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Preparing Your Preparing Your Business Plan Business Plan

Preparing Your Business Plan The Components of Successful

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Page 1: Preparing Your Business Plan The Components of Successful

Preparing Your Preparing Your Business PlanBusiness Plan

Page 2: Preparing Your Business Plan The Components of Successful
Page 3: Preparing Your Business Plan The Components of Successful

The Components of Successful Entrepreneurial Ventures

Business Plan

The Entrepreneur Opportunity

ResourcesOrganization

Strategy

Page 4: Preparing Your Business Plan The Components of Successful

Business Plan

A “Business Plan” is a “Selling Document” that conveys the excitement and promise of your business to any potential backers and stakeholders .

Page 5: Preparing Your Business Plan The Components of Successful
Page 6: Preparing Your Business Plan The Components of Successful

Reasons for Writing a Business Plan

To sell yourself on the business To obtain bank financing To obtain investment funds To establish strategic alliances To obtain initial contracts To attract key employees To assist in the completion of mergers and

acquisitions To motivate and focus your management team

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Types of Business Plans

1. The Summary Business Plan: 10 pages

Used for:

Bank Loan Application

Lifestyle business

To gauge initial investor interest

Page 8: Preparing Your Business Plan The Components of Successful

Types of Business Plans

2. The Full Business Plan: 25-40 pages

Used for:

Seeking a substantial amount of financing

Looking for a Strategic Partner

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Types of Business Plans

3. The Operational Plan: 40+ pages

Used for:

Complex, rapidly growing companies

Part of an annual planning process

Page 10: Preparing Your Business Plan The Components of Successful

Key Elements of a Business Plan

An economically viable product or service with attractive markets.

An established attack plan that can be replicated.

A seasoned management team that has demonstrated it can carry out the attack plan.

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What Should a Business Plan Contain?

1. Letter of Transmittal2.Title Page3.Table of Contents4.Executive Summary and Fact Sheet5.Body of the Plan

The Company and IndustryThe Product/Service OfferingMarket AnalysisThe Marketing PlanThe Development PlanThe Production/Operations PlanThe Management TeamImplementation Schedule and Risks Associated with the VentureThe Financial Plan

6.Appendices

Page 12: Preparing Your Business Plan The Components of Successful

A Typical Business Plan

1.Letter of Transmittal

2.Title Page

3.Table of Contents

4.Executive Summary

and Fact Sheet

Introduce your business plan to the readerOutline the major features that may be of interest

Provide identifying information about you and your proposed business. Name, address and contact numbers for the business as well as key company contacts

A list of the major headings and sub-headings contained in your plan.

A 1-2 page summary of the most important points in your planMay be the most important part of your business planYour Fact Sheet summarizes the basic information that relates to the venture

Business Plan Contents

Continued

Page 13: Preparing Your Business Plan The Components of Successful

A Typical Business Plan (Continued)

5.Body of the Plan

History and current situation of your companyGoals and objectives for the businessPrincipal characteristics and trends in the industry

Detailed description of your product or serviceOutline stage of development and proprietary position

Describe the profile of your principal target customersIndicate current market size, trends, and seasonal patternsAssess the nature of your competitionEstimate your expected sales and market share

Company and the Industry

Product-Service Offering

Market Analysis

Continued

Page 14: Preparing Your Business Plan The Components of Successful

A Typical Business Plan (Continued)

Detail the marketing strategy you plan to useDescribe your marketing plan insofar as your sales strategy, advertising and promotion plans, pricing policy, and channels of distribution

Your Marketing Plan

Outline of the development status of your product and what is still required to get it to a market-ready stateAre there regulatory, testing or other requirements that still have to be met?

Your Development Plan

Outline the operating side of your businessDescribe your location, kind of facilities, space requirements, capital equipment needs, and labour requirements

Your Production/Operations

Plan

Continued

5.Body of the Plan(Continued)

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A Typical Business Plan (Continued)

Continued

Present an overall schedule indicating what needs to be done to launch your business and the timing required to bring it aboutDiscuss the major problems and risks that you will have to deal with as well

Your Implementation Schedule

Identify your key management people, their responsibilities and their qualificationsIndicate the principal shareholders of the business, your principal advisors and the members of your Board of Directors

Your ManagementTeam

5.Body of the Plan(Continued)

Page 16: Preparing Your Business Plan The Components of Successful

A Typical Business Plan (Continued)

Indicate the type and amount of financing you are looking for and how the funds will be usedOutline your proposed terms of investment, the potential return to the investor, and what benefit is being providedProvide an overview of the current financial structure of your businessPrepare realistic financial projections that reflect the effect of financing. Include:Cash flow forecastsPro forma profit and loss statementsPro forma balance sheetBreakeven analysis

Your Financial Plan

Continued

5.Body of the Plan(Continued)

Page 17: Preparing Your Business Plan The Components of Successful

6.Appendices

Supporting material for your plan including:Detailed resumes of the management teamProduct literature and photographsNames of possible customers and suppliersConsulting reports and market surveysCopies of legal documentsPublicity materialLetters of reference

A Typical Business Plan (Continued)