Business Plan

Your road map to success

1
2
• What is business plan?
 A written document that describes the business
 A road map for starting and running a business
 Blueprint of the step-by-step procedure that would be followed
to convert a business idea into a successful business venture
 It provides information about
i. Marketing
ii. Finance
iii. Operations and human resources

3
 pl an
es s
u s in
o f ab
i v es
ject
o b
The

4
Give directions to the vision formulated by
entrepreneur.
Persuade others to join the business
Seek loans from financial institutions
Identify the strengths and weakness of the plan.

5
6
7
5. Customers
1. Identify your targeted customers
2. Their characteristics
3. Their geographic locations

8
6. Product or service description
Information
 Description of your product or service
 Innovative features product or service
 What makes your product/service different than others

9
7. Competition Analysis
In order to compete successfully in any business you
need to know your competitors.
Here are some simple hints to help you in this section:
Who are your most important competitors?
What are their main strengths and weaknesses?
How can you be different?
What are your competitors’ pricing policies?

10
8. Location
 The location must be convenient to
transportation and proximity to the customers
as well as the suppliers.
 Location consideration
o Space
o Lighting and ventilation
o Material handling and storage
o Control of hazardous substances

11
9. Pricing
Explain your method or methods of
setting prices.
Approaches to price setting
• Adopt competitor price
• Consider cost of production
• Assume customer value to the
product
12
10. The Market Plan
 How the venture will succeed-Marketing strategy

 It focuses on specific marketing activities

It describes
 Pricing policies
 Quality
 Warranty policies
 Promotional programs
 Distribution channels 13
11. Key personnel
 Owner(s)

Other management people

Non-managerial person

14
12. Materials and sources of supply
Purpose of this section of your business plan is to
1. Determine what materials you will need
2. Where you will get them.

15
13. Manufacturing and production
• Explain the process and equipment used to make your
product.

14. Sales forecast

• A sales forecast includes quantity of sales in numerical
terms

16
15. Forecasting costs
Calculating the sales forecast cost

Costs can be divided into two categories:

Startup costs and

On-going operating costs

17
16. Financial Plan
• Sources and uses of funds
• Cash flow statement
• Income statement
• Balance sheet

18
Start-up Capital
INVESTMENT
Land
Building
Equipment
Miscellaneous
Total Investment -----------------------------xxx
WORKING CAPITAL
Months of staff costs
Months of operational costs
Total working capital ----------------------xxx
TOTAL START-UP CAPITAL----------------xxxx

19
Source of start-up capital
Type Source Amount Condition
(duration/interest)

Equity capital Own saving

Partner
Loan 1 Family
Friends
Money lenders
Loan
Loan 2
Credit cooperative
 Government scheme
 Bank loan

Total fund

20
17. Organization and Staff

Staff requirements
Amount of staffs

Position
Tasks
Responsibilities
Qualifications

21
18. Plan organization chart
• Show clearly the organization total chart
and its:
Structure
Relationship
Authority

22
 Top mgr/owner

Middle

Team leader 1 Team leader 2

Worker Worker Worker

23
19. Financial statement
• Preparing income statement and balance sheet

• Income statement shows specific date loss and profit

statement

• Balance sheet is summery of asset, liability and capital

of the enterprises; it shows the following formula

(Asset = liability + capital)

24
 Company
Profit and Loss Statement/income statement
Period: from............... to....................
Gross Sales
Less: Returns and allowances -
= Net Sales
Less: - Costs of goods sold
- Direct material
- Direct labor
- Overhead (indirect material and labor cost)
= Gross Profit
Less: - Administrative and selling expenses –
- Telephone
- Water
- Electricity
- Rentals
- Others
= Operating Profit
Less: - Interest expense
= Net Profit before Tax
Less: - estimated Income Tax
= Net Profit or net loss after Tax
25
Balance sheet

• Balance sheet presents a company's financial

position at the end of a specified date.
• Balance sheet is a "snapshot" of the company's
financial position at a point
• It also show the enterprise portion
• It helps to have loan access
• It shows =
Balance sheet
Asset = liability + owners equity

26
20. The appendix
The last section of the business plan is the
appendix and contains supporting
documentation.
Résumés of owners/managers
Advertising samples
Brochures,
Organization chart

27
28