Objectives

What is a business plan? Purposes of the business plan Parts of business plan Definition of the business Market Research and Analysis Development Plan Manufacturing Plan The Distribution and service plan The Organizational Plan The Development Schedule The Financial Plan

Planning-is a very important activity which involves “deciding what will be done , who will do it, where, when and how it will be done, and the standards by which it be done

Business Plan Is a document

containing “a written summary of the proposed venture , its operational and financial details, and its manager’s skills and abilities

Various Uses of Business PlanTo help the firm’s Management

To attract Potential Investors

To serve as a legal document with which funds are raised

Components of a Business Plan by William Osgood

1.Definition of the business

2.Market Research and analysis

3.Development plan

4.Manufacturing plan

5.Distribution and service plan

6.Organizational plan

7.Development schedule

8.Financial plan

Components of a Business PlanDefinition of the Business

1.The nature of the company

2.Products or services offered by the company

3.The nature of the industry

4.Opportunities available

5.The rationale for the creation of the company

6.The rationale for catering to a specific market

Components of a Business PlanMarket Research and Analysis

1.Situational analysis and target market

2.Marketing objectives and goals

3.Marketing strategies4.Marketing tactics5.Schedule and budget

Components of a Business PlanMarket Research and Analysis

6.Financial data and control

-sales estimates on a monthly basis

-cash flow requirement

-break-even analysis

-estimate of inventory turnover

-measures of profitability

Components of a Business PlanDevelopment Plan

Components of a Business PlanManufacturing Plan

Includes:

-Manufacturing facilities -Equipment Costs

-Location-Labor requirements

-Size

-Rentals

-Purchases

-Required equipment

-Inventory req. and control

Components of a Business Plan The Distribution and Service Plan

The distribution and service plan provides the steps required to effectively bring the product or service to the market. Pricing, sales, service policies, market penetration and timing are indicated. This also includes specific statement about and when anticipated events are to take place and assignment of specific responsibilities to specific individuals

Components of a Business Plan The Organizational Plan

Components of a Business Plan The Development Schedule

Components of a Business Plan The Financial Plan

The Financial plan is a document indicating the financial requirement necessary to support a given set of plan in other areas.

Its main components are:

-Projected income statement

-cash budget -purchasing budget

-personnel budget -break-even analysis

-production budget

Components of Financial Plan Projected Income Statement

Components of Financial Plan Cash Budget

Components of Financial Plan Personnel Budget

Components of Financial Plan Production Budget

Components of Financial Plan Purchasing Budget

Components of Financial Plan Break-even Analysis