elements bplan

7/31/2019 Elements Bplan

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Elements of a Business Plan


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Business Planning"In preparing for battle I have always found that plans are

useless, but planning is indispensable."

-Dwight Eisenhower

Those who fail to plan, plan to fail.

-George Hewell


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Understanding business plans is not only important forthose who are starting businesses.

More and more banks are requiring business plans forloans, for new projects and on-going operations.

Business plans are used in large companies to justifyprojects.

No matter where you work, it is increasingly likely thatyou will need to evaluate somebody elses business plan.

The Business Plan


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Executive Summary

Company Overview

Market Environment

Marketing and Sales Strategy

Team Composition

Operations

Financial Plan Risk Analysis and Mitigation

The (very) Basics of a Business Plan


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Your Business Plan Will... Discuss a particular market opportunity

Examine the markets that you will compete in, and

explain who your customers will be

Describe the products or services that your company willprovide

Your competition, and how you will defend against it

The operation that you will put in place in your company

The management team that will implement the plan

The size and profitability of your company


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Executive Summary The written version of the One minute pitch

Many people who read your plan, will only read your

Executive Summary...

...and then they mayread your financials. NOT an introduction, but a short version of the whole

plan


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Company Overview Explanation of history, structure, and organization of

your company

Strategic direction

Mission statement

Goals and objectives

Values and vision

People

Relevant skills and expertise of management team

Directors

Relationships with experts in the field


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Market Environment All factors of the market that are outside your direct

control:

Market structure

Market trends Competition

Opportunities/Threats


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Marketing and Sales Strategy Products or services offered

Follow-on products

Intellectual property or other defendable positions

Market research Marketing plan

Brand strategy

Distribution strategy

Product strategy Pricing strategy

Promotion


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Team Composition

Capability of the management team to run a promisingbusiness

The management team

Professional experience and past successes


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Operations Practical details required to meet the plan

Facilities

Manufacturing or out-sourcing

Personnel Varies widely depending on type of business


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Financial Plan Three key reports, in a five-year plan:

Income statement

Balance sheet

Statement of cash flows


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Risk Analysis & Mitigation

Risk scenario

Market risk

Competition risk

Technology risk

Regulatory risk

Financial risk

Management risk

What measures are proposed to counter these risks?


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Writing a great business plan

A great business plan is one that focuses on a series of questions

relating to the four factors critical to the success of every new

venture: the people, the opportunity, the context, and the

possibilities for both risk and reward. William Sahlman

1. The questions about people revolve around three issues:

What do they know? Whom do they know? How well are they

known?

2. As for opportunity, the plan should focus on two questions: Is themarket for the venture's product or service large or rapidly

growing (or preferably both)?

3. Is the industry structurally attractive?

Source: How to write a Great Business Plan, William Sahlman, Harvard Business Review


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Outline of Business Plan

SectionSuggested#

of pages

Executive summary 2-3

Market opportunity and Market Size 2-4

Your offering/product/service/IP 2-5Competitive landscape -analysis with data 1-2

Marketing Strategy- Positioning, Differentiation,

Pricing, Distribution

1-2

Financial Plan Projections, Use of Funds 5-6

Risk scenario & mitigation 1-2

Your team 2-4

Supporting data, research, resume 5-10


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Evaluating Business Plans what does one

look for?

1. The questions about people revolve around three

issues:

What do they know? Whom do they know? How

well are they known?2. As for opportunity, the plan should focus on two

questions: Is the market for the venture's product or

service large or rapidly growing (or preferably both)?

3. Is the industry structurally attractive?

Source: How to write a Great Business Plan, William Sahlman, Harvard Business Review


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Evaluating a Business Plan: Tips

Objectivity is ensured when the criteria for evaluation areclearly laid out

Eliminate possible bias e.g, you like the idea, you like/are

familiar with the industry, you like the student Prioritize content over format and presentation

Relevant Content (market opportunity, attractive industry,investment potential, business model and distinctive

competence) earns more weightage than a well laid outincomplete plan


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Opportunity to Business Model to B Plan

Evaluation What is common?

All three Focus on

Market/Customers

Industry/Competition

Team/People


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Is there any standard format of a B-Plan?

Many formats exist

Each business plan has to be unique general

templates/software may not be effective to

communicate your idea We provide you with a Detailed Guide for writing a B plan

Available on the NEN CD:

Kick-Starting the Entrepreneurial Campus


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Videos and Links

EY Business Plan Guide

How to write a great Business Plan

NEN Videos on B plan
http://hbswk.hbs.edu/archive/565.htmlhttp://www.nenonline.org/getAllVideoList.do?method=fetch&businessFn=getAllVideoList&searchStatus=1http://www.nenonline.org/getAllVideoList.do?method=fetch&businessFn=getAllVideoList&searchStatus=1http://hbswk.hbs.edu/archive/565.html


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Credits

Ed Rubesch,

Thammasat Business School, Thailand

Indus Khaitan, Venture Partner,Morpheus Ventures, Bangalore, India

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