Lesson: How to Create a Business Plan?

MELC: Formulate business plans and strategies

What is a Business Plan? - A business plan is an overview of the business idea, as well as a
strategy for building and running it. It’s a formal, written document that answers important questions
about your company.
Why Do You Need a Business Plan? - A business plan serves both internal and external
stakeholders and is crucial to developing your budding company in multiple ways.
A business plan can help with:
• Guidance: A business plan can act as a roadmap, helping you and your team stay focused on your
goals.
• Investors: If you want to bring investors into your venture, you’ll need to prove the viability of your
company. A well-developed business plan shows that you’ve done research on the market, your
competition, and how to succeed.
• Partners: Looking for a co-founder? In the same way a good business plan will help you draw in
investors, it can also help to attract potential partners.
Generating a business plan involves putting your ideas and research into writing.
Here’s how to create a business plan in three simple steps:
1. Come up With a Business Idea - In order to write a business plan, you need a winning
business idea. If you’re an aspiring entrepreneur still looking for an idea, start paying attention
to common problems you and the people around you encounter.
For example, you might notice your newlywed friends complaining about how hard it is to find a
photographer who doesn’t take cheesy engagement photos. This problem could inspire you to
start your own photography business. Or, if your friends want to buy a home, but hate the idea
of maintaining a yard, perhaps you could launch a landscaping service. While you’re
brainstorming, remember 4 successful businesses solve problems.

2. Do Your Research: The Elements of a Business Plan - Once you have a business idea you’re
excited about, start conducting research to flesh out your business plan. Use your business
plan to answer the questions others will have about your business and how it will be
successful. Then, organize your research into the following categories:
Executive Summary - This section serves as a quick preview of what will follow, much like the
opening paragraph of an essay.
Company Overview - Think of the company overview as an elevator pitch. This is another
opportunity to succinctly answer key questions
Products and Services - Use this section to expand on your business model Market Opportunity -
Those reading your business plan need to know why your business will be successful. Do the
necessary market research to identify your company’s viability here.
Marketing Plan - Here is where you need to explain how you’ll reach your customers. Don’t forget to
include digital marketing tools like a website, a social media presence, and an email marketing
strategy.
Operational Plan - Parse out company logistics in this section. Detail as much as you can about how
you intend to run your business.
Once you’ve thoroughly answered the most important questions about your proposed business,
you’ve essentially created a business plan. All that’s left is to polish it.
3. Apply the Finishing Touches to Your Business Plan - After you’ve written your business
plan, go over it with a fine-toothed comb. Typos and grammatical errors will make you and your
potential business seem unprofessional. It’s a good idea to give it to a friend who can look at it
with fresh eyes.
You should also eliminate any extraneous or redundant content. Investors and lenders don’t
want to read a book about your business. Be respectful of their time and present them with a
business plan that is concise and clear.

Developing a business plan is the first step on the exciting road to entrepreneurship. When you
learn how to create a business plan, you unlock the power to secure investments, loans, and
leases for your company. You also build an internal roadmap to success for your business

Activity 1
Directions: Answer the following questions.
EXECUTIVE SUMMARY
1. What is your company’s mission?
2. What are your products or services?
3. What is your company’s story?
4. What are your plans for growth?
COMPANY OVERVIEW
1. What will the business do?
2. What problems will it solve?
3. Who is your ideal customer?
PRODUCTS AND SERVICES
1. What will the company sell?
2. How will the company make money off of those products or services?
3. What is your pricing model? Be specific.
4. How does your pricing compare to what your competitors charge?
MARKET OPPORTUNITY
1. What is the size of your target market?
2. Who is your ideal customer?
3. What’s your potential for revenue?
4. Who is your competition?
5. How will you set yourself apart?
MARKETING PLAN
1. How will you sell your products or services?
a. Will you sell directly to consumers or to business?
b. Will your products be sold individually or wholesale?
c. If you choose a third-party reseller, what kinds of retail outlets will you target?
2. What kind of advertising efforts will you focus on?
OPERATIONAL PLAN
1. What kind of a staff do you need?
2. How do you plan to expand the business over time?
FINANCES
1. How much more funding does you need?
2. What is your sales forecast?

Lesson: Parts of a Business Plan

MELC: Design an operating plan to ensure that the inputs and processes required to
deliver the product or service are identified, and estimate the costs needed for
production.

Starting and growing a business requires careful planning. It serves as a blueprint

for where you want your business to be in the next three to five years, as well as a plan
for how to get there. It can also reveal potential issues before they occur. Planning is
bringing the future into present so that you can do something about it now. Thus,
knowing and understanding the different parts of a business plan is very important in
achieving your goal.
The following were the parts of a business plan:

The Executive Summary

The executive summary is the first paragraph investors read. If it doesn't grab the reader's
interest, it will be the last paragraph they read. In just a few sentences, describe the business
concept, its products and services, the competitive advantages and why the company will be
incredibly successful. This opening should intrigue readers and make them want to read more.

The Business Description

The description fills in the details outlined in your summary. It puts together the structure of the
business and should include the following:
What is the name of the business?
Where is it located?
What is the business structure: corporation, proprietorship or limited liability company?
Why is this business unique?
Why will it succeed?
What factors will cause the business to grow?

Description of Products and Services

The descriptions should show why the products and services are innovative, unique and
exciting. The reader should believe that you've really come up with an idea or concept that no
one else has created. Use the following as an outline:
What are the products or services you plan to offer?
What are their features?
What are their benefits?
What makes these products and services unique?
How do they meet the needs of your customers?
How do they add value to the customers?

Defining the Target Market

Your target market must be clearly defined. You need to show detailed thought about who your
customers are and that you have identified their characteristics:
Who are the likely customers?
Are they male or female?
What are their ages?
Where do they live?
How many customers are in your target market?
Is the market growing, shrinking, or is it stable?
What are the national and local trends that affect your industry?

Outline Your Competitive Advantages

In this section, you have to spell out how you intend to forge a share of the market against
more established competitors. This can't be something like just working harder; it needs
specific actions and steps that have a chance of succeeding and winning customers. Outline
your competitive action plan with answers to these questions:
Who are your strongest competitors?
What are their strengths and weaknesses?
How do they attract customers?
Why do customers buy from them?
Are your products price-competitive?
Are your competitors' businesses increasing or decreasing?
What will make your company different and better than your competition?

Describe Your Marketing Strategy

After you identify the weaknesses of your competitors, the marketing plan should describe how
you plan to exploit those weaknesses.
How will you position your products against the competition?
 Will you compete on price?
Can you offer better customer service and quicker response times?
Do you have a company logo and promotional theme?
What sales tactics will you use?
How will your products be distributed?

Financial Projections and Profit Plan

The objective of financial projections is to show that you have worked through the numbers
and come up with a plan to make a profit. Great ideas are nice, but you need cash flow to start
up a business and stay around long enough to gain market share.
What are the projections of sales and cash flow for the first year?
What are the initial operating costs?
How much do you need for personal expenses, and where will these funds come from?
How will you finance the startup and growth of the business?
Do you have a bank loan or line of credit?
How long will it take to break even and have a positive cash flow?

A word of caution: Take your sales projections for the first few years and cut that
number in half. Recalculate your cash flow and profits based on the lowered sales
estimates, because these figures will be closer to reality. If your business can survive
with these lower projections, then you've done a good job of figuring out how to forge
ahead and become successful.

Sell Your Management Team

The real heart of any business is its people. Even the best ideas will fail if a company does not
have skilled and aggressive employees. The management portion of the business plan needs
to assure investors and lenders that you have a top-notch team lined up to work for your
company. Sell your management team with answers to the following questions:
Who will manage the company and each of its departments?
What are the managers' experience and qualifications?
How many employees are needed for full-time and part-time positions?
What are the jobs and responsibilities of each employee?
Will the company pay competitive wages and benefits?
How will employees get training?
A business plan is required not only for potential investors and lenders. It forces the aspiring
entrepreneur to conduct a harsh and realistic analysis of his dream business. If the would-be
owner wants to succeed, he must address all aspects of the business.

Activity 2: Creating a Business plan

Directions: Create a business plan by following the steps below
Steps for creating your own business plan
Choose which sections you need in your business plan. Be sure to include the four most
important elements and add any others from the beginning of this article that you think you
might need.
Sketch or outline what you will include in each business plan section
Gather the information and data that support your business plan
Use this info to fill out each section of your business plan
Review each component of your business plan with trusted mentor, colleague, or friend

Guide Questions
1. Which business plan sections do you think are the most important for an existing
small business in most situations?
2. What parts of a business plan needs ample time to consider? why?
3. How does making a business plan helps you as young entrepreneur?
4. Which part of business plan do you think are not as important
5. What should not be included in the business plan?
Lesson: How to Write a Business Proposal
MELC: Formulate business proposal and strategies

A well-written business proposal can often mean the difference between winning or
losing a prospective client. And in today’s tough times, with contracts dwindling, it’s
more important than ever to have a standout proposal. But, what are business proposals? How
do you make them? What do you include in a business proposal? How long should a business
proposal be?

We answer all of these questions and more in this in-depth guide to creating business
proposals that will help you close more deals, make more sales and crush your
business goals.

What is a business proposal? - A business proposal is a document used by a B2B

or business-facing company (this may not always be the case) where a seller aims to
persuade a prospective buyer into buying their goods or services.

What is the purpose of a business proposal? - Essentially, a business proposal

aims to streamline the B2B sales process (which is often complex) between you as a
seller and a buyer by serving the dual purpose of acting as a source of information as
well as a sales pitch aimed at convincing your buyer why they should buy what you
have to offer.

What should you include in a business proposal? - A business proposal usually aims to answer
the following questions:
Who you are and what your company does
The problem your buyer faces
The solution your company offers to alleviate the problem
How your company will implement this solution effectively
An estimate of resources (time, money, etc) required to implement the solution

This being said, when writing a business proposal, you can break down the document
into these sections:
I. Introduction
II. Table of contents
III. Executive summary
IV. Project details
V. Deliverables and milestones
VI. Budget
VII. Conclusion
VIII. Appendix

Description
Step 1: Introduction - The introduction to your business proposal should provide your
client with a succinct overview of what your company does (similar to the company
overview in your business plan). It should also include what sets your company apart
from its peers, and why it’s particularly well-suited to be the selected vendor to
undertake a job whether the assignment is a singular arrangement or an ongoing
relationship. The most effective business proposal introductions accomplish more with
less: It’s important to be comprehensive without being overly wordy. You’ll want to
resist the temptation to share every detail about your company’s history and lines of
business, and don’t feel the need to outline every detail of your proposal. You’ll want
to keep the introduction section to one page or shorter.

Step 2: Table of Contents - Once you’ve introduced your business and why you’re
the right fit for the client you’re submitting the proposal to (a quasi cover letter), you’ll -
want to next create a table of contents. Like any typical table of contents, this section
will simply outline what the client can expect to find in the remainder of the proposal.
You’ll include all of the sections that we’ll cover below, simply laid out as we just did
above. If you’re sending an electronic proposal, you may want to make the table of
contents clickable so the client can easily jump from section to section by clicking the
links within the actual table of contents.

Step 3: Executive Summary - Next, your business proposal should always include
an executive summary that frames out answers to the who, what, where, when, why,
and how questions that you’re proposing to the client lead. Here, the client will
understand that you understand them. It’s important to note that despite the word
summary, this section shouldn’t be a summary of your whole business proposal.
Instead, this section should serve as your elevator pitch or value proposition. You’ll use
the executive summary to make an explicit case for why your company is the best fit
for your prospect’s needs. Talk about your strengths, areas of expertise, similar
problems you’ve solved, and the advantages you provide over your competitors4all
from the lens of how these components could help your would-be client’s business
thrive

Step 4: Project Details - When it comes to how to write a business proposal, steps
four through six will encompass the main body of your proposal where your potential 4
client will understand how you’ll address their project and the scope of the work.
Within this body, you’ll start by explaining your recommendation, solution, or approach
to servicing the client. As you get deeper within your explanation, your main goal will
be to convey to the client that you’re bringing something truly custom to the table. Show
that you’ve created this proposal entirely for them based on their needs and any
problems they need to solve. At this point, you’ll detail your proposed solution, the
tactics you’ll undertake to deliver on it, and any other details that relate to your
company’s recommended approach.

Step 5: Deliverables and Milestones - This section will nest inside the project details section,
but it’s an essential step on its own. Your proposal recipient doesn’t get merely an idea of your
plan, of course4they get proposed deliverables. You’ll outline your proposed deliverables here
with in-depth descriptions of each (that might include quantities or the scope of services,
depending on the kind of business you run). You never want to assume a client is on the same
page as you with expectations, because if you’re not aligned, they might think you over-
promised and under-delivered. Therefore, this is the section where you’ll want to go into the
most detail. Along these lines, you can also use this section of the prospective client’s proposal
to restrict the terms and scope of your services. This can come in handy if you’re concerned
that the work you’re outlining could lead to additional projects or responsibilities that you’re not
planning to include within your budget. Moreover, you might also want to consider adding
milestones to this section, either alongside deliverables or entirely separately. Milestones can
be small, such as delivery dates for a specific package of project components, or when you
send over your first draft of a design. Or you can choose to break out the project into phases.
For longer projects, milestones can be a great way to convey your company’s organization and
responsibility.

Step 6: Budget - There’s no way around the fact that pricing projects isn’t easy or fun after all,
you need to balance earning what you’re worth and proving value, while also not scaring away
a potential client, or getting beaten out by a competitor with a cheaper price. Nevertheless, a
budget or pricing section is an integral part of a business proposal, so you’ll want to prepare
your pricing strategy ahead of time before getting into the weeds of any proposal writing. This
being said, if you fear the fee might seem too high to your potential client, you might decide to
break out the individual components of the budget with these points in mind, once you’ve
determined how to outline your pricing, you’ll list it out (you might even include optional fees or
services) and the overall cost for the scope of work you’ve described.

Step 7: Conclusion - Finally, your conclusion should wrap up your understanding of the
project, your proposed solutions, and what kind of work (and costs) are involved. This is your
last opportunity to make a compelling case within your business proposal reiterate what you
intend to do, and why it beats your competitors’ ideas.

Step 8: Appendix - After the conclusion, you might also decide to include an appendix where
you add any supplemental information that either doesn’t fit within the main proposal without
being disruptive for the reader, or is less than essential to understanding the main components
of your proposal. You’ll likely only need an appendix if you have stats, figures, illustrations, or
examples of work that you want to share with your potential client. This being said, you might
also include contact information, details about your team, and other relevant information in this
section.