Purposes of Business Plans

Planning

Budgeting/Forecasting

Feasibility of a Business – (Convince yourself)

Investment (Convince others)

The business plan is most often usedas a sales document

Characteristics of Business Plans

You get out of it what you put in

Dynamic/Iterative – You will never be finished

Tells a story – It should be an interesting read

-– Logical flow

Convey information effectively

-Use bullets, tables, diagrams, etc.

25-30 page maximum

General Overview

A business plan must answer a number of questions.

What is the problem/need?
What is your solution?
Who has the need?
How big is the need?
What value does your solution offer compared with other solutions?•
What are its competitive advantages?
How will you provide your solution to those that have the need?
Why will they purchase your solution?
How much money will you make?

Basic Business Plan Outline

Cover Sheet
Table of Contents
Executive Summary
Business Summary

a. The problem

b. The solution

c. The company

Market Analysis

a. Industry Analysis

b. Customers

c. Competition

Operations

a. Product Development/Manufacturing

b. Intellectual Property/Regulation

c. Marketing Strategy

Management
Financial Plan/Exit/Financials with Assumptions

Cover Sheet

Name of your Company

Contact Information

Confidentiality Notice

Revision Number/Date

Table of Contents

Use your BP outline

Helps investors find things

Make sure your pages are numbered

Tables & Charts

Executive Summary

• This is written last

2 – 3 pages maximum

Summarize the critical points of your plan – your BP outline

This might be the only section of the plan read by a Senior leader/investor

Defining the Problem/Need

Magnitude of the problem – Quantitative

Monetize the Problem – Money lost

People involved – Those with the problem

Current approaches to address the problem

How these approaches fall short

Ensure that you have a good understanding of the problem and not just a result of the problem.

Describe the Solution

• Describe the technology solution BRIEFLY

Use non-technical language

Describe how your products will use the technology

A technical description should be prepared, but not included in the plan

Emphasize the advantages of the technology and its degree of disruption

Characteristics of a Good Solution

• Platform/Fundamental Technology

-Supports multiple products

– Difficult to ‘design-around’

Disruptive Technology

Intellectual Property Protection

-Secured Patents/Trade Secrets

-IP space is not crowded

Clear translation into Products or Services

Cooperation of the Inventor/Technical Expert

Describe the Company/Department

Type of Corporation

When founded and by whom

One sentence overview/Mission statement

Company history (short for a start-up)

Describe the products/solutions that will be offered to address the market need

Market Analysis Overview

Industry Analysis

Identifying Target Markets

Profiling Customers

Competitive Analysis

This is the heart of your business plan.

Industry Analysis

• Describe industry in which your company will operate – NAICS Classification

Industry Trend

Government regulation/Barriers to entry

Growth projections

Division of market share among competitors

Requirements: 2000 words

Answer preview to Purposes of Business Plans

APA

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