Entrepreneurship

“is a written document prepared by the entrepreneur that
describes all the relevant external and internal elements
involved in starting a new venture.”

It is a road map that integrated functional plans and answers
questions such as:
- Where am I now?
- Where am I going?
- How will I get there?

Is read by employees, investors, bankers, venture capitalists,
suppliers, customers, advisors & consultants.

Is important because:
- It helps determine the viability of the venture in
designated market.
- It provides guidance to the entrepreneur in organizing his
or her planning activities.
- It serves as an important tool in helping to obtain
financing.

Establishing goals & objectives help in defining what kind of
information is required from what sources.
 Market Information: such as
▪ Target market
▪ Market potential for product or service
▪ Industry & environmental trends (Macro & Micro
environment)
▪ Competitors
▪ Product/service required features
General environmental & Demographic trends
National industry trends
National environmental &
Demographic trends
Local industry trends
Local competition ,
Strengths &
weaknesses
Market Positioning
Market Objectives
 Operations Information: such as:
- Location
- Manufacturing operations
- Raw materials
- Equipment
- Labor skills
- Space
- Overheads
 Financial Information Needs: all the information required
for budgeting such as:
- Capital expenditure
- direct operating expense
- forecast for revenue and sales
1. Introductory Page
A. Name & Address of business
B. Name(s) & Address(s) of Principal(s).
C. Nature of Business
D. Statement of financing Needed
E. Statement of confidentiality of report
II. Executive Summary – Two to three pages summarizing the complete business
plan
III. Industry Analysis
A. Future outlook & Trends
B. Analysis of competitors
C. Market Segmentation
D. Industry & Market forecasts
IV. Description of Venture
A. Product(s)
B. Service(s)
C. Size of Business
D. Office equipment & Personnel
E. Background of Entrepreneur(s)
V. Production Plan
A. Manufacturing Process (amount subcontracted)
B. Physical Plant
C. Machinery & Equipment
D. Names of suppliers of raw materials
VI. Operational Plan
A. Description of company’s operations
B. Flow of orders for goods and/or services
C. Technology Utilization
VII. Marketing Plan
A. Pricing
B. Distribution
C. Promotion
D. Product forecasts
E. Controls
VIII. Organizational Plan
A. Form of ownership
B. Identification of partners or principal shareholders
C. Authority of principals
D. Management – team background
E. Roles and responsibilities of members of organization
IX. Assessment of Risk
A. Evaluate weakness(es) of business
B. New technologies
C. Contingency Plans
X. Financial Plan
A. Assumptions
B. Pro forma income statement
C. Cash flow projections
D. Pro forma balance sheet
E. Break even analysis
F. Sources & application of funds
XI. Appendix (contains backup material)
A. Letters
B. Market research data
C. Leases or contracts
D. Price lists from suppliers

If a business plan is to be used to raise capital,
the why would the entrepreneur want to
advertise the firm’s major risks by detailing
them in the business plan?