Business plan competition for young entrepreneurs Guide presentation Adnan Hagoog

Business plan A “business plan” is a roadmap that describes where you’re going and how you’re going to get there A guide to achieving your goals A tool to spark investor interest A document that helps employees understand the company mission

Getting Started Is business ownership right for you? An “entrepreneur” is a person who starts his or her own business Self-assessment questions: – Are you a self-starter? – How well do you plan and organize? – Can you work long hours? – How will the business affect your family?

What Type of Business Do You Want? A startup: – Follow your own dream Buying an existing business: – You will have current customers and a known track record of performance Franchising: – Brand recognition reduces marketing costs

Questions to ask when starting up A new business Does the idea suit your personality and interests? Will you use your own name to brand the business? Will it be financially viable? – Do you have startup money to invest? – What will your monthly expenses be? – Is there a current need in the marketplace? – Who are you competing with?

Key elements of the business plan Description of your products and services Market and industry analysis that demonstrates the need for your business List of competitors, including their strengths and weaknesses Marketing strategy (sales approach) Management team and operations plan Financial analysis: the investment needed

Business Plan Content 1.Executive Summary 2.The Problem & Opportunity 3.The Business Model 4. Underlying Ambitions, Skills and Insights 5.Competition 6. Management 7. Product Development & Deployment 8.Marketing & Sales 9. Financial Projections 10. Current status

Executive Summary A mini-business plan in one or two pages Highlights the most important points of your business plan It is NOT an introduction to the plan It must grab your reader, and entice him/her to read further

Executive… Identify the company, its background, structure and location Describe what the company does, and the market it serves Describe the market potential for the company’s products and services, market trends, etc.

Company Overview Brief Company Introduction – Mission statement – Location, size, history – Market and products – Overview of company capabilities – Objectives

Industry Overview Set The Stage Industry Definition and Description – Major players within the industry – Factors driving dynamics – New products and developments Legislation and Policies

Market Analysis Market Definition – Primary Market – Secondary Markets Market Size and Trends – Current total revenues – Predicted annual growth rate

Competitors Direct Competitors – Who are they? – Size and product breadth – Revenues and profitability – Strengths and weaknesses – Market shares Indirect Competitors

Customers Customer Characteristics – Who are they? – Why do they buy? – Need satisfied by the product/service – How is the need currently filled? – What are the alternatives? – Who makes the decision to buy? – How frequently do they purchase?

Marketing and Sales Plans Statement of Opportunity Marketing and Sales Objectives Existing Customers Potential Customers – Prospects targeted – How prospects will be targeted and qualified

Marketing and Sales Plans Marketing Programs – Direct Mail – Trade Shows – Advertising – Internet – Publicity/Public Relations – Marketing Budget Pricing – Basis for targeted price point – Margins and profitability by volume levels

Marketing and Sales Plans A “marketing plan” serves as a blueprint for you to follow to get your products and services known and recognized. It has: – Competitor and issue analysis: challenges and opportunities facing the business – Objectives: What do you want to achieve? – Action program: A “to-do” list – Budget: Detail expenses – Strategy: The Four “P’s” Sales Plan – Sales force structure – (direct or reps) – Sales expectations/quotas – Margins given to intermediaries – Service and warranties – Sales Budget

The Four P’s of Marketing Product: Describes features and benefits Price: Lists prices and pricing strategy Promotion: Tools or tactics to achieve marketing objectives Placement: Sales philosophies and methods

How Much $$$ Do I Need? Determine start up costs and estimate monthly operating costs to determine your working capital needs

Financial Plan THE PRIMARY EVALUATING TOOL – Support all information – Make conservative projections Start-up Budget: amount needed to open Operating Budget: ongoing expenses once open Sources and Uses Sheet

Financing Your New Business Start up loans are very difficult to obtain Chances are you have to rely on the funds you can personally raise Grants?! Sidebar here – World bank grants – ACF- African Challenge fund – BPC for young entrepreneurs – Global Entrepreneurship fund

Financial Plan: Startup Budget Personnel (costs prior to opening) Occupancy (lease, rent, or mortgage) Legal/ Professional Fees Equipment Supplies Salary/ Wages Utilities Payroll Expenses Internet Licenses/ Permits Advertising/ Promotions

Financial Plan: Operating Budget Personnel Lease/ Rent/ Mortgage Loan Payments Legal Fees Accounting Supplies Salaries/ Wages Dues/ Subscriptions/ Fees Repairs/ Maintenance Insurance Advertising/ Promotions Depreciation Payroll Expenses Internet Payroll Taxes Travel/ Entertainment Miscellaneous 3-6 Months of Operating Capital

Final Thoughts Build on every success Learn from your mistakes Take time to relax and reduce stress!

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