business plan by-rahul jain. business planning "in preparing for battle i have always found...
TRANSCRIPT
Business Plan
By-Rahul Jain
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
January 20103
BUSINESS PLAN BASICS
• The Business Plan - A SUPPORTED VISIONT
echn
olog
y
Inte
llect
ual
Pro
pert
y
Mar
ket
Ana
lysi
s
Com
petit
ive
Ana
lysi
s
Sal
es a
nd
Dis
trib
utio
n
Tea
m
Fin
anci
al
Pro
ject
ions Detailed
Support/Foundation
Full Business Plan
PowerPoint Presentation
Executive Summary
Elevator Speech
Mission/Vision Statement 1 paragraph30 seconds
2-5 pages
10-15 minutes
20-30 pages
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 will provide. 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.
January 20105
SESSION 1: BUSINESS PLAN BASICS
Because I have to...Needed for financingStrategic partneringTo explain business to
customers/suppliersTo attract key people
Why Write a Business Plan?
January 20106
SESSION 1: BUSINESS PLAN BASICS
The Business Plan is a result of a PLANNING PROCESS
People don’t Plan to Fail; they Fail to Plan Who are your customers? Why will the buy your service or product? What will they pay? How will you make and deliver the
service/product What resources (people, money, technology)
will you need? Can you create value and make money?
Why Write a Business Plan?– Because I Need to Understand My Business
January 20107
SESSION 1: BUSINESS PLAN BASICS
Who should write the Plan?CEO alone?The team?A hired writer/consultant?
You need to OWN the Plan
January 20108
BUSINESS PLAN BASICS
WHY PLANS FAIL THE FIRST CUT Insufficient MarketNon-Credible Technology Investment Too Large For The PromiseFailure to Understand The Market
January 20109
BUSINESS PLAN BASICS
WHY PLANS FAIL THE FIRST CUT (cont.)Action Plan Not Credible
Too OptimisticNaïve About The HurdlesRuns Off In All DirectionsNot Ambitious EnoughRegulatory Barriers Insufficiently
AddressedNo Promises At All
Team Not Credible
Components of the Business Model
• Value Proposition
• Market Segment
• Competitive Strategy
• Value Chain Structure
• Revenue Generation and Margins
Value Proposition
• A description of the customer problem
• The solution that addresses the problem
• The value of this solution from the customer's perspective
Market Segment
• The group to target
• Recognizing that different market segments have different needs.
Value Chain Structure
• The firm's position in the value chain
• Activities in the value chain
• How the firm will capture part of the value that it creates in the chain.
Revenue Generation and Margins
• How revenue is generated (sales, leasing, subscription, support, etc.)
• The cost structure
• Target profit margins.
Different Models to Evaluate
Direct Mass Media
Retail Telemarketing/ Phone Sales
Channels, Distributors and Partners
Trade Shows and Conferences
OEM Channels Internet - Web
January 201016
BUSINESS PLAN BASICS
The Plan is a SELLING DOCUMENT
Don't lose sight of the visionThe excitement must come throughThe Plan should project your image
BUT: The Plan Must Be Defensible
The (very) Basics of a Business Plan
Executive Summary Company Overview Environmental Analysis Strategy Formulation Marketing and Sales Strategy Operations Financial Plan Risk Factors and Contingency Plan
January 201018
SESSION 1: BUSINESS PLAN BASICS• What Should Be In A Business Plan?
Executive SummaryAn Executive Summary is
NOT an introductionNOT a prefaceNOT a random collection of highlights
An Executive Summary IS the Business Plan in miniature
Why This?
Why Now?
Why This Team?
Executive Summary
The written version of the “60 second pitch.”
Many people who read your plan, will only read your Executive Summary...
...and then they may read your financials. NOT an introduction, but a short version of
the whole plan.
January 201020
SESSION 1: BUSINESS PLAN BASICS
• What Should Be In A Business Plan? -Executive Summary (continued)
The Executive Summary tells Who you are What your strategy/vision is What you are doing and/or propose to do What is the market How many $$$$ do you need and what will you
do with them What your SUSTAINABLE COMPETITIVE
ADVANTAGE is When the reader is finished he or she should be
able to tell someone what you are up to.
Excerpted from: Gumpert, David E., How to Really Create A Successful Business Plan, INC Publishing, 1990
EXECUTIVE SUMMARY: PEOPLE EXPRESS The Eastern seaboard of the United States is ripe for the entry of a new,
superefficient, low-cost air carrier to provide quick, reliable inter-city air
transportation. Such an entity would bring to the Northeast the same benefits that
have accrued to other areas of the United States. Chief among these are:
Frequent jet commuter service between major cities Prices competitive with private automobiles Fulfillment of the congressional goals in enacting the Airline Deregulation
Act of 1978 to have better service at lower fares. The new company will be able to achieve these goals for the following reasons:
Aggressive, innovative management that has been tested in the field and been on the leading edge of innovation in air transportation marketing and systems
Equipment and facilities designed specifically for the low-cost production of air transportation
Manpower selected, trained, and motivated to be efficient and profit oriented
New systems to be applied to the entire business of air transportation to minimize investment in manpower and machines
All of these, when applied to the new entity, will result in considerable economies
vis-à-vis existing air carriers.
40 years of regulation have created an industry heavily unionized with
tremendous inefficiencies The economics of a new entity should be at least 30%-40% better per seat
mile than the current trunks. Other new carriers such as Southwest or Air Florida have shown a
consistent ability to compete on a price basis and earn extraordinary returns
The current political, economic, and regulatory climate is ideal for the proposal herein envisioned.
The Northeast is waiting for someone to bring it what the rest of the nation already has: low air fares.
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.
Environment
It will include both internal and external factorsMarket structureMarket trendsCompetitionExternal EnvironmentSWOT Analysis
January 201025
BUSINESS PLAN BASICS
The OpportunityWhat is the Market / Opportunity?
How big is it now?What are the trends- how fast is it
growing or grow?
Why Is This Time The Right Time For Your Product/Service?
Convergence of Opportunity and Solution
January 201026
BUSINESS PLAN BASICS
Market AnalysisExisting and planned products in
marketplaceMarket segmentsMarket players/competition
Competitive AdvantagesEstimated Market Shares
Current PlayersYou“Who Loses If You Win and What Will
Be Their Response?”
January 201027
• What Should Be In A Business Plan? -The Body of the Plan
Marketing PlanWhat is your Marketing Strategy?Pricing and Distribution
Pricing and margin erosionDistribution must match
strategy/pricingSales Tactics
Who will be the first customer, second customer etc.?
How will you reach the customer?“Will the Dogs Eat the Dog Food?”
Advertising and Promotion
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.
Operations
Practical details required to meet the plan. Facilities. Manufacturing or out-sourcing. Personnel. Varies widely depending on type of
business. Legal Compliances
Financial Plan
BudgetingCosting and PricingIncome statementAnalysis and InterpretationAssumptions and Rationale
Risk Factors
This will contain the limitations and risk factors affecting the business.
Contingency plan has to be indicated
Format
Some tips: Don’t waste time on long introductions. Be passionate, convincing, interesting. Tell a story.
Assignment – 11th Januar y
Dream Board
Research of your Business Idea & 5Qs
( Log Book)
Dream Board
Vision Collage _ Images containing
Company Overview, Values Perfect Customers Products & Services Creative Cohorts
