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7/31/2019 Elements Bplan
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Elements of a Business Plan
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Business Planning"In preparing for battle I have always found that plans are
useless, but planning is indispensable."
-Dwight Eisenhower
Those who fail to plan, plan to fail.
-George Hewell
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Understanding business plans is not only important forthose who are starting businesses.
More and more banks are requiring business plans forloans, for new projects and on-going operations.
Business plans are used in large companies to justifyprojects.
No matter where you work, it is increasingly likely thatyou will need to evaluate somebody elses business plan.
The Business Plan
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Executive Summary
Company Overview
Market Environment
Marketing and Sales Strategy
Team Composition
Operations
Financial Plan Risk Analysis and Mitigation
The (very) Basics of a Business Plan
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Your Business Plan Will... Discuss a particular market opportunity
Examine the markets that you will compete in, and
explain who your customers will be
Describe the products or services that your company willprovide
Your competition, and how you will defend against it
The operation that you will put in place in your company
The management team that will implement the plan
The size and profitability of your company
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Executive Summary The written version of the One minute pitch
Many people who read your plan, will only read your
Executive Summary...
...and then they mayread your financials. NOT an introduction, but a short version of the whole
plan
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Company Overview Explanation of history, structure, and organization of
your company
Strategic direction
Mission statement
Goals and objectives
Values and vision
People
Relevant skills and expertise of management team
Directors
Relationships with experts in the field
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Market Environment All factors of the market that are outside your direct
control:
Market structure
Market trends Competition
Opportunities/Threats
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Marketing and Sales Strategy Products or services offered
Follow-on products
Intellectual property or other defendable positions
Market research Marketing plan
Brand strategy
Distribution strategy
Product strategy Pricing strategy
Promotion
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Team Composition
Capability of the management team to run a promisingbusiness
The management team
Professional experience and past successes
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Operations Practical details required to meet the plan
Facilities
Manufacturing or out-sourcing
Personnel Varies widely depending on type of business
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Financial Plan Three key reports, in a five-year plan:
Income statement
Balance sheet
Statement of cash flows
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Risk Analysis & Mitigation
Risk scenario
Market risk
Competition risk
Technology risk
Regulatory risk
Financial risk
Management risk
What measures are proposed to counter these risks?
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Writing a great business plan
A great business plan is one that focuses on a series of questions
relating to the four factors critical to the success of every new
venture: the people, the opportunity, the context, and the
possibilities for both risk and reward. William Sahlman
1. The questions about people revolve around three issues:
What do they know? Whom do they know? How well are they
known?
2. As for opportunity, the plan should focus on two questions: Is themarket for the venture's product or service large or rapidly
growing (or preferably both)?
3. Is the industry structurally attractive?
Source: How to write a Great Business Plan, William Sahlman, Harvard Business Review
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Outline of Business Plan
SectionSuggested#
of pages
Executive summary 2-3
Market opportunity and Market Size 2-4
Your offering/product/service/IP 2-5Competitive landscape -analysis with data 1-2
Marketing Strategy- Positioning, Differentiation,
Pricing, Distribution
1-2
Financial Plan Projections, Use of Funds 5-6
Risk scenario & mitigation 1-2
Your team 2-4
Supporting data, research, resume 5-10
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Evaluating Business Plans what does one
look for?
1. The questions about people revolve around three
issues:
What do they know? Whom do they know? How
well are they known?2. As for opportunity, the plan should focus on two
questions: Is the market for the venture's product or
service large or rapidly growing (or preferably both)?
3. Is the industry structurally attractive?
Source: How to write a Great Business Plan, William Sahlman, Harvard Business Review
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Evaluating a Business Plan: Tips
Objectivity is ensured when the criteria for evaluation areclearly laid out
Eliminate possible bias e.g, you like the idea, you like/are
familiar with the industry, you like the student Prioritize content over format and presentation
Relevant Content (market opportunity, attractive industry,investment potential, business model and distinctive
competence) earns more weightage than a well laid outincomplete plan
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Opportunity to Business Model to B Plan
Evaluation What is common?
All three Focus on
Market/Customers
Industry/Competition
Team/People
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Is there any standard format of a B-Plan?
Many formats exist
Each business plan has to be unique general
templates/software may not be effective to
communicate your idea We provide you with a Detailed Guide for writing a B plan
Available on the NEN CD:
Kick-Starting the Entrepreneurial Campus
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Videos and Links
EY Business Plan Guide
How to write a great Business Plan
NEN Videos on B plan
http://hbswk.hbs.edu/archive/565.htmlhttp://www.nenonline.org/getAllVideoList.do?method=fetch&businessFn=getAllVideoList&searchStatus=1http://www.nenonline.org/getAllVideoList.do?method=fetch&businessFn=getAllVideoList&searchStatus=1http://hbswk.hbs.edu/archive/565.html7/31/2019 Elements Bplan
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Credits
Ed Rubesch,
Thammasat Business School, Thailand
Indus Khaitan, Venture Partner,Morpheus Ventures, Bangalore, India