1. PLANNING FOR BUSINESS SUCCESS
Temple University
Innovation & Entrepreneurship Institute
Presented by Amy Michelle Yom, Associate Director of IEI

2. THE BUSINESS PLAN & FREQUENTLY ASKED QUESTIONS
What is a Business Plan?
What is the purpose of a business plan?
Who needs a business plan?
Are there disadvantages to a business plan?
How does one create a successful business plan?

3. WHAT IS A BUSINESS PLAN? A roadmap for success
Future oriented: What you WILL do, how you WILL do it
All business plans should address
Business concept (product service description, business structure, how you will take the concept to market, industry trends, etc.)
Marketplace (competition, customers, purchasing behaviors, sales cycles, value prop, positioning, etc.)
Financial (income and cash flow statements, break even analysis, balance sheet, financial ratios, funding needs, etc.)

4. WHY DEVELOP A BUSINESS PLAN?
A well developed plan provides:
Focus to the entrepreneur
Vision to management team, potential funders, suppliers and other stakeholders
Organizes ideas and examines feasibility
Increases the chances of success
Helps attract key employees
Maximizes chance of success
Helps avoid and eliminate waste
The business needs funding!
Entrepreneur without business plan

5. A GOOD BUSINESS PLAN… Formalizes goals and intentions
Communicates value to stakeholders
Plans for financial support and stability
Identifies target markets
Effectively allocates resources and time
Creates a timeline to achieve the company’s main goals

6. Plan Your Work… Then Work Your Plan
ALWAYS REMEMBER TO…
Plan Your Work… Then Work Your Plan

7. WHO NEEDS A BUSINESS PLAN?
Anyone running or thinking about running a business
Entrepreneurs with solid business ideas
Any current successful business
Start-up companies
Companies seeking financial backing
Businesses in both pre-launch and post-launch stages
Businesses going through periods of intense change and/or stress

8. ARE THERE DISADVANTAGES TO A BUSINESS PLAN?
Inflexibility – Sticking to the plan no matter what, even when it’s failing or market or industry conditions change
Discouragement – There are so many unknown aspects of a business, some find it difficult to write a solid plan or “guesstimate”
Tunnel Vision – A narrow plan may result in overlooking beneficial opportunities
Time Consuming – Takes time away from business operations, customer meetings, etc.

9. DO IT RIGHT…
According to a Belmont University survey, “many plans fail because those involved do not spend the time or energy, or have the expertise, necessary to make the plan comprehensive enough to have true value.”

10. CREATING A SUCCESSFUL BUSINESS PLAN
Successful business plans include:
Executive Summary
Company Mission/Objectives
Company Overview
Product/Service Description
Management Team
The Marketplace

11. CREATING A SUCCESSFUL BUSINESS PLAN (cont.)
Sales and Marketing Strategy
Competition
Business Risks
Implementation Plan
Capital Requirements/Use of Funding
Financial Projections and Plan
Supporting Exhibits

12. MISSION STATEMENT Consists of three parts:
Business operations
Customers and target markets
Value proposition
States the purpose for existence
Addresses goals and priorities of the firm

13. MISSION STATEMENTS
All successful businesses, for profit, not for profit and social innovation ventures, must have a solid mission statement
The mission statement should convey the company’s purpose clearly to customers
Create a tone and “voice” that is consistent with the company’s culture (Exxon vs. Nike)

14. MISSION STATEMENTS Some examples:
Google: to organize the world’s information and make it universally accessible
eBay: to provide a global trading platform where practically anyone can trade practically anything
Dell: to be the most successful computer company in the world at delivering the best customer experience in markets we serve

15. MCDONALD’S MISSION STATEMENT
"McDonald's vision is to be the world's best quick service restaurant experience. Being the best means providing outstanding quality, service, cleanliness, and value, so that we make every customer in every restaurant smile."

16. TEMPLE UNIVERSITY’S MISSION STATEMENT
“Temple University is a national center of excellence in teaching
and research with an international presence.” (

17. $ AND THE BUSINESS PLAN Angels and venture capitalists demand it
No bank will loan you money without one
Prerequisite to apply for government grants

18. MONEY AND THE BUSINESS PLAN
Don’t borrow family money and don’t ask for their advice – if at all possible
Network with other business owners in similar industries – where did their funding come from?
Become highly informed of traditional and nontraditional funding sources

19. THINKING AHEAD… FROM IDEA TO PLAN
Thinking ahead includes identifying the end goal of the company
Will the business:
Develop technology, then sell or license it?
Grow business, then sell or merge?
Grow business into mega corporation, go public?
Grow business, and continue to operate it?

20. Strength Weakness Opportunity Threat
THE SWOT ANALYSIS
Strength Weakness Opportunity Threat

21. THE SWOT ANALYSIS The SWOT Analysis Should…
Examine your business and its performance relative to competitors and prospects
Be undertaken at the start of any business or marketing planning process
Look at internal strengths and weaknesses and external threats and opportunities

22. SWOT – INTERNAL CONSIDERATIONS
The internal review should outline your business position relative to your industry
Critical factors:
Management team/Human resources
Business structure
Financial position
Products/Innovation/R&D
Sales and marketing
Productivity

23. SWOT – EXTERNAL CONSIDERATIONS
The external review should address the “Big Picture Level” and “The Industry Level.”
Big Picture Level
Economic trends
Political
Society/environmental/ consumer
International
Industry Level
Competition
Technology
Demand patterns
Supply and suppliers
Industrial relations
Skills

24. “People don’t plan to fail.
BUSINESS FAILURE
“People don’t plan to fail.
They fail to plan.”

25. FAILURE STATISTICS
99.9% of all US businesses are “small businesses” (< 500 employees, < $500K sales)
0.1% or 17,000 businesses are “large businesses”
Small business failures have increased every year since As noted by Small biz loan, failure rates grew from 2.4 percent in 2004 to 11.9 percent in (Almost 12%) (

26. THE TOP TEN REASONS FOR BUSINESS FAILURE
#10 – Over expansion # 9 – Poor capital structure # 8 – Failure to control the controllable costs # 7 – Failure to prepare for volatility of uncontrollable costs # 6 – Add new products or divisions that reduce the profitable ones
* Waller/Lansden, Nashville, TN

27. THE TOP TEN REASONS FOR BUSINESS FAILURE
# 5 – Poor internal controls and execution
# 4 – Poorly designed business model
# 3 – Reliance on critical financing that dries up
#2 – Failure to adapt to a changing market, and . . .
* Waller/Lansden, Nashville, TN

28. THE #1 REASON FOR BUSINESS FAILURE IS…
Management in complete denial!
According to Dun & Bradstreet, 88.7% of business failures are due to management mistakes.

29. MORE REASONS FOR FAILURE
Dun & Bradstreet also claim that business failure results from
Lack of market awareness
Entrepreneur falls in love with product
Lack of financial responsibility and awareness
Lack of clear focus
Insufficient capital
Optimistic/realistic/pessimistic

30. IMPROVING CHANCES OF SUCCESS
Development of a business plan
Current and accurate profile of the competition
Current and accurate profile of the target customer
Go into business for the right reasons
Hire the right people
Obtaining accurate financial information in a timely manner

31. Additional Resources (Available in A 503g, IEI Resource Center)
Write a Business Plan… In no Time Frank F. Fiore
Business Plan in a Day Rhonda Abrams
Preparing Effective Business Plans Bruce R. Barringer
The Ernst & Young Business Plan Guide
Brian R. Ford, Jay M. Bornstein, Patrick T. Pruitt

32. ONLINE RESOURCES Entrepreneur.com – gr8 tutorials
Small Business Administration: sba.gov/smallbusinessplanner
Bplans.com – all kinds of goodies
businessplans.org – MOOT Corp b-plan competition & b-plan samples
myownbusiness.org

33. IEI BUSINESS PLAN RESOURCES
Ten workshops per semester
Resource Center
Coaching and counseling on all aspects of new venture creation
Executives and Entrepreneur in residence
IEI staff
Mentors: industry, subject matter and discipline experts

34. BE YOUR OWN BOSS BOWL
Info sessions in November and January, plans due in March
Free book, Write a Business Plan in No Time by Frank Fiore
BYOBB template keyed to book
Formal one-on-one mentoring program with GPSEG
Scoring sheet showing emphasis on various aspects of the plan

35. QUESTIONS AND DISCUSSION