BASIC UNDERSTANDING OF

BUSINESS PLAN
 WHAT IS A BUSINESS PLAN

• It's a tool for understanding how your business is put together. The
process will help you learn how to manage your own company more
effectively while you become an expert in your industry and business. It
creates a framework for you to start and grow your business.

• A business plan is a description of the firm you are to establish and a plan
for how to run and develop it. The plan will gather up the threads from all
your other preparations and in this way guarantee that you get around all
aspects at business start.

• A business plan is also a basis for negotiations with the bank and possibly
business connections to convince them to give credit or a loan. It can also
help you to convince family/ friends/ parents that it is a serious plan to
start your own business.
 WHY DO I NEED A BUSINESS PLAN

• Plots a course
– It helps you think long term - about the big picture, not just about
starting a business but staying in business.
– It assists in keeping you motivated.
• Feasibility study
– Is your idea viable?
– Is your business going to be profitable?
– Will you require outside financing to start or operate this business?
– What are your barriers to success?
 WHY CONTD.
• Become a better decision maker
– It will help you anticipate problems.
– Gathering information for your plan will increase your knowledge of
the industry thereby assisting you in making more informed decisions.
– Your plan provides an organized way to conduct your investigation.
• Reality Check
– Your plan raises questions that will help inspire solutions before a
crisis occurs.
– It helps you to know what will be required of you as an entrepreneur.
– By identifying strengths and weaknesses, it reveals where you will
need assistance.
 WHY CONTD.
• Implementation plan
– Use the Business Plan as a guide to keep you focused and making
progress during the business start up phase.
• Selling tool
– Use the Business Plan to sell your business opportunity to potential
investors, employees and suppliers.
 IMPORTANCE OF WRITING A BUSINESS PLAN

• If you are starting a new business you will require a plan to clearly assess
every aspect of the business and show how it will succeed.
• If you are buying an already established business you will need to identify
the strengths and weaknesses of the business to decide if you will be able
to make it a success.
• If you are already up and running and in need of extra finance you will
need a plan to convince those putting capital into your business that you
can and will succeed.
• If you are applying for one of the many grants available.
• A well thought out and carefully structured business plan is the key to the
long-term success of any business.
 IMPORTANCE CONTD.
• By being able to create a business plan, you demonstrate to
potential partners, investors and even executive hires that
you have thought out all aspects of the business
• The time you'll spend developing a solid, coherent business
plan will more than pay for itself in corporate strategic and
tactical clarity as the company grows
• Business plans are important because they help you see
your business from the perspective of your client or investor
• Provides a considered and logical framework within which a
business can develop and pursue business strategies not just
for the near future but throughout your business
 RESEARCHING FOR A BUSINESS PLAN (GATHERING INFO)

• Secondary Data
– Associations (Associations in Nigeria)
– Networking
– Newspapers, Magazines, Periodicals
– The Internet - Industry Canada
– Statistics Canada (National Bureau of Statistics)
– Directories and published researches
• Primary Data
– Questionnaire/Survey - telephone, mail, email, personal
– Focus Groups
– Product or Service Sampling
– Books
 INFOR MATION IN A BUSINESS PLAN

• Table of contents
• Executive Summary
• Company Profile
• Marketing Plan
– Industry Trends
– Product/Service
– Target Market
– Competitive Analysis
– Marketing Mix
• Promotion
• Place
• Price
• Product
 INFORMATION CONTD.
• Operational Plan
– Suppliers
– Manufacturing Plans
– Operating Requirements
– Human Resources
• Financial Plan
– Start up Costs
– Cash Flow Statement
– Income Statement
– Balance Sheet
• Appendix
 HOW TO WRITE YOUR IDEAS IN BASIC BUSINESS PLAN

• View Samples
– The Business Plan Handbook
– Interactive Business Planner
– On line Business Plan samples
– Chartered bank templates
• Define objectives and potential readers and determine your Action Plan.
• Prepare a time line.
• Begin to gather research information.
 HOW TO CONTD.
• Organize research into business plan components.
• Write the plan.
– Know your audience
– Use clear vocabulary
– Avoid jargon
– Clearly identify sections
– Quality vs. Quantity
– Know your plan
• Get help where required.