Business Plan Parts 2

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    Business Plans

    Guidelines

    By

    Mohammad Ali

    0323-5111105

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    Introduction

    Focus your thinking

    Establish realistic strategy

    Financing and other support Reaction by others

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    Definition

    Document that can convince the reader

    that the business can produce enough

    revenue to make a satisfactory profit and

    therefore attractive as an investment

    opportunity

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    Many reasons to build one

    BP should sell the writer/reader on

    the business:

    Writer: so that you can go out and do

    it,

    Reader: to invest in it

    Confidence of knowing the issues

    Improve chances of success

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    Many Purposes in real life

    Bank Financing

    Strategic alliances

    Large contracts Key employees

    Mergers and acquisitions

    Mgt team motivation

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    Principles of BP

    No right way: plans can differ

    Be creative but set a limit

    Concise and focused Captures energy and personality of

    business leader

    Include negatives and issues Spend some time on it

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    Sections of Business Plan

    Cover Page: contact name and info

    Table of contents

    Executive summary The company: past, present and

    future

    The market The Product/service

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    Sections of Business Plan -

    continued

    Sales and Promotion

    Financial projections

    Profit and loss Balance sheet

    Cash flow

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    Other sections: technology

    based

    Management team: people who fund other

    people value management skills above

    ideas

    Risk factors: shows that you know whatcould go wrong and plan to avert it

    Marketing plan: if this is innovative how

    are you going to get people to use it

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    Packaging the Plan

    It is a living document

    No right/wrong way: the need of

    reader is essential

    What are the challenges/ questions

    that can be raised by reader: answer

    these.

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    Packaging the Plan

    Include supporting materials

    Dont make unsupported statements

    Designate an outside reviewer/reader that can critique plan

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    Guidelines forBusiness Plan

    by Ideas 2010Guidelines for Outline:

    Executive Summary: The Opportunity Problem to solve or need to be filled The Description of the Business

    How the proposed business solves the problem or fills the need Competitive Advantages Description of the business model The Target Market The Management Team Brief Summary of Financial Projections

    Description of What the Business Needs The amount of capital needed and what the capital will be used

    for, if the plan is going to a potential investor Exit strategy for investors (if the plan is going to investors)

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    2. The Business:

    A. The Opportunity

    Problem to solve or need to be filled

    B. The Description of the Business

    How the proposed business solves the problem or fills the need

    Brief company history or background

    Company mission and objectives

    C. Competitive Advantage

    Description of the business model

    How the business will create a sustainable competitive advantage

    D. Current Status and Requirements Description of where the business stands today

    Description of what the business needs to move forward

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    3. Management Team

    A. Management Team

    Management experience

    Management ability

    Technical expertise

    B. Board of Directors

    Number of directors

    Composition of the boardC. Board of Advisors

    Number of advisors

    Composition of advisory board

    How the advisory board will be used

    D. Key Professional Service Providers

    Law firm Accounting firm

    Business consultants

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    4. Company Structure,

    Intellectual Property and

    Ownership:A. Organizational Structure

    Organizational chart

    Description of the organizational structureB. Legal Structure

    Legal form of organization

    Ownership structure of the business

    C. Intellectual Property

    Patents, trademarks and copyrights appliedfor or approved

    5 I d t A l i

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    5. Industry Analysis:

    A. Industry Description

    Industry trends

    Industry size

    Industry attractiveness (growing, mature or decline)

    Profit potential

    B. Target Market

    Description of target market

    C. Competitive Position with Target Market

    Competitor analysis

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    6. Marketing Plan:

    Matrix ( BCG, Product competitive grid )

    PEST, SWOT & TOWS Analysis

    Porters Model

    Competitive Grid

    Product Feasibility and strategy

    Product strategy

    Concept testing

    Usability testing

    Pricing Strategy

    Channels of Distribution

    Promotions and Advertising

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    6. Marketing Plan: cont

    Marketing Material Required:

    Flex (3*5)

    Standee (5*2)

    BrochuresVisiting cards

    Newspaper or magazine ad

    Website

    Any other marketing material

    7 O ti Pl

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    7. Operations Plan:

    A. Method of Production or Service DeliveryB. Availability of Qualified Labor PoolC. Business Partnerships

    Types of business partnerships

    Purposes of business partnerships

    D. Quality ControlE. Customer Support

    Customer support strategies

    Customer support obligations

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    8. Financial Plan:

    Capital Requirement for the Next Threeto Five years

    Sources and uses of funds Overview of Financial Projection

    Explanation of how financial projectionsare prepared (assumption sheet)

    Income Statements Cash Flow Projections

    Balance Sheets Payback and Exit strategy

    9 C iti l Ri k F t

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    9. Critical Risk Factors:

    A. Management Risks

    B. Marketing Risks

    C. Operating Risks

    D. Financial RisksE. Intellectual Property

    Infringement

    F. Other Risks as AppropriateG. Remarks Pages

    10 A di ( t fil )

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    10. Appendix (separate file)

    A. Supporting Documents

    Resume of founder and key

    employees

    Pictures of product prototypes

    Other documents as appropriate

    Legal documentation