Entrepreneurship

What is a Business Plan?

A written outline that evaluates all aspects (Viability) of business venture, including a description and analysis of your business prospects.

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Why to prepare a Business Plan?

Business plan as the ROAD MAP to chart the course of your business. Condition: CHANGES are UN-PREDICTABLE that impacts your TIME SCHEDULES NEED is to PERIODICALLY REVIEW and UPDATE your business plan.

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Why to prepare a Business Plan?

Other Reasons: To mark the deviation in terms of TIME factor. Help in developing the FOCUS APPROACH towards achieving OBJECTIVES. Act as a SELLING TOOLS to stakeholders.

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Why to prepare a Business Plan?

Uncover omissions and / or weaknesses in your planning process. Plans fails because of MY WAY strategy. Ignoring experts opinion. "My Way" is a great song, but in practice can result in unnecessary hardships.

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What to avoid in a Business Plan?

UNREALISTIC TARGETS No Reasonable limits on long-term, future projections. (Long-term means over one year). QUICK MODIFICATIONS: Modify the plan as your business progresses - Too often, long-range planning becomes meaningless because the reality of your business can be different from your initial concept.

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What to avoid in a Business Plan?

FOLLOW KISS APPROACH (KEEP IT SHORT & SIMPLE) - Use simple language in explaining the issues. Make it easy to read and understand.
BANGING UPON USP; R&D IS MUST Don't depend entirely on the uniqueness of your business or even a patented invention. Success comes to those who start businesses with great economics and not necessarily great inventions.

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Format of Business Plan

1. A Vision Statement: Thought by Initiator or CEO of the Organization. This will be a concise outline of your business purpose and goals. 2. The People: YOU Most Important. Success of BP depends on your prior experiences, applicable to your new business. SUPPORT - Staff involved from initiation to implementation. Prepare a rsum of yourself and one for each person who will be involved with you in starting the business. Be factual and avoid hype.

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Format of Business Plan

Include an explanation if you lack the ability to perform a key function. Eg: For example, if you lack the ability to train staff, include an explanation how you will compensate for this deficiency. Co-partnership : You could add a partner to your plan or plan to hire key people who will provide skills you don't have. Include biographies of all your intended management.

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Format of Business Plan

Your Business Profile: Define and describe your intended business and exactly how you plan to go about it. Try to stay focused on the specialized market you intend to serve. Assessment of SLEPT factors: Explain how your business will be appropriate for the regulatory agencies and demographics with which you will be dealing.

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Format of Business Plan

3. Cash flow assessment: Include a one-year cash flow that will incorporate your capital requirements. Include your assessment of what could go wrong and how you would plan to handle problems.

4. Include your Marketing Plan and expansion plans.

(a) Industry Overview (b) Management Plan (c) Market Analysis (d) Marketing Plan, (e) Operating Plan, (f) Financial Plan

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4 (a) Industry Overview

What is the size of your industry? What sectors does this industry include? Who are the major players in this industry? What are the markets and customers for this industry? What are the industry's estimated sales this year? Last year? The year before? What national / economic trends have affected this industry and how? What national / economic trends might affect it in the future and how?

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4 (b) Management Plan MANPOWER and ORGANIZATION LEGAL STRUCTURE Stake holders will look for : Skills managerial skills of YOU & STAFF

Past Experience in related industry

MANPOWER REQUIREMENT related to Business Plan Should be actual; if not, support by the statements.

EXTERNAL MANAGEMENT RESOURSES Where, When, Who, Why questions to be answered. Requires complete knowledge about operation phase.
Study level of staff contribution at all 3 LEVELS of management.

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4 (c) Market Analysis ASSESSMENT of TARGET MARKET demographics, geographic, psychographic, behavioral pattern, your target market's needs and how these needs are being met currently. COMPETITIVE ANALYSIS Segmentation; USP, Benefits ProductMix Why customers buy from them; Marketing Mix, Communication Mix, Channel Mix

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4 (d) Marketing Plan

Your proposed Sales Strategies, Communication Mix, Product Mix, Marketing Mix, Channel Mix.

USP & Benefits other than competitors.

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4 (e) Operating Plan A description of : Physical Location, Facilities and equipment, Kinds of employees needed, Inventory Requirements, Suppliers and supplies, Others as described by manufacturing process.

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4 (f) Financial Plan

Consists of three financial statements: The income statement The cash flow projection and The balance sheet, and a brief explanation/analysis of these three.
Gather some of the financial data and prepare financial statements by examining your expenses. Think of your business expenses as broken into two categories: Your start up expenses and Your operating expenses.

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Financial Plan

All the costs of getting your business up and running go into the start up expenses category. These expenses may include:
Business registration fees Business licensing and permits Starting inventory Rent deposits Down payments on property Down payments on equipments & technology Utility set up fees. This is just a sampling of start up expenses; your own list will probably expand as soon as you start writing them down.

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Financial Plan

Operating expenses are the costs of keeping your business running. Also called as MONTHLY expenses. Your list of operating expenses may include: Salaries (yours and staff salaries) Rent or mortgage payments Telecommunications utilities Raw materials storage Distribution expenses Promotion expenses Loan payments Office supplies Maintenance cost.

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5. Appendices And Exhibits

Any additional information that will help establish the credibility of your business idea, such as marketing studies, photographs of your product, and/or contracts or other legal agreements pertinent to your business.

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6. The Executive Summary of the Business Plan

WRITE in a way to make it READABLE, UNDERSTANDABLE, with high chances of getting ACCEPTABILITY.

Purpose is to provide your readers with an OVERVIEW of the business plan.

MIRROR IMAGE OF YOUR BUSINESS.

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The Executive Summary of the Business Plan

IT INCLUDES SUMMARIES: A description of your company, including your products and/or services Your mission statement Your businesss management The market and your customer Marketing and Sales Your competition Your businesss operations Financial projections and plans

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The Executive Summary of the Business Plan

The executive summary of the business plan is the FIRST DOCUMENT, read by STAKEHOLDERS. If your business plans executive summary is poorly written, it will also be the last, as they set the rest of your business plan aside unread! Executive summary MUST generate INTEREST or EXCITEMENT within readers?

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The Executive Summary of the Business Plan

The executive summary will end with a summary statement, a last kick at the can sentence.
MOST CRUTIAL: PURSUADE the readers of your business plan with a clinching closing sentence; otherwise answer the readers question WHY IS THIS A WINNING BUSINESS?

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The Executive Summary of the Business Plan

Tips for Writing the Executive Summary

Focus on providing a summary Stakeholders lacks TIME. Keep your language strong and positive - Eg: Instead of writing, might be in an excellent position to win government contracts, write will be in an excellent position... 2 PAGES not more than that.

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The Executive Summary of the Business Plan

The job of the executive summary is to present the facts and entice your reader to read the rest of the business plan, not tell him everything.
Get it reviewed for IMPROVEMENTS. Tailor it as per Audience who will read it. e.g.: If
the purpose of your business plan is to entice investors, for instance, your executive summary should focus on the opportunity your business provides investors and why the opportunity is special.