Creating a Winning E-Business Second Edition Creating an E-Business Plan Chapter 3 Business Plan Organization Business plan – Formal business planning document • • • • • • • Identifies the business and its mission Names the key management team members Describes the products or services to be offered Provides a marketplace analysis Identifies customers and competitors Determines resources for profitable operations Sets a timetable for profitability Business Plan Organization (continued) Government and for-profit sources for business planning information and templates – – – – – SCORE SBA BizPlanIt Bplans.com E-Future Centre (Canadian) Business Plan Organization (continued) Business plan components – – – – – Cover sheet and title page Table of contents Executive summary Business description Vision/mission statement Business Plan Organization (continued) Business plan components (continued) – – – – – Information on products/services Industry, customer, competitor analyses Operational, financial, and managerial plans Identification of critical risks What is an exit Exit strategy strategy? Business Plan Organization (continued) Cover sheet – Title of document and preparer’s name – Plan copy number – “Confidential” notation Title page – Cover sheet information and • Contact numbers • Key team members’ names • Name of person receiving the plan Business Plan Organization Business Plan Organizati on (continued) Business Plan Organization (continued) Table of contents – Lists all the major sections and subsections of the plan – Prepared after rest of plan is complete – Carefully checked for omissions and page number errors Business Plan Organization (continued) Executive summary (A condensed version of the complete plan) – Used by interested parties to quickly assess the business idea and weed out plans – Keep it short (one to three pages) – Use clear and concise language and action words – Create last after plan details are developed Business Plan Organization (continued) Vision statement – A formal statement of a business’s hopes and desires – Written to guide and inspire employees Mission statement – A formal statement that explains a business’s reason for existing Business Plan Organization (continued) Business description – – – – – Summary of business’s background Information about legal form of business Business’s history to date Key personnel Future goals Business Plan Organization (continued) Products or services section – Description of products or services offered – Anticipated sales for each product or service – Describes benefits of product or service to customers Business Plan Organization (continued) Marketplace analysis – Information about specific industry of which business is a part – Description of targeted customers – Description of major competitors – Overview of marketing and sales strategies Business Plan Organization (continued) Operational plan – Describes a business’s physical location and equipment – Notes the manufacturing or service actions needed to get products/services to market – Summarizes Web site operations Business Plan Organization (continued) Financial plan – Explains how your e-business idea, goals, and strategies translate into profits – Provides standard financial statements for income, expense, and cash flow data • Pro forma balance sheet • Projected income statement • Planned cash flow statement – May include “deal plan,” break-even analysis, ratio analysis Business Plan Organization (continued) Management plan – Organizational structure of business – Information on • • • • Key members of management team Outside advisors Mentors Consultants Business Plan Organization (continued) Appendices – – – – – Resumes Pictures of products Explanation of services Legal documents Other supporting documentation Legal Forms of Organization Sole proprietorship – Business started by an individual – Owner and business are one in the same for tax and legal liability issues Legal Forms of Organization (continued) Partnership – Legal business entity with two or more co-owners – Follows a partnership agreement – General partnership: Tax and legal liabilities flow through to individual partners – Limited partnership • General partner manages and assumes unlimited liability • Limited partners have liability for amount of their capital contribution and their accepted debt Legal Forms of Organization (continued) Corporation – – – – Separate legal and taxable entity from its owners “C” corporation owners are it shareholders Liability is limited to investment in business Profits are taxed twice: once for the corporation and again when distributed to owners as stock dividends Legal Forms of Organization (continued) Corporation (continued) – “S” corporation gives owners partnership status and corporate liability protection Limited liability company (LLC) – Tax status of sole proprietorship or partnership – Liability status of a corporation