Developing Your EnterpriseHow To Create An Effective Business Plan

Explore the eight major components of an effective business plan

AGENDA

• Executive Summary

• Market Analysis

• Company Description

• Organization and Management

• Marketing and Sales

• Funding Request

• Financial Projections

• Recapitulate the major elements of the plan

• 1 or 2 paragraphs • Provides enough insight in order to

generate an overall idea of the business

EXECUTIVE SUMMARY

• Explores the highlights of the business

– The product and or service

– Differentiation

– Target market

– Financial projections

» NPV and Breakeven

• Industry description• Outlook for the industry (5 years)• Define the target market

– Demographic, psychographic, geographic, and behavioral

• Size and characteristics of the target market

• Projected portion of market share• Pricing and projected profit margins• SWOT

MARKET ANALYSIS

• Company’s Value Proposition – What needs / wants your product and or service sates– How those needs / wants are met– Strategic approach

• Low cost, differentiation, niche– Competitive advantage

• Core competencies and distinct capabilities

COMPANY DESCRIPTION

• Organizational Structure– Functional, departmental,

matrix, etc– Tall vs. flat– Explanation of the structure

• Ownership profile– Based on percentages

• Management bios• Qualifications of the board

members

ORGANIZATION AND MANAGEMENT

• Explore the 4 Ps of marketing– Product, place, promotion, and

pricing

• Marketing strategy– Penetration, product

development, market development, diversification

• Description of the Supply Chain

• Integrated Marketing Communication– How are you going to

communicate to your potential customers

MARKETING AND SALES

• Details of the product and or service– Advantages and disadvantages

• Discuss the Product Life Cycle (PLC)– Where the product falls and

how it will be extended• Intellectual property / patents

• R&D activities

• How does the firm innovate

SERVICE AND OR PRODUCT LINE

• Current funding request• Future funding request (1-5 years)• Current capital / equity position• How the funds will be used to enhance and grow the business• How the business plans to repay debt

FUNDING REQUEST

• Historic financials of the firm• Prospective financials

– Short term (0-1) year– Mid term (1-5) years

– Long term (5-10) years• NPV analysis• Breakeven analysis• ROA and ROE projections

FINANCIAL PROJECTIONS

sba.gov/category/navigation-structure/starting-managing-business/starting-business/how-write-business-plan

REFERENCES

QUESTIONS?