BA 129 Final Paper Guideline

The Business Plan is the culminating requirement of BA 129. It serves as a summation of your knowledge

in Strategic Management, Marketing, Operations and Finance. The deliverable is a fully explained and

detailed business plan for a business enterprise chosen by the students. The fully developed business

plan aims to evaluate the business opportunity and at the same time design an appropriate business

model, marketing strategy and tactics, and operations plan. At the end of the day, all of these will be

evaluated under a financial evaluation that will ensure that the plan is viable. The following are the

expected parts and requirements of the business plan:

1.  An Executive Summary (one page)

a.  The summary is the window into the project. Discuss the business concept, key

marketing and consumer insights, business model employed, operating highlights and

financial attractiveness.

2.  The Business Concept

a.  This portion discusses the overall business concept. Generally describe the product and

its features and key propositions.

3.  Strategic Development  –  the key message of this portion is lay down the logic behind your

market positioning. From a to-down approach, there are information or forces which support or

allay your chosen position later on. This story should be seamless from start

(macroenvironment) to end (positioning). This all should make sense. Your conclusions are more

persuasive if this backed by statistics and data. Always see to it that the aim is to convince the

reader that what you are saying is true or, at least, possible.

a.  Macroenvironment Analysis using the relevant analyses framework. Provide data and

not merely unfounded conclusions.

b.  Microenvironment Analysis using the relevant analyses framework. Provide data and

not merely unfounded conclusions.

c.  Competitive Analysis using the relevant analyses framework. Provide data and not

merely unfounded conclusions.

d. Market Research Framework, Method and Results (if appropriate)

e.  Segmentation / Targeting / Positioning

i.  Always link back to market research if appropriate. Market research validates

your conjectures. Remember that you are not the target market. What you feel

and perceive as desirable might not be the case for the target market. Market

research validates your “hypothesis” about their behaviour.

4.  Demand Analysis  –  this portion describes the framework, methodology and results of the

demand projection, as guided by the final positioning.

a.  Research objectives  –  describe what you want to measure

b.  Projection method  –  describe how you will measure it

c.  Data used  –  describe the nature of the data you will use and its appropriate sources.

d.  Results  –  discuss the results

5.  Marketing Plan  –  this portion deals with the marketing tactics of the 4Ps or SAVE (if b2b).

 

a.  Product / Solution

i.  Describe the product and its unique attributes. Why will this work? Lay down

the product features, specifying the details that will link to the positioning.

Include metrics which will highlight the competitive advantage of this product

versus competition.

b.  Place / Access

i.  Describe the appropriate distribution channel. Which channels should you use?

How will this distribution channel operate? Link back to strategy  –  how will this

distribution channel support your positioning.

c.  Price / Value

i.  Describe the decision making or factors considered in deciding on the price

point. What principles were observed? How does this fare versus competitive

pricing? Link back to strategy  –  how does this price point support the market

positioning?

d.  Promotion / Education

i.  Design an integrated promotions plan. How will you communicate value? In

what channels? What is the key message that will be communicated? Link back

to strategy  –  does the medium use and the message enhance or is consistent

with your positioning?

e.  Marketing Budget  –  This portion will culminate with the marketing budget.

6.  Operations Plan

a.  The Product’s Technical Specifications

b.  The Manufacturing / Service process

i.  Illustrate the process  –  describe the process and discuss its key subprocesses.

ii.  Factory or Manufacturing layout and Location  –  where will manufacturing be

situated? Why there? Is it possible to find such location?

c.  The supply chain

i.  Input requirements  –  what are the required inputs? What characteristics of

inputs are needed?

ii.  Equipment requirements  –  what equipment are needed?

iii.  Sourcing  –  where to source the input and equipment?

iv.  EOQ or order quantities  –  how to buy them?

d.  Required inventory levels

e.  Production Schedule

f.  Cost of Production

g.  Cost of Equipment and other initial outlay

7.  Financial Evaluation

a.  Financial Forecast Assumptions - Explain the assumptions behind the P&L, B/S, CF

Forecasts.

i.  Income and Expense  –  recap based on Demand Projection and Operations Plan

ii.  Working Capital  –  recap based on Operations plan

iii.  PPE  –  recap based on Operations plan

 

iv.  Capital Structure  –  decide on a capital structure, and explain your rationale.

v.  Equity Investment  –  ultimately, the exercise is to “offer” some shares to outside

investors since the proponents (you guys) cannot finance it all. You have to

decide on how many shares to offer to outside investors (or alternatively, the

amount you want to obtain from them).

1.  How much is owned by proponents?

2.  How much is offered in the Private Placement?

b.  Pro-forma Financial Statements

c.  Financial Ratio Analysis of the Forecasted Financial Statements

i.  Evaluate the forecast using usual financial statement ratios.

ii.  Are forecasted results attractive? Discuss against a competitive or industry

benchmark.

iii. 

Do forecasted results make sense? You should be able to explain abrupt

changes or jumps in ratios.

d.  Net Present Value Analysis

i.  WACC computation  –  discuss the assumptions behind the WACC computations.

1.  Cost of Debt

2.  Cost of Equity

3.  Weights

ii.  Cash Flows  –  describe the cash flows to be used

iii.  NPV

8.  Risk and Sensitivity

a.  Identify key factors which may adversely affect the soundness of the financial forecast.

b.  Perform sensitivity analysis based on this identification of risk factors.

9.  Bibliography

a.  Include a list of all references used.

KEY DEADLINES:

FINAL PAPER  –  September 23, 2013, at 5:00pm. Late papers will not be accepted, this will earn an

automatic 5.0.

PRESENTATIONS - September 26, 28 and October 5, 2013. I will assign the presentation schedules.