Business Plan Preparation Business Plan Preparation

A road map for success of

Entrepreneurship
% BUSINSS PLAN INCLUDS % BUSINSS PLAN INCLUDS
Executive Summary
2 %he description of the business
3 %he marketing plan
4 %he management plan
5 %he financial management plan
n Addition to it, business plan should include
the supporting documents and financiaI
projections
Coer Sheet Coer Sheet
!rior to your Business Description,
attach a cover sheet
t includes the name, address and
telephone number of the business and
the names of all principals
ecutive Summary ecutive Summary
Business idea?
Criteria of uniqueness?
%arget customers?
Market volume and growth rates do you forecast?
Competition ?
Additional stages of development needed?
nvestment ? (Realistic estimation)?
Opportunity and risks?
Long term goals?
Business Description Business Description
Section-
What is the Business dea
Section-2
!roduct/ Services you are offering
Section-3
Location of your business (Why)
Section1: Business Idea Structure Section1: Business Idea Structure
Legalities- business form !roprietorship,
partnership, corporation What licenses or
permits you will need
2 Business type Merchandizing, manufacturing
or service
3 What your product or service is
4 s it a new independent business, a takeover,
an expansion, a franchise?
Contd.. Contd..
5 Why your business will be profitable What are the
growth opportunities?
6 When your business will be open (days, hours)?
7 What you have learned about your kind of business
from outside sources (trade suppliers, bankers, other
franchise owners, franchisor, publications)
Special leature and clear Goals Special leature and clear Goals
Emphasize any special features that you feel
will appeal to customers
Should clearly identify goals and objectives
and it should clarify why you are, or why you
want to be, in business
Section 2: Product , Serices Section 2: Product , Serices
What you are selling
2 ow your product or service will benefit the
customer
3 Will there be steady demand and cash flows?
4 &niqueness in the product/service
Section 3: Location Section 3: Location
Location Requirements ?
2 ow much and what kind of space is needed?
3 Why is the area desirable? the building
desirable?
4 s it easily accessible? s public transportation
available? s street lighting adequate?
%e Marketing Plan %e Marketing Plan
'ital nstrument for successful business ventures
ow well you market your business, along with a few
other considerations, wiII uItimateIy determine your
degree of success or faiIure
ey element of a marketing plan customers -- their
likes, dislikes, expectations
By analyzing various factor, develop a marketing
strategy for growth
%arget customers/ market
2 Markets %rend Growing? steady? Declining?
3 Markets size !ossible expansion in Business
4 !ricing strategy to crack the market
5 ow will you access, attract, hold and grow your
customer?
6 f a franchise, how is your market segmented?
7 f a franchise, will the franchisor provide assistance
in this area?
8 Based on the franchisor's strategy, how will you
promote your sales?
%e Marketing Plan %e Marketing Plan
Competition Competition
ive nearest/direct competitors?
2 ndirect competitors?
3 %heir businesses Steady/ growing/ Declining
4 %heir operational and advertising strategy
5 Strengths and weaknesses of competitor
6 ow does their product or service differ from yours?
Pricing and Sales Pricing and Sales
Competitive position
!ricing below competition
!ricing above competition
Multiple pricing
Service costs and pricing (for service businesses only)
Service components
Material costs
Labor costs
Overhead costs
Advertising and Public Relations Advertising and Public Relations
ow you advertise and promote your goods and
services may make or break your business aving a
good product or service and not advertising and
promoting it is like not having a business at all
Remember the more care and attention you
devote to your marketing program, the more
successful your business will be
%e Management Plan %e Management Plan
Who will be on the management team?
%heir strengths/weaknesses
What are their duties/ Job Role and !OD?
Are these duties clearly defined?
ow does your background/business experience help
you in this business?
What are your weaknesses and how can you
compensate for them?
Current personnel needs?
iring and training plan for personnel?
Salaries, benefits, vacations, holidays? And incase of
franchisor?
What benefits, if any, can you afford at this point
f a franchise, what type of assistance can you expect
from the franchisor? Will this assistance be ongoing?
%e Management Plan %e Management Plan
%e Iinancial Management Plan %e Iinancial Management Plan
Cornerstone of every successful business venture
Each year thousands of potentially successful
businesses faiI because of poor financiaI
management.
!lan a sound, realistic budget to open your business
(start-up costs) and the amount needed to keep it
running (operating costs)
linancial Plan: lirst Step linancial Plan: lirst Step
Start-up Budget
Supplies
Advertising
!romotions
Accounting
ncome
&tilities
!ayroll expenses
!ersonnel (costs prior to
opening)
Legal/professional fees
Occupancy
Licenses/permits
Equipment
nsurance
linancial Plan: Second Step linancial Plan: Second Step
Operating Budget
Rent
Loan payments
Advertising/promotions
Legal/accounting
nsurance
Miscellaneous expenses
Supplies
Salaries/wages
&tilities
Dues/subscriptions/fees
%axes
Repairs/maintenance
linancial Planning linancial Planning
A Loan applications
B Capital equipment and supply list
C Balance sheet
D Breakeven analysis
E !ro-orma income projections (profit & loss
statements)
!ro-forma cash flow
ddress these spects ddress these spects
ow much money do you have? Your bank baIance
ow much money will you need for start-up?
ow much money will you need to stay in business?
ow much money will you need to purchase the
franchise?
A financial wizard not required, but certain level of
understanding for financial tools is well enough to gain
their benefits Your accountant or financial advisor can
help you accomplish this goal
Supportive Document Supportive Document
%ax returns of principals for last three years
!ersonal financial statement (all banks have these
forms)
n the case of a franchised business, a copy of
franchise contract and all
Supporting documents provided by the franchisor
Copy of proposed lease of purchase agreement for
building space
Copy of licenses and other legal documents
THANK YOU