1. 1 | The Business Plan

3. A Business Plan is…
a blueprint of how the business should look like in your mind.
“tell a story” and explain how the
business will achieve its objectives
in a coherent manner. The “story”
should focus on customer’s needs.
To identify the market, its growth prospects, target customers and main competitors.

4. A Business Plan is…
Based upon a credible set of assumptions to which the success of the business is most sensitive.
To identify the risks facing the
business, the potential downsides
and actions should be taken to
mitigate the risks.
To describe its differences from its competitors: its source of competitive advantage and how it will be sustained in longer term.

5. A Business Plan is…
To describe the experience and track record of the management team.
To identify the funding being sought from potential investors.

6. A Good Business Plan Checklist
Tells a coherent, consistent and customer focused story;
Clearly defines market, its prospects, the customers, suppliers and competitors;
Contains credible business planning assumptions and forecasts;
Describes how business will achieve sustainable competitive advantage;
Identifies assumptions to which business is most sensitive, the potential risks and any mitigating actions;

7. A Good Business Plan Checklist
Is supported by those that must implement it;
Contains description of individuals involved in managing the business;
Identifies funding requirement for the business.

8. Who is this business plan for and why?

9. A Business Plan should…
Focus on market growth and
the sources of sustainable
competitive advantage for
the business.
Emphasis on strategy, tactics and financial projections, rather than on operational detail.

10. A Business Plan should…
Provide basis for creation of business process, job descriptions and operational budgets.
Provide basis for monitoring
and analyzing performance.

11. A Business Plan in Another Situation
A business unit in a large organization will prepare business plans in order to gain approval for new business initiatives from senior management and the board. However, the following questions may be asked.
Is the plan consistent and supportive of the business’s overall strategy?
What is the impact on overall financial performance of the business in terms of revenue growth and profitability.

12. A Business Plan in Another Situation
Will adopting the business plan require additional fundraising?
Does the business plan reinforce the position of the business’s brand?
Is the business plan feasible and within the scope of the organization’s capabilities?
Will adoption of this business plan have impact on other areas of the business?
What alternative opportunities could be pursued?

13. A Business Plan Template
Executive Summary
Current business situation
Vision, mission, objectives
Definition of the current business and its market
Current state of the business
Corporate history, major events and past financial performance
Products and services
Current business and market position
Strategy and sources of sustainable competitive advantage
Core competencies
Customer acceptance
Current business organization and outline business infrastructure
Summary financial forecasts
Money required, timing and deal on offer
Strategic analysis
Basic business information
Political, economic, social and technological analysis and impacts
Title
Key differentiators and unique selling points
Contents
VRIO analysis
Contact information
Document control
Configuration of resources
Professional advisers
Value add analysis
Definitions
Legal structure and corporate data

14. A Business Plan Template
Value add analysis
Strategic plan
Value chain analysis
Vision, mission and objectives
Value system
Sources of sustainable competitive advantage
Resource audit
Competitive position
Operations resources
Marketing positioning
Human resources
Brand strategy
Organizational resources
Portfolio strategy
Financial resources
Business design
Industry life cycle
Industry structure
Marketing plan
Competitor analysis
Marketing segments, size and growth
SWOT analysis
Description of customers and customer needs
Target market segment
Product positioning and value proposition
Marketing mix

15. A Business Plan Template
Description of products and services
Engineering and design support
Pricing and discounting
Quality control plans
Advertising and promotional plans
Staffing requirements
Channel and distribution strategy
Sources of supply of key materials
Guarantees and warranties
After-sales service and customer care
Research and development
Comparison with competition
Objectives
Performance and economics
Organization
Marketing forecasts
Plans
Resources
Operations/production
Physical location
Management and organization
Make or buy considerations
Organization chart
The production process
Top management
Facilities, equipment and machinery
Management’s ability to deliver the plan
Scalability of operations

16. A Business Plan Template
Corporate governance and shareholder control
Discounted cash flow
Staffing
Payback
Recruitment
Breakeven
Training
Benchmarks
Labour relations
Sensitivity analysis
Office space and amenities
Employment and related costs
Financing
Summary of operations prior to financing
Forecasts and financial data
Current shareholder loans outstanding
Summary of performance ratios
Funds required and timing
Sales forecast
Use of proceeds
Assumptions underpinning financial forecasts
The deal on offer
Profit and loss account (income statement)
Anticipated gearing and interest cover
Balance sheet
Exit routes for investors
Cash flow statement
Evaluation criteria and valuation

17. A Business Plan Template
Risk analysis
Appendices
Risk overview
Glossary of terms
Limiting factors
Details of market research
Critical success factors
Consultants’ reports
Alternative scenarios and strategic responses
Product specifications
Specific risks and risk-reduction strategies
Marketing collateral
Orders in hand
Business controls
Organization charts
Curricula vitae
Information technology
Detailed financial forecasts
Financial
Technical data
Sales and marketing
Operations
Details of patents, copyright
Other controls

18. Layout and Style Document should be: Attractive Impressive
Easy to read
General appearance: logo, contact details, etc.
Page layout: A4, 12 pt, ring bind, etc.
Writing style: Clear, concise, evidence, etc.

19. Getting Started Basic business information: Title Content
Contact information
Document control
Professional advisers
Definitions
Legal Structure and corporate data

20. Getting Started Legal structure and corporate data:
Full name of business
Corporate status of business
Its capital structure
Address of registered office
Registration number
Head office address

21. Getting Started
Executive Summary-The most important section: The 1st section to be read it must engage readers and excite them about the potential of the business idea. It should NOT be an introduction to the business plan; it should be most carefully written of all the sections. It contains:
Current state of the business
Products and services and the customers
Sources of sustainable competitive advantage
Shareholder objectives and business strategy
Summary financial forecasts
Decision or funding being sought

23. Your group should start thinking your new business ideas
Your group should start thinking your new business ideas. Go through the concepts and business plan template just learned.