Basics of business plan writing

1. Entrepreneurship & Small Business Management
(ESBM)-MSH-1109
Tutor: Mayank Choubisa (Guest Faculty)
Birla Institute of Technology (Mesra), Jaipur Campus
Getting Started
Preparing a Business Plan

2. Lecture Outline
 What to put in the business plan
 Getting started
 Government and non-Government support
for business

3. The Business Plan
 A sales tool
 To attract investors or new business partners
 Strategic document and action plan
 Defines the company
 Sets out objectives
 Identifies priorities

4. Content of the Plan
 Write for your audience
 Good presentation
 Ideas expressed clearly and concisely
 Avoid too many management/technical jargons
 Be realistic – not overly optimistic
 Executive summary should entice the reader
 Highlight the skills and talents of the team

5. Preparation
 Goals
 Route to market
 Finance
 Premises
 Legal format

6. Legal Format
 Sole trader
 Partnership
 Limited Company
 Register with Companies House
 Off the shelf company
 Franchise

7. Essential Areas to Cover in the Business Plan
 Executive summary
 The business concept
 Product or service
 The market and competition
 Management
 Business operations
 Financial projections
 Marketing strategy
 Bid for finance

8. Executive Summary
 Includes the key elements from the plan
 Should attract interest
 Maximum length: 2 pages (1000 words)
 Often written last

9. The Business Concept
 Introduce the nature of the business
 Include vision and mission statements
 Delineates the focus of the business
 States the aims of the business

10. The Product or Service
 The product or service
 What makes it different?
 What value does it offer?
 How will it be delivered?
 What are the planned developments
 Protection by patent?
 For existing businesses
 Current and planned products
 History of the business

11. Market and Competition
 Define your market
 Industry sector, geographic scope
 Market size
 Focus on your target segments
 How large is each segment?
 What is your likely market share?
 What are the trends?
 Outline the principal competitors
 Products/services
 Advantages/disadvantages compared to you

12. Management
 Demonstrate qualities to turn the Plan into reality
 The entrepreneurial team
 Education
 Business experience
 Key skills and talents
 Other members of the management team
 Define responsibilities
 Recruitment
 Training

13. Business Operations
 Analyse the workforce in total numbers
and by task/department
 What premises does the business need?
 What production facilities are needed?
 What management information systems
are needed?
 Are there any regulatory standards which
must be met?

14. Financial Information
 The funding request
 Financial statements ~ historical
 Forecasts
 Profit and loss statements
 Cash flow
 Balance sheets for 3 to 5 years
 Clearly state the assumptions behind the
forecasts
 What-if scenarios

15. Marketing Strategy
 How will you position your product/service
in the marketplace?
 Which markets are you going to serve now
and where do you want to be in the future
 Overview of the key aspects of the
marketing mix

16. Bid for Finance
 What is the money for?
 How much will you be investing yourself?
 What amount do you need?
 When do you need it?
 How and when will you repay it?
 What security (if any) can you offer?

17. Appendices
 Detailed analyses should be in an
appendix and not in the Plan
 Items which can go in an appendix:
 SWOT analysis
 Market research results
 Financial data

18. Getting Started
Business Start-up

19. Start-up ~ how long will it take?
 Delays
 Finding customers
 Finding suppliers and distributors
 Finding business premises
 Building work
 Recruitment
 Research and development
 Raising finance

20. The Start-up Obstacle Course
 Everything takes longer than planned
 Gaining market credibility
 Forecasts are rarely accurate
 Avoid profit margins being squeezed
 Supplier relationships
 Getting paid
 Managing people and building a team
 Fire-fighting

21. Employing Staff
 Employment law
 National minimum wage
 The Working Time Directive
 Fairness at Work Legislation
 Ensure do not discriminate: race, sex,
marital status or disability
 Pay as You Earn and National Insurance
 Employer’s Liability Insurance

22. Regulation
 Register for VAT (Refer Current Regulations)
 Employing staff
 Business Link guide
 New Employer’s Starter Pack
 Self employed:
 Inform Inland Rev (NI contributions): Class 2 + 4 NI
 Limited Co:
 Set up PAYE scheme
 Inform local Inland Revenue office re Corp tax
 Health and Safety
 May have to register with HSE or local authority

23. Support Agencies
 Business Links
 Banks
 Chambers of Commerce
 Small Business Federation
 Institute of Small Business Affairs
 Institute of Directors

24. Websites
 nasbic.org
 http://business.gov.in
 www.cmie.com
 www.new-ventures.org/center/new-ventures-india
 www.ibef.org/industry
 www.bizTradeShows.com
 www.researchandmarkets.com
 www.statisticsofindia.com
 www.securities.com
 www.franchiseopportunities.com
 www.indianindustryprofiles.com
 http://msme.gov.in & http://www.laghu-udyog.com
 www.ediindia.org and many many more…….