Business

Plan
unit-3

Business Plan

Meaning & Definition

Meaning:

A business plan is a written document that describes all the

steps necessary in opening and operating a particular
proposed business . The project is initiated with the
preparation of a formal , written master plan. The purpose of
this plan is to guide the project manager and team
throughout the prject life cycle.
A business plan is a basic document which gives an explicit
but precise account of what one has in mind to achieve and ,
in that context , it defines : What will have to be done?
When will be done?
How will be done?

Business Plan
Definition:
A business plan/project spells-out the principal features and
the future prospects of a proposed business . Besides , it
provides analyses of and insights into vital issues that are to
be attended and sorted-out with an eye to achieving the
ultimate goal .
A business paln is well-defined written argument , based
on relevant facts , figures , and estimates . It portrays an
overall picture of a business proposal , attempts to justify its
technical feasibility as well as commercial success and
makes clear suggested course of actions in distinguish
sections .

Nature of Business Plan

1) It must suggest as high an overall rating as possible of the
ventures product development and team sophistication .
2) It must contain believable financial projections , with the key
data explained and documented .
3) It must show how investors can cash out in three to seven
years , with appropriate capital appreciation .
4) It must be presented to the most potentially receptive
financiers possible to avoid wasting precious time as
company funds dwindle .
5) It must be easily and concisely explainable in a wellorchestrated oral presentation .

1)
2)
3)
4)
5)
i.
ii.
iii.
iv.
v.

Objective of Business Plan

To Identify Opportunities
To Evaluate Performance
To Gauge Strategies
To Obtain Finance
Other Objectives
To give directions to the vision formulated by entrepreneur.
To objectively evaluate the prospects of business.
To monitor the progress after implementing the plan.
To persuade others to join the business.
To visualize the concept in terms of market availability ,
organizational , operational and financial feasibility.
vi. To guide the entrepreneur in the actual implementation of
the plan.
vii. To identify challenges in terms of opportunities and threats
from the external markets

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viii. To identify challenges in terms of opportunities and threats

from the external markets .
ix. To clarify ideas and identify gaps in management information
about their business , competitors and the market.
x. To identify the resource that would be required to implement
the plan.
xi. To document ownership arrangements , future prospects and
projected growths of the business venture.

Scope of Business Plan

1) Entrepreneur
2) Investor
3) Suppliers
4) Buyers
5) Other Stakeholders

Elements of a Business Plan

Elements of a Business Plan
Introductory Page
Market
Analysis/Environmental and
Industry
Production Plan

Executive Summary
Description of Venture
Operations Plan

Technical Plan

Marketing Plan

Organizational Plan

Human Resource Plan

Social Plan

Assessment of Risk

Financial Plan

Appendix

Business Planning Process

Self-Audit
Evaluation of the Business Environment
Setting Objectives and Establishing Goals
Forecasting Market Conditions
Stating Actions and Resources Required
Evaluating Proposed Plans
Assessing Alternatives Strategic Plans
Controlling the Plan through the Annual Budget

Evaluation of the Business

Environment

1) Demographic Changes
i. Sex,
ii. Age,
iii. Absolute numbers,
iv. Location,
v. Movement,
vi. Ethicity.
2) Economic Conditions
vii. Employment level,
viii.Regional performance,
ix. Wage levels,
x. Spending patterns,
xi. Consumer debt.

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3)Government Fiscal Policy and

Regulations
i. Level of spending and entitlements,
ii. War and peace,
iii. Tax policies,
iv. Environmental regulations.
4)Labour Supply
v. Age,
vi. Sex,
vii. Education,
viii.Cultural factors,
ix. Work ethics,

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5)Competition
i. Market penetration and position,
ii. Market share,
iii. Commmodity or niche product.
6)Vendors
iv. Financial soundness,
v. Quality and quantity of product,
vi. Research and development capabilities,
vii. Alternatives ,
viii.Foreign,
ix. Domestic,
x. Just-in-time capabilities .

Setting Objectives and Establishing

Goals
1.
2.
3.
4.

Profitability
Human Resources
Customer Service
Social Responsibility

Common Errors in Business Plan

Formulation
1. Failure to be Clear and Cocise
2. Inefficient Utilization of Human
Resources
3. Overestimation of Financial Projections
4. Insufficient Reserch

Essential Requirement of Developing Business Plans

Essential Requirement of Developing

Business Plans
Keep the Business Plan Short

Executive Summary

Reveal People Involved and

Their Roles

Description of Venture

Information should be Based

on Study
Make Proper Mission
Statement

Operations Plan
Marketing Plan

Significance of Business Plan

Significance of Business Plan
Analysis of Ideas on a Piece
of Paper

Help in Convincing Others

Reduction in Emotional Bias

Provide SWOT Analysis

Justify Ones Ideas/Plans

Develop Consistent Strategy

Achieve Ones Commitment

Feasibility Study

Action Plan

Selling Tool

Fundraising

Evaluating Progress

Thankyou!!!