BUSINESS PLAN

Introduction to the Business

Plan Goal Setting
TASK - 1

This is your first and perhaps easiest task

in writing a Business Plan.

In this element of your Business Plan, you

are to introduce your company to the
reader and explain the purpose of your
business plan.

Introduction to the Business

Plan Goal Setting
TASK - 1

It should be used to briefly familiarize the

reader with who are you, what the goals
of your business, when these goals will be
accomplished

If you are presenting your plan to a

banker, you may state how much you
intend to borrow, and what you intend to
do with the funds.

Introduction to the Business

Plan Goal Setting
Goal Setting Application

Are the goals which you have put into

your

introduction

clear

and

unambiguous to you and to an outside

reader?

Do you understand them clearly?

Introduction to the Business

Plan Goal Setting
Goal Setting Application

Will you be able to say when you have

achieved them or are they vague and
indeterminate?

Do you know by WHEN you aim to

achieve them?

Description of Business
Risk Taking
TASK - 2

This section of the Business Plan provides

background and other information on how
your business was started and how it is
presently doing or

If a proposed business, how and when you

plan to start it

Description of Business
Risk Taking
TASK - 2
Contents of this Section

For an existing business, the following

topics should be covered:
1. Name of Business: Legal Name and
Trade Name, if any
2. Date and Place of
Incorporation, if any

Registration

3. Date actual operations

planned to begin

began

or
or

Description of Business
Risk Taking
TASK - 2
Contents of this Section
4. Brief History: Discuss the type of business,
the major events in the past operations,
and discuss the results, mentioning sales
history when pertinent.
5. Form
of
Business
Organization:
Corporation, Partnership, or Proprietorship
6. Names of
Investors.

Owner,

Partners

or

Major

Description of Business
Risk Taking
TASK - 2
Contents of this Section

For a proposed business, provides as

much of the above information as is
possible.

You should explain what the business will

be, how the idea originated and how the
business is expected to develop.

Description of Business
Risk Taking
Risk Taking Application

If you are proposing to start a new

business, have you really thought through
the risks involved.

By planning the business carefully and

evaluating alternative, as suggested in
this workbook, you will reduce the risk,
but it can still happen.

Description of Business
Risk Talking
Risk Taking Application

Will you be able to survive failure?

Remember that entrepreneurs are not

gamblers, but they must and do task
risks.

Have you got what it takes.

Description of Products or
Services Demand for Quality
and Efficiency and Opportunity
Seeking and Initiative
TASK- 3

In this section of the Business Plan you

discuss the products and/r services that
you will be selling.

Part

of

the

information

that

will

be

included in this section is for the benefit

of outside readers who may not be
familiar with your business.

Description of Products or
Services Demand for Quality
and Efficiency and Opportunity
Seeking and Initiative
TASK- 3
Contents of this Section
1.

Description of Products and/or Service:

Explain what it is that you are selling.
Be specific
On the other hand, if you will sell your
services as a bookkeeping firm, you
may need to do little more than list the
services that you will provide.

Description of Products or
Services Demand for Quality
and Efficiency and Opportunity
Seeking and Initiative
TASK- 3
Contents of this Section

Question to ask are: a) What are you selling?

b) How will it benefit the customer?
c) Which product or service will be in
demand?
d) What is different about your product or
service?

Description of Products or
Services Demand for Quality
and Efficiency and Opportunity
Seeking and Initiative
TASK- 3
Contents of this Section
2.

Status of the Products and/or Service: Are

your products and/or Services available
for sale now?
If not, what needs to be done to
develop them?
Have you actually produced one or
more completed products?

Description of Products or
Services Demand for Quality
and Efficiency and Opportunity
Seeking and Initiative
TASK- 3
Contents of this Section
If you are selling a service, do you
presently have the skills and technical
capability to provide it?
If not, what needs to be done?
If additional inputs are required before
you products or services can be sold,
indicate the amount of time that you
will need to complete this process.

Customer -- Opportunity Seeking

and Initiative and Information
Seeking
TASK- 4

This will become a part of your marketing

Plan

The purpose of your market research is to

identify your Market Area (i.e. the
geographical area where the majority of
your customer are located), Market Size
(how much money people spend in a year
on your kind of product or service in your
area) and Market Trends (whats expected
to happen to this market in the future).

Customer -- Opportunity Seeking

and Initiative and Information
Seeking
TASK- 4

Three components of that market:

1. Customers
2. Competitors
3. Products (or Services).

Customer -- Opportunity Seeking

and Initiative and Information
Seeking
TASK- 4
Contents of this Section:

Determine in detail who your customers

are, or are likely to be.

Be as specific as possible,

For instance, if you will be selling only to

hotels, and there are only a dozen in your
market, then list each of them.

Customer -- Opportunity Seeking

and Initiative and Information
Seeking
TASK- 4
Contents of this Section:

If you sell to the general public, instead of

to other business, then you may need to
group potential customer according to
their demographics, such as age, income,
education, ethnicity, etc.

While you need to know who your

potential customers are, it is useful to also
know how much each individual target
group will contribute to your business.

Competition Persistence and

Information Seeking
TASK- 5
Part of your Marketing Plan

You can learn exceptionally important

lessons about your business by noting how
your competitors operate their business.

Try to learn as much as you can from their

successes and their failure.

Competition can be inspiring rather than

threatening if it is fully researched and
understood.

Competition Persistence and

Information Seeking
TASK- 5
Contents of this Section:
1.
Description of Competitors: Identify those
businesses which will be competing with
you. List any expected or potential
competitors
2.
Size of Competitors: Determine the assets
and sales volume of the major competitors.
Will you be competing against firms whose
sizes is similar to your or will you be
competing against corporations.

Competition Persistence and

Information Seeking
TASK- 5
Contents of this Section:
3.
Profitability of Competitors: Try to
determine how profitability the business is
for those companies already in the field
4.
Operating Methods: For example, what
pricing strategy does each firm use? In
addition to price, you may also want to
consider: a) Quality or product and/or service:

Competition Persistence and

Information Seeking
TASK- 5
Contents of this Section:
b) Hours of operation
c) Ability of personnel
d) Servicing; warranties and packaging
e) Methods of selling; distribution channels
f) Credit terms; volume discounts
g) Location

Competition Persistence and

Information Seeking
TASK- 5
Contents of this Section:
h) Advertising and Promotion
i) Reputation of company and/or principals
j) Inventory levels

Many of the above items will not relevant to

all businesses

After you have completed your research, it is

useful to summarize your finding in tabular
form, such as the one shown in the sample.

Pricing Persuasion and

Networking
TASK- 7
Part of your Marketing Plan
Contents of this Section:

In this task, you have to consider your

pricing policy, Pricing is often one of the
things that a small businessman spends too
little time.

The determination of prices should be done,

however, taking a lot of other factors into
consideration.

Some factors that you want to consider are:

Pricing Persuasion and

Networking
TASK- 7
1.

Cost.
If
you
wholesale
or
retail
merchandise, you should explain the basis
of your markup.

2.

Consumer
Perceptions.
Another
consideration when setting your prices is
the perception of the value of your
products and/or services by the consumer.

3.

Competition. Competition is, of course, an

important consideration in pricing.

Pricing Persuasion and

Networking
TASK- 7

The objective of your pricing is, of course,

to set the price at the level that
maximizes profits.

Penetration pricing, which the Japanese

often use, is a good illustration of this.

In your Business Plan, you should

describe your pricing policy and explain
why you think this policy will result in the
maximization of your profit.

Pricing Persuasion and

Networking
Persuasion and Networking Application

It is easy to fall into the trap of believing

that the best, or even the only way to
persuade people to bus something from a
new supplier is by offering the lowest price.

Probably not, because factors like service,

location and quality were more important
than the price.

When you are considering your prices, think

about how it will be when you are trying to
sell your products.

Pricing Persuasion and

Networking
Persuasion and Networking Application

In business you cannot ORDER people to

do things, no matter whether what you
want them to do it is to work harder or to
buy your products.

You have to PERSUADE them, by showing

them that it is in their best interest to do
what you want them to do.

Thank you