Business Planning Writing a Business Plan 2 Frankie .docx

Business Planning
Writing a Business Plan
2
Frankie Lim S3_Writing a Business Plan - Part 2 1
Business Plan
Production
Market Analysis
analysis

broad business domain
alysis breaks the industry
into segments and focuses on a
specific segment (target market)
very well then to service all of it!
Market Section
target market
marketplace
marketing/sales functions)
Market Section
-

& the nature of the plan
firms manufacturing outputs, for
the marketing plan, how many
people to hire etc.
understanding the market the
more it can match the product
Market Analysis
the needs of the users
has a well thought out target
market
market

Market Analysis
-
h the
goals of the organisation
demonstration of sales and ROI
investment
usually takes considerable time
Market Analysis
customer
market in some cases
characteristics

Market Segmentation
f you have shown this in the
business plan recap here
- cover the basics
-
process of dividing market into
subsets
same way or have similar
needs
How to segment?
-
etc
family size, income etc
-personality,
life-style,values
-varies by product

Testing your assumptions
within the segment
between the segments
compared to differences across segments
members can be identified
the segment
profitable
Mintel
segmentation methods in different
industries

industry, suppliers, distributors,
customers
Selection
prospects
-
professionally & personally
market!
Selection
firm to become an expert in a
particular area.
trends

Market Size & Trends
assumptions
affected if you guess
available use Mintel/websites etc
to track size of industries &
segments
A market that doesn’t exist
one store to assess the market
s of assumptions made
anchored to facts and sound analysis

time/budget constraints
Buyer Behaviour
r in a given target market
accommodate customer needs
-social interaction
segmentation method i.e. an
understanding of a certain age group, &
or lifestyle segment
B2B markets
Influencers in the DMU
(Decision making Unit)

on?
(time & effort)
Competitor Analysis
competitors
different ways
Look for direct, indirect &
potential competitors
-a competitive
analysis grid/map to look for
issues/advantages

Competitors
-offers a product/service similar to
yours
-close substitutes
-potential to move into
your market
and intensity of the competition
competitors
Estimate Sales and Market Share
comparable product
tions when
estimating

Multiplication method
willing to pay
stimate the size of the market
-ups often use a bottom up
approach-
expect
Large segment
iPod while exercising

engage in wet sports who are iPod users
-% of people who would
be your product & how much they would
spend (sample)
Market Analysis
methods
r ideas on the
plan
Any Questions ???
Reflections
Frankie Lim S3_Writing a Business Plan – Part 2 25
50D64FF2-F642-47BD-A526-7D3735A154B7.JPG

8E827465-9933-4C22-8041-68D491BA74D1.JPG
BUSINESS PLANNING
WRITING A BUSINESS PLAN
Frankie Lim S2_Writing a Business Plan 1
Aims & Objectives
overview of the business plan (s)
steps of writing the business plan
Your plan should
product

ceived Value’
This research should enable you to:
sure that you are offering
Addressing the needs of your
audience

ad
a family business
Writing The Plan
business plan, and what do
they look for?
Executive Summary
beginning!)
helps formulate ideas

attention
h’
Elevator pitch
-10th floor!
customer?
Business Plans

directors, accountants, lawyers
-drawing from the
succession plan
d management
structure
Business Plans
Planning Templates

Cover page of Business Plan
cover page stamped confidential
author
mission statement
title page
Naming the Business
ome way the
market offering

- i.e.
Fat Man Tailors;
Weight Watchers’ Delights
-i.e. Kraft foods
companies - Ben & Jerry’s Homemade
Legal Issues
and trademarked, & internet domain
has been secured
–shows awareness
Business (Company) Description

-about you here!
-
founder’s/shareholder’s agreement-split
of equity
ment
Business Description-Background
prestigious

Business Description
-define
normally?
an entrepreneur?
solve?
customer?
competing products
Positioning over rivals

Identified Changes
-no competition
Industry Analysis

similar product i.e. electronic
games, airplanes.
e, growth rate, structure,
financial characteristics
Industry Analysis
-
not the target market
r a particular time
market discussions &
Industry Analysis

plan i.e.
casts-justify numbers
Industry Analysis
- more women
entering business workforce
ustry made up of small companies
relatively low
-level of competition

Industry Analysis
c profile of target
market/customers
tastes and preferences
and weaknesses
-Kotler
Industry Analysis
advertising practices
rents and activity patterns
distribution

Industry Analysis
Any Questions ???
Reflections
BUSINESS PLANNING
Those who

“fail to plan”, “plan to fail”
Frankie Lim S1_Businesss Planning _ Essentials & Concepts 1
Business Planning
• Producing a Business Plan is the single most
important aspect of an organization’s
activities
• The Plan demonstrates careful consideration
of all activities: way forward, threats,
opportunities have been analysed
• A formal document is essential if finance,
equity or grants are to be secured
Structure of planning
• Mission statement
• Vision statement
• Clarify organizational objectives

• Forecasts
• SWOT analysis
Business Planning
• Mission Statement
• What are our goods / service?
• What do our customers buy?
What do we do?

Who are we?
Who do we do it for?
• We should be clear about who are we,
what are our values, our beliefs
• Whom do we serve?
Where do we do?
What we do?
• This might refer to geography but it
might also refer to segments
• We must be clear about the areas we
wish to satisfy

• Money?
• Benefit to others?
• To make a living?
• Thrill?
• Status?
• Self-actualisation?
Why do we do it?
• Processes
• Quality
• Differentiation
• Matching stakeholders’ values with
“quality”
• Are our values the same as our
customers’?
How do we do it?

Organizational Objectives
• Specific
• Measurable
• Agreed
• Realistic
• Time-bound
• Evaluate
• Review
Frankie Lim S1_Businesss Planning _ Essentials & Concepts
10
Setting Objectives
• Profitability / Surplus
• Market share and standing
• Productivity
• Personnel performance
• Innovation

• Social and public responsibility
• Resource utilisation
11
Forecasts
• Make assumptions regarding business
conditions and trends
• State them clearly
• Are they realistic?
12
SWOT Analysis
• Strengths • Weaknesses
Product
Price
Place
Promotion
People

Process
Physical
Evidence
13
SWOT Analysis
• Opportunities • Threats
Political
Economic
Socio-cultural
Technological
Legal
Ecological
Demographic
14

15
Strengths Weaknesses
Opportunities SO WO
Threats ST WT
Strategic Options
Structure of Planning
• Competitive advantage
• Re-define objectives
• Strategic options
• Evaluate Strategic options
• Select Strategy
• Action plans
• Control and evaluation
• Iterate
16
Internal Appraisal

• Product mix
• Markets
• Research and Development
• Finance
• Personnel
• Management
• Structure
17
Product mix
• Product life cycle
• Portfolio of products
• Synergy
• Innovation
• Differentiation
• Patents
• Barriers to entry

18
Markets
• Size and shape
• Trends
• Evidence of growth rates (or decline!)
• Market share – present and expected
• Marketing strategies (Ansoff?)
19
Market
Penetration
Product
Development
Market
Development
Diversification

M
A
R
K
E
T
S
Existing
New
P R O D U C T S
Existing New
Marketing strategies – Ansoff Matrix
Frankie Lim
S1_Businesss Planning _ Essentials & Concepts
20
Research and Development
• What are R& D Policies?

• How much finance attributed to R & D?
• Does this fit with marketing strategies?
21
Finance
• What are our current financial
resources?
• Are we currently profitable?
• How will any further
investment/expense affect our balance
sheet structure?
• Will we need external assistance?
• If so, which type will be best?
22
Personnel
• Training needs analysis to ascertain

present level of skills
• What knowledge do our people have?
(Knowledge is different from skill!)
• What values do they have?
• Do they have the right attitude?
23
Management
• Skill / Knowledge, behaviour, values and
attitudes
• Leadership qualities
• Resource allocation
• Entrepreneurial Vision
• Disturbance handling
• Liaising
• Controlling
• Negotiating

24
Structure
• Pyramid: appropriate for slow-to-
change industries
• Flat: appropriate for fast-moving firms
25
Evaluation and Control
• Establish performance targets
• Compare results with targets
• Analyse deviations
• Implement modifications
26

Why Planning can Fail
• Lack of commitment
• Resistance to change
• Absence of clear objectives
• Failure to appreciate scope of plans
• Over-reliance on past experience
27
Why Planning can Fail
• Poor and inflexible control techniques
• Hostile external environment
• Lack of clear delegation
• BUT GOOD PLANNING WORKS!
28
Any Questions ???

Reflections
29
Frankie Lim Guidelines for Business Plan Assignment Ideas
Conception - & Assessment 1
Entrepreneurship Assignment
Expectations
1. Conception
1. High ambition entrepreneurial quality
2. Justification of demand and potential
2. Description of venture and innovation
1. Key features – creativity and innovations
2. Key challenges and how these will be overcome
3. Presentation quality – effectiveness
1. Grammars, etc, visual quality
2. K.I.S.S. – 15 mins presentation
IMPORTANT POINTS TO NOTE:
Frankie Lim 2

A Proposed Entrepreneurial
Business Plan for a Food Catering
Business in Singapore
“ALL ASIANS DELIGHTS”
Best choice for home cooked Asian Foods
Submitted by:
Tan Chin Koo
Student No: XXXXXX
Batch Number: BIBD5 XXXX
Lecturer: Mr. Frankie Lim
Frankie Lim 3
Idea Conception
• Sources of Idea:
– Where do you get your ideas from?
– Examples: Personal Experiences and
feedbacks from friends
– Reports from Government and D.O.S

• Opportunities:
– What solutions do you provide to a problem?
– What added value to you provide to a
situation
Frankie Lim 4
Opportunities & Feasibility
Analysis
(Evidences/Citation of marketing/research sources)
• Market Size & Potential
– Current size (source)
– Trend and Potential (source)
• Market Segments
– Size & Potential of Key Segments
• Competitive Analysis
– 5 forces model
– Key competitors and strategies

Frankie Lim 5
Business Model
• Uniqueness & Competitive Advantages
– Creativity
– Innovativeness
• Target Market Segments
– Primary segment
– Secondary segment
• Positioning
– Value Proposition & Value Delivery System
– Product/Service offerings
Frankie Lim 6
Entrepreneur’s Background &
Resources
• Background

– Education
– Experiences
– Others
• Resources
– Financial
– Networks
Frankie Lim 7
Product/Market
(Emphasis place on “creativity” &
“innovation”)
• Description of Products/Services for each
target market served
• Areas of Differentiation
– Highlights the key differentiation

Frankie Lim 8
Marketing
(Emphasis place on “creativity”
& “innovation”)
• Product …………..
• Pricing …………..
• Place …………..
• People …………..
Note:
Visuals/Photos/Pictures
/Diagrams, etc, may be
included to provide
better support
Frankie Lim 9
Marketing
(Emphasis place on

“creativity” & “innovation”)
• Process ………….
• Physical Evidence ……
• Promotion …….
Note:
Visuals/Photos/
Pictures/Diagrams
, etc, may be
included to
provide better
support
Frankie Lim 10
Operation
• Location
• Layout
• “Make” or “Buy”
• Outsourcing

• Key requirements
– Equipment
– Plants
– Materials
Note:
/Diagrams, etc, may be
included to provide
better support
Frankie Lim 11
Organization
• Legal Structure
– Private Limited / Partnership,
etc
• Organization Structure
– Organization chart
• Management Team
– Background & Experiences of

key members
• Human Resources
– Policies
Note:
/Diagrams/Charts, etc,
may be included to
provide better support
Frankie Lim 12
Financials
• Key Assumptions
– Units to be sold
– Average selling price per unit
– COGS
– Other costs
• Pro forma income statements
– Sources of income
(products/services)

– Sources of profit (products/services)
• Projected break-even analysis
Note:
Visuals/Photos/Picture
s/Diagrams/Charts,
etc, may be included
to provide better
support
Frankie Lim 13
Financials
• Amount of investments required
• Sources of funds
– Self
– Investors
– Loans (sources)
• Applications of funds

• Projected cash flows
• Projected pay-back period
• Pro forma Balance Sheet
Note:
/Diagrams/Charts, etc,
may be included to
Frankie Lim 14
Risks & Contingencies
• Types of Risks
– Market risks
– Product life cycle
– Competition
– Costs
– Others
• Contingencies

– Plan B
Note:
Visuals/Photos/Pictures/
Diagrams/Charts, etc,
may be included to
Frankie Lim 15
Conclusion
• Summary of the plan
• Justifications to the business proposal
• Invitation to invest OR lend
• Thank the prospective investors / lenders
Frankie Lim 16
List of Appendices
• References
• Sources

• Financial statements
• Data / charts / Diagrams
Frankie Lim
Outline of a Business Plan
1
Sample Structure for an
Prepared by: Frankie Lim
Frankie Lim
2
Outline of a Business Plan (1 of 2)
I. Introductory Page
A. Name and address of business
B. Name(s) and address(es) of
principal(s)

C. Nature of business
D. Statement of financing needed
E. Statement of confidentiality of report
II. Executive Summary—Three to
four pages summarizing the
complete business plan
III. Industry Analysis
A. Future outlook and trends
B. Analysis of competitors
C. Market segmentation
D. Industry and market forecasts
IV. Description of Venture
A. Product(s)
B. Service(s)
C. Size of business
D. Office equipment and personnel
E. Background of entrepreneur(s)
V. Marketing Plan

A. Pricing
B. Distribution
C. Promotion
D. People
E. Process
F. Physical Evidences
G. Future Product forecasts
H.. Controls
Frankie Lim
3
Outline of a Business Plan (2 of 2)
VII. Production Plan
A. Manufacturing process (amount
subcontracted)
B. Physical plant

C. Machinery and equipment
D. Names of suppliers of raw materials
VI. Operational Plan
A. Description of company’s operation
B. Flow of orders for goods and/or services
C. Technology utilization
VIII. Organizational Plan
A. Form of ownership
B. Identification of partners or principal
shareholders
C. Authority of principals
D. Management-team background
E. Roles and responsibilities of members of
organization
IX. Financial Plan
A. Assumptions
B. Pro forma income statement
C. Cash flow projections

D. Pro forma balance sheet
E. Break-even analysis
F. Sources and applications of funds
X. Assessment of Risk
A. Evaluate weakness(es) of business
B. New technologies
C. Contingency plans
XI. Appendix (contains backup material)
A. Letters
B. Market research data
C. Leases or contracts
D. Price lists from suppliers

Business Planning Writing a Business Plan 2 Frankie .docx

Recommended

Recommended

More Related Content

Similar to Business Planning Writing a Business Plan 2 Frankie .docx

Similar to Business Planning Writing a Business Plan 2 Frankie .docx (20)

More from RAHUL126667

More from RAHUL126667 (20)

Recently uploaded

Recently uploaded (20)

Business Planning Writing a Business Plan 2 Frankie .docx