Business plan 1
Nov 16, 2014
Business Plan, funding, lending, executive summary, marketing strategies, marketing plan, financial summaries, mission, vision, market analysis, sales plan, pricing, operations, management, financials, jose cintron, advance business consulting, mba4help.com
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Why a Business Plan?
If you don't know where you're going any road will take you there
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Why a Business Plan?
to look aheadallocate resourcesfocus on key pointsprepare for problems and opportunitiesTake business to next level
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No Business Plan = Russian Roulette
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Why a Business Plan?
Strategic GuideLenders- borrow moneyInvestors-partnership
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Strategic Guide
Where Do You Want To Go?How You Get There?What is your Market?What is your Niche?How Much $ Cost?Greatest Profit opportunity!What Exit Strategy?
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Funding Sources $$$
Savings-401kRefinanceFriends and FamilyFinancial Institutions Angel Investors
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Lender Expectations
Good Business Track Ability to RepayStaying PowerCollateral
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Investors Expect More!
Competitive AdvantageHuge MarketStrong Management TeamStrong Marketing and Sales Plan and strategiesHigh ROI and Exit Strategy
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What is in a Business Plan?
Executive SummaryCompany DescriptionProduct / Services Industry OverviewMarket AnalysisCompetitors
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What is in a Business Plan?
CustomersMarketing & Sale PlanMarketing StrategiesMarketing ProgramResearch & DevelopmentOperations
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What is in a Business Plan?
ManagementPersonnel Financial Financial Summary
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Executive Summary
A mini-business plan on one/two pagesHighlights the most important points …It is NOT an introduction to the planIt must grab your reader’s attention
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Executive Summary
Identify the company, its background and structureDescribe what the company does, and the market it servesDescribe the market potential and market trends.Competitive Advantage
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Executive Summary
Outline the backgrounds and experience of the top management team
Describe the funding $ required, the purposes, collateral available and the expected outcomes
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Company Description2
Brief Company Introduction– Mission statement– Location, size, history– Market and products– Overview of company – Start up $$$– Objectives
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Example
Vision statement
Avon: To be the company that best understands and satisfies the product, service and self-fulfillment needs of women - globally.
Mission statement
Google's mission is to organize the world's information and make it universally accessible and useful
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Products or Services
Products / Services– What does it do?– Uniqueness– Competitive AdvantageTechnology– Brief description– Applications
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Industry Overview
Legislation and Policies Driving the IndustryHistorical-Future TrendsIndustry Definition and DescriptionMajor players-industry
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Market Analysis
Market Definition– Primary Market– Secondary Markets
Market Size and Trends– Current total revenues– Predicted annual growth rate
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Competitors
Direct Competitors– Who are they?– Size and product breadth– Revenues and
profitability– Strengths and
weaknesses– Market sharesIndirect Competitors
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Customers
Customer Characteristics– Who are they?– Why do they buy?– Customers Need satisfied? – How is the need currently filled?– What are the alternatives?– Who makes the decision to buy?– How frequently do they buy?
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Marketing Strategies
Product or Service StrategyPricing StrategyDistribution StrategyAdvertising and Promotion Push and pull strategySales StrategyMarketing and Sales Forecasts
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Interruption Marketing
DOES NOT WORK (Low ROI) Outbound Marketing is out • Telemarketing • Trade shows • Direct mail
• Print ads
TV/radio ads
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Marketing and Sales Plans: Marketing Program
Conventional marketingInternet Marketing Social Media Marketing Website and SEONetworking /PREmail campaignMarketing Budget
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Marketing and Sales Plans: Pricing (4)
Basis for targeted price (cost analysis)Margins and profitability by volume levelsAdd valueCompetitors
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Marketing and Sales Plans: Sales Plan
Sales force structure – (direct or reps)Sales expectations/quotasMargins given to intermediariesService and warrantiesSales Budget
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Research & Development
Research & Development Plan– Objectives– Milestones and
current status– Difficulties and risks– R & D Budget
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Operations:Manufacturing/Production Plan
ObjectivesFacilitiesStaffingSubcontractorsQuality ControlBudget / Operating Expenses
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Management
Company OrganizationManagement Team Administrative Expenses
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Management Team
PresidentVP FinanceVP SalesVP MarketingVP ManufacturingGeneral Manager
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Personnel
Human Resource Plan– Staffing Objectives– Organizational
Structure– 3-5 year growth plan– Budget
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Summary of Financials
Financial Objectives– Time to Cash Flow
Positive (milestone)– Time to profitability
Capital RequirementsRepaymentExit Scenario
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BEP and Contribution Margin
Fixed Cost- $10,000(Rent, insurance, manager, interest…)Variable cost- $800/ea (Hourly, commission, inventory…)Sales are $1,000 per unit
$1,000-$800=$200 Contribution Margin
$10,000/$200=50 Units to BEP Fixed Cost/Contribution Margin.
$10,000+5.000=$15,000/200=75 units to make a $5,000 profits.
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Financials
Pro-forma Cash Flow Pro-forma Profit & Loss StatementsPro-forma Balance SheetBreak Even PointBusiness RatiosMethod of Repayment
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Appendices
Resumes of KeyPhotographsPatent InformationCustomer ListTestimonialsReferences
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Market Research for your Business Plan
Primary market Research– Existing customers – Potential customers Your competition
Software Equipment Niche Strategies
Secondary Market ResearchTrade associations*Government information – Federal, state and local government reports – Small Business Administration – SBA– Small Business Development Center – SBDC – U.S. Bureau of Census Chambers of CommerceMarket research firms ($$$$$$$)
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Conclusion
With Business Plan NO Business Plan!
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