Business Plan Writing For Business Plan Series 20110624

Writing a Business Plan
If you fail to plan, then you plan to fail

Harvey Mackay
the plan is useless, but planning is essential
- Dwight D. Eisenhower
LiveWIRE Brunei (c) 2011
About the speaker

Mohd
Fadhilullah Tudun Bin Haji Hassan

@Mohd Hasbolah Bobby
Entrepreneur, Computer Trainer and
Business Counsellor
Interests: IT, Biz and Education
Contact:
Phone:
+673 8651632
E-mel: bobbyofbrunei@yahoo.com
Introduction
Getting
to know each other
Name
From
Where
Hobby and Interests
Occupation/Employment/Business
Reason for Attending Workshop
Business Plan Series Dates

Session
1 (24 June 2011)
Introduction to Business Plan

Business Plan Structure
Company Profile and Startup Table
Session
2 (1 July 2011)
Products and Services

Market Research, Analysis and Strategy
Human Resource Management
Session
3 (8 July 2011)
Financial Analysis
Making a Business Plan Using IT
Presentation
What is a Business Plan?

It
is a medium to communicate your

business idea
It is a document that shows the inner
workings of the business.
Business Blueprints and Roadmap
Business Plan Crash Course

Business
Plan Structure
Business Profile
Market Research and Market Strategy
Organization
Operation Strategy
Financial Strategy
Winning Strategy
Whats the Purpose of a Business Plan?

Business
Profile To convince
investors/bankers of the business feasibility.
The Business Roadmap To clarify the
structure of the business and how it will be
managed.
Operations Manual To communicate to
employees on their responsibilities in relation
to the company objectives.
The Style of the Business Plan will differ with
different purposes.
What Biz Ideas Can You Plan?

Conventional
but
Feasible
e.g. restaurant, stall,
bakery, workshop,
retail shop, School
Simple
evaluated by the
business plan
writing, and how you
can make it different.
Innovative
but
Unproven
e.g. new franchise,
technology company,
new inventions
Challenging
evaluated by the
Business idea and
its feasibility
The Perfect Business Idea

Expertise
Passion
Business Model
Where to learn to create a Biz Plan?

Books
Bookstores, Libraries
Internet
www.bplans.com, www.sba.gov,
www.shell-livewire.com, www.livewire-brunei.com,
www.howstuffworks.com, www.soyouwanna.com,
www.entrepreneur.com, www.google.com.
Courses
Sinaut
Entrepreneurial Development Centre

LiveWIRE Business Plan Series
iCentre - Think Big Biz Plan Workshops
10
Formal Business Plan Structure
Cover
Table of Contents
Executive Summary
Business Profile
Products and Service
Operations Strategy
Marketing Analysis
Market Strategy
Organization Strategy
Operation Strategy
Financial Analysis and
Forecasts
Milestones, Future Plans
and Exit Strategy
Appendices
11
Executive Summary
12
Executive Summary
Often
Written Last, Shown First.

Make it interesting for the reader.
Make the reader want to read more.
Make it simple point form for every
section, or a simple abstract summary.
1 or 2 pages Maximum.
E.g. 30 second Movie Preview
13
Business Profile
Introduce
the business
Legal Structure of Business
Sole Proprietor, Partnership, Sendirian Berhad,

Koperasi
Nature
of business
Food, Service, Manufacturing, IT,
Mission
and Objectives
Startup Cost
Milestones/Achievements
14
Products and Service

What
is it?
Who are you going to sell it to?
What problem is it solving?
How much will it cost them?
What makes it unique?
Intellectual Property Involved?
Sales Forecast
15
Market Analysis
Who
are you going to sell to?

Who are your competition? What do they do?
SWOT Analysis (Strengths, Weaknesses,
Opportunities, Threats) What are the Market Forces that affects you?
Political, Economic, Social, Technological
(PEST) Factors for Success
16
Market Strategy
How
are you going to tell your customers

that you are there?
4 Ps
Product
Price
Place
and Distribution
Promotion
17
Human Resource Management

Who
are involved?
Organization Chart
Personnel Roles and
Responsibilities
Personnel
Qualifications
Key
Roles/Management
Payroll Cost
18
Operations Strategy
How
is the business going to run?

How is the business making money?
Location and Working hours
Product Life Cycle - e.g. Agricultural vs Retail
Production Process
Input Process Output
Technology/equipment
Involved
Sales Forecast in relation to Operations or
Season (can also be in product section)
19
Financial Analysis and Forecast

Start
up costs
Sales Forecast
Personnel/Payroll
Cost
Profit and Loss
Cash flow Forecast
Balance Sheet
Break-even analysis
20
Future Plans and Exit Strategy

What
are you going to do with the business in

the long-term:
Expand
Sell
Handover to family member
Go Public
Get Merged or Acquired
or
if anything goes wrong.

If Bankrupt or unsuccessful what will you do?
21
Appendices
Marketing
Materials
Research
Materials and Results

Sample of Advertisements
Survey
Results
Full
Financial Tables
2-5
years
22
Business Profile
23
Business Profile
Introduce
the business and its history

Biodata of the Business
Name,
Legal
Location, Contact no., Year Started, etc.
Structure of Business
Sole
Proprietor, Partnership, Sdn Bhd,

Cooperative
Nature
Food,
Startup
of business
Service, Manufacturing, IT, etc
Cost or Milestones/Achievements
24
Vision and Mission

Vision
vs Mission
Mission
What is the desired Goal

Vision How you see the future
Why
does the Business Exist?

The Purpose of the Business.
Usually Intangible, Broad, and Abstract
25
Examples of Mission
Google's
- to organize the world's

information and make it universally
accessible and useful.
Rich Dad Companys - to elevate the
financial well-being of humanity
Microsofts - To help people and
businesses throughout the world realize
their full potential
26
Objectives
What
you need to do to achieve the mission

Objectives are SMART:
Specific
Measurable
Attainable/Achievable
Relevant
Timely
This
might be clearer after the biz plan is done
27
Examples
To earn
$1 million dollars in revenue in

the 2nd Year
to sell 1000 units in the first year
to achieve 50% market share in the 2 nd
year.
28
Exercise
Create
you Business Profile
Business
Name
Legal Structure
Nature of Business
Mission and Objectives
29
Startup Costs Accounting Terms

Capital
money that was put in by the owner.

Liability money put in by banker/investor to
be paid back.
Assets property that can be turned to cash
Expenses purchases or payments that
cannot be redeemed for cash
Income Money coming in from business
operations or sales.
30
Startup Costs
Assets and Expenses
Assets
Assets
Expenses
Purchase
Business
Furniture
License
Initial
Building
Assets
Cash
in hand
Raw materials
Work In Progress
Intangible
Expenses
Registration
Equipment
Current
Legal
Assets (IP)
Operation
Expenses
Rental
Deposit
Utilities
Marketing
Employees
Decorations
Design
31
and
Exercise
Create
your Startup Table
Assets
Fixed
Assets
Current Assets
Intangible Assets
Expenses
Legal
Initial
Operation
Renovations
32
Products or Services
33
Know your product or service

What
do you provide?
What are the Features and Benefits.
What makes it unique?
To who do you provide?
Business
to Business (B2B)
Business to Customer (B2C)
34
Features vs Benefits
What
you offer
E.g.
Food
Phone
House
Hotel Room
Furniture
Gym
What
customers get
E.g.
Satisfaction/Full
Communications
Home
Rest/Sleep
Comfort
Health/Look Good
35
Intellectual Property Rights

Copyright
Books,
Software, Audio,
Video
Trademark Logo,
Signage
Patent Inventions,
Mechanisms
Design Physical
Appearances
E.g.
Android OS, iOS
Android
Logo, Apple
Logo
The combination of
the chips and circuits
The look and feel of
the phone.
36
What to Who?
Product to Consumer Matrix
PC
Consumer
Student
High End Medium
Low End
Professionals
Office
Geeks/Gamers
37
Market Research
38
Resources on Marketing
Books
Ziglar on Selling zig ziglar

Salesdogs Blair Singer
Websites
Smallbusiness.yahoo.com, bnet.com,
salesdogs.com, howstuffworks.com,
en.wikipedia.org
Courses
LiveWIRE BSOM
EDC Pemasaran yang berkesan, Jurujual
Profesional
39
Why is Market Research Necessary?

To know
your
customers
To know
what type of
people or how
many would be
interested?
Where can you get
your customers?
How much people
will want to pay?
your
competitors
See
Who
they are
What they
do/provide?
What are their Pros
and Cons
To see
how feasible
your biz idea is.
40
What you need to know first

Understand
Its
your products or service
benefits, quality
Your
basic operations and product life

cycle e.g. farming, manufacturing, etc
Seasonality
Your
(weeks, months, years)
Products History
Price,
Promotions, Distribution
41
Where can you get Market Research?

Primary
Research
research you get and analyze yourself
Secondary research
research that has already been done
42
Primary Research
Phone
Call
SMS
Interview
Survey
Letters
Design,
Print,
Photocopy, Gather,
Data entry and
Analyze
Use Internet e.g.
Facebook and
Survey Poll.
43
Secondary research
www.depd.gov.bn
Department of
Economic Development and Planning
Perancangan
Kemajuan Jangka Panjang NBD

Brunei Statistical Yearbook 2004
Other
Government Newsletters
Internet
Internet
statistics www.internetworldstats.com
Cia world factbook www.cia.gov
44
What you need to Ask?

How
Big is the market?

Market Segmentation. Who are your
Customers? (Dont say everyone)
Age
group, Geographic Location, Employment,

Income Level, etc.
Who
are your Competitors/Allies
What
they do well or badly.
What
your targets wants in your

product/service?
Price,
quality, feature, benefits.

45
PEST factors
Political
Factors how does the

government affect your market.
Economic Factors how does the
economic status affect your market.
Social Factors cultural and social
trends.
Technological Factors technology
that affects the market.
46
SWOT
Internal
Strength
Weakness
External
Opportunities
Threats
47
Porters 5 Forces
48
Exercise
Product
and Market Research
What
are your Product(s) or Service(s)

Who do you Sell to? Market Size?
Segmentation e.g. Age, Income, Occupation
Who else is trying to get your customers?
How does the market affect your business?
PEST,
What
or porter 5 forces
are your SWOTs
49
Market Strategy
Getting someone, who has a need, to
know, like and trust you
John Jantsch (Duct Tape Marketing)
50
Why do you need a Marketing Strategy?

Focuses
your Marketing efforts more

effectively
So you can decide how and when are
you going to Market yourself.
So you can allocate the Budget for
Marketing Strategies
51
How do you choose a strategy?

Choose
those
That
focuses on your target market

Affordable
Effective
Not
energy consuming
Not time consuming
52
What is your Marketing Mix?

The
4 Ps
Product
Unique Selling Advantage,

Packaging and Value added services
Price Pricing of the products compared to
competitors.
Place Location of your business or/and
Distribution of your products
Promotion Advertising, Public Relations,
Word of Mouth, Point of Sale.
53
What Promotion Strategies can you do?
Fliers
Posters
Newspaper
Brochures
Business Cards
Exhibition
TV
Radio
Letters/faxes
Stationery and gifts
Referrals
Word of Mouth
Direct Selling
New Technologies
E-mail
Website
Web advertising
Social networking
Blogs
And Many More!!!

54
Market Strategy Implementation

Marketing
Calendar when are you

going to implement the strategies?
Look
at your production capacity

Look at the market seasonality
Marketing
Budget how much will it cost

during those times.
55
Marketing Costs
Month
10 11 12 Total
Fliers
Business
Card
Online
Exhibition
Total
56
Marketing Costs Pie Chart
57
Exercise Marketing Strategy

Keep
in mind
What
is are your products?

Who do you sell to?
Who is also trying to sell to them?
How
are you going to reach your

customers?
What
are your 4Ps

What does your marketing cost you?
58
Organization Strategy/
HR Management
59
Why do you need an organization strategy?

Judges
see this as how strong your

team can build the business
Investors see this as how good the
people are that can make their money.
To calculate costs for Personnel / Payroll
To see any management gaps
60
Management Team and Gaps

Briefly
describe who are in your team

(who you already have)
A summary of each team members CV
Also mention what gaps you may have
(Team member you may lack)
Mention advisors you may have
Include CV in appendices
61
Organization Chart
CEO
Admin
Finance
Sales
And
Marketing
Products/
Service
HRD
Front Desk
Back Desk
62
Roles and Responsibilities

Roles
or positions
Responsibilities
Qualifications
Salary
Roles
Responsibilities
Qualifications
Salary
CEO
Manages Company
Degree, MBA
$2,000
CFO
Manages Finances
Degree, MBA
$1,500
CIO
Manages IT
ND or Degree
$1,500
MD
Manages Department
ND or MBA
$1,200
63
Payroll/Personnel Cost
Month 1
10 11 12
CEO
CFO
CIO
MD
TAP
SCP
Total
64
Operations Strategy
65
Operation Strategy
What
How does your business make money?
How
do you receive your payment?
Cash or Credit/Accrual
What
is the business/product cycle?
When do you produce your products/service
What
are your business activities?
What do you do? Services or products?
What
is your business model?
are the overhead costs?
What are the monthly running costs?

66
Sales Forecast Table

Month
10
11
Units
Sold
Sales
Price
Cost
Price
Total
Sales
Total
Cost
Gross
Profit
67
12
Total
How to base the Sales

By Supply/Capacity
How much you can
handle and when
Services like
restaurants or internet
cafe look at capacity
(number of chairs)
Products look at how
much or when it can be
produced, stored, or
how fast it can be
reordered.
By Demand
How much people often
want to use your service
or buy your product, this
can be derived from
market research.
Services like
restaurants or tailoring
look at seasonal
behavior of customers
Products look at
customers use of
products. E.g. addiction
to cigarettes
68
Overhead Costs
Fixed Costs that are

related to running the
operations.
May be Unrelated to
costs such as:
Cost of goods (COGs)

Variable Marketing
costs
Payroll costs
Examples:
Stationery
Rental
Utility Bills
Electricity, Water,
Phone, Internet Access
Maintenance
Loan Repayments
License Fees
Insurance
Taxes
69
Financial Analysis
70
Resources
Financial
Books
Accounting
for non accountants, accounting

for dummies,
Internet
Courses
LiveWIRE
BSOM
EDC Accounting Courses
BICPA-FTMS certified accounting courses
71
Why do you need Financial Analysis?

To see
that the business is feasible in

terms of cash
To see that you are making money
So you can plan your expenditures more
carefully
72
Financial Analysis
Break-even
analysis
Profit and Loss
Cash Flow Forecast
Balance Sheet
73
Break-even analysis
What is the purpose?

To see how many units
need to be sold to make
money.
What you need to know?
Units Sold
Sales per unit
Cost per unit
Fixed Costs
Note:
this is for a single product,
for multiple products you
may use average.
74
Profit and Loss Forecast

Calculates
the amount of money going in (from

sales) and out (from operations cost)
Factors
Income from Sales of Goods or other items
Expenses from
Direct Cost of Goods Expenses ,

Controllable and Fixed Costs
Calculate
Gross Profit and Gross Margin
Net Profit
75
Profit and Loss Forecast Sample

1
10 11 12 Total
Gross
Sales
Direct
Cost of
Goods
Gross
Profit
Expenses
Nett
Profit
76
Cash Flow forecast

Similar
to Profit and Loss, But it looks at:
Other factors of money going in or out other than

monthly business operations.
In-flow additional loans, owners capital,
Out-flow business taxes, assets purchase, renovations,
expansion, owners draw/dividends
Nett-flow (profit or loss)
and accumulated cash (money in bank)
Actual Money going in or out
Especially useful if you are buying/selling by using credit.
Ensuring there is money in the bank.

77
Cash Flow forecast sample

Month
10 11 12 Total
In-Flow
Out-flow
Overhead
Payroll
marketing
Nett Flow
Accumulated
Cash
78
Sample Cash-flow Chart
79
Balance Sheet
Assets
Current
Assets
Liabilities
Current
Stocks,
Cash,
Accounts
Receivable
Fixed
Accounts
Taxes,
Liabilities
Equipment,
Mortgages,
Furniture, Land,
Building, Vehicles
Patents,
Goodwill
Assets
Copyrights,
Payable,
Long-Term
Assets
Intangible
Liabilities
Payments
Net
Contract
Worth = Assets Liabilities

80
Balance Sheet Sample

Assets
Current Assets
Liabilities
Current Liabilities
Stocks and WIP
500
Cash
5,000
Accounts Receivable
Accounts Payable
500
Taxes
200
500 Long-Term Liabilities

Bank Loan, Mortgages
Fixed Assets
Furniture
2,000
Contract payment
Equipment
5,000 Total Liabilities
10,000
1,000
11,700
Other Assets
Trademark
Total Assets
500
13,500 Net worth
1,800
81
Using IT
82
Using the IT to create a biz plan

Using
Word
Templates, styles and TOCs, Header and Footer,

Page number
Inserting Graphics, Organization Chart, Tables
Using
Excel
Using Formulas and relative addresses,

importing into word
Creating Cash flow and Graphs
Using
PowerPoint
Slide Design, Animation Schemes, Footers and

Printing
83
Writing and Presentation Tips
84
Plan to Make Your Business Plan

Allocate
the time you need to do certain

parts of the Business Plan
Use
Calendar/Planner/Diary/Journal
Create a deadline for specific tasks
If
you are doing in a group (highly

recommended) allocate specific tasks for
a specified person
85
Writing Tips
Clear
Concise
Organized
Well
Laid Out
Natural
Positive
Well
interpreted facts
Do not jump to
conclusions
Show Sources
Proofread
Make it Perfect
Well written
executive summary
86
Presentation Tips
10-15
slides
10-15 minutes
Keep it Simple
Make it to the point
Tell a Story
Dress Professionally
Practice
In front of mirror
In front of someone
87
Tell a Story
Introduction
(breaking the ice)

Existing Problem/Pain/Situation
Solution (Product/Service) your are
providing
Market Research and Strategy
Who are involved
How you can succeed
88
10 tips from David S. Rose

Do not look at the screen
Do not read your speech
Do not do a Live Demo
Always use a Remote control
Remember handouts are not your presentation
Do not tell Jokes.. Ever
Do not stroll or fidget
Pace the presentation smoothly and evenly
Check equipment, own laptop and projector
Only the CEO give the money pitch
89
Quick Tips
Your
idea doesnt just make money, but helps

people:
Creates jobs, or provides a service, or provide a

solution, alleviates a pain/discomfort
Its
not just an idea, but a work in progress.

You have the numbers to back you up.
You have qualified people (employees or
partners) involved.
Be passionate in your presentation
90
Your Mission
1.
2.
3.
4.
5.
6.
7.
Start and Complete Your Business Plan!

Choose a business Idea
Plan to create biz plan
Create a draft Biz plan or exec summary
Design and implement market research
Analyze Market Research
Adapt Biz Plan Strategy to meet Market
Analysis
91
The End
Thank You,
Good bye, and
Good luck!
92

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Writing a Business Plan

If you fail to plan, then you plan to fail

LiveWIRE Brunei (c) 2011

About the speaker

Fadhilullah Tudun Bin Haji Hassan

to know each other

LiveWIRE Brunei (c) 2011

Business Plan Series Dates

1 (24 June 2011)

Introduction to Business Plan

Products and Services

LiveWIRE Brunei (c) 2011

What is a Business Plan?

is a medium to communicate your

LiveWIRE Brunei (c) 2011

Business Plan Crash Course

Whats the Purpose of a Business Plan?

What Biz Ideas Can You Plan?

LiveWIRE Brunei (c) 2011

The Perfect Business Idea

LiveWIRE Brunei (c) 2011

Where to learn to create a Biz Plan?

Entrepreneurial Development Centre

Formal Business Plan Structure

LiveWIRE Brunei (c) 2011

LiveWIRE Brunei (c) 2011

Written Last, Shown First.

LiveWIRE Brunei (c) 2011

Sole Proprietor, Partnership, Sendirian Berhad,

Food, Service, Manufacturing, IT,

Products and Service

are you going to sell to?

LiveWIRE Brunei (c) 2011

are you going to tell your customers

LiveWIRE Brunei (c) 2011

Human Resource Management

is the business going to run?

Input Process Output

LiveWIRE Brunei (c) 2011

Financial Analysis and Forecast

LiveWIRE Brunei (c) 2011

Future Plans and Exit Strategy

are you going to do with the business in

if anything goes wrong.

LiveWIRE Brunei (c) 2011

Materials and Results

LiveWIRE Brunei (c) 2011

LiveWIRE Brunei (c) 2011

the business and its history

Location, Contact no., Year Started, etc.

Proprietor, Partnership, Sdn Bhd,

Vision and Mission

What is the desired Goal

does the Business Exist?

LiveWIRE Brunei (c) 2011

- to organize the world's

you need to do to achieve the mission

might be clearer after the biz plan is done

LiveWIRE Brunei (c) 2011

$1 million dollars in revenue in

LiveWIRE Brunei (c) 2011

you Business Profile

LiveWIRE Brunei (c) 2011