Business plan student copy

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a business plan “writing a plan is an internal journey through the mind of one person. Even in partnerships and corporations, usually one person has the vision and energy to take an idea and turn it into a business by writing a business plan.” McKeever, Mike. How to Write a Business Plan (7th Edition). Berkeley, CA, USA: Nolo, 2005. p 14. Nick Charlton: 3/2006. Class reference only. Do not copy or distribute

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probably the most important ‘framework’ for your success concept process contents outcome business architecture Nick Charlton: 3/2006. Class reference only. Do not copy or distribute

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what is a business plan? depends on the ‘business’ depends on its purpose difference between a project and business creation a business plan is………….? key attributes or things that it addresses Nick Charlton: 3/2006. Class reference only. Do not copy or distribute

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a document that demonstrates feasibility a reality check a ‘buy in’ document an action plan an operational tool a financial tool a benchmark a guide to future growth strategic tactical evaluation

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‘throw away your business plan’ generate and then maintain a ‘living’ document core conventional ideas about a

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‘I have made this letter longer, because I have not had the time to make it shorter’ Blaise Pascal (1623 – 1662) "Lettres provinciales", letter 16, 1657 it better be easy (to use)

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‘god is in the detail’ ‘the devil is in the bits that are left out’

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what do I want to do here? who am I preparing this document for? clarity of purpose who do I need to convince? my ideal: this is what I want and this is what it will look like first questions can I be detached enough to do this on my own? friends, family, colleagues, mentors, business coaches

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A: a business case B: feasibility C: strategic plan D: action/operational plan sequence A + B + C + D = a business plan preparing to create a business plan

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is my idea justifiable as a valid business proposition? can a case be made for investing further time and money in this idea? What have I got to offer? What is my product or service, really? Is there or could there be a market? What ‘business’ will I be in? Where in the value chain do I fit? Who’s my competition? How will this business make money? does this feel right and am I optimistic after this review? A: business case (1) 5 X *

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what approaches could I take strategically (scenarios) type, size and scale of business? how big, how quick? what and how many products? different ways to get started? how will it be funded? which one looks the most ‘doable’? business case (2) so it looks like it might fly as a business proposition A B C

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B: feasibility study facts, figures, estimates & guesstimates: specific type of products/services cost to produce/deliver sales volume and cost over time fixed and variable overheads establishment costs time to set up cash forecast, income and expenditure profitability funding can this work, practically?

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establish the objectives and way marks confirm market and its potential. confirm the business model? confirm technical and production feasibility. confirm operational capacity and capability. confirm ‘people’. confirm legal requirements and IP issues. contingency and risk management constraints identified. feasibility confirmed yet more detail

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feasibility confirmed? yes no rework, reappraise or look for something else! we see what we want to see particularly when we are ‘emotionally engaged’ with a project

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possible responses a conceptual map (from a helicopter) is there a clearer picture of where things could go and what ‘side steps’ could be taken if things change? C: strategic plan external forces consequences positioning the business in a wider context SWOT PESTLE avoid assumptions check perspectives is this really the issue?

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PESTLE and SWOT wot?

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P E S T L E Political- are there any political circumstances likely to effect your plans? Ie. Will a change of government have any impact? Are there any professional ‘political’ issues? Are changes in tariffs going to allow competing imports? Environmental- are there environmental constraints? This might include RMA, recycling, disposal of waste, or issues to do with the use of toxic materials. It may also be expanded to include consideration of location and the nature of the working environment. Social- How will the planned activity be perceived and will it be acceptable to the community? Are there any professional community issues? What will your neighbours think? Can you go on using fur on your garments? Technological- what processes and materials will you be using? Are you reliant on sophisticated machinery and can you afford it? What are the priorities? Are there sunrise technologies that may affect you or your product? Legal- are there any legal requirements that you need to meet? What are your legal obligations re-consumer rights? Is where you plan to undertake the activity zoned for such work? Do you have to offer product warranties or return to base guarantees? Economic- what are the cost factors associated with what you are planning? What are the priorities and where can you get money from?

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Political Economic Social Technological Legal who what where when how why Environment Political P E S T L E might want the product? Need or opportunity is it addressing? would this be used? Under what circumstances? Will it be used and how will we respond to it? Would this be of interest, and why would we want to use/buy it? from the ‘users’ point of view- product from the designers point of view- process (5XW+H)+pestle

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swot strengths/weaknesses/opportunities/threats a swot analysis deals with ‘what is’ i.e. the present. It is important to describe current reality and not the reality of the past or what we anticipate for the future current factors or circumstances which then can be responded to in the plan

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Strengths What advantages do you have over others with whom you will be competing? What do you do particularly well, and better than anyone else? Weaknesses What don’t you have or can’t you do well? What have you done badly in the past? Are there any perception issues you need to address? Opportunities Where can you find or create competitive advantage? Can you collaborate or rationalise your activities to make you stronger? Threats What are current or future competitors doing that may result in loss of clients? Are there environmental changes looming? Are you short of resources? List everything; rate as being major (A), medium (B), minor (C) Prioritise and assess impact on plan.

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if the plan is to get financial support: what ‘tangible’ assets do you have? what value your ideas? have the ideas been safe-guarded? show how the product can win a place in the market up front. show how early sales can be achieved. show how you know this. show a sound business model. show additional sources of funding. show personal commitment. From the investors point of view: How risky? How secure? Chance of success? FFF

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90 day planning functional areas and core activities tasks and systems task capability organisational structure people, roles and responsibilities now and what it needs to evolve to become measures D: action plan

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Cover page including contact details Executive summary What are the circumstances of the opportunity. Who will undertake the business development. What briefly is the business strategy. Assumptions underpinning the business plan. Critical risks and contingencies. Background: key personnel and business history to date. The business proposition including product description. Unique selling proposition Markets and customers The people The operation Finances Evaluation the classic business plan structure

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persuasive objective supported honest a POSH presentation

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1. Executive summary what is the context of the business opportunity? who is involved? what is the business strategy? what assumptions have been made? what are the critical risks? what contingencies are proposed? description purpose aim A brief summary of the entire report Establishes from the outset what the report is about and its purpose to communicate a sense of thorough preparation and confidence key points

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2. Background: description purpose aim key points business history to date, and key personnel. to show how far advanced plans are and to profile the key personnel to highlight the expertise available and to reinforce that the project is underway Paint a compelling picture of the people who are involved, the experience and expertise that they bring to the business. An investor will be looking for reassurance that those involved have the capacity and will to drive the business and achieve its objectives. Outlining the steps taken so far will demonstrate purpose and commitment.

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3. The business proposition including product description. describe precisely what the business is furniture designing / product design / exhibition design secretarial services ‘data management, typing and copying’ or - ‘providing small businesses with affordable convenient access to a fully equipped and staffed administration office’. amongst other things, helps identify other competitors (house painters/house washers)

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4. The USP or unique selling proposition. Why would someone want to buy your product, use your service or employ you? What makes your offering better than someone else's? A statement that clearly describes the competitive advantage or reasons that you believe that your business can compete successfully. my chairs better than your chair its not only about the product

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Critical section! backs up your feasibility claims. As far as possible support with data or independent market research (where can you get free data from?) who are your customers? who might be customers? market size current ‘character’ and location quality and service requirements trends competitors, direct and indirect segmentation, or parallel services price comparisons and expectations legislative requirements (e.g. electrical certification) 5.Markets and customers. however good your product, no customers, no business

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Marketing strategy how will you go about taking the product to market? 5 P’s Product Purchasers Price Promotion Place

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6. The people Identification of the people who will be involved Legal structure Qualifications and experience as related to the business needs Roles and responsibilities Professional development or upskilling Investors are often at least as interested in the people behind a business as they are in the actual product.

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7. The operation All of the things that together allow the business to proceed Ownership Management structure Administration systems Premises Equipment

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Sources of funding, loans and liabilities Income and expenditure projections Break even analysis It may be prudent to work through this with an accountant if the venture is of sufficient scale. 8. Financial information CFIMITYM

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Sensitivity analysis Contingency planning Risk minimisation 9. Risk evaluation A realistic appraisal of the situation and a demonstration that you are positively prepared in the event that circumstances change.

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and then you get the money and everyone lived happily ever after

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choose a project, start planning monitor costs make your own spread sheet or I’ll provide

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by month by week Objectives Actions, details, contacts, requirements etc

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functional areas and responsibility of each Within your business what are the operational areas that have to be resourced? e.g. workshop / retail / accounts

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tasks and systems To meet its responsibilities each area needs to undertake these tasks………. To undertake these tasks the following systems need to be in place………… the workshop needs to be able to produce finished goods to produce finished goods the workshop needs to have materials available materials to be ordered in advance of need

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task capability do I or the people I intend to work with have: the knowledge the skill the equipment the understanding the training to complete the tasks successfully?

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organisational structure communications, roles and responsibilities how are decisions made? who has the final say?

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people, roles and responsibilities who have you got on board? do they understand what their position is? is their relationship to the company clear? are job expectations, J/D’s and measures clearly stated? do you know what your obligations are regarding employment?

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now, and what it needs to evolve do you intend to grow the business? are there any steps that should be anticipated? how will resource demands change?

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way marks, performance measures, checks…… how do you know you are achieving what you need to? measures could include………..…?

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Value Chain coined by Michael Porter 1985 The production of any goods or services are comprised of stages At each step of the way, from ‘cradle to grave’, where can you add value? If you are part of a larger chain of production where do you sit, and how can you add value in a way that will make your business more attractive than others? Question: how could you apply this principle to your basic business proposition.

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