Business Planning Business Planning ProcessProcess

MeaningMeaning A business plan is a formal statement of a set of

business goals. It may also contain background information about the

organization or team attempting to reach those goals. A written document that details a proposed or

existing venture. It explains the vision, current status, expected needs,

defined markets, and projected results of the business.

Guide for managing the start-up and or operations of a co operative, including:

1. Estimate of amount and sources of start-up and operating capital;

2. Projection of revenue and expenditures for defined period of time; and

3. Identification of all requirements for the future operations

Functions of business planFunctions of business plan 1. A business plan offers a path to follow in making

crucial startup decisions. ◦ It is a management and financial "blueprint." ◦ It is an important guide for starting, building and

managing a successful business. 2. The plan clarifies your ideas and establishes a plan

of action. ◦ It explains how the business will function in the

marketplace. ◦ It describes what you are selling, your background

and qualifications, who your prospective customers are, where they can be found, what is needed to build the business, how you plan to promote and determine the viability of the venture in a designated market.

o Business plan helps in attracting lenders.o Employees and managers get proper direction .o Measuring actual performance against targets.o The plan should prove that the venture will be able to

repay loan amount. 3. It is an operational tool.

◦ The business plan is a tool that clearly depicts characteristics which, when properly used, will help you manage your business and work toward its success.

◦ It is a means for communicating your ideas to others by measuring operational progress.

4. Business plan is a financial tool.◦ By determining how much money will be needed

for start-up costs, it details how the business will be financed.

◦ And, as a prospectus for potential investors, it is an important tool to help obtain financing by anticipating ongoing capital and cash requirements to reassure lenders or backers.

5. It is a benchmark for good operational management. ◦ The finished plan will be an operational tool that

provides guidance to the entrepreneur in organizing planning activities to help move the business forward.

6. Finally, a business plan provides for future growth. ◦ An explanation of how you plan to keep your

business growing -- a detailed guide of what you are going to do, and how you are going to increase your profits.

◦ These plans should outline your specific goals for the coming one, two and three years.

Elements of Business PlanElements of Business Plan Executive Summary: The purpose and nature of the

business, location, founders. Company Description: Legal establishment, history,

start-up plans, etc. Product or Service: Describe the products to be sold.

Focus on customer benefits. Market Analysis: To know your market, customer

needs, where they are, how to reach them, etc. Strategy and Implementation: Includes

management responsibilities with dates and budgets. Management Team: Describe the organization and

the key management team members. Financial Analysis: An income statement is required

to show revenue, cost of goods sold, net income. A projected balance sheet .

Format of Business PlanFormat of Business Plan 1.0 Executive Summary1.1 Fundamentals of the proposed business

1.2 Objectives1.3 Keys to Success

1.4 Sources of Funding

2.0 Company Summary2.1 Company History (for ongoing companies) or Start-up Plan (for new

companies)

2.2 Mission Statement2.2.1Company Goals & Objectives2.2.2 Business philosophy

2.3 Company Locations and Facilities

2.4 Industry Description

2.5 Strengths & core competencies

2.6 Legal form of Ownership

3.0 Products and Services

3.1 Product and Service Description

3.2 Features & Benefits

3.3 Customers

3.4 Competitive Comparison

3.5 Niche Area3.6 Sales Literature3.7 Sourcing and Fulfillment3.8 Technology3.9 Future Products and Services

4.0 Market Analysis Summary

4.1 Market Segmentation

4.2 Target Market Segment Strategy4.2.1 Market Needs4.2.2 Market Trends4.2.3 Market Growth

4.3 Industry Analysis4.3.1Industry Participants

4.3.2 Competition and Buying Patterns4.3.3 Main Competitors

4.4 Distribution Channels

5.0 Operational Plan

5.1 Production

5.2 Location

5.3 Access

5.4 Legal Environment

5.5 Personnel

5.6 Inventory

5.7 Suppliers

5.8 Credit Policies

6.0 Strategy and Implementation Summary

6.1 Strategy Pyramids

6.2 Value Proposition

6.3 Competitive Edge

6.4 Marketing Strategy6.4.1 Positioning Statements

6.4.2 Pricing Strategy6.4.3 Promotion Strategy6.4.4 Distribution Patterns6.4.5 Marketing Programs

6.5 Sales Strategy6.5.1 Sales Forecast6.5.2 Sales Programs

6.6 Strategic Alliances

6.7 Milestones

7.0 Web Plan Summary

7.1 Website Marketing Strategy

7.2 Development Requirements 8.0 Management Summary

8.1 Organizational Structure

8.2 Management Team

8.3 Management Team Gaps8.4 Personnel Financial Plan

9.0 Start-up Expenses And Capitalization

10.0 Financial Plan

10.1 Important Assumptions10.2 Key Financial Indicators10.3 Break-even Analysis

10.4 Projected Profit and Loss10.5 Projected Cash Flow10.6 Projected Balance Sheet10.7 Business Ratios10.8 Long-term Plan

Tools of Business PlanTools of Business Plan Mission Vision Objectives Goals Strategy Policies http://www.businessinsider.com/pepsico-ceo-women-

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