Assignment: Business Finances Scarborough: (Skill 2,3,4,8 & 9) 9/26-10/2 Chapter 7SBM SUPPLMENT - updated 9/27/2011 Page 5 of 13
  6. 6. − Assignment: See Lesson 4- “Homework”, ECampus Start Up Costs Lesson 5-Starting − Reading (Skill 2,8 & 9) a New Business Assignment: 10/3-10/9 Scarborough: Chapter 8 − Complete Lesson 5- “Homework”, ECampus Pricing and Break Even Lesson 6: − Reading Analysis Small Business Assignment: Finance Scarborough: 10/10-10/16 Chapter 11 (Skill 1,8 &9) − Assignment: See Lesson 6- “Homework”, ECampus Financial and Legal Lesson 7: − Reading Management Financial and Legal Assignment Management- Scarborough, (Skill 1, 2, 3,4,8) Income statements Chapter 7 10/17-10/23 − Assignment: See Lesson 7- “Homework”, ECampus NO ASSIGNMENTS FOR SPRING BREAK Sources of Capital -Reading (Skill 1, 2, 3, 4,8) Assignment Scarborough, Chapters 14-15 Financial Statements- Lesson 8: − Reading Balance Sheet Understanding the Assignment: Balance Sheet − Scarborough,SBM SUPPLMENT - updated 9/27/2011 Page 6 of 13
  7. 7. Chapter 7 10/24-10/30 − Assignment: See Lesson 8- “Homework”, (Skill 1, 2, 3,4,8) ECampus Financial Statements- Lesson 9: − Reading Cash Flow Managing Cash Assignment: Flow − Scarborough, Chapter 8 (Skill 1, 2, 3,4,8) 10/31-11/6 − Assignment: See Lesson 9- “Homework”, ECampus Human Resource Lesson 10: Payroll − Reading Issues Assignment: − Scarborough, Chapter 19 11/7-11/13 − Assignment: See − Lesson 10, ECampus − Business Law and Lesson 11: − Reading Regulations Dealing with the Assignment: IRS; Succession − Scarborough, Plan and Ethics Chapters 20- 11/14-11/20 22 − Assignment: See Lesson THANKSGIVING 11, ECampus HOLIDAYS 11/21-11/27 NO CLASS Techniques to Enhance COMPLETE − Scarborough, Profitability BUSINESS PLANS Chapters 17- AND INTERVIEWS 18, 13 11/28-12/11ASSIGNMENTS AND EVALUATIONEntrepreneur Interview:SBM SUPPLMENT - updated 9/27/2011 Page 7 of 13
  8. 8. − Each participant is responsible for interviewing an Entrepreneur (someone who has started a business within the last 5-10 years, whose sales exceed $100,000 annually). Each participant is to develop his/her own interview outline.− Your interview summary should be a 3- to 6-page, bullet point, summary (word document in 12 point, Arial font) and include the following three sections: 1. Entrepreneur and Business(es) Overview: A description of the person you are interviewing and the business(es) he/she has started (1- to 2-pages). 2. Key Observations: The most important observations learned from the interview (1- to 2-pages). 3. Key Insights/Impacts: How your key interview observations relate to/impact you and your entrepreneurial aspirations (1- to 2-pages).Venture Capitalist Interview:− Alternatively, each participant is responsible for interviewing a Venture Capitalist (someone who has invested in a business within the last 5-10 years, whose sales exceed $1M annually). Each participant is to develop his/her own interview outline.− Your interview summary should be a 3- to 6-page, bullet point, summary (word document in 12 point, Arial font) and include the following three sections: 1. Venture Capitalist and Business(es) Overview: A description of the person you are interviewing and the business(es) he/she has invested in (1- to 2-pages). 2. Key Observations: The most important observations learned from the interview (1- to 2-pages). 3. Key Insights/Impacts: How your key interview observations relate to/impact you and your entrepreneurial aspirations (1- to 2-pages).Business Attorney or Tax Accountant Interview:− Alternatively, each participant is responsible for interviewing either a Business Attorney or Tax Accountant (someone who has assisted entrepreneurs within the last 5-10 years). Each participant is to develop his/her own interview guide.− Your interview summary should be a 3- to 6-page, bullet point, summary (word document in 12 point, Arial font) and include the following three sections:SBM SUPPLMENT - updated 9/27/2011 Page 8 of 13
  9. 9. 1. Attorney or Tax Accountant and Business(es) Overview: A description of the person you are interviewing and examples of the business(es) he/she has assisted (1- to 2-pages). 2. Key Observations: The most important observations learned from the interview (1- to 2-pages). 3. Key Insights/Impacts: How your key interview observations relate to/impact you and your entrepreneurial aspirations (1- to 2-pages).Business Plan Development:Each course participant will be required to develop a “basic” business plan.The Plan requires course participants to demonstrate an understanding ofthe course materials by integrating and applying the course topics to a“real life” business idea. Your Plan should follow the “Business PlanAssessment” outline provided in the „eCampus‟ area of the course website.Your Plan should be done as a word document in 12 point, Arial font. At youroption, you may also purchase Business-Plan Pro as an alternative source tosupport your business plan, as preferred by the Scarborough Text. If youearlier took BUSG 2309-5426, we will focus instead on execution of yourbusiness plan developed in that course and the financing options.GRADING SCALEGrades will be determined based on performance on the following tasks:− Coursework 30 points− Interview 20 points− Business Plan: 50 points− Total Course Points 100 pointsGrades will be assigned based on the total points earned in the class. Grade Grade Points 100-point Scale* A 4.0 93-100 A- 3.7 90-92 B+ 3.3 87-89 B 3.0 83-86 B- 2.7 80-82 C+ 2.3 77-79 C 2.0 73-76 C- 1.7 70-72SBM SUPPLMENT - updated 9/27/2011 Page 9 of 13
  10. 10. D+ 1.3 67-69 D 1.0 63-66 D- 0.7 60-62 F 0.0 <=59 FA 0.0 Failure because of excessive absences or failure to withdraw from the course. *As a percentage of total points possible for the course.eCampus and eConnect eCampus is the web interface used to access Internet-based distance education courses. This class is registered on eCampus and there are assigned materials that are located there. IN ADDITION, THE TEXT HAS CROSS REFERENCES TO WEB MATERIALS THAT WILL BE INTEREST TO YOU IN EACH CHAPTER AT For information, go to eConnect is also the web interface that provides online student services, which allow students to search, register, and pay for credit classes, view final grades and financial aid status. Go to this address: You MUST have an email address on file with the College to access eConnect. You may use a DCCCD email address, which is free if you are eligible, or you may use a commercial email address). If you have a question, contact COMPUTER USE POLICY: This class will require you to utilize campus computers. Please see the computer use policy for the district under the student code of conduct at will use e-Campus in this course in the following way:− The course syllabus and schedule− Key resources (e.g. articles/book excerpts, tools, etc.) in the “Course Documents” function.− Emails and posting boards for discussion topicsSBM SUPPLMENT - updated 9/27/2011 Page 10 of 13
  11. 11. − Posting questions or comments regarding the lectures in the posting boards and following the discussion threadLIBRARYThe El Centro Library is a valuable resource for this course, providing accessto many references and electronic databases that will be useful researchtools for this course. “Hoovers”, a service of Dun & Bradstreet, is anexcellent source for information on businesses of all types.Recommended readings from the Library include, inter alia:Accounting for Dummies----John A. TraceyGrowing a Business—Paul HawkenGuerilla Marketing---Jay Conrad LevinsonHow to Set Up Your Own Small Business—Vol. 1& 2, --Max Fallek101 Best Businesses to Start—Sharon Kahn and Phillip Lerp GroupSmall Businesses for Dummies—Eric Tyson and Jim SchellSmall Time Operator—Bernard KamrofSo, You’re Thinking of Having a Business—Jonathan SherThe Entrepreneur and the Small Business Problem Solver---William A. CohenWorking from Home---Paul & Sarah EdwardsPOLICY ON ACADEMIC HONESTY Any violation of the Student Code of Conduct (as printed in the El Centro College Catalog and available at will be penalized accordingly. All matters of academic dishonesty (plagiarism, collusion, fabrication, cheating, etc.) will result in a failing grade for the assignment in question. (The instructor will always advise when a project or assignment is a group project, which will involve approved collaboration among students). All violations will be forwarded to the proper college authorities for review. The college may, at its discretion, impose additional penalties on the student including academic probation, suspension, or expulsion. ANY form of disruptive behavior as aforementioned will not be tolerated.SBM SUPPLMENT - updated 9/27/2011 Page 11 of 13
  12. 12. GRIEVANCE PROCEDURES: Students are expected to follow established procedures of the Health Occupations Division, Paralegal Studies, in handling academic issues such as grade appeals. El Centro College requires that other complaints and disputes (that cannot be resolved by the persons directly involved) be referred initially to the Ombudsman Office for informal, confidential, resolution. Additional grievance procedures and the Student Code of conduct are outlined in the El Centro Catalog, available in hard copy in advisement or on the web at AID STATEMENT: Students who are receiving any form of financial aid should check with the Financial Aid Office prior to withdrawing from classes. Withdrawals may affect your eligibility to receive further aid and could cause you to be in a position of repayment for the current semester.RELIGIOUS HOLY DAYS STATEMENT: A student who is absent from classes for the observance of a religious holy day shall be allowed to take an examination or complete an assignment scheduled for that day within a reasonable time after the absence if, not later than the fifteenth day after the first day of the semester, the student notified the instructor of each class scheduled on the date that the student would be absent for a religious holy day. A “religious holy day” means a holy day observed by a religion whose places of worship are exempt from property taxation under Section 11.20, Tax Code. The notice shall be in writing and shall be delivered by the student personally to the instructor, with receipt acknowledged and dated by the instructor or by certified mail, return receipt requested, addressed to the instructor. A student who is excused under this section may not be penalized for the absence, but the instructor may appropriately respond if the student fails to satisfactorily complete the assignment or examination.SBM SUPPLMENT - updated 9/27/2011 Page 12 of 13
  13. 13. CHILDREN ON CAMPUS: El Centro College strives to protect an environment conducive to teaching and learning for all enrolled students. Minor children may not be brought to classrooms, labs, testing areas or study areas of the college. This practice is disruptive of the learning process. Children who are taking part in organized scheduled activities, or who are enrolled in specific classes, are welcome. For reasons of security and child welfare, the college will not permit unattended children to be left anywhere on the premises. Students/Parents who have problems with childcare should visit the advisement/counseling center or the Adult Resource Center to receive referrals to childcare services in the area.POLICY ON THE AMERICANS WITH DISABILITIES ACT Any student who may need accommodations due to a disability should contact the Disability Services Office, Room A110, phone number 214.860.2411.SCANS STATEMENT –See Course Objectives for anticipated SCANSobjectives. A summary of SCANS is available with the Syllabus undereCampus.SBM SUPPLMENT - updated 9/27/2011 Page 13 of 13