Business Planning

and preparing a
Business Plan

Anjana Vivek
anjana@bizkul.com

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BEFORE YOU START
Spend some time on some analysis
 WHAT is the purpose of the
business plan
– Is it for internal use
– Is it for investors (VC/bank/angel
investor)
– For other purpose (incubation)

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BEFORE YOU START
Think through
 WHAT are the strengths – that
you bring to this business

WHAT are the constraints that you
have to either
– Address or
– Accept (and work keeping this in
mind)
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AT THE STARTING
POINT

Before starting on preparing the
business plan, think through the
following:
PUT YOURSELF IN THE READER’S
PLACE
– What is the reader looking for in a
business plan?
– What is the message you are trying to
convey through the business plan?
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AT THE STARTING
POINT

Different persons may view the
business plan differently
 Try to understand background and
experience of person/group to
whom plan is shown

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AT THE STARTING
POINT

Just because someone rejects or
scoffs at your idea, does not mean
it is bad
 Try to take some learnings from
rejections

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THE PLAN DOCUMENT
 You may prepare a detailed plan in
sections, which you may be stand alone
and kept for different purposes, ie
sections for internal use, for investor
and for banker
 Keep a track on versions to minimise
confusion and possible errors
 Keep control of access to the document

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BUSINESS PLAN
 The document must be self speaking:
ie minimum clarification must
be required from your end (particular
attention to be paid to explaining
abbreviations/short forms and technical
terms)
 The document must be reader friendly:
key information that you want
to convey should not be hidden amongst
too much details
Do not think only of what you want to tell,
rather think about what your target would
want to hear www.bizkul.com 8
BUSINESS PLAN
 Plan on format of report and how
data, information, analysis,
comments etc. are to be presented
– To move what is not essential to flow
of document to main report
– Think of content required to capture
attention of reader; avoiding
excessive information overload

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BUSINESS PLAN
 Avoid using graphs for the sake of using
graphs; tables for the sake of using
tables etc. without substance in the
document
 Avoid information overload, i.e.
temptation to disclose all you know and
demonstrate your knowledge and
experience about the business
 Make attempts to protect your
intellectual property if any
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CONTENTS
 Table of contents

Executive summary

Sections/chapters/paras
 Summary/conclusion
 Appendix of abbreviations,
references, other annexures
Graphs, tables, figures to be numbered
and labelled
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CHAPTERS - Illustrative

Company and background information

Management team, organisation structure

Business idea, strategy and
implementation plan

Marketing plan

Financial details

Other information such as implementation
schedule, statutory environment applicable
etc.

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CHAPTERS - Illustrative

Company and background information
– Background history if existing company; current
status
– Rationale for existing business or new start up
– General industrial environment of business
– Brief background of promoters

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CHAPTERS - Illustrative

Company and background information
– Vision and mission statement
– Goals and objectives
– Key business drivers and key constraints; SWOT
and business strategy
– Other key information to make initial background
information complete

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CHAPTERS - Illustrative
 Management team, organisation
structure
– Experience and qualification of
promoters and key team
– Organisation structure
– Any key organisation/HR policies

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CHAPTERS - Illustrative
 Business idea, strategy and
implementation plan, including inter-alia:
– Vision, mission
– Product/service offered
– Operational details
– USP(unique selling point); barriers to
competition
– Differentiator
– Strategy to handle competition

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CHAPTERS - Illustrative
 Business idea, strategy and
implementation plan, including inter-alia:
– Details of any in-house techonology/process or
idea; or source of technology, ie technology
transfer through collaboration
– Details of alliance partners, current as well as
proposed
– Details of any intellectual property associated
with the business

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CHAPTERS - Illustrative
 Marketing plan
– Target market size
– Market research details
– Customer profiles; existing,
potential/pipeline
– Marketing strategy
– Pricing strategy

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CHAPTERS - Illustrative
 Financial details
– Past financials: Balance sheet, P&L account
and cash flow summary for five year period if
available
– Future forecast – five years in summary
(detailed schedules may be in appendix)
– Details of how funds will be raised and utilised
– Details of contribution from promoters
(cash/kind)

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CHAPTERS - Illustrative
 Financial details
– Sensitivity analysis for key parameters, eg sales
variations of + / - 10%
– Scenario analysis:
optimistic, normal and pessimistic (budget)
– Key ratios, break even, project IRR
– Other information such as quality of key
parameters, ie revenue based on geography
– Cash burn, i.e. monthly requirement of cash
and requirement for capital investment in
phases

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CHAPTERS - Illustrative

Other information
– Time lines, implementation schedule,
expected date of commercialisation
– Regulatory environment if applicable, ie
environmental laws for pharma company
– Other information which may be relevant
to the business
– Include any required references,
contact information, data and statistics

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PREPARING THE
BUSINESS PLAN
 PRESENTATION IS THE KEY


CAPTURE THE READER’S
INTEREST


Think through the format of report
and how data, information,
analysis, comments
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PREPARING THE
BUSINESS PLAN
 Document should be consistent,
flow well (date formats, number
formats, serial number flow, prefix
to names, grammar and tense
used, avoid long sentences, spell
check, US/British English not to be
mixed etc.)

Source information for data,
content to bewww.bizkul.com
disclosed 23
PREPARING THE
BUSINESS PLAN

Format and style should be neat,
consistent, professional giving
attention to details of:
– format styles, font sizing, colours not
too light, legibility, header, footer,
headings, para alignment, spacing

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BUSINESS PLAN

Points to consider
– You must believe in the idea to sell it
– Homework before hand, adequate
knowledge
– Credibility is important, ie if caught
with one falsehood, nothing said
would be believed

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UPDATES &CHANGES IN
BUSINESS PLAN
 Points to consider
– If there has been substantial change,
update the plan
– The difficulty is when there are too
many versions which are around

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UPDATES &CHANGES IN
BUSINESS PLAN
 Points to consider
– If there is inconsistency between one
plan and the other, this is to be
reconciled, at least for internal
records if not for external
communication
– While the plan is to be updated to
reflect reality and changes, too many
such changes give wrong signals

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PRESENTATION OF
BUSINESS PLAN

Content, value to listener, any
take away?
 In preparing a presentation
– Master slide can be useful
– Include page numbers
– Use clear headers to demonstrate
slide topic

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PRESENTATION OF
BUSINESS PLAN

In preparing a presentation
– Avoid clutter (generally not more
than 5 points per slide)
– Pay attention to details: colour
combinations, business logo legibility,
consistency of message
– Clarity, tone, steady speed in
speaking

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APPENDIX
Planning for a business
 Plan for advisors / accountants /

lawyers
 Educate oneself about the law and

regulations to be followed
 Educate oneself on basics of managing

a business and finance

 Plan for long term impact of decisions

taken with regard to hiring employees,

taking office space etc.
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