The document discusses the purpose and components of a business plan. A business plan serves entrepreneurs in navigating their course, and serves investors and financiers in evaluating business propositions. It also guides managers and staff. Key components include an executive summary, management and marketing sections, and financial forecasts. The business plan outlines the business concept, goals, stakeholders, customers, strategy, and ensures regulatory compliance.
The document discusses the purpose and components of a business plan. A business plan serves entrepreneurs in navigating their course, and serves investors and financiers in evaluating business propositions. It also guides managers and staff. Key components include an executive summary, management and marketing sections, and financial forecasts. The business plan outlines the business concept, goals, stakeholders, customers, strategy, and ensures regulatory compliance.
The document discusses the purpose and components of a business plan. A business plan serves entrepreneurs in navigating their course, and serves investors and financiers in evaluating business propositions. It also guides managers and staff. Key components include an executive summary, management and marketing sections, and financial forecasts. The business plan outlines the business concept, goals, stakeholders, customers, strategy, and ensures regulatory compliance.
for? Entrepreneur who plans to enter any business endeavor must have a business plan on hand to guide them throughout the process. They need to convey the capabilities and competencies of their owners and managers. They must also be able to ‘sell’ the proponent and the business proposition to this audience. Clearly, a business plan serves many masters. First, it serves the entrepreneur who must set a navigational course. Second, it serves investors and cautious financiers. And third, it serves the managers and staff of the organization so that they will know the strategies and programs of the enterprise. The following are the components found in a Business Plan. Introduction - this part discusses what is the business plan all about. Executive Summary - is part of the business plan which is the first to be presented but the last to be made. Management Section - shows how you will manage your business and the people you need to help you in your operations. Marketing Section - shows the design of your product/service; pricing, where you will sell and how Financial Section - shows the money needed for the business, how much you will take in and how much you will pay out. Production Section - shows the area, equipment and materials needed for the business. Competitive Analysis - is the strategy where you identify major competitors and research their products, sales and marketing strategies. Market – refers to the persons who will buy the product or services Organizational chart - is the diagram showing graphically the relation of one official to another, or CONTENTS OF THE BUSINESS PLAN THE BUSINESS CONCEPT AND THE BUSINESS MODEL
A business concept contains the
essence of the enterprise in a concise but powerful manner. It stresses the value of the product offering to the target customers who would most likely buy it. There are four areas of moneymaking which the business model must address: How will the business raise revenues? What critical factors will cause the revenues to materialize? What will be the costs of the enterprise products and other costs of doing business? How will these costs be managed to ensure comfortable profits? What critical factors will drive the costs? How can these factors be controlled? What will be the major investments of the enterprise? Why will these investments give the enterprise a competitive edge? How will the enterprise finance the investments? How will the enterprise fund its growth? The Business Goals Vision Mission Objectives Performance Targets The Business Goals are communicated by articulating the basic purpose of setting up the enterprise in a mission statement. Needless to say, all business enterprises are established for the purpose of making money for its investors. The vision and the mission statements must then be translated into measurable end results, more popularly called objectives. Objectives must be more specific than the vision and mission statements. They should be measurable, achievable, and time-bound. THE EXECUTIVE SUMMARY It must contain the major argumentations of the business proponent on why the business will work and succeed. It should provide the business plan audience all the arguments on why they should participate in the business venture. The executive summary should then introduce and highlight the good qualities of: The business proponents and their partners The enterprise organization and its capabilities The technology providers and their expertise and experience Executive Summary should then proceed to discuss and justify the Enterprise Strategy and Enterprise Delivery System. Enterprise Strategy builds and develops the game plan for attaining competitiveness. Enterprise Delivery System is the entire process of converting input (resources) into output and these outputs into outcomes. Activity 3. Picture Analysis. Analyze the picture below then answer the corresponding guide questions. Guide Question: What appropriate product and/or business that can be conceptualized during this COVID -19 pandemic? Write as many in bullet form in a yellow paper. ENTREPRENEURS HIP THE BUSINESS PROPONENTS The third section of the business plan contains information about the business proponents or stakeholders. There are four types of stakeholders: Resource mobilizers and financial backers Technology providers and applicators Governance and top management Operating and support team THE TARGET CUSTOMERS AND THE MAIN VALUE PROPOSITION
The fourth section of the business plan
is the Target Customers and the Main Values Proposition. Target Customers must be of sufficient size, sufficient paying capacity, and have sufficient interest to purchase the products being offered by the enterprise. MARKET DEMAND AND SUPPLY, INDUSTRY DYNAMICS, AND MACRO ENVIRONMENTAL FACTORS
The fifth section of the business plan is
the market demand and supply, the industry dynamics, and the macro environmental forces affecting the business of the enterprise. The business plan should estimate the total market supply and demand for the product offerings of the enterprise. The business plan should discuss the major trends and changing patterns in the macro-environment, which would have significant impacts on the relevant industry and the behavior of consumers. Social environment – includes the demographics and cultural dimensions that govern the relevant entrepreneurial behavior. Political environment – defines the governance system of the country or the local area of business. It includes all the laws, rules, and regulations on allowable and disallowable business forces. Economic environment – is mainly driven by supply and demand forces. It is the same factor that drives the interest and foreign exchange rates to fluctuate with the movement of the market forces. Ecological environment – includes all natural resources and the ecosystem that defines the habitat of man, animals, plants, and minerals. Technological environment – makes or breaks competing participants in any industry. New scientific and technological discoveries often lead to the launch and commercialization of new products with superior attributes or to rendering the old ones obsolete. PRODUCT/SERVICE OFFERING: DESCRIPTION, EVOLUTION, AND JUSTIFICATION
The sixth section of the business plan is
the product/service offerings that should contain a description, evolution, and justification of the product/service offerings. The business plan should also prove that the products/services would be accepted and carried by the distribution channels. ENTERPRISE STRATEGY AND ENTERPRISE DELIVERY SYSTEM The business plan should expound on the Enterprise Strategy (ES) by mapping the competitive landscape and by situating the enterprise and its competitors as to their strategies and chosen positioning. Input Throughput Output Marketing Desired outcomes • Harnessing of conversion goods positioni customer human, money of input produce ng satisfied and physical into output d or product sales resources and the services packagin volume • Resources transforma delivere g attained mobilized tion d place profits • Money process people generate • Men within the promotio people • Machines factory or n performan • Materials service price ce • Methods shop • management FINANCIAL FORECASTS: EXPECTED RETURNS, RISKS, AND CONTINGENCIES
The eight section of the business plan
is the financial forecast including the financial returns, the financial risks, and the financial contingencies. ENVIRONMENTAL AND REGULATORY COMPLIANCE The ninth part of the business plan is composed of the environmental and regulatory compliance. The business plan must articulate the laws, rules, and regulations governing the business, and the industry that the enterprise is in. CAPITAL STRUCTURE AND FINANCIAL OFFERING: RETURNS AND BENEFITS TO INVESTORS, FINANCIERS, AND PARTNERS
The tenth section of the business plan
contains the capital structure and financial offerings of the enterprise including some discussions on who are the investors, the financiers, and the partners of the enterprise.