A business plan is a formal written description of your business future

by defining your goals, strategies to meet the goals, and the

timeframe for the achievement of those goals.
Is it necessary for you, as an entrepreneur, to write your own
business plan? As cited by Edralin (2016), the Department of Trade
and Industry through the Bureau of Small and Medium Enterprise Development
mentioned the following reasons of writing a business plan.
1. Minimize or remove risk of losing money. Investment on poorly researched
business that may result to financial instability should be avoided. You must
see all sides of the venture before letting go of any resources.
2. Avoid costly mistakes. Unplanned decisions may result to negative outcomes
that may hurt the business.
3. Anticipate the financial requirements. Futuristic view of the increase or
decrease of demand on the given product/service will prepare you in meeting
business obligations.
4. Organize the activities beforehand. Thinking in advance, you must look at the
near and distant future. Contingency plans must be present for anticipated
concerns that may arise.
5. Assess actual performance against set goals. Having a clear goal will help you
achieve your target in terms of sales, revenues or even expenses.
6. Apply for financing from lending institutions. There are cases that financial
assistance from other people or organization is needed to start a business. A
good business plan may encourage investors to entrust you their resources
but remember to be wise whenever you are lending money and make sure to
use the money for its intended purpose for the growth of the business.
In writing a business plan, you must have a specific audience in mind and
answers to possible important questions that may arise. To start, you may follow the
format below (Edralin, 2016).

Parts of a Business Plan

I. Executive Summary
II. Management and Organization
III. Product/Service Plan
IV. Market Plan
V. Financial Plan
Let us discuss the individual parts and its contents.
I. Executive Summary
This part can be found at the beginning of the plan but is the last to be
accomplished since this synthesizes the whole plan. This contains a brief
introduction and summarizes everything that is relevant and important
to the prospect business audience.
These are the information needed to guide you:
 description of your proposed business and business model
 description of the market opportunity you want to capture or market problem
the business solves
 reasons why this is an attractive business opportunity
 key distinctions or differentiators of your business versus competitors
 overview of the sales, marketing, and operations strategy and plan
 description of your executive planning timeline
 overview of the projected financials containing revenues, cost, profits, and
assumptions of your business
II. Management and Organization
This part includes all the basic information of your business.
This also describes the workflow (organizational structure; the
background, experience and role of each) of your business
from the highest position up to the lowest.
These are the information needed to guide you:
 Company Name, Logo, and Address

 Vision and Mission Statements

 Key Personnel
 Organizational Chart
 Ownership Capitalization, Compensation, and Incentives
 External Management Support
III. Product/Service Plan
This part describes the highlight of the product or service offered
to the customers so that they will be encouraged to patronize your
product or service. It also explains how the products or services will be
accepted and carried by the distribution channels.
These are the information needed to guide you:
 Purpose of your Product or Service
 Product’s/Service’s Unique Features
 Material Requirements and Sources of Supply
 Processing Equipment that will be Used to Manufacture the Product or Render
the Service
 Production or Service Process and Controls
 Distribution Logistics
 Regulatory and Other Compliance Issues
IV. Market Plan
This includes your business strategies, the target market,
value proposition of your product or services that may increase the
company sales (Chen, 2019).
These are the information needed to guide you:
 Market Analysis
 Marketing and Sales Strategies

 Product or Service Characteristics

 Pricing Policy
 Sales Projection
Market Analysis
This includes the process of how you divide the total market into smaller
groups seeking similar needs and wants (market segmentation) and the
characteristic analysis of the business in relation to internal and external
factors. (SWOT Analysis)
An example of market segmentation is shown below.
Food is a physiological need, but the cravings depend on each consumer.
Chicken wings offered by The Wing Hub of Limay even come in different
flavors. Consumers who crave for samgyupsal may turn to Super Boink
of Balanga City while those who want to have a taste of Vietnamese food
would probably go to Loleng’s Hu Tieu-An in Morong.
SWOT Analysis, on the other hand, is a popular tool to evaluate the internal
environment pioneered by George Albert Smith Jr. and Ronald Christensen,
two Harvard business professors (Aduana, 2016). SWOT stands for Strengths,
Weaknesses, Opportunities and Threats.
Strengths refer to strong attributes or capabilities of the business that
provide great advantage in exploiting the business opportunity. Weaknesses are
poor attributes or deficiencies that give disadvantage to the business. Both strengths
and weaknesses are considered internal origins, meaning they are attributes inside
the business venture.
On the other hand, opportunities are business
situations that must be exploited due to their potential in
terms of profit and growth. Threats are possible external
factors that may harm the business.
Marketing and sales strategies
These are also known as the product PUSH. These have three key
characteristics that allow to perform marketing function of persuading
customers to buy right away. (Go, 2010)
1. Temporary – Sales promotions are conducted at short periods
creating a sense of urgency on the part of the customers.
2. Better value – Sales promotions are used to create short-term
differentiation by offering a better product value.
3. Beneficial – Sales promotions promote growth sometimes even at
artificial level.
7-11 stores offer promotional sales, such as “Buy1-Take1” of products at
particular period. At the same time, they offer Cliqq Rewards to loyal
customers by getting Cliqq points in every purchase which in turn can be
exchanged to free or discounted items.
Product/Service Characteristics
This includes value proposition of the product/service. Value
proposition answers the question, why should your customers buy from you and not
from other similar businesses? These contain the convincing reasons
that buyers should see that will make them purchase your products/services.
BDO: “We find ways”. Before this pandemic, while other banks operate
from 8AM-3PM Mondays to Fridays, BDO offers services until 6PM and
even operates during weekends fulfilling their promise of “finding ways”
for the customers.
Pricing Policy
This part specifies the price of the product/service. It must be noted
that quality and price cannot be separated in marketing (Aduana, 2016). You
must be careful in setting the price of your product/service considering the
costs of production, competitors’ pricing, and customers’ perception.
Filipinos are generally price conscious. We tend
to check the price tag of a product first before
whether to buy or not to buy a commodity.
“SALE” and “PROMO” tags are consumer
magnets. In cases wherein the prices of the product cannot be decreased,
the entrepreneur should be able to give emphasis on the benefits of
his/her product to convince the customer of its value.
Sales Projection
This is also called sales forecast or the prediction of the amount of
revenue your company expects to earn at some point in the future. This shows
the quantity of product sold or service rendered and its corresponding amount
within a given period.
V. Financial Plan
This is a document containing your current financial situation as an
entrepreneur and long-term monetary goals, as well as tactics to attain those
objectives. You may create a financial plan on your own or with the assistance of
someone who is knowledgeable about handling finances such as certified financial
planner.
These are the information needed to guide you:
 Start-up costs requirements – These are expenses that you will be needing
during the course of creating a new business.
and not from other similar businesses? These contain the convincing reasons
that buyers should see that will make them purchase your products/services.
BDO: “We find ways”. Before this pandemic, while other banks operate
from 8AM-3PM Mondays to Fridays, BDO offers services until 6PM and
even operates during weekends fulfilling their promise of “finding ways”
for the customers.
Pricing Policy
This part specifies the price of the product/service. It must be noted
that quality and price cannot be separated in marketing (Aduana, 2016). You
must be careful in setting the price of your product/service considering the
costs of production, competitors’ pricing, and customers’ perception.
Filipinos are generally price conscious. We tend
to check the price tag of a product first before
whether to buy or not to buy a commodity.
“SALE” and “PROMO” tags are consumer
magnets. In cases wherein the prices of the product cannot be decreased,
the entrepreneur should be able to give emphasis on the benefits of
his/her product to convince the customer of its value.
Sales Projection
This is also called sales forecast or the prediction of the amount of
revenue your company expects to earn at some point in the future. This shows
the quantity of product sold or service rendered and its corresponding amount
within a given period.
V. Financial Plan
This is a document containing your current financial situation as an
entrepreneur and long-term monetary goals, as well as tactics to attain those
objectives. You may create a financial plan on your own or with the assistance of
someone who is knowledgeable about handling finances such as certified financial
planner.
These are the information needed to guide you:
 Start-up costs requirements – These are expenses that you will be needing
during the course of creating a new business.