ENTREPRENEURSHIP

Governor Pack Road, Baguio City, Philippines 2600

Tel. Nos.: (+6374) 442-3316, 442-8220; 444-2786;
442-2564; 442-8219; 442-8256; Fax No.: 442-6268 Grade Level/Section: HUMSS 12
Email: [email protected]; Website: www.uc-bcf.edu.ph

MODULE 5 – ENTREP Subject Teacher:

Introduction to business plan

Learning Objectives:
At the end of this module, the learners are expected to:
a. define business plan;
b. specify the different sections of the business plan;
c. identify the information included in the Introduction section of the business plan;
d. describe the executive summary;
e. identify the major areas of an executive summary included in the environmental
analysis; and
f. state the important areas to be included in the business description.

Business Plan is defined as detailed and integrated written document that describes the
various activities involved in opening and operating a new entrepreneurial venture. The business plan
is prepared using a scientific approach in determining possible business situations considering the
different perspectives of people who are interested in the business. It is the roadmap of the new
business. It provides a clear direction to any uncertain business endeavor.
Aside from the business plan, feasibility study is also prepared as well. This serves as a
forerunner of the business plan. Business plan and feasibility study has almost the same content and
structure. The data shown in the feasibility study are same set of data presented or used in the
business plan. Nonetheless, the business plan presents a more detailed discussion of how the business
will be undertaken and operated.
Every time a new business idea is created, the test of possibility should have a positive result, so
that the next test, the feasibility study or viability, can be conducted. The primary objective of the
feasibility study is to determine whether the proposed business is feasible or not in all areas. If the
outcome of the feasibility study is positive, then the entrepreneur prepares the business plan.

MAJOR PARTS OF THE BUSINESS PLAN

Though there is no universally accepted standard format or structure of the business plan, this
book adopts the following format for the major parts of the business plan:
1. Introduction
2. Executive Summary
3. Environmental Analysis
4. Business Description
5. Organizational Plan
6. Production Plan
7. Operation Plan
8. Marketing Plan
9. Financial Plan
10. Appendix

Introduction
The introduction presents the general perspective of the business. It may consist of one to two
pages. It includes, among others, the following sections:
a. Proposed name of the business
The formulation and drafting of the proposed business name is not as simple as it
sounds. It is a delicate and important entrepreneurial task. Remember that the name of the

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 ENTREPRENEURSHIP
Governor Pack Road, Baguio City, Philippines 2600
Tel. Nos.: (+6374) 442-3316, 442-8220; 444-2786;
442-2564; 442-8219; 442-8256; Fax No.: 442-6268 Grade Level/Section: HUMSS 12
Email: [email protected]; Website: www.uc-bcf.edu.ph

MODULE 5 – ENTREP Subject Teacher:

business may exist in the market for many years. Careful and in-depth planning is of prime
importance.
The proposed business name must reflect the business identity and image, promote the
philosophical values and culture that the business values the most, profess the brand identity
of the product, and attract or influence the target customers.
At least three suggested trade names must be submitted to the Department of Trade
and Industry for approval and registration.

b. Address of the business

It is important that the address of the business is correctly written because all business
correspondence is mailed to the business address. Raw materials and other manufacturing
supplies are also shipped by the seller to the designated business address.

c. Name of the owner/s

The name of the owner must be properly stated. In sole proprietorship, there is only one
owner. In case of partnership, the names of partners including the extent of their liabilities must
be indicated. For business ventures that will operate as a corporate entity, the names,
nationalities, and addresses of the incorporators must be given.

d. Description of the business

A brief description of the business must include information about the type of product
or service that the business intends to produce or provide. It may include brief information
about the ultimate mission, vision, and objectives of the business. The other products and
services that the business plans to produce or provide must also be mentioned in the
description of the business.

e. Location of the business

The basic entrepreneurial consideration is to place the proposed business in a strategic
location that will assure competitive advantage. Unlike the address of the business, location of
the business indicates the reason/s for the selection of the location. In the case of processing
plant is not within the vicinity of the business, its exact location must also be described.
Consider the following when deciding on the location of the proposed business:
• Proximity to the target customers
• Distance from the sources of raw materials, labor, and utilities
• Availability and cost transportation
• Peace and order situation
• Presence of direct competitors
• The geographic and climatic conditions

f. Funding requirement and source

The estimated total initial cost of the business venture must be clearly indicated. It
should include the project breakdown or allocation of the total cost. This section also presents the
source or source of funds. The initial cost of the investment may be provided solely by the owner/s or
partly by the owner/s and creditors. The estimated period to settle the funding source provided by
the creditors must also be mentioned.

Executive Summary
Executive summary is commonly the last section to be written after all the major parts have
been completed, it is the next major part of the business plan after the introduction. Investors,
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 ENTREPRENEURSHIP
Governor Pack Road, Baguio City, Philippines 2600
Tel. Nos.: (+6374) 442-3316, 442-8220; 444-2786;
442-2564; 442-8219; 442-8256; Fax No.: 442-6268 Grade Level/Section: HUMSS 12
Email: [email protected]; Website: www.uc-bcf.edu.ph

MODULE 5 – ENTREP Subject Teacher:

creditors, and other significant parties usually proceed to the details of the business plan once they
find the executive summary interesting, convincing, and worthy of further reading.
The executive summary must cover at least three pages but must not go beyond five pages.
An executive summary that is either too short or too long may discourage the reader to continue
reading.

a. Vision, Mission, Goals, and objectives of the business

T the very outset, the business plan must depict the fundamental characteristics, nature,
philosophical values, identity, and image of the business. These important concerns are
embodied in the vision, mission, goals, and objectives of the business. The VMGO must clearly
be understood. They must be reviewed and revisited at least three years to determine whether
they are still reasonable and achievable in view of the rapid changes in the business
community.

b. Business and product position

The business and product position will help determine how the business defines its
course and the process of accumulating wealth. It tells the size of the market share of the
business and product. The business and product position must be able to convince the
readers that the proposed business has a competitive advantage in the market.

c. Wealth Improvement approaches

This section of the executive summary describes the methodologies or approaches that
will be taken by the business in order to:
• Maintain a competitive advantage
• Position the business in the market
• Improve the market share
• Maximize the utilization of resources
This section also includes a brief discussion of the marketing policies and financial
operations of the business, and the profitability level of the industry and of the business.
Standards benchmarks are good indicators in assessing the economic performance of
the business.

d. Parties supporting the business

The last section of the executive summary is a description of the parties that strongly support
the business. The parties that have a direct relationship with the business are as follows:
• Consumers
• Creditors
• Suppliers
• Employees

Relevant information about individuals and parties that support the business is important since
the proposed business may conduct transactions with them later.

Environmental Analysis
Environmental Analysis is a strategic toll that helps determine the external and internal factors
affecting the performance of the business. These factors may be political, economic, social, or
technological in nature.
Since the business that you intend to open in this entrepreneurial course is considered small in
terms of capitalization, the industry analysis will only focus mainly on the consumers and competitors.
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 ENTREPRENEURSHIP
Governor Pack Road, Baguio City, Philippines 2600
Tel. Nos.: (+6374) 442-3316, 442-8220; 444-2786;
442-2564; 442-8219; 442-8256; Fax No.: 442-6268 Grade Level/Section: HUMSS 12
Email: [email protected]; Website: www.uc-bcf.edu.ph

MODULE 5 – ENTREP Subject Teacher:

The presence of the consumers, after all, is the ultimate reason for the existence of any business
endeavor.

Global Analysis
The environmental analysis section may begin with a description of the global business
situation to provide enough knowledge about the global perspective or horizon of the business.
Remember that is not the business trend that has the most significant bearing on the global analysis
but rather the possible business opportunities or ideas that the global business trend offers.
The trend in the global market is the result of what happened in the past, while a possible
business idea is the expected event that may happen in the future Investors are more interested in
what will happen in the future. The global trend simply acts as an indicator of any favorable sign for
the business idea. However, there is a direct relationship between these two concepts. Once the
works market is properly described the business opportunities that the global trend provides must be
described. The reader, therefore, must be convinces that it is worth to exploit the business idea or
opportunity based on the global business trend.

Societal Analysis
After describing and possibly convincing the reader of the bright business prospect in the
world market, the next step is to present the societal analysis and determine the different variable
affecting the societal environment. For your business plan use PESTEL Analysis.

Industry Analysis
The industry analysis basically involves three important related tasks as follows:
• Conducting a critical evaluation of the forces in the industry that affect the proposed business.
• Evaluating the probable position of the business in the industry,
• Determining the most appropriate strategy that may be adopted by the proposed business.
For your business plan, use the competitive forces matrix.

Internal Environment
Use SWOT Analysis as discussed in the previous modules.

Business Description
The business description section presents the nature and forms of the business to be
undertaken, and may cover two or three pages. A to nature the business may be a merchandising,
service, or hybrid. The description must include the innovative features of the business. As to form, it
may either be a sole proprietorship, a partnership, or corporation. The reason/s for selection of the
form must be indicated.
The business description also includes the following information:
• Product or service that it plans to produce or serve
• Various plant and office equipment
• Size of the proposed business
• Future parties with whom contracts may be necessary
• Personnel requirement
• Administrative operation

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 ENTREPRENEURSHIP
Governor Pack Road, Baguio City, Philippines 2600
Tel. Nos.: (+6374) 442-3316, 442-8220; 444-2786;
442-2564; 442-8219; 442-8256; Fax No.: 442-6268 Grade Level/Section: HUMSS 12
Email: [email protected]; Website: www.uc-bcf.edu.ph

MODULE 5 – ENTREP Subject Teacher:

References:
BAL 338.04
Kuratko, D. (2012). Entrepreneurship: An Introduction. Pasig City: Cengage Learning Asia
K9654
2012 Pte. Ltd.
BAL 658.421 Batisan, R. (2016). Entrepreneurship. Makati City: Diwa Learning Systems Inc
B3208
2016

BAL 658.421
Aduana, N. (2016). Entrepreneurship in Philippine Setting. Quezon City: C&E Publishing,
B3208
2016 Inc.

Kotler, P., & Armstrong, G. (2013) Principles of marketing (14th ed.). Harlow, England:
Pearson Education Ltd.

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