ACTIVITY

1. Given the difficulties in accurately predicting the future, is a business plan

useful? Provide three reasons for writing one and three reasons for not preparing a
plan. What is your conclusion and why?

Reason for writing a Business Plan

 It will serve as a road map for your business to succeed
 It focuses the resources on the attainment of the company’s objective and
goals
 It identifies the critical points of the business project and gives a response to
the problems that could arise

Reason for not preparing a Business Plan

 Some entrepreneur has no knowledge on how to build a Business Plan
 Time Consuming
 It cannot guarantee that the entrepreneur will be able to meet his/her
expectation in the Business Plan

Writing a Business Plan is not an easy task it required a lot of brainstorming to

visualize your Business venture, but this will also serve you as a road map or guide
on how you can successfully manage your business in the long run. Having so
many competitors in the market will become a hindrance to your business but, if
you already had a Business Plan, you could easily solve the problem. Therefore,
preparing a business plan is useful in business.

2. What makes an excellent business plan?

- An excellent business plan consists of all information regarding the business

enterprise. It includes the title page, table of content, summary/overview,
market analysis, description of the company, organization and management,
description of product/service, funding, financials, and lastly the appendix
that will serve as a road map of the business to succeed. But before we can
say that a business plan is an

excellent business plan, we should consider the

 information it holds, whether if it is attainable, realistic, goals and objective
are clearly stated . If we can justify that all information that was inside in the
business plan are above mention. We can finally say that it is an excellent
business plan.

3. Would the entrepreneur be better off spending more time selling his or her
product rather than
investing so much time in writing a business plan?

- All entrepreneur wants their business to grow and earn more, but in many
cases when a business is not well planned, there is a high tendency that it
will not succeed or it will take years or more to expand. Especially if the
entrepreneur does not have a business plan in the first place, focusing on
selling the product in the market without having thought of creating a
business plan is like going to a war without any weapon on hand. It means
that the entrepreneur might not be able to solve a specific problem that might
occur in the business. Meanwhile, if the entrepreneur will spend too much
time writing a Business Plan, it will also affect his/her business, because
he/she would not be able to handle the business well. Therefore, writing a
Business Plan is necessary but it should not take all your time especially if
you already started the business.

4. If a business plan is to be used to raise capital, then why would the entrepreneur
want to advertise the firm’s major risks by detailing them in the business plan?

- The business plan will also tackle some of the possible problem that a
business might encounter therefore, the entrepreneur will be able to
determine the risk of the business and to come up with a possible solution.

5. What is the purpose of the business plan if the audience is (a) the entrepreneur,
(b) an investor, or (c) a key supplier? How might the plan be adapted for these
audiences? Or do you believe that it is better to simply have one business plan that
serves all audience

a) The Entrepreneur

The purpose of the business plan is entrepreneur are the following:

- to manage uncertainty by breaking it down into meaningful components.

- Steer the business.
- Set goals and priorities.
- Set strategy and tactics. That includes product-market fit, target markets,
product plans, etc.
- Set important milestones including dates, deadlines, responsibilities, what
happens when, and how much it costs.
- Plan for essential numbers including starting costs, sales, costs, expenses,
and cash.

b) The Investors

- The purpose of the business plan to the investor is to provide them a clear
vision of the business that they are going to invest therefore, the
entrepreneur must be able to provide a good business plan to persuade an
investor in investing to the business.

c) The Supplier

- The purpose of business plan to the suppliers is to provide a complete cash

flow or any financial report to reassure them that your business can pay
them.