Promotion Strategy

How the companys product or services will

be promoted is an important component of
the marketing. The promotion strategy
must include the following:
1.Advertising aspects
a)Advertising budget
b)Positioning message
c)First years media schedule
2. Packaging which describes how the
companys products will be packaged

3. Public relations-this will be detailed presentation

of the publicity strategy of the firm.
4. Sales promotion- these are means used to
support the sales message like special sales,
coupons, contests, premium awards, trade in,
among others.
5. Personal sales- these present the sales strategy
including
a)Pricing procedures
b)Rules on returns and adjustments
c) Methods of sales presentation
d)Generation of leads
e)Policies on customers services
f) Compensations of salesmen
g)Responsibilities of the salesmen

ANALYSIS OF THE
COMPETITION

The small business operator will find it difficult to

compete if his competitors are unknown to him. This
makes necessary to make an analysis of the competitors.

In competitive analysis, the following

must be determined:
1.The strengths and weaknesses of the
firms competitors
2.Strategies that will give the firm a
competitive advantage
3.Barriers that can be developed to
prevent competitors or would be
competitors from exploiting the firm's
market;
4.Any opportunity that can be exploited

OPERATIONS AND
How the firm will be operated on a
MANAGEMENT

continuing basis is an important

component of the business plan. As
such, the plan must contain the
following:
a)Organization structure
b)Operating expenses
c)Capital requirements
d)Cost of goods sold

ORGANIZATIONAL
A STRUCTURE
well defined and realistic organizational
structure is an important element of the business
plan. Generally, they will be concerned on how
the firm is organized along the following
concerns:
1.Marketing (including sales, customers, relations
and service)
2.Productions (including quality assurance)
3.Research and development
4.Management
5.Human resource

OPERATING EXPENSES

Projections of operating expenses are important aspects in the preparation of a business plan. This is
prerequisite in projecting financial statements. Lenders and investors are especially interested in
scrutinizing such statements.
These expenses included the following:
1.
Material
2.
Labor
3.
Overhead

CAPITAL REQUIREMENTS

Capital equipments are necessary items in

operating businesses. The business plan will
not be complete unless a listing of capital
equipment needed to be purchased is drawn
up.

COST OF GOODS
The cost of goods of trading firms consist
of products purchased for resale, while
The cost of goods of manufacturing firms
refer to total expenses incurred in
manufacturing the products that are
intended to sold.
-material, labor, overhead

FINANCIAL DATA

Financiers are most interested in the financial aspects of the

business plan. To satisfy this requirement, the following
statements must be presented in the business plan:
1.The income statement
2.The balance sheet
3.The cash flow statement

THE INCOME STATEMENT

It shows the income, expenses and profits of a firm over a

period of time. It is also alternatively called statement
of earnings. It my cover a certain year, quarter or month.
It provides basic data to help the prospective financier
analyze the reasons for the projected profits.

THE BALANCE SHEET

The balance sheet is that type of financial
statement that shows the financial condition of
the business as of a given date. The
information provided by this statement is useful
not only the entrepreneur but also to the
prospective creditors.
a summary of the financial balances of asole
proprietorship, abusiness partnership,
acorporationor other business organization,
such as anLLCor anLLP.Assets,liabilitiesand
ownership equityare listed as of a specific
date, such as the end of itsfinancial year.

A summary of financial
information about the business
is contained in the balance
sheet and are broken down into
three areas, namely;
1.Assets
2.Liabilities
3.Owners equity

THE ASSETS

The assets portion of the balance sheet lists the assets of the firm in
order of liquidity from the most liquid to the least liquid. As such this
portion is subdivided into the following:
1.Current assets
a)Cash- which includes cash in checking, savings and short terms
investments account;
b)Account receivables-these refer to income derived from credit
accounts;
c)Inventory- this refers to the inventory of material used to manufacture
a product not yet sold.
2. Fixed assets- these are durable assets and will last more than one
year. These consist of the following;
a)Capital and plant- this refers to the book value of all capital
equipment and others such as land and building, if owned by the firm,
less depreciation.
b)Investment- these are investments account owned by the company
that cannot be converted to cash in less than a year

THE LIABILITIES
The liabilities portion of the balance sheet is
classified as current or long term. Current liabilities
are due in one year or less and they include the
following;
1.Accounts payable- these refer to all expenses
incurred by the business that are purchased on an
open account from suppliers and are due for
payment
2.Accrued liabilities- these refer to operational
expenses that are not yet paid. Examples are
overhead and salaries
3.Taxes that are due and payable.

Long term liabilities are due in more than

one year.
1.Bonds payable- these are bonds due
and payable over one year.
2.Mortgage payable-this refers to loans
used for the purchase of real estate and
is repaid for a period of over one year
3.Notes payable- these are loans
represented by a written document
which is payable for a period of over one
year

The owners equity

This section refers to how
much the owner has in the
business. It provides a useful
means in evaluating the
company.

The cash flow

statement
acash flow statement, also known
asstatement of cash flows, is
afinancial statementthat shows how
changes inbalance sheetaccounts and
income affectcash and cash
equivalents, and breaks the analysis
down to operating, investing, and
financing activities.

The following items are listed in

cash flow statements
1.Cash- which is the cash on hand in the
firms
2.Cash sales- which are income from
sales paid for by cash
3.Receivables- which are income
collected from credit sales.
4.Other income- which are income
derived from investments, interest on
money loaned to borrowers and on cash
derived from sale of assets

5) Total income- is the sum of each cash, cash

sales, receivables and other income
6) Material or merchandise refers to
a. Raw material used in the manufacture of the
product or
b. The cash outlay for merchandise inventory
of trading firms or
c. The supplies used in the performance of a
service
7) Direct labor refers to all required to
manufacture a product or perform a service
8) Overhead- this refers to all fixed and
variable expenses required in a day-to-day
operations of the business

9) Marketing expenses- these refers to all

salaries, commissions, and other direct
cost associated with the marketing and
sales departments.
10)R and D expenses- are labor
expenses required to support the
research and development efforts of
the firm
11)G and A expenses-refer to those
required to support the general and
administrative functions of the firm.
12)Taxes- refer top all taxes, except
payroll with holding taxes, paid to the
government, national and local.

13) capital- represents the funds

requirements to obtain any equipment
needed to generate income
14)Loan payments- refers to total
payments made to reduce or eliminate
any long-term debts.
15)Tal expenses- refer to the sum of
materials, direct labor, overhead,
marketing expenses, R and D, G and A,
taxes capital and loan payments
16)Cash flow-refers to the different
between total income and total
expenses
17)Cumulative cash flow- refers to the
different between current cash flow and

Supporting documents
The business plan would be more
meaningful if supporting documents are
included.
1.The owners resume
2.Contracts with suppliers
3.Contracts with customers
4.Letters of reference
5.Letters of intent
6.A copy of the firm's lease
7.A copy of copyright or patent acquired,
if applicable
8.Tax returns for the last past 3 years

THANK YOU !