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Business PlansBusiness PlansIntroduction
Why a Business Plan?Why a Business Plan?
Strategic Guide
Lenders
Investors
Strategic GuideStrategic Guide
Where Do You Want To Go? How Are You Going to Get There? What Market Niches? How Much is it Going to Cost? Greatest Profit Opportunity?
Lender ExpectationsLender Expectations
Good Business Track Record Ability to Repay Staying Power Collateral
Investor ExpectationsInvestor Expectations
Competitive Advantage Huge Market Strong Management Team Strong Marketing and Sales Plan Exit Strategy
Entrepreneurs Start Businesses:Entrepreneurs Start Businesses:
To Capitalize on an Invention To Be Their Own Boss To Get Rich
---All Need an Exit Strategy
Funding Sources:Funding Sources:
Savings Friends and Family Financial Institutions / Banks Angel Investors Venture Capital
Business PlanningBusiness Planning
A business plan is a formal statement of a set of business goals, the reasons they are believed attainable, and the plan for reaching those goals. It may also contain background information about the organization or team attempting to reach those goals.
STRATEGIC PLANNNINGSTRATEGIC PLANNNING
Strategic planning is an organization's process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy. In order to determine the direction of the organization, it is necessary to understand its current position and the possible avenues through which it can pursue a particular course of action. Generally, strategic planning deals with at least one of three key questions:
"What do we do?" "For whom do we do it?" "How do we excel?"
Strategic PlanningStrategic Planning
Business planning VS Strategic Business planning VS Strategic PlanningPlanning
A strategic plan is primarily used for implementing and managing the strategic direction of an existing organization. A business plan is used to initially start a business, obtain funding, or direct operations.
A strategic plan is for established businesses, organizations and business owners that are serious about growing their organization. Whereas a business plan could be for new businesses and entrepreneurs who are startups.
A strategic plan is used to provide focus, direction and action in order to move the organization from where they are now to where they want to go. Whereas a business plan is used to provide a structure for ideas in order to initially define the business.
Cont….Cont….A strategic plan is used to communicate the
direction of the organization to the staff and stakeholders. However, a business plan is used to present the entrepreneur’s ideas to a bank.
A strategic plan is critical to prioritizing resources (time, money and people) to grow the revenue and increase the return on investment. Whereas a business plan is critical if the business is seeking funding. s
Business planning VS Strategic Business planning VS Strategic PlanningPlanning
Business Plan ContentBusiness Plan Content
Executive Summary Company Description Product/Services Description Industry Overview Market Analysis Competitors
Business Plan ContentBusiness Plan Content
Customers Marketing and Sales Plans Development Operations Management
Business Plan ContentBusiness Plan Content
Personnel Financial Summary Financials Offering Appendices
Executive SummaryExecutive Summary
A mini-business plan in one or two pages Highlights the most important points of your
business plan It is NOT an introduction to the plan
Executive SummaryExecutive Summary
Identify the company, its background, structure and location
Describe what the company does, and the market it serves
Describe the market potential for the company’s products and services, market trends, etc.
Executive SummaryExecutive Summary
Outline the backgrounds and experience of the top management team
Describe the funding required, the purposes for which it will be used, the collateral available (if for a lender), and the expected outcomes
Company OverviewCompany Overview
Brief Company Introduction– Mission statement– Location, size, history– Market and products– Overview of company capabilities– Objectives
Products/ServicesProducts/Services
Products / Services– What does it do?– Uniqueness– Competitive Advantage
Technology– Brief description– Applications
Commercialization Status– Brief overview
Industry OverviewIndustry Overview
Set The Stage Industry Definition and Description
– Major players within the industry– Factors driving dynamics– New products and developments
Legislation and Policies Driving the Industry Historical and Future Trends
Market AnalysisMarket Analysis
Market Definition– Primary Market– Secondary Markets
Market Size and Trends– Current total revenues– Predicted annual growth rate
CompetitorsCompetitors Direct Competitors
– Who are they?– Size and product breadth– Revenues and profitability– Strengths and weaknesses– Market shares
Indirect Competitors
Indirect competitors in the business world are those businesses that don't necessarily sell the same products but offer different alternatives to satisfying the same customer need.
CustomersCustomers
Customer Characteristics– Who are they?– Why do they buy?– Need satisfied by the product/service– How is the need currently filled?– What are the alternatives?– Who makes the decision to buy?– How frequently do they purchase?
Marketing and Sales PlansMarketing and Sales Plans
Statement of Opportunity Marketing and Sales Objectives Existing Customers Potential Customers
– Prospects targeted– How prospects will be targeted and qualified
Marketing StrategiesMarketing Strategies
Product/Service Strategy Pricing Strategy Distribution Strategy Advertising and Promotion Strategy Sales Strategy Marketing and Sales Forecasts
Marketing and Sales PlansMarketing and Sales Plans
Marketing Programs– Direct Mail– Trade Shows– Advertising– Internet– Publicity/Public Relations– Marketing Budget
Pricing– Basis for targeted price point– Margins and profitability by volume levels
Marketing and Sales PlansMarketing and Sales Plans
Sales Plan– Sales force structure – (direct or reps)– Sales expectations/quotas– Margins given to intermediaries– Service and warranties– Sales Budget– Organizational chart indicating planned growth
DevelopmentDevelopment
R & D Plan– Objectives– Milestones and current status– Difficulties and risks– Staffing– R & D Budget and assumptions
OperationsOperations
Manufacturing/Production Plan– Objectives– Facilities– Staffing– Subcontractors– Quality Control– Budget / Operating Expenses
ManagementManagement
Company Organization Management Team Administrative Expenses
Management TeamManagement Team
President VP Finance VP Sales VP Marketing VP Manufacturing Board of Advisors
PersonnelPersonnel
Human Resource Plan– Staffing Objectives– Organizational Structure– 3-5 year growth plan– Budget
Summary of FinancialsSummary of Financials
Financial Objectives– Time to Cash Flow Positive– Time to profitability
Financial Assumptions Capital Requirements Exit Scenario
FinancialsFinancials
Pro-forma Cash Flow Projections Pro-forma Profit & Loss Statements Pro-forma Balance Sheet
OfferingOffering
Investment Requirements Pro-forma Valuation of Business Offer
AppendicesAppendices
Resumes of Key Management Patent Information Customer List Testimonials Supplemental Financial Spreadsheets References
Questions?Questions?