Strategic Business Planning for Commercial Producers What Is A Business Plan?

Strategic Business Planning for Commercial Producers Objectives To develop a document that presents a picture of the business, where the business is going, and how it will get there To understand the organization of a business plan

Strategic Business Planning for Commercial Producers “If you don’t know where you’re going, you may end up somewhere else.” -Casey Stengel

Strategic Business Planning for Commercial Producers What Is A Business Plan? A document that conveys your organization’s prospects and growth potential. It describes: – You and your products and services – The market and your role in it Shows you are committed to achieving a vision Good follow-up to developing a strategic plan Keeps focus on end product

Strategic Business Planning for Commercial Producers Format of the Business Plan 1.Title Page 2.Executive Summary 3.Vision/Mission and Goals 4.Current Position 5.Strategic Analysis 6.Implementation 7.Projections

Strategic Business Planning for Commercial Producers Executive summary Written last Maximum of two pages Major points of each section

Strategic Business Planning for Commercial Producers Vision/Mission & Goals Where is the business headed? What do you want the business to achieve? What time frame?

Strategic Business Planning for Commercial Producers Current Position How do you describe the farm? –History: important milestones –Products/services: What? How much? –Resources: Who owns what? What is their reward? –Management: Who? What do they do? –Organizational Structure: Who’s the boss? –Marketing: What tools? What customers? –Ownership Structure: Legal form?

Strategic Business Planning for Commercial Producers Farm Business Production Resources Land (shares) Land (cash rent) Machinery Paid Labor Unpaid Labor Contribution Compensation Management Resources Management Responsibility and Authority Organizational chart Products/Services Pie Chart Of Gross Sales by Enterprise Current Position

Strategic Business Planning for Commercial Producers Strategic Analysis What opportunities and threats does the business face? What are our strengths and weakness? What do we do better than others? What strategy will we use?

Strategic Business Planning for Commercial Producers Implementation For each business unit –What size? –What resources will be needed? –How will the resources be acquired? –How will product/service be marketed? –What performance targets will be set?

Strategic Business Planning for Commercial Producers Implementation For the firm as a whole –What is the scope of business? –How will it be financed? –How will the business be organized? –What are our social responsibilities? –How will we develop new management skills? –When will it happen? –How much will it cost/generate?

Strategic Business Planning for Commercial Producers Projections What numbers can we put behind our plan? What assumptions have we made? What do we expect for our ROA and ROE? What is our contingency plan? What will we do in an emergency?

Strategic Business Planning for Commercial Producers Be sure that... 1.Your goals are tied to your vision 2.You can point to major opportunities 3.You’re prepared for threats 4.You’ve described your customers 5.You know your strengths/weaknesses 6.Your strategy makes sense 7.Your data is accurate 8.You’re really ready for change 9.Your plan is clear, concise, and current

Strategic Business Planning for Commercial Producers Keep in mind that... This is an opportunity to work on the business This is important and difficult work but not urgent The value of the work will increase as you share, review, and update the business plan

Strategic Business Planning for Commercial Producers Now what? Share your plan judiciously Live it Revisit and revise

Strategic Business Planning for Commercial Producers

References The Business Plan: Roadmap to Success. Tiffany, Paul and Steven D. Peterson. Business Plans for Dummies. Foster City, CA: IDG Books, 1997.