1. BUSINESS PLAN AND SOURCES OF FINANCING
CHAPTER 5
BUSINESS PLAN
AND
SOURCES OF FINANCING

2. Learning Objectives
After studying this chapter you should be ready to describe:
The format of a business plan.
The marketing aspects of new ventures.
The operational aspects of new ventures.
The financial plan of new ventures.
The sources of financial and business support systems.

3. Purposes of Preparing Business Plan
View & evaluate in objectivity, critically & practicality
Analyse & evaluate its viability
Convincing the relevant parties on its investment potential
As as guideline
Allocate business resource effectively
EUW 224 ENGINEERING ENTREPRENEURSHIP

4. Who Needs a Business Plan
Entrepreneurs
Shareholders
Bankers/Creditors/Financial Institutions
Investors
Management/ Employees
Clients/Customers
Suppliers

5. INFORMATION GATHERING OF BUSINESS PLAN (Refer to the text book
Cover Letter
Cover Page
Table of Contents
Executive Summary
Main Body of The Business Plan (see below)
Appendices
Business Plan Format
INTRODUCTION
PURPOSE
COMPANY’S BACKGROUND
OWNER’S BACKGROUND
LOCATION OF BUSINESS
ADMINISTRATIVE PLAN
MARKETING PLAN
OPERATION PLAN
FINANCIAL PLAN
CONCLUSION
Main Body of The Business Plan
EUW 224 ENGINEERING ENTREPRENEURSHIP

6. Main Body of The Business Plan
INTRODUCTION
PURPOSE
COMPANY’S BACKGROUND
OWNER’S BACKGROUND
LOCATION OF BUSINESS
ADMINISTRATIVE PLAN
MARKETING PLAN
OPERATION PLAN
FINANCIAL PLAN
CONCLUSION
Main Body of The Business Plan
EUW 224 ENGINEERING ENTREPRENEURSHIP

7. Cover Letter Cover Page Table of Content Exec. Summary Main body
Intro to the purpose & contents of Bus. Plan
Cover Page
Title
Name of the business & address
Name of the writer
Date of submission
Table of Content
Headings
Tables
Schedules
Page Numbers
Exec. Summary
Highlighting the important components
Product, mkt potential, project mgt. cost & expected returns
Main body
See next slide
Appendices
Supplier’s quotation
Agreement letter
Letter of reference
EUW 224 ENGINEERING ENTREPRENEURSHIP

8. Elements of a Business Plan
Intro:
Company name
Nature of business
Industry profile
Purpose:
“ This business plan is prepared by Fair One Sdn. Bhd. For the purpose of obtaining working capital loan from Maybank for the amount of RM50,000.
Company Background:
Name of the company
Business Address
Correspondence address

9. Elements of a Business Plan
Owner/Partner Background:
Name of the partners
Identity card No.
Permanent Address
Location of the Business:
Physical location
Type of building
Basic amenities
Administrative plan:
Intro of the org.
Org. chart
Manpower plan

10. Elements of a Business Plan
Marketing Plan:
Prodt./Serv. Description
Target market
Market size
Operation Plan:
Process flow chart
Production schedule
Material requirements
Financial Plan:
Project implementation cost schedule
Sources of funds schedule
Fixe asset depreciation table
Conclusion

11. Updating the Business Plan (added knowledge)
Financial Changes
Changes in the Market
Additional Financing
Launch of a New Product or Service
New Management Team
Reflect the New Reality
Reasons to Update the Plan

12. Guidelines to Remember (Added knowledge)
Keep the plan respectably short
Be focused
Organize and package the plan appropriately
Orient the plan toward the future
Avoid exaggeration
Highlight critical risks
Give evidence of an effective entrepreneurial team
Do not over-diversify
Identify the target market
Capture the reader’s interest

13. Questions to Be Answered (Added knowledge)
Is your plan organized so key facts leap out at the reader?
Is your product/service and business mission clear and simple?
Are you focused on the right things?
Who is your customer?
Why will customers buy? How much better is your product/service?
Do you have a competitive advantage?
Do you have a favorable cost structure?
Can the management team build a business?
How much money do you need?
How does your investor get a cash return?

14. Please Feel free to ask your questions….
EUW 224 ENGINEERING ENTREPRENEURSHIP