2. Overview
Description of the business
Selecting business location
Identifying the competition
Detailing a marketing strategy
Laying out a financial plan
Describing personnel/management needs
Designing a strategic plan for the present and
future
Business Plan FormulationBusiness Plan Formulation
The Key Elements For SuccessThe Key Elements For Success
3. 1) Description of the Business:
Focus on the business concept and why such a business
opportunity exists as well as the products and services being
offered, the pricing system to be used to meet costs and profits.
Distinguishing your business products/services from others
in the industry (lower prices, faster delivery, longer warranties
etc.) and identifying potential customers and suppliers.
4. 2) Selecting an Appropriate Business Location
Consideration of location choices on the basis of business
customers, accessibility and security and whether the
location is conducive to the business specific industry
needs.
5.
6. Knowledge of who the competition is
with reference to the length of time in
business, reputation, quality of
products and services, customer
service, number of employees, image
and strengths and weaknesses.
3) Identifying the Competition
7. 4) Detailing a Marketing Strategy
Development of marketing/research techniques to help promote
your business market using various advertising tools such as
television, news, trade shows, telemarketing, sales programs,
internet, radio, magazines, direct mail, long-term sponsorships,
public relations (web presence, events, press releases), and other
referral mechanisms (yellow pages).
Use of networking activities such as memberships or leadership
positions and strategic alliances to bolster your business market.
8.
9. Assessment of the financial feasibility
and profitability of a business ,
identification of funds needed and
how the funds will be spent, the
potential sources for funding
(personal resources, banks, venture
capital, angel investors, public agency
loan programs).
Three years profit and loss statements
(projections), three year cash flow
summaries, balance sheets
(assets/liabilities/net worth), and
providing for supporting documents
relevant to the plan (personal financial
history, legal documents, leases, etc.)
5) Laying out a Financial Plan
10. 6) Describing Personnel/Management Needs
Description of the human capital skills and experience needed for a
particular business, pay methods, fringe benefits, payroll taxes and
the use of independent contractors versus employees.
Division of tasks/ reporting hierarchy / final decision makers.
Creation of an advisor group and Board of Directors.
11.
12. 7) Designing a Strategic Plan for the
Present and Future
Establishment of business priorities and goals, including
branding, benchmarking, timetables for action, anticipated
plans to retain and expand current markets and having an
exit strategy.
13. Major components of a business plan
I. Executive Summary
II. Business Profile
III. Market Section
IV. Financial Statements
14. II. Business Profile
One page that states: Legal structure of the business
(e.g., proprietorship, subchapter S, corporation, etc.) as
well as the educational and professional background of
management and principle stake holders. Brief past
company history (if any), or related history of principals.
15. IV. Financial Statements
Start-up costs: licenses, equipment, inventory, remodeling,
deposits, etc.
Show a break-even analysis: how many units must be sold to
cover fixed and variable costs.
Produce pro-forma income statements: anticipated sales,
expenses, and net profit or loss projected over the next three
years.
Pro-forma balance sheets should cover: anticipated assets,
liabilities and net worth of business.
Notes de l'éditeur
List company banker, accountant, legal counsel industry expert and/or government regulations that impact on your operation. Enjoin these professionals in an advisory board that will help you with decisions.
Include an organization chart (on separate page, if necessary).
Refer to the excel templates
Important: If business is seasonal or credit is extended, create a pro-forma cash flow analysis showing business financial trends.
Finally, when going for a business loan, financial statements should be prepared by an independent accountant, collateral offered should be appraised by an independent appraiser, and collateral and any existing receivables should clearly justify the amount and risk of the loan. In other words it should be equal to or greater than the debt. Financial institutions will expect a personal guarantee and/or co-signer.