MAN 470 – Berk TMAN 470 – Berk TUNCALIUNCALI1

What is a Business Plan?

It is a written summary of an entrepreneur’s proposed

business venture, its operational and financial details, its

marketing opportunities and strategy, and its managers’

skills and abilities.

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VIDEOBUSINESS PLAN PRESENTATION

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Never forget;

It is not about coming up with an idea. It is about those who take these ideas to the market, test them out and make profit.

It doesn’t matter who came up with the idea first, but it matters who first started a business with it.

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Why design a Business Plan? REALITY TEST

- Proving that the market for the product or service

exist.

- Focus on market size, potential customers

- Is it different from the existing competiton?

- Can the company build at the projected cost estimates?

- Does it offer value to customers?

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COMPETITIVE TEST

- Relative position according to key competitiors

- How do the strengths and weaknesses match

with competitors?

- Do comparisons threaten the company’s

success or survival?

- Plan must prove quality, skill and experience

of the management team

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VALUE TEST

- Convince lenders and investors that the business offers value and profitability.

- Smoke and mirrors do not replace financial basics (Dot-com boom)

- Venture must have long term strategic vision and practical focus on operations.

- Demonstrate knowledge;a)supplies and cost of goodsb)Unit labour cost c)Selling price and gross profit marginsd)Break even point

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The Elements of a Business PlanTHE EXECUTIVE SUMMARYMISSION STAMENTCOMPANY HISTORYBUSINESS AND INDUSTRY PROFILEBUSINESS STRATEGYDESCRIPTION OF FIRM’S PRODUCT/SERVICEMARKETING STRATEGYCOMPETITOR ANALYSISDESCRIPTION OF THE MANAGEMENT TEAMPLAN OF OPERATIONFORECASTED OR PRO-FORMA FINANCIAL

STATEMENTSLOAN OR INVESTMENT PROPOSAL

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THE EXECUTIVE SUMMARY

Summarize the presentation. (max 2 pages.)

This is the written version of the Elevator Pitch

Must capture the readers attention (in order to read the rest)

First impression is important

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MISSION STAMENT

Entrepreneurs vision for the companyVery broad expression of purposeSet the broad direction that the company will

move

COMPANY HISTORY

If the company is pre-existing, a brief history should be included.

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BUSINESS AND INDUSTRY PROFILE

This part should enlighten the investor in regard to the industry in which the compnay will take part in.

Therefore, state the Goal of the business. (The long range, broad statements that the company plans to achive)

Also state the objectives of the business by which the goals will be accomplished. (short term, measureable, performance targetted, attainable and controlable)

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BUSINESS AND INDUSTRY PROFILE

This part should enlighten the investor in regard to the industry in which the company will take part in.

Therefore, state the Goal of the business. (The long range, broad statements that the company plans to achive)

Also state the objectives of the business by which the goals will be accomplished. (short term, measureable, performance targetted, attainable and controlable)

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BUSINESS STRATEGY

This part focusses on how the company will achieve its

goals and objectives.

How the entrepreneur will gain competitive edge and set

its business apart from the rest?

What makes the company unique?

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DESCRIPTION OF FIRM’S PRODUCT/SERVICE

Describe the overall product line.Overview of how the customer uses goods or

servicesProduct lifecycle – where is the product in this

stagePatents/copyrights from competitors? Final honest comparison

Feature: a descriptive fact about a product or service.

Benefit: what a customer gains from the product or service.

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MARKETING STRATEGY

A target market should be identified. A company should

not try to become everything for everybody! The odds of

success is higher if focused on a specific market niche.Eg: MTV, ESPN, CNN, Cartoon Network,

Finding your target market is the first step in an effective

marketing strategy.• Who are the most promising customers?• Where do they live?• Why do they buy?• Age/Gender/Characteristics• When do they buy?.....etc.

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MARKETING STRATEGY

Customer Interest; If your service or business is already available, then it

will be easy to guess the customer interest. However, if you are going to offer a new product or service,

Finding your target market is the first step in an effective

marketing strategy.• Who are the most promising customers?• Where do they live?• Why do they buy?• Age/Gender/Characteristics• When do they buy?.....etc.

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MARKETING STRATEGY

Documenting Market Claims: In general, busines plans rely on generalizations which usually turn out to be either wrong or unexpected.

There are easy ways to avoid these. Some of these are;

• Surveys/Questionnaires• Demographic studies• Market size and growth rates with facts• Business prototyping

Business prototyping: a process in which entrepreneurs test

their business models on a small scale before commiting serious resources to a business that may or may not

work. (ebay)

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An effective market analysis should contain the following;

AdvertisingMarket size and trendsLocationPricingDistibution

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COMPETITOR ANALYSIS

This section should include an analysis of significant competitors. Every business has a competitor.

Have a look at trade journals, exhibitions, internet… etc.

DESCRIPTION OF THE MANAGEMENT TEAM

Most important factor in the success of a business

venture is the quality of the management team. The

business plan should describe directors, managers or

Anyone with more than 20% ownership in the business.

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PLAN OF OPERATIONTo complete the description of the business, the owner

should construct

an organizational chart.

FORECASTED OR PRO-FORMA FINANCIAL

STATEMENTSOne of the most important parts of the proposed business

venture is

financial statements. Whether it is a running company or a new start up,

this is a crucial point in securing capital for your company.20

LOAN OR INVESTMENT PROPOSALThis part is where the purpose and the amount of the

financing required is stated.

Ask for what is required and do no over inflate. Investors face startups every day.

Details on how you will pay back

Beneficial to include an evaluation of the risks

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General Tips:No typosFirst impressions are crucialShould be visually appealingInclude a table of contentsShould be interestingMust prove that the business will

make moneyTell the truth

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THANK YOU

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