1. Business Plans

2. Aims: To be aware of Business Plans, their purpose and contents.
To broaden your awareness of real business opportunities.

3. What is a business plan?

4. Why do you need a business plan?
Basic business planning is essential:
To set the objectives for the business
To ensure the business can be viable
To raise finance (if required) from third parties

5. Who would look at the business plan?
Suppliers
Owner(s)
Which stakeholders
would be interested?
Bank
Creditors

6. What is in a Business Plan?

7. Log onto this website…
This website link has a range of completed business plans for you to look at.
Select a business plan and complete the following questions:
Underscores used here!

8. Your task…. General Questions
What is the name of business on the business plan?
What product/services do they intend to offer?
What are the company objectives?
What are their ‘key’ to success points?
What type of ownership do they propose to start under?
What is the market segmentation that they have identified?
Have they identified their competitive edge issues?
What are the total requirements for the start up costs?
What are the personnel costs/wages
What do they expect their monthly breakeven revenue and units?
What is the projected annual NET profit for Year 1, 2 and 3?

9. Plenary What are company objectives? What is market segmentation?
What were the start up costs for your business plan?
What were their break-even sales value – how realistic is this for the business?

10. The exam board expect you to know the content of a business plan!
Business Plan Content
The Marketing Plan
Market analysis showing level of demand
Who customers are and what they want
The strengths and the weaknesses of competitors
The marketing mix – product, price, place and promotion.
The Production Plan
The methods and stages of production
The premises and equipment needed
Ways of ensuring quality
The Financial Plan
Sources of finance required
Profit forecast/break-even analysis
Cash flow forecast.
Introduction
Basic business details
The type of legal ownership
The goals of the business
The Business Idea
The product/service to be provided
Summary of the key selling points
Management and Personnel
The roles of the managers
The experience and skills of the workforce.
Print this as 1 slide for notes
The exam board expect you to know the content of a business plan!

11. Benefits of a Business Plan
Provides focus and direction
Tests the viability of the business proposal through financial forecasts
Convinces investors or lenders
Plans and review business strategy
So what a business plan helps provide focus & direction? Know what needs to be done, where, how, how much…..SO WHAT? Not to waste money, earn revenue = reach breakeven – profits……SO WHAT …. Get a good reputation, grow, expand!
So what moment….
How to
… analyse issues

12. Drawbacks of Business Plans
So what moment….
How to … analyse issues
Lack of flexibility
Collecting accurate information
Takes time and commitment
Planner lacks skills or expertise to analyse results
What if the business plan is based on inaccurate data
Unrealistic financial projections
Need to be flexible – to react to competitors, customer changing requirements, change in the economy….financial crisis! Must be able to adapt, react and change….so not to go bankrupt!

13. We’re going to plan this now…
Essay Q
To what extent does having a business plan prevent business failure for an entrepreneur?
(15 marks, C = 3, An = 7, E = 5)
We’re going to plan this now…

14. Sources of information & guidance
Banks
Accountants, solicitors, Insurance advisors
Small Business Advice Service
Small business advisors
Government agencies – Dept of Trade & Industry, Business Link, Her Majesty’s Revenue & Custom
Chamber of Commerce
Prince’s Trust – Charity support for 18-30’s to set up businesses
Shell Live Wire – for 18-30’s to set up businesses

15. Further Questions….
List the key areas of a business plan – use the sub heading of non-financial items and financial items. (2 marks)
Identify three different stakeholders that might be interested in the business plan. Explain why they might be interested. (9 marks, C = 3 An = 6)
Where might an entrepreneur gather the information required for a business plans? (4 marks)
Total 15 marks