1. Business Plan
Format and Contents

2. Contents of Business Plan
Executive summary
Industry and Company and ts products /Services
Market Research and Analysis
Economics of the Business
Marketing Plan
Design and Development Plans
Manufacturing and operations plan
Management Team
Overall Schedule
Critical risk problems and assumptions
Financial Plan
Proposed Company offering
Appendices

3. Executive Summary Description of the Business Concept and the Business
Opportunity and strategy
Target market and projections
Competitive advantage
Costs
Sustainability
The Team
The Offering - Finance needed (Debt equity and your contribution)

4. Industry ,Company and Product/Service
The industry current state,
size,
growth
competitors,
new product/devp,
environmental profile –energy intensity, supply chain, waste, green technology –carbon credits CER)

5. Company and the Concept
present biz, products service offered /will offer,
background of growth and promoters involvement,
prior sales and profit performance or discuss losses and why
and improvements done or envisaged

6. Product or Service
Product and or service – describe of new product service ,
application of its use ,
delivery system
unique features how they add value, differentiation from those current available,
possible drawbacks,
present state of development,
first mover of head start advantage
any features which give you unfair advantage over others like patents trade secrets or proprietary features,
opportunities of expansion of product lines or related products.

7. Entry and Growth Strategy
Entry and growth strategy – Key success variables in mktg plan
innovative product,
timing advantage,
marketing approach,
pricing ,
channels of distribution
advertising and promotion

8. Market Research and Analysis
Customers
Market size and trends
Competition and competitive edges
Estimated market share and sales
Ongoing market evaluation

9. Customers
Who are they? Classified by groups segments-common identifiable characteristics
Where are they? Segment and region
How they buy (retail /wholesale), reached and receptiveness?
Where buying decisions are made and length of decision cycle, customers purchase process, basis of decisions (price, quality timing, delivery training, service personnel, contacts, political pressures) and can they change current buying decisions?

10. Customers(2)
What orders contracts or letters of commitment or potential customers you have in hand?
What you are doing to overcome negative customer reaction?
If in existing business , current customers and sales trends

11. Market Size
Five year projections of size and your share, by segment, region or country for product or service
Potential annual growth for at least 3 years
Major factors for market growth ( industry trends, socio economic trends, govt. policy, envrt. impact, population shifts)
review previous trends

12. Competition and Competitive Edge
Realistic SWOT of Competitors, assess substitute and alternatives ,list of suppliers of these
Compare competing and substitute products or services on market share, price ,quality, performance , delivery, timing service, warranties, other features
Current advantages and disadvantages of these products

13. Competition and Competitor’s Edge
Knowledge of competitors actions that could lead to improved products (R&D)
Are they awake or asleep?
SWOT of competing companies their market share sales and distribution
Financial position ,costs and profitability of competitors
Who are service providers
pricing, performance ,cost and quality leaders-why co exiting or entered the business
Discuss 3-4 key competitors and why customers buy from them
What you know of competitor’s operations

14. Economics of the business
Gross and operating margins
Profit potential and durability
Fixed variable and semi variable costs
Months to breakeven
Months to reach positive cash flow

15. Marketing plan Overall marketing Strategy Pricing Sales and tactics
Service and warranty policies
Advertising and promotion
Distribution

16. Design and development plan
Development status and tasks
Difficulties and risks
Product improvement and new product
Costs
Proprietary Issues

17. Manufacturing and Operation plan
Operating cycle
Geographical allocation
Facilities and improvements
Strategy and Plans
Regulatory and Legal teams

18. Management team Organisation Key management personnel
Management Compensation and Ownership
Other investors
Employment and other agreements and stock options and Bonus Plan
Board of Directors
Other shareholder’s rights and restrictions
Supporting professional advisers and services

19. Overall Schedule
A schedule that shows the timing and interrelationship of the major necessary to launch the venture and realise its objectives.
Cash conversion cycle will underline key inputs
Deadlines indicated
Indicates to investors your depth of planning and resource use
Indicate methods of calculations

20. Critical Risks Problems and Assumptions
Demonstrate that you have thought out and can handle them
Description of risks implicit in plan
Assumptons- use objectivity to deal with it – sales projections, orders
Consequences of adverse outcomes –industry, company, personnel, product, market appeal
Unstated negative factors of investors

21. Contingencies – Indicate critical ones
Running out of cash before orders come in
Price cutting by competitors
Potentially unfavorable industry trends
Costs excess of estimates
Sales projections not achieved’
Unmet product development schedule
Difficulty in procuring long lead items
Difficulties in obtaining bank credit
Increase in R&D costs
Running out of cash after orders come in

22. Financial Plan -Best Estimate of Reqt.
Indicate venture’s potential and timetable for financial viability
Operating plan for fin mgt using fin benchmarks
Prepare exhibits
Use three year income statements and balance sheets and break even analysis. For cash flow statement use cash system instead of accrual system
Give assumptions behind -sales levels, growth, inventory requirements, cash balances, operating and cash conversion cycles

23. Fin Plan (2)
Proforma income statement – plan for profit indicates potential fin. feasibility of the venture.
Initially, level of profits cannot finance operating assets and cannot match the actual cash flow on a short term basis, hence a forecast of cash needs should take care of such conditions is recommended.

24. Fin Plan (3)
Proforma balance sheets are used to detail the assets required for the projected level of operations and how they will be financed (liablilities)
Indicate projected debt equity ratios, working capital, current ratios, inventory turnover within the limits required to justify future financing

25. Financial Plan (2) acceptable limits to justify future financing
Break even chart showing level of sales that will cover all costs including those that vary with production and those that do not
Income statements -In Proforma statements fully discuss bad debts, discounts, assumptions for sales expenses, general and administrative costs

26. Fin Plan(2)
,show effect of sales reduction say 20%, learning curve and level of productivity snesitivity of profits to risks
Prepare Balance sheets, cash flow analysis, Break even charts ,cost control measures and budget overrun
Highlight important conclusions, including maximunm amount and timing of cash required , amount of debt and equity needed, how fast debts will be repaid

27. Financial Plan Actual Income Statements and balance Sheet
Proforma Income statements
Proforma Balance Sheets
Proforma Cash Flow Analysis
Breakeven Chart and Calculations
Cost control
Highlights

28. Proposed Company offering
Amount of money being sought
Nature of security offered to investors
Summary of how the investor can expect to achieve his targeted rate of return
Terms for financing your company spelt out here
Description of Uses of Capital
Desired Financing –how much

29. Proposed Company Offering
Offering – common stock, convertible,debentures, debts with warrants, debt plus stock,unit price, total amount of securities (if not common , interest rate,type,maturity and conversions conditions, percentage others can hold before and after conversion, private placement –restrictred securities for a period of time
Capitalisation – current and proposed (post offfering number of outstanding shares and how the holding will change after on completion of fnancing), authorised and issued capital, stock options

30. Offering (3)
Use of funds – how capital raised will be used- R&D,capital eqpt, marketing , working capital
Investors Return- Indicate how your valuation and proposed ownership pattern will result in in desired rate of return for investors whom you have targeted

31. Appendices Information too extensive in the body but necessary
Product specification
Photos
List of references
Suppliers of critical components
Special location factors
Facilities
Technical analysis
Consultant reports
Critical regulatory approval or licences