Week 5 - business plan

Question 1

What is a business plan?

Answer 1

A written narrative, 25 to 35 pages long, describing business goals and how they’ll be reached.

Question 2

• What are the two primary reasons for writing a business plan?

Answer 2

Internal: founding team systematically thinks through every aspect of their new venture

External: Communicates the merits of a new venture to outsiders, e.g. investors and bankers

Question 3

• Who reads a business plan and what are they looking for?

Answer 3

Employees:
Focusses management,
Staff understand where they fit.
Investors, stakeholders being recruited to assist

Question 4

• When should the business plan be written in relation to the feasibility analysis?

Answer 4

Feasibility & business plan first

Question 5

3 types of business plans

Answer 5

Summary Business - 10/15pg, new ventures, test waters

Full Business Plan - 25/35pg, new ventures seeking funding, blueprint for operations.

Operational Business Plan - 40/100pg, internal audience, detailed blueprint for managers & staff.

Question 6

Sections of a business plan

Cover page
Exec summary
Company desc
Industry analysis
Marketing plan
Management team
Ops plan
Product
Fin projections
Appendix

Answer 6

Cover page – contact information

Executive summary - a short overview of plan

Company description - a general description of the company demonstrating idea to business.

Industry analysis - industry nature, size, growth

Market analysis - segmentation of market, id target market

Marketing plan - market strategy & 4ps

Management team and company structure – shows strength of founders & reporting/accountability lines.

Operations plan - outlines how your business will be run and how your product or service will be produced

Product (or service) design and development plan – development status, prototype, challenges/ risks, intellectual property strategy

Financial projections – proforma financials for the next 3-5 years based on sources and use of funds and assumptions.

Appendix. - additional information vital to the plan but not appropriate for the body of the plan itself.

Question 7

Why write exec summary last?

Answer 7

Plan will evolve during process.

Prevents writing plant to fit exec summary