Business Plans

1
Business Plans

• Part 3
• Taken from http//www.bplans.com/hurdleonline
• http//www.sba.gov/starting/indexbusplans.html

2
Assignments to Date

• Preliminary Mini Plan
• Mission/Objectives
• Keys to success
• Target Market
• Competitive Advantage
• Basic Strategies
• Initial break-even chart
• Company Summary Product Description

3
Simplified Business Plan Outline

• Executive Summary
• Company Summary
• Product Description
• Market Analysis Summary
• Strategy and Implementation Summary
• Management Summary
• Financial Plan

4
Management SummaryIf it isnt a good place to
work, it wont be successful

• Important to have to quality of the workplace in
  mind and to find ways to communicate this in the
  plan
• Commitment to and enjoyment of work
• Integrity (honesty)
• Competence
• Personal connection
• Balance
• Fun

5
Management Summary

• Basics
• How many employees
• How many are managers
• How many are founders
• Summary views of strengths of personal (resumes
  should be attached to back of plan)
• Management gaps
• Does organizational structure seem appropriate
• Missing members
• How you intend to fill them

6
Management Summary

• Organizational Structure
• Include
• organizational chart
• Job Descriptions
• Are organizational lines clearly drawn?
• Is authority properly distributed?
• Do you have jobs that include responsibility
  without authority?
• Other considerations
• Noncompete agreements with competitors

7
Management Summary

• Develop numbers for Personnel Plan

8
Management Summary

• More detailed Personnel Plan
• Organized by department
• Include personnel burden
• payroll taxes and benefits
• This should be in either simple or detailed
  personnel table and assumptions included in your
  general assumptions
• Payroll assumptions will be used elsewhere
• Profit and loss statement

9
Knowing Your Market

• Need to describe the general state of your
  industry and the nature of the business
• - Industry participants
• number and market share
• trade associations, conventions, publications
• - Distribution patterns
• to distributors, to retail stores, directly?
• - Competition
• main strengths and weaknesses

.
10
Knowing Your Market

• Resources (on our website)
• http//www.bplans.com/qa/
• http//www.sba.gov/
• http//dir.yahoo.com/Business_and_Economy/small_bu
  siness_information/
• http//www.quicken.com/small_business/
• http//www.knowthis.com/general/marketplan.htm
• http//www.score.org/
• http//www.census.gov/
• Trade associations and business publications
  use favorite search engines

11
Knowing Your MarketPractical Market Research

• Study Similar Businesses
• Find similar but non-competing businesses that
  will share experiences
• Look for people selling similar businesses
• Shop the competition
• Talk to Customers
• Do direct market research (ask a credible number
  of people what they want)
• Use online surveys
• Assess Potential Customers
• Average age, income education levels, buying
  patterns, values, etc.

12
Knowing Your MarketForecasting Your Sales

• Experience is important here more of an art
  than science
• Simple Sales Forecast

13
Knowing Your MarketForecasting Your Sales

• Detailed Sales Forecast

14
Knowing Your MarketForecasting Your Sales

• Use graphics for monthly and annual sales

15
Knowing Your MarketForecasting Your Sales

• Charts and tables must be described in text
• Summarize and highlight numbers in sales forecast
  tables
• Are anticipated questions answered
• Give the sales strategy behind the forecast
• How and when to close sales prospects
• How to compensate sales people
• How to optimize sales processing
• How to maneuver price, delivery, and conditions
• How are sales people trained
• Are details of sales programs given with
  milestones, responsible persons, and budgets
• Provide and justify the assumptions used

16
Knowing Your MarketMarket Segments

• Segmentation concept is crucial to market
  assessment and market strategy
• Ex.
• http//www.dell.com/us/en/gen/default.htm
• http//www.ashling.com/
• http//www.nordictrack.com/nt/v4/index.html

17
Knowing Your MarketMarket Segments

• Analysis using tables and charts

18
Knowing Your MarketMarket Segments

• Charts and tables must be described in text
• Begin with a summary
• Define the groups
• Justify them as targets
• Be concise
• Explain your segmentation
• Display you wisdom and understanding of industry
• Discuss what characteristics distinguish
  different groups
• Discuss the strategy behind the segmentation
• strategy is focus it is creative and it doesnt
  follow pre-written formulas
• Explain market needs, growth, and trends