Business Planning part one.ppt

Business Planning

Institute for Certified Business Consultants

Richard A. Quinn

Agenda

Part One:Introduction – Content – ExpectationsThe Feasibility Study – friend or foe?Strategic Planning

After Lunch:

Part Two:Developing a Business PlanFinding resourcesWrap-up

Assessment Strategy

Assessment Methods: Participants must complete a variety of assessment methods that will include:

Written short answers

Practical exercises

Case studies

Projects

Simulation

Introduction

The objective of this module is to equip the student with the Business Planning skills necessary to assist the small business owner/ manager to:Recognize the importance of business planning to the success of the small business;Apply the knowledge and skills of business planning to the benefit of the small business.

Feasibility Study

Starting a new business

Buying an established business

Acquiring a franchise

Expanding an existing business

Doing business overseas

Strategic Planning

Establishing goals

SWOT analysis

Diagnostic assessment

Operational planning

Developing a Business Plan

Format for a business plan

Role of the business plan in an on-going business

Avoiding fatal errors in the plan

Why do I need a business plan?

Realism

Outside advice

Recognize change

Balance growth and opportunities

Create a results-oriented business

Benefits of Business Planning

Reduce “firefighting”

Justify plans and actions

Test ideas before you write a big check to pay for them

Help focus ability and commitment

The Feasibility Study

It’s not just for start-ups

It is a form of planning that examinesA new business idea

Evaluating an existing business

Acquiring a franchise

Assess the introduction of a new product or service

Consider expansion potential

Identify new markets to enable diversification

Starting a new business

To determine the feasibility of starting up a completely new venture, there is a need to gather information that will prove the business idea is financially viable and that there is a profit to be made by pursuing it.

Evaluating an established business

What is the market demand and need for this product/service?Can a market be created?What is the level of competition?Is the market growing, static or declining?What is the anticipated selling price?What are the costs involved

to produceto operateto distributeto market?

What could the business yield in terms of profit and is that sufficient reward?How much financing will be required and is it possible to acquire it?What legal requirements will apply?Is there any special experience or technical expertise required?

Acquiring a franchise

A franchise is a business arrangement where the franchisee (franchise buyer) is granted the right by the franchisor (franchise seller) to manufacture or sell the product/service of the franchisor within a certain area. Franchises can involve:

a system; a unique method of doing business (e.g. motels or fast food)a product; the distribution of products (e.g. cars or petrol)a manufacturing process: the product is manufactured under license (e.g. soft drinks). The benefits of franchising vs. bootstrapping a new business

Exercise One

Develop a feasibility study before lunch

Strategic Planning

This type of planning is designed to give a business direction and purpose over the long term. It attempts to look beyond the current range of business activities and ask your clients questions such as:

What are your goals?Are you in the right business?What is happening to your market in the long term?What is the outlook for your present product/service? Will it become obsolete?

The strategic planning process:

In formulating a long range plan, the small business owner should follow this series of steps.

Set business objectives.Set long range goals.Conduct a SWOT analysis/situational analysis.Develop strategies.Develop an operational plan.Implement your planDevelop an action plan and methods to evaluate performance

Setting Business Objectives

What is the business there for?

Why was it created?

What are the expectations of the owners?

How will the business be conducted?

What codes of practice will be adopted?

What will be the business philosophy?

Is there a commitment to quality, high ethical standards, environmental protection or other ideals?

Establishing long-term goals

How far is the future from here?

Mission – What you’re going to provide

Vision – What you want to be when you grow up

Purpose – Why you’re doing all of this work anyway

The SWOT analysis

Why do I need one?

Strengths and Weaknesses

Threats and Opportunities

Who owns what and why

Value of a SWOT analysis

Developing Strategies

Developing an operational plan

Setting achievable targets

Identifying resources and the means available to achieve targets

Provides methods of control and feedback

What’s Next?

Consider it “Homework”:

Identify a business opportunity and create a feasibility study in one of the markets where you have consulted previously

Conduct a SWOT analysis for that business

This Afternoon:

The written Business Plan

Getting help and finding resources

Wrap-up