CLASS / COURSE: Business Plan

QUESTION DESCRIPTION:

Executive Summary

 

(This portion of your mini-business plan should contain a brief overview of everything in your plan.  This brief overview should contain an explanation of your product/service line, the market you will serve, and a brief summary of your financial goals. This should be completed in Unit 9.)

 

The executive summary should be one-two pages and be in this position before your plan as the introduction of your business plan.  However, it is easier to conclude after you finish your plan so we complete this section in Unit 9 after you know what you want to say.  Choose the best highlights from each section and summarize for this activity.  You will finish this part of the plan along with edits during Unit 9.

 

Business Description

This section of the plan should include the legal business description and what you are in business to do, what products or services you will produce or deliver to the customer. This should be specific and include:

 

—  Business Name

—  Owner’s names

—  Date of startup

—  Business formation (partnership, corp., etc.)

—  Location

—  Hours of Operation

—  Brief product description – what will you sell?

 

Do not use this list as it looks tacky.  Write this up in paragraph form or at least introduce your description in paragraph format and then introduce a list. 

 

Vision Statement

 

Keep your vision and mission simple and short so people can remember you and what you are about.  Your vision should illustrate the passion you have and what you plan to accomplish. 

 

(This section of the plan should be a statement of what you visualize the business to be at some definite point in the future based on present realities.)

 

Mission Statement

 

The mission tells us how you will accomplish your vision.

 

(This section of the plan should represent a succinct statement detailing the reason(s) for the business’ existence and the guiding principles of the business.)

 

 

 

 

 

Personal Motivation

Starting a new business involves making many decisions! Since it is critical that the entrepreneur make good decisions, it is a good practice to approach decision making in a consistent and orderly way. Your text authors discuss the basic five-step decision-making process on pages 609-610 as it applies to risk management. At this initial stage of examining your motivation, you can also apply these steps to your own decisions. These are: (1) Identify the issue or problem; (2) Evaluate the alternatives; (3) Select an acceptable alternative; (4) Implement the decision; and (5) Review and evaluate the decision made. In this section, you should briefly discuss your motivations for wanting to own and operate your own business and how you could use each of these decision steps in your own planning process.  

  

Description of Products or Services

(This section of the plan should describe how your proposed product or service fills a gap in the marketplace or how your product or service will be “better” than those already existing in the marketplace. It should include any innovative features of your product or services that would distinguish your venture including any patent or copyright protections possessed by the venture as well as any growth strategies for your product or services and if relevant, any secondary markets the business will pursue.)

 

Marketing Plan: Market Analysis

 

Be sure to include the segmentation of your market, target audience and points about the marketing mix including product, price, place and promotion.  Estimate your product life cycle or at least talk about how you will introduce your product to market and identify your competition.  Do research.  This is a critical area of your plan and identifies your price  through competition which is tied to revenue and profit in the financial part of the plan.  Cite sources in-text and reference list.

 

(This section of the plan should contain a customer profile for each identified potential target market customer based upon secondary research for this assignment. Ideally, it should also be based upon primary research as well. It should outline and describe what kind of potential customer the business seeks to reach. It should include customer demographics like age, geographical areas, ethnicity, religion, culture, income levels, gender, IF these are relevant to your product or service. It likely will contain some general things you would most likely want to know such as the purchasing power of this group (how much disposable income); their dominant family status (families, singles); their age ranges; and their leisure habits.)? 

(The Market Analysis should also outline and describe principal rivals for each target market customer group. Be sure to also include indirect competitors as well as direct competitors.)

 

Marketing Plan: Marketing Strategy

(This section of the plan should describe how you propose to reach the target customer. Will you use a single segmented, multi-segmented, or non-segmented strategy? Explain how you will promote the product or service to the target customer. Explain your proposed pricing strategy and why. Explain your distribution strategy; how you will deliver your product or service to the customer.) 

(Note: In a “live” business plan, you would also include a section here containing cost estimates to advertise or promote your product or service).

 

 

 

 

Operational Plan

(This section of the plan should contain:

1. Information about your products or servicesincluding how and where your products or services are produced, production techniques, quality control, customer service, inventory control, and product development;

 

2. Information about your proposed business location including any location requirements such as space, type of building, zoning, power, and other utilities, access, parking, etc., estimated total location expenses, business hours, any major required building alteration;

 

3. Information about your proposed venture’s legal and regulatory environment including any licenses required, any health, workplace, or environmental regulations affecting the business, any special professional requirements, zoning or building code requirements, insurance coverage, and any trademarks, patents, or copyrights held or required;

 

4. Information about proposed personnel including the number of employees (excluding management), type of labor, source of this labor, pay structure, required training, and any possible use of contract workers;

 

5. If Applicable, information about the inventory including the type of inventory (raw or finished goods), any seasonable impacts, and ordering lead times;

 

6. Information about key suppliers including a listing and discussion of key suppliers, their credit policies, history of reliability, need for backup suppliers, any expected delivery problems, and any anticipated increases in supply costs; and

 

7. Information about your proposed venture’s credit policies including any plans to sell on credit, needs to sell on credit, credit policies, credit limits, credit terms, any discounts, and cost estimates of the use of credit.)

 

  Management and Organization Plan

 

Be sure to identify who’s on first.  You must carry insurance, have a bank and should have someone able to do the accounting and financial planning as well as handle any legal needs in addition to internal owners, managers and employees.  Be sure to address these areas and tell us why the people you have chosen can handle the task. 

 

(This section of the plan should contain information about who will manage the business on a day-to-day basis. This should include the experience and special competences that each key individual brings to the business. You should also disclose any outside professional advisors such as boards of directors, advisory boards, attorneys, accountants, insurance agents, bankers, consultants, mentors, or other advisors who will be assisting the new venture.)

 

 

 

 

 

 

 

Financial Plan

See financial plan template on the doc sharing main page.

You must include a balance sheet, income statement and projected startup expenses.  These are estimates based on the research you conduct and price you establish.

 

Price x number of units you think you can sell = total revenue.  First number on income statement.

 The other worksheets in the template are optional.  Paste your worksheets in the appendix area labeling as follows:

Appendix A – Balance Sheet

Appendix B – Income Statement

And so forth.  Each item should have a letter label to reference the reader in the body of the report. 

Be sure to explain the financial calculations in the body of the report and then refer to the appendix schedules. 

Each section is worth 5 points of your grade which is half of your grade for content. 

A key part of your Business Plan is the Pro Forma Financial Statements! This sub-section will provide the following documentation: An estimated 12-month profit and loss projection; a pro forma balance sheet; and a pro forma income statement. In order to accurately make these critical estimates, it is necessary to conduct primary and secondary research into the particular market and venture. The goodness of the business plan rests upon the accuracy of these financial estimates.

While this course examines these financial elements, you will notcreate these pro forma (forward looking) financial statements in this descriptive business plan. Instead, you will focus on two other important sub-sections; the Start-Up Expenses Sub-Section and the Capitalization Sub-Section. 

 

The Start-up Expenses sub-section of the Descriptive Business Planshould include a discussion of the following elements:

1.A discussion of the applicable expenses to start the new business. These could include some (or all) of the following: costs of sales, professional fees, technology costs, administrative costs, sales and marketing costs, wages and benefits. Explain how each of these would impact your particular venture.

2.A discussion of any contingency percentage to cover any under estimation along with your rationale for this percentage

The Capitalization sub-sectionof the Project Template should include a discussion of the following elements:

1.The sources of all loans (existing or proposed) including amounts, terms, and collateral.

2.The names and amounts contributed by each investor in the business including the percentage of ownership of each investor.

 

 

References (Separate Page)

All citations in your text above need to also be in your references here in APA format. Include no references if you have not also cited them above.

 

See virtual office for examples. You should include at least one reference every week for each section of your plan including in-text citations.

 

This is an excellent resource that illustrates how to cite various types of references:

 

http://www2.liu.edu/cwis/cwp/library/workshop/citapa.htm

 

 

Appendix(Separate page at end of document, if necessary)

(An appendix would be used in a business plan to contain large or lengthy elements that would make reading the body of your plan cumbersome. It would also contain associated elements like figures, charts, drawings, photographs, etc.)

 

Use this area to paste in your financial worksheets located in the financial plan template.

The appendix should be the last item listed in your plan after the reference page. 

SOLUTION DESCRIPTION: Place a checkmark here as a reminder that you have completed this particular section of your descriptive business......

SUBJECTS / CATEGORIES:
1. Marketing
2. Finance
3. Strategic Business Management

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