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CREATING A BUSINESS PLAN
BUSINESS PLANS
Used to seek funding for a new e-business
Serves as a design for operating an e-business after it is funded
Forces you to think critically, objectively, and unemotionally about your idea
Helps to find hidden strengths and fix hidden weaknesses
BUSINESS PLAN CONTENTS
A cover sheet and title page A table of contents An executive summary A description of the e-business idea Information on products or services to be
offered Analyses of the overall industry, target
market and competition Identification of critical risks An exit strategy
COVER SHEET
Identify the e-business The title of the document The preparer’s name The plan copy number The word “CONFIDENTIAL”
TITLE PAGE
Repeat the information from the cover sheet Add contact information for the preparer and
any associates May include the name of the person to whom
the copy is assigned
TABLE OF CONTENTS
List all the major sections and subsections of the e-business plan
Be sure it is neat, and avoid missing sections, and incorrect page numbers
EXECUTIVE SUMMARY
A miniature version of the complete e-business plan
Allows readers (investors, bankers, managers) to quickly understand the opportunity and build interest
Should generate excitement and interest Should be limited to 1-3 pages Highlight the reasons why the concept will be
successful Is usually easiest to write after the rest of the
plan
EXECUTIVE SUMMARY
Can include brief information on: The staff and management team A definable market Any competitive advantages Financial projections
BUSINESS DESCRIPTION
An outline of the background and concept Include information about the
legal form of the business, when & where it was formed history current status future goals
PRODUCTS AND SERVICES
Provide a description of the products and/or services offered sales that each product/service group is expected
to generate Provide enough information for a reader to
understand the business Do not provide too much detailed information
as to confuse readers
PRODUCTS
Describe products from customer’s perspective
Describe what the products do Highlight customer benefits Give information about the compete product
line In appendices, add high-quality photos of a
few of the major products In appendices, also add supporting
documents such as patents, trademarks and copyrights
SERVICES
Describe what service(s) you are providing How does the service work What marketplace need does the service
address What is the customer benefit for using the
service What makes it different What materials/equipment are needed to use
the service
INDUSTRY ANALYSIS
Industry: businesses that make/sell similar, complementary, or supplemental products/services
Examples: Travel Industry: airlines, hotels, travel agencies Auto Industry: auto, tire, and auto maintenance Computer Industry: hardware manufacturers,
software developers, chip manufacturers Theme Park Industry: theme park operators, ride
manufacturers, software developers, food vendors
INDUSTRY ANALYSIS
Describes: industry size characteristics trends growth factors distribution systems competitors effects of technology other relevant topics
INDUSTRY ANALYSIS
Based on verifiable data gathered from recognized sources government agencies industry trade associations studies from reliable organizations
Changes in customer preferences, shifts in customer demographics, new technologies
Product pricing trends, pricing advantages/disadvantages of the e-business
Trends you can exploit to attract new customers
INDUSTRY ANALYSIS
Should address supplier issues labor shortages legal, technical, personnel issues affecting the e-
business’s ability to deliver products/services Major competitors should be identified
including their market share (i.e. eBay owns about 80% of market share of online auctions)
Charts and graphs help with understanding and readability – but do not make them too large
MARKETING PLAN
Information about the target market Demographics: age, gender, income level, population
density Geographic: country/region, state city/town, climate,
population Psychographic: beliefs, hopes, fears, prejudices, needs,
desires Customer characteristics
Frequency of use / Method of use Frequency of purchase of products similar to those you
offer Marketing objectives
clearly stated and measurable have a time frame lead to sales
MARKETING PLAN
Marketing strategies Marketing budget Action plan
describe specific promotional tasks when they start / end
OPERATIONS PLAN
Business location Warehouses, branch offices, manufacturing space
Equipment needs Vehicles, computer, office equipment
Manufacturing needs Labor needs Order and Fulfillment Shipping
MANAGEMENT PLAN
Management team 3-5 people involved in day-to-day operations Important to investors! Include description of each team member,
responsibilities, previous experience and success, education
Board of advisors Individuals with industry / business experience If the board is impressive, adds credibility to the
business venture Outsourcing
Attorneys, accountants, insurance agents
RISK ANALYSIS
Identifies threats to the e-business success impending product innovations environmental issues barriers to entry into market government regulations staffing concerns management experience
Include a page with plans to resolve the issues
EXIT STRATEGY
How will an investor get their money back? Tell the investors how they will recover their
money Identify long-term plans for the business and
principals Possible exit strategies:
Payment plan / percentage of profits IPO – initial public offering Selling the company to other individuals or a business Joining with an existing company to form a new
company Stockholder buyout
LEGAL FORMS FOR E-BUSINESS
Model Description
Sole Proprietorship
Started & operated by an individualThe individual is responsible for tax and legal claims
Partnership Two or more ownersRequires a written partnership agreementPartners are responsible for tax and legal claims
Limited Partnership
General partners / limited partnersGeneral: manage / unlimited liabilityLimited: no management / liable for capital + accepted debt
C corporation Separate individual unitTaxed twice: corporate income & shareholder dividendsNo liability past the corporate unit
LLC Limited Liability CompanySimilar to partnership for tax purposesSimilar to a corporation for liability purposes
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