Chapter 1: THE DEVELOPMENT OF THE BUSINESS PLAN

Business Plan - Guides an entrepreneur throughout the process.

- Need to convey the capabilities and competencies of their owners and
managers.
- Must be able to ‘sell’ the proponent and the business proposition to this
audience.
Business concept - Contains the essence of the enterprise in a concise but powerful manner.
- Stresses the value of the product offering to the target costumers who would
most likely buy it.
- Product concept must then be translated into a business model.
Business model A formula on how the enterprise exactly plans to make money out of the business.
Business goals - First section of the business plan
- Show the future and long-term prospects of the enterprise.
- Composed of the vision, mission, objectives, key result areas, and
performance indicators of the enterprise.
Executive Summary - Second section of the business plan
- Contains everything that is relevant and important to the business audience.
- A synthesis of the entire plan.
- Must contain the major argumentations of the business proponent on why the
business will work and succeed.
- Should provide the business plan audience all the arguments on why they
should participate in the business venture.
The executive 1. The business proponents ad their partners
summary should 2. The enterprise organization and its capabilities
then introduce and 3. The technology providers and their expertise and experience
highlight the good 4. The suppliers and all the major service providers
qualities of:
Enterprise Strategy Builds and develops the game plan for attaining competitiveness.
Enterprise Delivery The entire process of converting input (resources) into output and these output into
System outcomes.
Business proponents Third section of the business plan.
Four types of 1. Resources mobilizers and financial backers
business proponents 2. Technology providers and applicators
or stakeholders 3. Governance and top management
4. Operating and support team
If resource providers Want to know who else are on board to share the burden of raising money to see the
whole thing through
If technology Want to know if there will be sufficient funds to pay for the technology
providers
If governance and Want to know what strategies and performance indicators are being proposed
top management
team
If implementing, Want to know what programs, activities, tasks, and resources would be in place
operating, and
support teams
Target Customers Fourth section of the business plan.
and Main Value
Proposition
Target Customers Must be of sufficient size, sufficient paying capacity, and have sufficient interest to
purchase the products being offered by the enterprise.
Main Value The unique selling proposition of the enterprise.
Proposition
Market Demand and Fifth section of the business plan
Supply, Industry
Dynamis, and the
Macro
Environmental
Factors
SPEET Social, political, economic, ecological, and technological
Social environment Includes the demographics and cultural dimensions that govern the relevant
entrepreneurial behavior.
Political Defines the governance system of the country or the local area of business.
environment
Economic Mainly driven by supply and demand forces.
environment
Ecological Includes all natural resources and the ecosystem that defines the habitat of man,
environment animals, plants, and minerals.
Technological Makes or breaks competing participants in any industry.
environment
Product/Service Sixth section of the business plan.
Offering:
Description,
Evolution, and
Justification
Product/service Must be described by highlighting the features and attributes that would most appeal
offering to the target customers.
Enterprise Strategy Seventh section of the business plan.
and Enterprise
Delivery System
Enterprise Strategy Business plan should expound ES by mapping the competitive landscape and by
situating the enterprise and its competitors as to their strategies and chosen
positionings.
Enterprise Delivery - Business plan should show hoe EDS would enable the business to implement
System the ES
- EDS starts from the Input (resources mobilized), proceeds to the Throughput
(the transformation process where input are converted to the output), and
produces the Output (the products/services)
Output Marketed to the costumers or experienced by the costumers.
Business outcomes - High customer satisfaction levels
should reasonably - High sales volume, market shar, and market reach
include: - High financial returns
- High people performances, productivity, and morale levels
Financial Forecast Eight section of the business plan.
Financial forecast - Financial returns
includes: - Financial risks
- Financial contingencies
Important return 1. Expected return on sales
calculations are the 2. Expected return on assets or investments
following: 3. Expected return on stockholders’ equity
Environmental and - Ninth section of the business plan.
Regulatory - Business plan must articulate the laws, rules, and regulations governing the
Compliance business, and the industry that the enterprise is in.
Capital Structure - Tenth section of the business plan.
and Financial
Offering: Returns
and Benefits to
Investors,
Financiers, and
Partners
The business plan must appeal to its target audience. It must highlight or them the main features of the
business plan that they are looking for.