The Business Plan and Its Role-

A business plan is a written narrative, typically 25 to 35 pages long, that describes what a new business plans
to accomplish.

1. Where it Fits in the Entrepreneurial Process:

o Writing a business plan comes after you have developed and tested your business idea.
o It is not the first step; doing it too early can be a mistake because you won’t yet have enough
information.
o The plan relies on insights gained from feasibility analysis—research about the product/service,
industry, market, management team, and finances.
2. Purpose of a Business Plan:
o A business plan communicates the value and potential of your venture to investors, lenders,
or partners.
o It shows that the business is exciting, viable, and deserving of support.
o The level of detail must be enough to convince readers of the business’s merits.
3. Reality Check: Many Entrepreneurs Don’t Write One:
o Studies show only about 33–35% of small business owners create a formal business plan.
o Despite this, research strongly supports the value of having one.
4. Benefits of Writing a Business Plan:
o Entrepreneurs with a business plan tend to have higher expectations for growth and success.
o They are more likely to:
 Increase employment
 Grow revenues
 Make new capital investments
 Apply for credit

Key Takeaway

Writing a business plan is not optional if you want structured growth and investor support. Even though
many entrepreneurs skip it, having a plan improves the chances of success because it organizes your research,
clarifies your strategy, and demonstrates to others that your business is credible and promising.

Dual-Use Document

A business plan often serves two purposes at the same time, which is why it’s called a dual-use document:

1. External Use
o Audience: Investors, lenders, partners, or other stakeholders outside the company.
o Purpose:
 Persuade them that the business is viable and worth supporting.
 Demonstrate the potential for profit, growth, and sustainability.
 Secure funding, partnerships, or other resources.
2. Internal Use
o Audience: The entrepreneur and the management team.
o Purpose:
 Serve as a roadmap for launching and growing the business.
 Guide decision-making, resource allocation, and strategy implementation.
 Track milestones and measure progress toward goals.
Key Idea:
A business plan is not just a document to show others—it’s also a practical tool for running your business
effectively. Its value lies in both persuading outsiders and guiding internal management.

Reasons for Writing a Business Plan-

Writing a business plan is essential for entrepreneurs because it serves two primary purposes:

1. Forces Systematic Thinking About the Business

 A business plan makes founders carefully examine every aspect of their new venture.
 It encourages research, planning, and analysis that is difficult to replicate without a formal plan.
 For example, founders of a new restaurant or a product company will use a business plan to:
o Identify their target market.
o Design a preliminary product or menu.
o Create a marketing plan.
o Plan hiring and operations.
o Estimate start-up costs.
o Project financial performance over the next several years.
 This systematic process ensures that founders fully understand the challenges and opportunities before
investing time and money into the business.
 Example: Gwen Whiting and Lindsey Wieber of The Laundress spent weekends creating a business
plan, performing cash flow analyses, and researching product formulations. Their detailed preparation
helped them build a successful business.

2. Serves as a Selling Document

 A business plan is a tool to persuade outsiders—such as investors, lenders, partners, or suppliers—that

the business is viable and worth supporting.
 It demonstrates that the entrepreneur is serious, committed, and has thought through the business
carefully.
 Without a plan, investors or partners have no structured information and may doubt the entrepreneur’s
preparation.
 Example Scenario:
o Two entrepreneurs pitch start-ups at a conference.
o One has no business plan and only discusses ideas verbally.
o The other provides a detailed 28-page business plan and a clear 10-slide presentation.
o Investors are far more likely to engage with the second entrepreneur because the plan shows
preparedness, clarity, and commitment.

Key Idea:
A business plan is both a planning tool and a sales tool—it helps founders think clearly about their
business and communicate its potential convincingly to external stakeholders.
Who Reads a Business Plan and What They Are Looking For?

A business plan is read by two main groups, each with different expectations:

1. Internal Audience – The firm’s employees and managers

A clearly written business plan helps the employees of a firm operate in sync and move forward in a consistent
and purposeful manner.

 A business plan is not just for outsiders; it is also a tool for employees and management.
 It clearly articulates the vision, goals, and strategy of the firm.
 For management and department heads, the plan serves as a guide to ensure everyone’s actions align
with the company’s overall direction.
 For example, if a new VP joins a start-up, the business plan provides a roadmap for making decisions
that support the firm’s goals.
 Even though markets change quickly, the process of creating the plan helps the team systematically
think through the business and operate consistently.

2. External Audience – Investors, Partners, and Key Recruits

A firm’s business plan must make the case that the firm is a good use of an investor’s funds or the attention of
others.

 The second group includes outsiders who might invest, partner, or work with the company.
 They are looking for a realistic, credible, and viable business idea.
 Overly optimistic projections or exaggerated claims reduce credibility; the plan must demonstrate
potential returns and viability.
 Typically, investors first review a PowerPoint deck or an executive summary. If interested, they may
then request the full business plan.
 During due diligence, investors carefully check the accuracy of claims, legal considerations, and the
feasibility of the business.
 A solid business plan shows that the company:
o Has validated its idea through feasibility analysis.
o Understands its market and competition.
o Has a clear plan to address resource limitations before starting operations (e.g., hiring, capital
needs, facilities).
 Experienced investors appreciate transparency about resource gaps because they can provide guidance
and support to help the start-up succeed.

Key Idea:
A business plan must serve both internal and external audiences. Internally, it aligns employees and
management. Externally, it convinces investors, partners, and key hires that the business is well-researched,
feasible, and promising.

Guidelines for Writing a Business Plan-

A business plan is a guide for starting and running a new business. Think of it as a map or blueprint. It explains
what the business is about, who it serves, how it will operate, and what it needs to succeed. It helps the
entrepreneur organize their ideas and plan for challenges before starting.
1. Structure of the Business Plan-
A business plan should follow a clear and conventional structure to make it easy for investors and
stakeholders to understand your business idea.

1. Follow a Conventional Structure

o A business plan should generally follow a standard format, including sections such as the
executive summary, company description, market analysis, organizational structure, product or
service details, marketing strategies, financial projections, and funding requirements.
o While some entrepreneurs may want to show creativity in presenting their plan, deviating too
much from the standard structure can be counterproductive. Investors often review many plans
and prefer ones where critical information is easy to locate.
o A clear, well-organized plan gives the impression of professionalism and increases confidence in
the venture.
2. Use Software Packages Wisely
o There are many software tools available that can help in preparing a business plan. These
programs often provide step-by-step guidance, templates, and interactive menus that make the
process easier.
o While such software can be useful, entrepreneurs should avoid simply copying boilerplate
content. Plans that look generic or “canned” are often rejected, as investors want to see
originality, authenticity, and a clear understanding of the business opportunity.
o It’s best to use these tools as a guide rather than as the final product.
3. Project a Sense of Excitement and Vision
o A strong business plan is not just about numbers and data. It should also communicate the
vision, potential, and enthusiasm behind the venture.
o Investors are more likely to support a business if they sense that the entrepreneur is passionate
and optimistic about the opportunity.
o Including a narrative that highlights the unique aspects of the business, market potential, and
future growth prospects can make the plan more compelling and engaging.
4. Maintain Clarity and Professionalism
o The language should be clear, concise, and professional. Avoid jargon or overly technical terms
unless necessary.
o Presentation matters: a neatly formatted, error-free, and visually appealing plan reflects the
entrepreneur’s attention to detail and seriousness.

2. Content of the Business Plan-

The content of a business plan explains the “what” and “how” of the business. It provides all the essential
details that investors or stakeholders need to understand the opportunity and assess its viability.

1. Provide Clear and Concise Information

o A business plan should cover all important aspects of the proposed venture.
o It should be detailed enough to give a complete understanding of the business but concise
enough to keep the reader’s attention.
o The plan must clearly explain the business idea, market opportunity, financial requirements, and
operational approach.
2. Recommended Length
o Most business plans are 25 to 35 pages, with closer to 25 pages being ideal.
o Appendices can include supplementary material such as founders’ résumés, legal documents,
charts, or market research, which do not clutter the main content.
3. Importance of Review
o After completing the plan, it should be carefully reviewed for spelling, grammar, and
completeness.
o Omitting critical information can reduce the chances of investor interest. For example:
  Key industry trends
 Amount of funding required
 How the funding will be used
 Contact information of the entrepreneur
o Even small oversights can lead to lost opportunities, as investors may be interested but unable to
act due to missing details.

✅ Key Point:
A well-prepared business plan balances clarity, completeness, and brevity, ensuring that investors get all
essential information quickly and effectively.

[Link] and Format of a Business Plan-

1. Appearance Matters
o The business plan should look professional and well-organized but not overly fancy.
o Avoid giving the impression that a lot of money was spent on its production. Investors
understand that entrepreneurs usually have limited resources.
o Recommended format: A plastic spiral binder with a transparent front cover and a back sheet
for support.
2. Design Guidelines
o Keep formatting simple and consistent. Avoid excessive use of:
 Bold, italics, and multiple font sizes
 Different colors
 Clip art or fancy graphics
o Overuse of these elements can make a plan appear amateurish rather than professional.

[Link] Business Plan-

The length, detail, and purpose of a business plan depend on the stage of the business and the intended
audience. There are three main types:

1. Summary Business Plan

 Length: 10–15 pages

 Purpose:
o Designed for early-stage ventures that are still developing ideas.
o Also used by experienced entrepreneurs testing a new idea without committing time to a full
plan.
 Use Case:
o Provides a concise overview for investors or mentors to give feedback before a complete plan is
written.
o Useful for presenting a business concept quickly without overwhelming the reader.
 Example:
o Drew Houston, cofounder of Dropbox, could use a summary business plan to pitch a new idea to
select investors, leveraging his reputation without needing detailed background information.

Key Features:

 Focuses on the main idea, market opportunity, and basic financials.

 Less detailed than a full business plan but enough to gauge interest.
2. Full Business Plan

 Length: 25–35 pages

 Purpose:
o Provides a comprehensive picture of the business, covering all aspects of operations, strategy,
and financial planning.
o Serves as the main document for investors evaluating the venture.
 Use Case:
o Typically required when seeking significant funding from investors or banks.
o Helps demonstrate that the entrepreneur has thoroughly researched and planned the business.

Key Features:

 Detailed market analysis, competitive analysis, and marketing strategy.

 Complete financial projections, including income statements, balance sheets, and cash flow statements.
 Clear explanation of the organizational structure, operations, and risk management.
 Shows the viability and growth potential of the venture.

3. Operational Business Plan

 Length: 40–100 pages

 Purpose:
o Primarily intended for internal use by an established business.
o Acts as a detailed blueprint for managing day-to-day operations.
 Use Case:
o Guides operational managers and teams to execute the company’s strategy efficiently.
o Useful for coordinating departments, tracking performance, and setting operational goals.

Key Features:

 Includes in-depth operational procedures, policies, and responsibilities.

 Provides detailed guidance on production, staffing, inventory, and logistics.
 Often updated regularly to reflect changes in processes or goals.

✅ Summary Table of Types:

Type Length Purpose Audience Key Feature

10–15 Early ideas or testing new
Summary Plan Investors, mentors Concise overview, limited detail
pages concepts
25–35 Complete business Detailed operations, strategies,
Full Plan Investors, lenders
pages presentation financials
Operational 40–100 Internal management and Managers, internal Detailed operational procedures,
Plan pages execution teams departmental guidance

Investor Preferences and Tips

 Sometimes investors request only a PowerPoint deck or an executive summary instead of the full
plan.
 If the investor is interested, they will ask for more details later.
  Writing a full business plan is valuable even if not initially requested—it helps the entrepreneur gain a
deeper understanding of the business.
 Cover Letter: Always include a cover letter when sending the plan. It should:
o Introduce the entrepreneur briefly
o Explain why the business plan is being sent
 Avoid sending plans to a generic list of investors. Each recipient should be carefully selected based on
their potential as a viable investor.

✅ Key Points:

 Keep the plan professional, clear, and concise.

 Use a simple, consistent format to maintain credibility.
 Choose the type of plan based on the stage of the business and the audience.
 Always accompany the plan with a targeted cover letter.

[Link] That a Business Plan Evolves-

1. Plans Are Not Static

o A business plan is a living document. It will almost always change while it is being written.
o New insights often emerge when entrepreneurs:
 Immerse themselves in writing the plan
 Seek and receive feedback from mentors, investors, or peers
2. Feedback and Iteration
o Writing a business plan is not done in isolation; interaction with potential:
 Customers
 Suppliers
 Business partners
o This feedback helps refine the business idea, strategies, and financial projections.
o Even after launch, the business will often iterate and adapt based on ongoing market feedback.
3. Alternative Approach: Lean Startup
o Some experts advocate a more experimental approach:
 Focus on trial-and-error learning
 Emphasize customer feedback before formal planning
o This approach encourages rapid adaptation but may skip the detailed analysis that a formal
business plan provides.
4. Industry and Business Factors Affect Changes
o Businesses in volatile or new industries may change their plans more frequently.
o A strong initial feasibility analysis can reduce uncertainty and guide more stable planning.

✅ Key Takeaways:

 A business plan is a dynamic document—expect it to evolve.

 Feedback from stakeholders is essential to improving the plan.
 Formal planning and iterative experimentation can complement each other.
 Understanding that the plan will change helps entrepreneurs remain flexible and responsive.
Outline of Business Plan- page 233

1. Cover Page and Table of Contents

 Cover Page: Company name, address, phone number, website, social media links, lead entrepreneur’s
contact info.
 Table of Contents: Lists sections and page numbers for easy navigation.

2. Executive Summary

 Short overview of the entire business plan (1–2 pages).

 Highlights the unique aspects of the venture, key strategies, and funding requirements.
 Not an introduction—serves as a summary of the plan itself.

3. Industry Analysis

 Description of the industry: size, growth rate, sales projections.

 Industry structure: concentrated vs. fragmented.
 Key success factors and competitive landscape.
 Trends: economic, social, technological, political, and regulatory.
 Long-term industry prospects.

4. Company Description

 General description and origin of the business idea.

 Mission statement and tagline.
 Products/services: unique features, positioning, and feasibility study results.
 Current status, milestones, legal status, and ownership structure.

5. Market Analysis

 Segmentation of the target market (geographic, demographic, psychographic, behavioral).

 Consumer behavior and buying patterns.
 Competitor analysis and market share estimates.
 Annual sales projections using sound methods.

6. Economics of the Business

 Revenue drivers and gross/contribution margins.

 Fixed and variable costs; operating leverage analysis.
 One-time start-up costs.
 Break-even analysis.

7. Marketing Plan

 Marketing strategy, positioning, and points of differentiation.

 Pricing strategy, promotion, and distribution.
 Sales process or cycle and sales tactics.

8. Product or Service Design and Development Plan

 Current stage of development, product roadmap, and timelines.

 Prototype or virtual prototype description.
 Challenges, risks, and anticipated design/development issues.
 Intellectual property: patents, trademarks, copyrights, trade secrets.
9. Operations Plan

 Overview of business operations.

 Back-stage (internal) and front-stage (customer-facing) activities.
 Location, facilities, and equipment acquisition.
 Production process and outsourcing plans.

10. Management Team and Company Structure

 Profiles of founders and key management personnel (titles, responsibilities, experience, education).
 Board of directors and/or board of advisors.
 Organizational structure and chart; lines of authority and accountability.
 Plans to fill competency gaps in the team.

11. Overall Schedule

 Milestones and timeline for launching and operating the business.

 Critical events: incorporation, prototype completion, financing, first sales, etc.

12. Financial Projections

 Sources and uses of funds statement.

 Assumptions underlying financial projections.
 Pro forma financial statements (income statement, balance sheet, cash flow statement) for 3–5 years.
 Ratio analysis for interpreting financial health.

13. Appendix

 Supporting documents: resumes, product images, prototype diagrams, financial data, market research.
 Should be concise and contain only essential supplementary information.

[Link] Page and Table of Contents section in a business plan:

1. Cover Page

The cover page acts like the “business card” of the entire plan. It provides the reader with essential details and
creates a professional first impression.

Key Elements of a Cover Page:

 Company Information
o Company name (bold and clear)
o Company address
o Phone number (smartphone + landline, if available)
o Website URL
o Social media handles (Facebook, Twitter, Instagram, LinkedIn, etc.)
 Entrepreneur/Contact Information
o Lead entrepreneur’s name
o Email address
o Phone number (preferably direct contact)
 Date of Submission
o Helps track when the plan was prepared.
 Trademark/Logo (if available)
o Placed near the center of the page to create a strong brand identity.
2. Table of Contents (TOC)

The table of contents comes immediately after the cover page (and cover letter if included). It makes the
business plan easy to navigate.

What the TOC Should Contain:

 A clear list of the major sections of the plan (e.g., Executive Summary, Industry Analysis, Company
Description, Market Analysis, etc.).
 Page numbers for each section.
 A separate listing for the Appendices.

Purpose:

 Helps investors or readers quickly locate sections they are most interested in (e.g., Financial Projections
or Market Analysis).
 Shows professionalism and organization.

2. Executive Summary-

The executive summary is a short overview of the entire business plan. It provides a busy reader with
everything that needs to be known about the new venture’s distinctive nature. An executive summary
shouldn’t exceed two single-space pages.

The executive summary is often called the “gateway” to the business plan. It is the first section that investors,
lenders, or partners see, and it determines whether they will read further.

Purpose

 Provides a snapshot of the entire business plan in a concise manner.

 Helps a busy reader or investor quickly understand the venture’s uniqueness and potential.

Key Features

1. Length
o Should not exceed two single-spaced pages.
o Must be short, crisp, and compelling.
2. Timing of Writing
o Even though it appears at the beginning, it should be written last.
o Reason: The business plan evolves during preparation, so summarizing at the end ensures
accuracy.
3. Two Versions
o Integrated version (as part of the full business plan).
o Stand-alone version (for investors who only want a quick review first).

Typical Content of an Executive Summary

 Business Overview: Name, location, nature of business.

 Opportunity: Problem in the market and how the business solves it.
 Product/Service: What is being offered and why it is distinctive.
 Target Market: Who the customers are.
 Business Model: How the business will make money.
 Competitive Advantage: Why the venture can succeed against competitors.
  Management Team: Key people and their capabilities.
 Financial Highlights: Revenue model, funding needs, and projections.
 Vision: Long-term goals and growth potential.

Importance

 Often the most critical section because many investors only read the executive summary before
deciding whether to proceed.
 A poorly written executive summary may lead to the entire plan being ignored, no matter how strong the
details are inside.

3. Company Description-

The Company Description is the foundation of the business plan. It provides the reader with a clear picture of
what the business is, what it does, and where it is heading. It shows how an idea is being transformed into a
real business.

Purpose

 Introduces the business to readers (investors, lenders, partners).

 Builds credibility by sharing background, structure, and vision.
 Explains who you are, what you do, and why it matters.

Key Components

1. Company Description
o Basic details: name, location, type of business, and industry focus.
o What makes the company unique.
2. Company History
o If it’s a startup: explain when and how the idea originated.
o If already operating: highlight key milestones, past growth, and achievements.
3. Mission Statement
o A clear, concise statement of the company’s purpose.
o Should reflect values, goals, and vision.
4. Products and Services
o What the company sells or offers.
o Why these products/services are valuable to customers.
o Any unique features or benefits.
5. Current Status
o Stage of development (idea stage, prototype, revenue-generating, expansion, etc.).
o Current resources and achievements (e.g., customer base, funding, partnerships).
6. Legal Status and Ownership
o Business structure (sole proprietorship, partnership, limited liability company, corporation, etc.).
o Ownership breakdown (who owns what percentage).
7. Key Partnerships (if applicable)
o Strategic alliances, suppliers, distributors, or collaborators.
o Partnerships that strengthen business operations.

Key Insights

 Although it might seem like a simple background section, it is extremely important.

 Helps the reader see the seriousness and credibility of the business.
  Demonstrates that the entrepreneur has moved beyond just an idea and is building a real, structured
business.

[Link] Analysis-

The Industry Analysis section provides a detailed overview of the industry where the business will operate. It
helps readers (especially investors) understand the environment, opportunities, and risks that the company
faces. This section is critical because the strength and attractiveness of the industry often determine whether the
business can succeed.

Purpose

 To show that the entrepreneur understands the industry landscape.

 To identify opportunities for growth and areas of concern.
 To define the "playing field" in which the business will compete.

Key Components

1. Industry Size, Growth Rate, and Sales Projections

o Current size of the industry in revenue terms.
o Historical growth rate (past 3–5 years).
o Forecasted growth and sales projections (next 3–5 years).
o Backed by credible data sources (market research, government statistics, reports).
2. Industry Structure
o Fragmented vs. concentrated (many small competitors or a few large ones).
o Competitive intensity (low, medium, high).
o Barriers to entry (low capital requirements vs. high regulations/technology needs).
3. Nature of Participants
o Who are the major players (large firms, SMEs, startups).
o The role of suppliers, distributors, and intermediaries.
o Typical customer groups served.
4. Key Success Factors
o What companies must do to succeed in this industry. Examples:
 Strong brand and customer trust.
 Efficient supply chain.
 Access to technology/innovation.
 Affordable pricing strategies.
5. Industry Trends
o Emerging technologies, shifting consumer behavior, new regulations.
o Example: in retail—rise of e-commerce; in energy—shift to renewables.
o Trends that create opportunities or threats.
6. Long-Term Prospects
o Overall attractiveness of the industry in the future.
o Potential for profitability, growth, or stability.
o Risks that could harm sustainability (e.g., environmental issues, policy changes).

Key Insights

 Before choosing a target market, a business must fully understand its industry.
 Industry analysis shows where opportunities exist (promising areas) and where vulnerabilities lie
(competition, regulations, declining demand).
 The industry largely defines the competitive battlefield—who the business will face and what it takes
to win.

[Link] Analysis-
The Market Analysis goes one step deeper than the Industry Analysis. While the industry analysis explains the
overall playing field, the market analysis narrows down to the specific group of customers (target market)
that the business will serve.

This section proves that the entrepreneur knows who the customers are, how they behave, and how to
position the business against competitors.

Key Components

1. Market Segmentation & Target Market Selection

o Divide the industry into smaller customer segments based on demographics, geography,
behavior, or needs.
o Identify the target market (the specific group of customers your startup will focus on).
o Explain why this target market is attractive (size, growth, unmet needs, purchasing power).

✅ Example: Instead of serving the entire clothing industry, a startup may target urban youth aged 18–
25 who prefer affordable streetwear.

2. Buyer Behavior
o How customers in the target market make decisions (price-sensitive, brand-loyal, convenience-
driven, online/offline shopping).
o What factors influence their purchase decisions (quality, price, speed, trust, recommendations).
o Frequency of purchase, average spending, and buying patterns.

✅ Example: Online grocery shoppers value fast delivery and reliability more than brand variety.

3. Competitor Analysis
o Identify direct competitors (who serve the same target market) and indirect competitors (who
provide substitutes).
o Compare strengths and weaknesses of competitors.
o Use tools like a competitive matrix to show how your business is different (better price, unique
features, niche focus).
o Explain your competitive advantage (why customers will choose you over others).

Key Insights

 Startups rarely serve an entire industry; they succeed by focusing on a niche (target market).
 The better you understand your target customers’ needs, preferences, and behaviors, the more you can
design products/services that fit them.
 Strong competitor analysis shows that you know who you’re up against and how you will
differentiate yourself.

[Link] Plan-

The Marketing Plan explains how the business will attract and retain customers. While the Market
Analysis identifies who the customers are, the Marketing Plan describes how to reach them, convince them,
and keep them coming back.

This section proves that the entrepreneur knows how to turn a product/service into actual sales.

Key Components

1. Overall Marketing Strategy

 o Defines the brand positioning (how you want customers to see your business compared to
competitors).
o Explains the points of differentiation (what makes you unique—quality, price, convenience,
speed, customization).
o Shows how your marketing will build awareness, generate interest, and create loyalty.

✅ Example: “Our café will position itself as the first eco-friendly, affordable coffee shop in Dhaka,
targeting health-conscious young professionals.”

2. The 4 Ps (Marketing Mix)

 Product:
What you are selling, including features, design, packaging, and service.
→ Example: Organic skincare made with locally sourced ingredients.
 Price:
Pricing strategy (premium, competitive, discount, penetration).
→ Example: A food delivery startup charging 5% less than competitors for first-time users.
 Promotion:
How you will communicate with customers—advertising, social media, influencer marketing,
discounts, events, PR.
→ Example: Social media campaigns, referral discounts, partnerships with student clubs.
 Place (Distribution):
How customers will access the product/service—physical location, website, app, third-party platforms,
direct delivery.
→ Example: Online ordering with 30-minute delivery promise in Dhaka city.

Key Insights

 The Marketing Plan should start with the big picture (strategy, positioning, differentiation) and then
move to the specific tactics (4Ps).
 The goal is to show how the startup will win customers in a competitive market.
 Investors want to see that you have a clear, cost-effective, and realistic approach to reaching your
target audience.

[Link] Team and Company Structure-

This section explains who is running the business, how the company is organized, and what outside
support it has. Investors often say they prefer to invest in a strong team with an average idea rather than in a
weak team with a great idea. Why? Because a capable team can adapt, solve problems, and guide the business
to success.

The management team of a new firm typically consists of the founder or founders and a handful of key
management personnel. A brief profile of each member of the management team should be provided,
starting with the firm’s founder or founders. Each profile should include the following information:

■ Title of the position

■ Duties and responsibilities of the position

■ Previous industry and related experience

■ Previous successes
■ Educational background

2. Board of Directors (if applicable)

o A formal governing body (legally required in some company types, e.g., private limited).
o Provides oversight and guidance, ensuring accountability.
o Usually includes people with experience, connections, and credibility.

✅ Example: A former CEO of a logistics firm sitting on the board of an e-commerce startup.

3. Board of Advisers (if applicable)

o An informal group of experts who provide advice and mentorship but do not have legal
authority.
o Adds credibility to the startup and gives access to industry knowledge and networks.

✅ Example: A university professor in technology advising a software startup.

4. Company Structure
o The legal form of the business (sole proprietorship, partnership, private limited company, etc.).
o The organizational chart (who reports to whom).
o Clarifies roles and responsibilities inside the business.

✅ Example: In a food delivery startup, the structure might include the CEO, Operations Manager,
Marketing Manager, Finance Manager, and Customer Service team.

Key Insights

 This section is critical because investors often look at the team first to judge whether they can execute
the business idea.
 A strong management team shows that the startup is more than just an idea—it has the leadership and
skills to succeed.
 Even if gaps exist in the team, acknowledging them and showing how you’ll fill them (e.g., hiring,
partnerships, advisers) increases credibility.

[Link] Plan-

The operations plan explains how the business will function on a daily basis—from producing the product or
service to delivering it to customers. It provides a behind-the-scenes view of how the company runs, ensuring
that the idea can be executed in practice.

Key Components

1. General Approach to Operations

o A short description of how your business will operate.
 o Covers the overall process from input (resources, suppliers) to output (final product or
service).
o Example: For a bakery, this may include sourcing ingredients, baking, packaging, and delivering
fresh goods daily.

2. Business Location
o Where the business is physically located and why that location is strategic.
o Factors: accessibility, cost, proximity to customers/suppliers, visibility, etc.
o Example: A coffee shop near a university campus to attract students.

3. Facilities and Equipment

o What facilities and equipment are needed to operate effectively.
o Could include production facilities, office space, warehouses, vehicles, software, or
machinery.
o Example: A digital marketing agency might highlight computers, design software, and a small
co-working office.

4. Back Stage vs. Front Stage Activities

o Back stage (unseen): Activities customers don’t see, such as inventory management, supplier
negotiations, payroll, and product development.
o Front stage (seen): Activities directly visible to customers, such as sales, customer service,
website interface, or in-store experience.

Back Stage (Behind-the-Scenes Activities) -

■ ■ Staff selection ■ ■ Operations manual ■ ■ Relationships with suppliers ■ ■ Relationships with city government ■ ■
Development of marketing materials ■ ■ Employee orientation and training ■ ■ Emergency plans

Front Stage (What the Members See)-

■ Member tours ■ ■ Operating hours ■ ■ Staff assistance ■ ■ Fitness classes and programs ■ ■ Fitness machines ■ ■
Workshops ■ ■ Monthly newsletter

✅ Example (E-commerce business):

o Back stage → Managing stock in warehouses, updating website, processing payments.

o Front stage → Customer browsing the online store, placing an order, receiving delivery.

[Link] (or Service) Design and Development Plan-

This section is only necessary if the business is creating a new product or service. It explains the progress so
far, the tasks left to complete, and how the business will overcome potential hurdles. The goal is to reassure
investors and stakeholders that development is realistic, manageable, and will not stall.

Key Components

1. Development Status and Tasks

o Describe where you are right now in the development process.
 o List next steps to bring the product/service to market.
o Example:
 Prototype completed
 Beta testing ongoing
 Next → Final design refinement, supplier agreements, regulatory approvals

2. Challenges and Risks

o Identify potential difficulties that could slow or block progress.
o Show that you’ve thought about solutions.
o Examples:
 Risk: Technology may take longer to develop → Solution: hire experienced engineers.
 Risk: Regulatory approval delays → Solution: consult with compliance experts early.

3. Intellectual Property (IP)

o Mention whether the product/service involves patents, trademarks, copyrights, or trade
secrets.
o Highlight steps taken (or planned) to protect your idea.
o Example:
 Patent pending for unique design.
 Trademark filed for brand name.
 Copyright for original software code.

Key Insights

 Many startups fail at the development stage because they underestimate time, cost, or technical
challenges.
 This section must convince readers that you:
1. Have a clear roadmap.
2. Are aware of risks and prepared to handle them.
3. Are protecting your intellectual property to secure long-term value.

[Link] Projections-

This is the final section of a business plan. It translates the strategies and plans described in earlier sections into
numbers and financial expectations. It shows investors and stakeholders that the business is financially viable
and can achieve sustainable growth.

Key Components

1. Sources and Uses of Funds Statement

o Explains where the money will come from (sources) and how it will be spent (uses).
o Example:
 Sources → investor equity, bank loan, personal savings
 Uses → product development, marketing, hiring staff, equipment

2. Assumptions Sheet
o Lists the underlying assumptions used to build financial forecasts.
o Examples:
  Sales will grow at 15% annually
 Average customer spends $50/month
 Raw material costs rise by 5% per year

3. Pro Forma Income Statements

o A projected profit and loss statement.
o Shows expected revenues, expenses, and profits over the next 3–5 years.

4. Pro Forma Balance Sheets

o A snapshot of the company’s projected assets, liabilities, and equity at future points in time.
o Demonstrates financial health and stability.

5. Pro Forma Cash Flows

o Tracks expected inflows and outflows of cash.
o Shows whether the business will have enough liquidity to cover expenses and grow.

6. Ratio Analysis
o Uses key financial ratios to assess performance.
o Examples:
 Gross margin (%)
 Current ratio (liquidity)
 Debt-to-equity ratio (leverage)
 Return on investment (ROI)

Key Insights

 Financial projections are placed last because they are built on all the strategies, plans, and
assumptions developed earlier.
 They convert the business vision into numbers, giving investors confidence that the idea is not just
attractive but also financially feasible.
 Investors often focus heavily on this section to evaluate whether the startup can survive, grow, and
generate returns.

✅ In short:
The Financial Projections section answers:

 How much money do we need, and where will it come from?

 What assumptions are we making about costs, sales, and growth?
 Will the business be profitable and sustainable?
 How financially healthy will it be in the coming years?

Read 243 table

Presenting the Business Plan to Investors-

Presenting a business plan is both an art and a science. It’s not just about showing your slides—it’s about
convincing investors that your business is viable, your team is capable, and your vision is worth backing.

1. The Oral Presentation

Purpose:
The goal is to provide a clear, compelling summary of your business, highlight key opportunities, and generate
investor interest.

Key Principles:

 Follow directions: Always respect the time limit and format given. Overrunning a time limit can signal
poor preparation or lack of discipline.
 Smooth and polished delivery: Rehearse multiple times to ensure your presentation flows naturally.
Avoid reading slides verbatim; instead, tell a story that complements your slides.
 Clear and effective slides: Each slide should convey one main idea. Use visuals, charts, and diagrams
to support your points. Avoid clutter or excessive text.
 Confidence and body language: Maintain eye contact, speak clearly, and use gestures naturally.
Confidence is often interpreted as competence.

Structure Example:

1. Hook / Attention grabber: Start with a compelling story, problem, or statistic that highlights the
market opportunity.
2. Problem and solution: Clearly explain the problem your business addresses and how your
product/service solves it.
3. Market opportunity: Showcase target market size, trends, and customer needs.
4. Business model: Explain how your company makes money.
5. Traction / Milestones: Highlight early success, prototypes, or customer feedback.
6. Team: Introduce your team and why they’re uniquely qualified.
7. Financial overview: Provide high-level projections, funding needs, and ROI potential.
8. Closing / Call to action: Finish with a strong statement and the funding request.

Title: How Shark Tank Operates

1. Introduction

 Start with a hook: “Imagine walking into a room where wealthy investors are ready to fund your
business idea—but only if they see potential. That’s Shark Tank.”
 Purpose: Shark Tank is a reality TV show that connects entrepreneurs with investors (“Sharks”) to
pitch business ideas and secure funding.
 Format: Entrepreneurs present ideas, negotiate investments, and sometimes make deals right on the
spot.

2. The Pitch Process

 Step 1: Presentation
o Entrepreneurs introduce themselves and their business.
o They explain the product/service, target market, and business model.
o They reveal financial information like sales, profit margins, and investment needed.
o Tip for entrepreneurs: Keep it short, clear, and compelling—usually 2-3 minutes.
 Step 2: Investor Questions
o Sharks ask questions to evaluate the business.
 o They focus on:
 Market size and demand
 Product uniqueness and competitive advantage
 Financials and revenue potential
 Risks and challenges
 Step 3: Negotiation
o Entrepreneurs state the funding they want and the equity (ownership) they’re willing to give.
o Sharks may:
 Offer full or partial investment
 Counteroffer with different terms
 Ask for more equity or different payment terms
o Negotiations can involve multiple sharks competing to invest.

3. Investment Decisions

 Deal Made: The entrepreneur accepts the Shark’s terms and gets funding.
 No Deal: Either the Sharks are not convinced, or the entrepreneur rejects the offer.
 Outcome: Deals can include money, mentorship, strategic guidance, and industry connections.

4. What Sharks Look For

 Innovative products or services with potential for growth

 A clear business model and revenue streams
 Market validation (sales, customer interest)
 Passionate and capable entrepreneurs
 Opportunities to make a significant return on investment

5. Impact of Shark Tank

 Provides funding and mentorship for small businesses

 Encourages entrepreneurial thinking and innovation
 Influences the market: products featured often see sales boosts even without a deal
 Inspires viewers to start their own businesses

6. Conclusion

 Shark Tank is more than a TV show—it’s a platform where innovation meets opportunity.
 Success depends on preparation, persuasion, and the ability to show that your business is worth the
investment.
 Closing line idea: “In Shark Tank, it’s not just about selling a product—it’s about selling your vision.”

2. Questions and Feedback from Investors

Investors will almost always follow your presentation with questions. They are evaluating:

 Market understanding: Do you really understand your industry and customers?

 Financial viability: Are your projections realistic? How long until the business becomes profitable?
 Competitive edge: How is your product or service different or better than others?
 Team capability: Can your team execute the plan?
 Risks and mitigation: What challenges might arise, and how will you handle them?
Preparation Tips:

 Anticipate likely questions and prepare clear, concise answers.

 Practice with mentors, advisors, or peers who can ask tough questions.
 Be honest if you don’t know an answer—show that you can research and follow up.

Read page 246-

Twelve PowerPoint Slides to Include in an Investor Presentation
1. Title Slide
2. Problem
3. Solution
4. Opportunity and target market
5. Technology
6. Competition
7. Marketing and sales
8. Management team
9. Financial projections
[Link] status
[Link] sought
[Link]

.Presentation Etiquette and Preparation-

• It’s also important to look sharp when presenting a business plan.

1. Professional Appearance:
o Dress neatly and appropriately for the audience. First impressions matter.
o A sharp, confident appearance can enhance credibility.
2. Rehearse Thoroughly:
o Go over your slides multiple times.
o Practice smooth transitions between topics.
o Time your presentation to ensure it fits the allotted period.
3. Final Review:
o Check slides for clarity, grammar, and visual appeal.
o Ensure data is accurate and up to date.
o Run through the presentation as a team if multiple people are presenting.
4. Confidence and Composure:
o Be prepared for questions and interruptions.
o Maintain a calm, professional demeanor, even under pressure.

Key Insight: Proper preparation and a polished appearance reinforce the professionalism of your business plan
and build investor confidence.

Blue Ocean Strategy and Red Ocean Strategy, along with examples:

1. Red Ocean Strategy

 Definition: Competing in an existing market space with many competitors. The goal is to outperform
rivals and capture a bigger share of existing demand.
  Characteristics:
o Compete in existing industry
o Beat the competition
o Exploit existing demand
o Trade-off between value and cost
 Example: Coca-Cola vs. Pepsi
o Both companies compete in the soft drink market, targeting the same consumers.
o Their strategies focus on advertising, pricing, and brand loyalty.
o The market is crowded, and competition is fierce.

2. Blue Ocean Strategy

 Definition: Creating a new, uncontested market space where competition is irrelevant. The focus is on
innovation and value creation.
 Characteristics:
o Create new demand
o Make competition irrelevant
o Offer unique value
o Break the trade-off between value and cost
 Example: Apple (iPod/iPhone)
o Apple created a new market for portable digital music players and smartphones with unique
design, user experience, and ecosystem.
o Competitors were irrelevant at the time of innovation because Apple offered something entirely
new.

Summary Table

Strategy Type Focus Competition Example

Red Ocean Compete in existing market High Coca-Cola vs. Pepsi
Blue Ocean Create new market Irrelevant Apple iPod / iPhone

If we consider WASA (Water Supply & Sewerage Authority) in Bangladesh as an example of Blue Ocean
Theory, it’s because it largely operates in an uncontested market space—no other large-scale utility directly
competes with it in Dhaka or other major cities for piped water supply. It has a monopoly-like position, so
competition is irrelevant (blue ocean).

On the other hand, an example of Red Ocean Theory in Bangladesh would be:

The telecom industry (Grameenphone, Robi, Banglalink, Teletalk).

 It’s a classic red ocean: multiple players competing head-to-head in the same industry.
 Market is saturated, growth is limited, and they fight intensely over price wars, packages, network
quality, data offers, and promotions.
 To survive, they mostly engage in competitive strategies rather than creating new uncontested demand.

👉 So:

 Blue Ocean Example (Bangladesh): WASA (monopoly utility, uncontested market).

 Red Ocean Example (Bangladesh): Telecom sector (Grameenphone vs Robi vs Banglalink vs
Teletalk).
Service is considered a subset of product because in marketing, the term “product” is used broadly to include
anything offered to satisfy a customer’s need or want. Products can be tangible goods or intangible
services.

Here’s why service is a subset of product:

1. Product Definition
o A product is anything that can be offered in the market to meet a need or desire.
o This includes physical goods, services, ideas, or a combination of these.
2. Service as an Intangible Product
o Services are non-physical offerings that still provide value to the customer.
o Examples: Banking, consulting, healthcare, education, or streaming.
3. Part of the Product Spectrum
o Tangible products: You can touch and own them (e.g., a smartphone, a chair).
o Intangible products (services): You cannot touch, but you experience or use them (e.g., Uber
ride, Netflix subscription).

✅ In short: All services are products because they fulfill a customer’s need, but not all products are services
because some are purely physical goods.

Qualities of Service

Services have unique characteristics that differentiate them from tangible products:

1. Intangibility
o Services cannot be seen, touched, or stored.
o Example: You cannot physically hold a consultation with a doctor; you experience it.
2. Inseparability
o Services are produced and consumed simultaneously.
o Example: A haircut happens while the customer is present; it cannot be separated from the
provider.
3. Variability (Heterogeneity)
o Service quality may vary depending on who provides it, when, and how.
o Example: A meal at a restaurant may taste different depending on the chef or time of day.
4. Perishability
o Services cannot be stored for later use. If they are not used, the opportunity is lost.
o Example: Empty seats on a flight cannot be sold once the plane departs.