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Business Proposals and Business Plans

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Presentation on theme: "Business Proposals and Business Plans"— Presentation transcript:

1 Business Proposals and Business Plans

2 What is a Business Proposal
Persuasive written report offering To provide a service To sell a product To find a solution to a problem or need Two types: Solicited formal proposal Unsolicited formal proposal

3 Business Proposal They range from casual, one-page memos to multiple-volume, lengthy reports that are hundreds of pages long.  

4 Proposals Solicited - Sent to funder in response to request
Funder – agency, business, foundation that finances projects RFP – request for proposal RFI – request for information CFP – commercial request for proposal Unsolicited - Sent without request or invitation

5 Proposal Checklist What do I propose to do? Can I do it?
How do I propose to do it? Is this possible or feasible? What evidence can I introduce to demonstrate that what I propose to do will actually get the desired results?

6 Proposal Checklist How much will it cost me to do the task?
How much shall I charge to perform the task? What evidence must I show to convince the reader that this cost is acceptable? Is my time schedule appropriate?

7 Proposal Checklist What evidence can I use to convince my reader that my way is the best way to obtain the desired results? How can I show my ability to do what I propose to do?

8 Characteristics of a Proposal
Proposals deal with the future Proposals must convince the reader that there is a problem Proposals must convince the reader that the writer is the best person to fix the problem Proposals are often legally binding offers

9 To Convince the Reader Proposals must be persuasive.
Proposals must convince your reader that they will get benefits from your proposal. Proposals must show that you are capable of fulfilling your promise

10 Internal Business Proposals

11 The Opening Paragraph Convince the reader that there is a problem at the beginning of the proposal Convince the reader that the solutions you are proposing is urgently needed

12 The Body Paragraphs Should suggest a practical solution to the problem
Describe the solution in detail Explain the approach you will adopt Tell about the expertise, qualifications and the personal you will use. Describe the equipment you will use Give the cost breakdown

13 The Closing Paragraph Reconfirm that the proposal will solve the problem Repeat that you have confidence that you can carry out the plan Discussion of the plan could be face to face with the reader Additional information could be given

14 Introduction of the Capital Appropriations Proposal
A proposal committing a large sum of money Introduction should provide all the background information needed to make a decision Introduction should briefly describe feasibility study that has been conducted.

15 Body of the Capital Appropriations Proposal
Briefly describe the item to be purchased Alternative choices you have considered Life expectancy of the item The specific products, services or projects to be supported by the item Expected return on investment Latest feasible date of acquisition


17 External Proposals Vary in length and format More formal manuscript
Same components as a formal report Very persuasive document Provide details of your credentials Usually has supplementary parts Occasionally contain an appendix

18 Copy of the RFP and Letter of Transmittal
Request for proposal Letter or memo issued by a company or government agency that invites competing companies to bid for a job Large companies and government agencies may have more than one circulating Letter of transmittal – sometimes called the cover letter.

19 The Opening Paragraph Refer to the RFP
Tell why you are submitting the proposal Proposals must convince the reader that there is a problem Proposals must convince the reader that the writer is the best person to fix the problem

20 The Body Paragraphs Describe what you are offering
Focus on the strengths of products or service Disclose enough information to convince the client Describe how you will carry out the work Give dates when portions will be finished Methods and resources you will use

21 Body Provide information about the people in charge of implementing the work plan Supporting staff Credentials, expertise, and qualifications Budget Most important Uses more numbers than words Can get the proposal accepted or rejected Budget carefully provide the information as accurately as possible. Breakdown the costs in detail

22 The Closing Paragraph Last chance to persuade
Review what you have said Restate the merits of the proposal briefly Stress your company’s strong points Emphasize the benefits Sound assertive, assuring and confident

23 Poor Business Proposals
Too little information - Submitting just a company brochure with a price quote. * Poor writing - Pleasing to look at, but, after the first read-through, boring to read. * Lack of marketing focus - Trying to be everything to everyone, but being nothing to no one. * Too general and self-centered - Focusing on the company instead of addressing the prospect's needs and desires. * Done too quickly - Offering trivial solutions and canned material instead of ideas that get results. * No "sell" - Presenting just information rather than a persuasive argument for the company.

24 Business PLANS

25 Definition Document that can convince the reader that the business can produce enough revenue to make a satisfactory profit and therefore attractive as an investment opportunity

26 What is a Business Plan? Define goals
Determine objectives to reach goals Assess resources and make decisions Create contingency plans for managing changes Rationally assess operational feasibility and financial viability Why should you take the time and go through all the trouble of writing a business plan? It forces you to look at the business in a critical manner. A strong reality check!!!! helps you to focus and serves as a feasibility study it can serve as an operational report and define current conditions and future possibilities It can be a good communicational tool that shows your management team, competition and business purpose. Justifies financial projections It is for all of these reasons that the owner of the business should write the plan. Get help from a consultant but you need to do the work.

27 Reasons for Writing a Plan
To serve as the guide you will follow throughout the life of your business All lenders and investors require a business plan A business plan is the key to conducting business in the international marketplace

28 Business Plan Characteristics
Persuade potential investors to invest Allows readers to assess the profitability and goals of the new venture Provide employees with guidance and direction Convince suppliers and customers that the new venture is promising Clarify the objectives of the new venture Create strategic alliances with other business partners

29 The Planning Process What are the parts of a Business Plan?
Cover Sheet Table of Contents Executive Summary Part 1: Organizational Plan Part 2: Marketing Plan Part 3: Financial Documents Part 4: Supporting Documents

30 Title Page (cover page)
Business name, address, and phone number Date the plan was prepared Confidentiality statement Owner's name, address, phone number, web address,

31 Table of Contents List major sections of the plan and the page number where each section can be found. This page cannot be prepared until the plan is finished.

32 Executive Summary (prepared last)
Describe the business structure, purpose, and goals Describe your products / services and production process? What is your overall marketing strategy, and who will be/are your customers? Who will be/is in the business, and how is it managed? What are the skills of each member of the management team? What is the amount and terms of needed financing and what will it be used for? How will loans be repaid?

33 The Company Profile The two major topics of the company section:
Organization and Management Products or services

34 (The Company) Organization and Management
Briefly mention what the business purpose is and what you provide to the customer Identify the legal structure of your business Sole proprietorship Partnership Corporation LLC

35 Organization and Management
Describe your own experiences, skills, qualifications and education that will ensure the success of the business. Personnel Management Bookkeeping Inventory control Customer service Advertising Work history Professional membership

36 (The Company) Organization and Management
Identify your team How many employees are needed? Organizational chart Methods of compensation Hours to be worked Required skills Job descriptions Specialists Advisors

37 The Market The two major items for this section of the business plan are: Industry Marketing Plan

38 Part II: Marketing Plan
Overview & Goals of Your Marketing Strategy Market Analysis: Target Market, Competition, Industry Trends Marketing Strategy: Product Distribution, Packaging, Pricing, Branding, Database Marketing, Sales Strategies, Promotions, Advertising Strategies, Public Relations, Networking Customer Service Implementation of Strategy Assessment of Marketing Effectiveness

39 (The Market) Marketing plan sections
Competition Customers Strategies to meet sales goals Market research

40 (The Market) Marketing plan-customers
Who? What? When? Where? Why? How?

41 (The Market) Marketing plan- sales strategies
What is the selling price of the product or service? How was this determined? Quality Competition * Service provided Location Your business costs * Perceived value to customer What the market will allow * Profit

42 (The Market) Marketing plan- sales strategies
Promotional activities are determined by your target customers Advertising – newspaper, radio, TV, yellow pages, billboards, direct mail, flyers, posters, business cards, website, etc.. Sales promotions –samples, reduced prices, coupons and contests. Publicity –feature stories, public relations, trade shows, networking, organizations How will you let your potential customers know you are in business.

43 The Financial Plan Major sections include: Financial Projections
Income statements Balance sheet Cash flow Assumptions Sources and uses Break even analysis Contingent liabilities

44 Assumptions Spell out conditions assumed when compiling financial statements Sales volume Pricing structure Average sales amount Number of customers Seasonal trends Specific expenses Owner’s draw/salary Growth rate

45 Sample Sources and Uses Statement


47 Supporting Documents Personal resumes Personal financial statement
Supporting documentation Market research Business documents Promotional materials Letters of support Proprietary protection Previous income tax returns

48 The End

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