BUSINESS PLANNING
rajnikant
s2_writing_a_business_plan.pdf
BUSINESS PLANNING
WRITING A BUSINESS PLAN
Frankie Lim S2_Writing a Business Plan 1
Aims & Objectives
You will be familiar with the overview of the business plan (s)
You will be introduced to the first steps of writing the business plan
So you can make a start!
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Your plan should
Describe the purpose of your business
Explain its goals and objectives
Show that there is a need for your product
‘Perceived Value’
Appealing to investors
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This research should enable you to:
Refine your business idea to make sure that you are offering
the right product to the market,
in the right quantity,
at the right price,
in the right place,
at the right time
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Addressing the needs of your
audience
Investors
Banks/lenders
Future management
Strategic partners
To plan ahead
Develop new ideas
Buying a new business/franchise/taking over a family business
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Writing The Plan
How do investors read a business plan, and what do they look for?
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Executive Summary
Write this at the end! (Or at the beginning!)
As the experience of writing the plan helps formulate ideas
BUT has to be well written to get attention
Clear, concise, not too long
‘Elevator speech’
Enthusiasm
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Elevator pitch
From the 1st-10th floor!
What benefits does it offer the customer?
What is the RoI?
How is the customer to be reached?
Which methods are to be used?
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Business Plans
The business idea
Ownership & company structure
The team; leadership, board of directors, accountants, lawyers
The family-drawing from the succession plan
Franchisor details and management structure
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Business Plans
The Product
The Patent situation
Distribution
Competitors
Customers (The Market)
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Planning Templates
Design your own?
Use a template?
Verify that it is suitable
Write in report format
3rd person
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Cover page of Business Plan
Cover page normally starts with a cover page stamped confidential
This contains name & address of the author
Title page may also include a mission statement
Often a standard disclaimer on the title page
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Naming the Business
Name must describe in some way the market offering
Customer driven companies- i.e. Fat Man Tailors; Weight Watchers’ Delights
Industry driven names-i.e. Kraft foods
Personality or Image Driven companies - Ben & Jerry’s Homemade
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Legal Issues
FedEx
FedExtra?
Trademark check
Obvious names are usually taken
Company name should be registered and trademarked, & internet domain has been secured
Show these are pending in your plan –shows awareness
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Business (Company) Description
Introduction
Company History-about you here!
i.e.Legal Status & Ownership- founder’s/shareholder’s agreement-split of equity
Legal Entity
Mission Statement
Tagline
Products
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Business Description-Background
If suitable/applicable
i.e. was the idea invented somewhere prestigious
Involvement of industry experts
Celebrity endorsement
Won prizes/awards
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Business Description
The business idea
Innovative/creative/invention
What is the idea-define
How will the process operate normally?
How will you take advantages as an entrepreneur?
Are there changes?
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Business Description
What problem does the product solve?
What are the advantages for the customer?
What are the advantages over competing products
Positioning over rivals
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Business Description
Identified Changes
The unexpected in the marketplace
Process need
Industry changes
Changes in market structure
Demographics
New ideas
A niche-no competition
Family succession
Critical incident
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Industry Analysis
A group of firms producing a similar product i.e. electronic games, airplanes.
Industry sectors vary
Size, growth rate, structure, financial characteristics
& overall attractiveness
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Industry Analysis
Only focus on the firm’s industry- not the target market
This is different
Target markets for a particular time
Logically precedes the target market discussions &
Marketing strategy later in the plan
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Industry Analysis
This also helps guide the rest of the plan i.e.
Financial forecasts-justify numbers
Product selection
Target market
Operations plan
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Industry Analysis
Examples
Growth industry
Business attire women- more women entering business workforce
Industry made up of small companies
Capital costs of setting up a store are relatively low
Barriers to entry-level of competition
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Industry Analysis
Market size, industry sector size
Demographic profile of target market/customers
Trends in market, technology, consumer tastes and preferences
Competitor profiling: number, size, strengths and weaknesses
BCG matrix; Shell Directional Policy Matrix
Kodak Competitor Map-Kotler
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Industry Analysis
Profitability in the sector
Pricing policies, promotion and advertising practices
Proposed location: size, facilities, rents and activity patterns
Appropriate channels of distribution
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Industry Analysis
Secondary data
Research of suppliers etc.
Porter’s 5 forces
Web searches
Growth market?
SWOT
Innovations, patents required
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Any Questions ???
Reflections
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