EXECUTIVE

SUMMARY
LESSON 6
OBJECTIVES:
a. enumerate the parts of
executive summary.

b. describe the 4 M's of

operations in relation to the
business opportunity.
Business plan
- a written document describing
the nature of the business, the
sales and marketing strategy,
and the financial background,
and containing a projected
profit and loss statement.
Business concept
- contains the essence of
the enterprise in a concise
but powerful manner and
must be translated into a
business model.
 e ss
s in pt
Bu nce
co

● What do you offer?

● Who do you offer it to?

● Why does your idea have value to these

customers?

● How will you beat your competitors?

● What differentiates you from the

competitors?
Business model
- a formula on how the
enterprise exactly plans to
make out of the business.
 FOUR (4) AREAS OF
MONEYMAKING WHICH THE
BUSINESS MODEL MUST ADDRESS
1. How will the business raise revenues? What critical factors will
cause the revenues to materialize?
2. What will be the costs of the enterprise products and other costs of
doing business? How will these costs be managed to ensure
comfortable profits? What critical factors will drive the costs? How
can these factors be controlled?
3. What will be the major investments of the enterprise? Why will
these investments give the enterprise a competitive edge?
4. How will the enterprise finance the investment? How will the
enterprise fund its growth?
 EXECUTIVE SUMMARY
● contains everything that is relevant and
important to the business audience.

● must contain the major argumentation of the

business proponent on why the business
work and succeed.

● should provide the business plan audience all

the arguments on why they should participate
in the business venture.
 PARTS OF EXECUTIVE
SUMMARY
Introduction The market

Financial
The company
considerations

Products and Business

services proponents
 Introduction
- introduce and highlight the good
qualities of the business.

(e.g.) Basti’s Cafe (BTI) is a start-up coffee and bakery retail

establishment located in Daang Hari Muntinlupa. BTI expects to
catch interest of a regular loyal customer base with its broad variety
of coffee and pastry products. The company plans to build a strong
market position in the town, due to the partner’s industry experience
and mild competitive climate in the area. BTI aims to offer its
products at a competitive price to meet the demand of the
middle-to-higher-income local market area residents.
 The company
- the business proponents and their
partners.

(e.g.) BTI is incorporated in the city of Muntinlupa. It is equally owned

and managed by its two partners. Mr. Jayson Lee has extensive
experience in sales, marketing, and management, and was vice
president of marketing with both Cafe Puro and Jollibee Foods. Mr.
David Andrade brings experience in the area of finance and
administration, including a stint as chief financial officer with both Kenny
Rogers Roasters and the popular coffee store chain, Starbucks. The
company intends to hire two full-time pastry bakers and six part-time
baristas to handle customer service and day to day operations.
 Products and services
- their features and attributes, and why
they are the right ones to deliver to the
customers.

(e.g.) BTI offers a broad range of coffee and espresso products, all from
high quality Columbian grown imported coffee beans. BTI caters to all
of its customers by providing each customer coffee and espresso
products made to suit the customer, down to the smallest detail. The
bakery provides freshly prepared bakery and pastry products at all
times during business operations. 7 to 9 moderate batches of bakery
and pastry products are prepared during the day to assure fresh baked
goods are always available.
 The market
- the enterprise organization and its
capabilities.

(The retail coffee industry in the Philippines has recently experienced rapid
growth. The growing interest of young professionals and families in
coffee-based beverages has been remarkable. BTI wants to establish a
large regular customer base, and will therefore concentrate its business
and marketing on local residents, which will be the dominant target market.
This will establish a healthy, consistent revenue base to ensure stability of
the business. In addition, city dwellers in nearby Alabang are expected to
comprise approximately 25% of the revenues. High visibility and
competitive products and services are critical to capture this segment of
the market.
Enterprise strategy - builds
and develops the game plan for
attaining competitiveness.

Enterprise delivery system

- the entire process of converting
input (resources) into output and
these output into outcomes.
Enterprise Delivery System and the Customer, Market and Financial
Outcomes
Input Throughput Output Final Delivery Outcomes
to Customers

● Customer
● Resources ● Transforma ● Products ● Marketing Expectations
Mobilized tion and ● Quality
● Money Process ● Goods Customer ● Delivery
● Manpower made or Servicing ● Price
● Machines ● Conversion Services ● Market
● Materials of rendered ● Marketing Expectations
● Methods Input into Program ● Revenues /
● Management Output Sales
● Market Share
● Market Reach
● Finance
Expectations
● Profits
● Return on
Investment
 Financial consideration
- investment requirements should be presented
along with the summaries of the projected income
statements, balance sheets, cash flows, and funds
flow, and their analysis and conclusions.
(e.g.) BTI expects to raise P800,000 of its own capital, and to borrow
P200,000 guaranteed by the SBA as a ten-year loan. This provides the
bulk of the current financing required. BTI anticipates sales of about
P1,000,000 in the first year, P2,000,000 in the second year, and
P3,000,000 in the third year of the plan. BTI should break even by the
fourth month of its operation as it steadily increases its sales. Profits for
this time period are expected to be approximately P100,000 in year 1,
P200,000 by year 2, and P500,000 by year 3. The company does not
anticipate any cash flow problems.
Entrepreneurs who plan to enter any business endeavor must
have a business plan on hand to guide them throughout the
process. Different business plans are prepared for different
purposes. There are business plans prior to setting up an
enterprise, which are similar to pre feasibility study and a
feasibility study. Many new enterprises need to convince
prospective business investors about the soundness and
potential of their business. They need to convey the
capabilities and competencies of their owners and managers.
They must also be able to sell the proponent and the
business proposition to this audience. These are situations
when a good business plan is needed.