College of Business Education

Second Semester, A.Y. 2020-2021

MODULE 4
WRITING A BUSINESS PLAN

Introduction

This module discusses the importance of writing a business plan. A business plan is a written narrative,
typically 25 to 35 pages long, that describes what a new business intends to accomplish and how it intends to
accomplish it. For most new ventures, the business plan is dual-purpose document used both inside and outside the
firm. Inside the firm, the plan helps the company develop a “road map” to follow to execute its strategies and plans.
Outside the firm, it introduces potential investors and other stakeholders to the business opportunity the firm is pursuing
and how it plans to pursue it.

I. Objectives

At the end of the end of this module, students should be able to:
1. Explain the purpose of a business plan.
2. Discuss the two primary reason for writing a business plan.
3. Describe who reads a business plan and what they’re looking for.
4. Explain the difference between a summary business plan, a full business plan and an operational business plan.
5. Explain why the executive summary may be the most important section of a business plan.
6.Detail the parts of an oral presentation of a business plan.

II. Lecture

THE BUSINESS PLAN

The time to write a business plan is midway through the step of the entrepreneurial process titled “Developing
Successful Business Ideas.” It is a mistake to write a business plan too early. The business plan must be substantive
enough and have sufficient details about the merits of the new venture to convince the reader that the new business is
exciting and should receive support. Much of this detail is accumulated in the feasibility analysis stage of investigating
the merits of a potential new venture. A large percentage of entrepreneurs do not write business plans for their new
ventures. One academic study found that potential entrepreneurs who completed a business plan were six times more
likely to start a business than individuals who did not complete a business plan.

REASONS FOR WRITING A BUSINESS PLAN

The time to write a business plan is midway through the step of the entrepreneurial process titled “Developing
Successful Business Ideas.” It is a mistake to write a business plan too early.

First, writing a business plan forces a firm’s founders to systematically think through each aspect of their new venture. 5
This is not a trivial effort—it usually takes several days or weeks to complete a well-developed business plan—and
the founders will usually meet regularly to work on the plan during this period. An example of how much work is
sometimes involved, and how a well- planned new business unfolds, is provided by Gwen Whiting and Lindsey
Wieber, the cofounders of The Laundress, a company that sells specially formulated laundry detergents and other
fabric care products.
The second reason to write a business plan is to create a selling document for a company. It provides a mechanism for
a young company to present itself to potential investors, suppliers, business partners, key job candidates, and others. 7
Imagine that you have enough money to invest in one new business. You chat informally with several entrepreneurs
at a conference for start-ups and decide that there are two new ventures that you would like to know more about. You
contact the first entrepreneur and ask for a copy of his business plan. The entrepreneur hesitates a bit and says that he
hasn’t prepared a formal business plan but would love to get together with you to discuss his ideas. You contact the
second entrepreneur and make the same request. This time, the entrepreneur says that she would be glad to forward
you a copy of a 30-page business plan, along with a 10-slide PowerPoint presentation that provides an overview of
the plan. An hour or two later, the PowerPoint presentation is in your e-mail in-box with a note that the business plan
will arrive the next morning. You look through the slides, which are crisp and to

III. Application/Activity

For your formal work in this course, you are required to write your reflection paper that contains your learnings
on this module following this format (Tahoma, 12, Legal Size, Justified with 1 inch margin to all sides). Google
Classroom will be utilized for the discussion of this module. Deadline for the submission of your activity will be posted
in the Google Classroom and will be attached therein.

IV. ASSESSMENT

Oral questioning, reflection exercises, online quizzes and major examination.