Republic of the Philippines

DEPARTMENT OF EDUCATION
Region I
Schools Division of Pangasinan II
PANGANIBAN NATIONAL HIGH SCHOOL
Tayug

LEARNING MATERIAL
ENTREPRENEURSHIP
QUARTER 4, WEEK 6

MELC: Manifest understanding of starting and operating a simple business

K to 12 BEC CG: CS_EP11/12B-ENTREP-IVa-i-2

Prepared by:

RANDY S. GARCIA
SHS Teacher III

Content Evaluated by: Language Evaluated by:

AMALYN B. MACUSI CHRISTOPHER M. RABARA

Teacher III Teacher III
Reviewed by:

REBECCA C. CABIENTE JANET V. CABIENTE

Master Teacher I Principal II
General Instruction: Read and understand the lesson before you answer the activity sheets
that follow. Submit your answered activity sheets on time.

Lesson 6: BUSINESS PLAN

What Is a Business Plan?

A business plan is a written document that describes in detail how a business—
usually a startup—defines its objectives and how it is to go about achieving its goals. A
business plan lays out a written roadmap for the firm from marketing, financial, and
operational standpoints.

Business plans are important documents used to attract investment before a company
has established a proven track record. They are also a good way for companies to keep
themselves on target going forward.
Although they're especially useful for new businesses, every company should have a
business plan. Ideally, the plan is reviewed and updated periodically to see if goals have been
met or have changed and evolved. Sometimes, a new business plan is created for an
established business that has decided to move in a new direction.

Understanding Business Plans

A business plan is a fundamental document that any startup business needs to have in
place prior to beginning operations. Banks and venture capital firms indeed often make
writing a viable business plan a prerequisite before considering providing capital to new
businesses.
Operating without a business plan is not usually a good idea. In fact, very few
companies are able to last very long without one. There are definitely more benefits to
creating and sticking to a good business plan—including being able to think through ideas
without putting too much money into them and, ultimately, losing in the end.
A good business plan should outline all the projected costs and possible pitfalls of
each decision a company makes. Business plans, even among competitors in the same
industry, are rarely identical. But they all tend to have the same basic elements, including an
executive summary of the business and a detailed description of the business, its services, and
its products. It also states how the business intends to achieve its goals.

The plan should include at least an overview of the industry of which the business
will be a part, and how it will distinguish itself from its potential competitors.

THE PARTS OF A BUSINESS PLAN

Here are the key pieces to a solid Business Plan.
Title page
 The title, or heading, of the plan, and very brief description of the business.
 The date
 The name of the owner
 The company name and location
 A copyright or confidentiality notice
Table of Contents
 A list of the individual sections and their page numbers, starting with the Title Page
and ending with a section for Special Materials (references, etc.).

1
Summary/Overview
 A brief, but focused statement (a few sentences or paragraphs) stating why the
business will be successful. This is the most important piece of a Business Plan
because it brings everything together.
Market Analysis
 Identifies specific knowledge about the business and its industry, and the market (or
customers) it serves.
 An analysis that identifies and assesses the competition.
Description of the Company
 A close look at how the different components of the business fit together, such as:
o Information about the nature of the business and the factors that should make
it successful.
o Special business skills and talents that provide the business with a competitive
advantage, such as a unique ability to satisfy specific customer needs, special
methods of delivering a product or service, and so on.
Organization & Management
 The company’s organizational and legal structure, Is it a sole proprietorship? A
partnership? A corporation?
 Profiles of the ownership and management team: What is their background,
experience and responsibilities?
Marketing & Sales
 The company’s process of identifying and creating a customer base.
Description of Product or Service
 A detailed description of the product or service – from the customer’s point of view:
o How they will benefit from the product or service?
o Specific needs or problems that the business can satisfy or solve, focusing
especially on areas where the business has the strongest skills or advantages.
Funding
 The amount of current and future funding needed to start or expand the business.
Includes the time period that each amount will cover, the type of funding for each
(i.e., equity, debt), and the proposed or requested repayment terms.
 How the funds will be used: For equipment and materials? Everyday working capital?
Paying off debt?
Financials
 Explains or projects how the company is expected to perform financially over the next
several years. (Sometimes called a “pro-forma projection.”) Because investors and
lenders look closely at this projection as a measure of your company’s growth
potential, professional input is strongly recommended.
Appendix
 Provides specific information that certain individuals (such as creditors) may want
review. It allows the addition and/or deletion of information as needed, such as:
o Credit histories (personal & business)
o Resumes of key personnel and partners
o Letters of reference
o Details of market studies
o Copies of licenses, permits, patents, leases, contracts, etc.
o A list of business consultants, attorneys, accountants, etc.

Elements of a Business Plan

2
 The length of the business plan varies greatly from business-to-business. All of the
information should fit into a 15- to 20-page document. If there are crucial elements of the
business plan that take up a lot of space—such as applications for patents—they should be
referenced in the main plan and included as appendices.

As mentioned above, no two business plans are the same. But they all have the same
elements. Below are some of the common and key parts of a business plan.

Executive summary: This section outlines the company and includes the mission statement
along with any information about the company's leadership, employees, operations, and
location.

Products and services: Here, the company can outline the products and services it will offer,
and may also include pricing, product lifespan, and benefits to the consumer. Other factors
that may go into this section include production and manufacturing processes, any patents the
company may have, as well as proprietary technology. Any information about research and
development (R&D) can also be included here.

Market analysis: A firm needs a good handle of the industry as well as its target market. It
will outline who the competition is and how it factors in the industry, along with its strengths
and weaknesses. It will also describe the expected consumer demand for what the businesses
are selling and how easy or difficult it may be to grab market share from incumbents.

Marketing strategy: This area describes how the company will attract and keep its customer
base and how it intends to reach the consumer. This means a clear distribution channel must
be outlined. It will also spell out advertising and marketing campaign plans and through what
types of media those campaigns will exist on.

Financial planning: In order to attract the party reading the business plan, the company
should include its financial planning and future projections. Financial statements, balance
sheets, and other financial information may be included for already-established businesses.
New businesses will instead include targets and estimates for the first few years of the
business and any potential investors.

Budget: Any good company needs to have a budget in place. This includes costs related to
staffing, development, manufacturing, marketing, and any other expenses related to the
business.

A Business Plan has a dual function:

 Management Tool:
 Provides economic/financial projections.
 Enhances the monitoring and control of the business by following up the results
obtained and analyzing management indicators.
 Introduces an analysis of the supply and demand.
 Reflects the commercial strategy and the marketing policy.
 Identifies the guidelines for the management of human resources.
 Analyzes the key factors of success and the risks of a business.

 Planning Tool:
The company assumes and takes responsibility for the definition of its objectives:

3
  With results-oriented actions.
 Strict fulfillment of its economic commitments.
 Orients decision-making processes:
 Provides qualitative and quantitative information.
 Planning conforms to a homogeneous pattern.

Types of Business Plans

Business plans help companies identify their objectives and remain on track. They can
help companies start and manage themselves, and to help grow after they're up and running.
They also act as a means to get people to work with and invest in the business.

Although there are no right or wrong business plans, they can fall into two different
categories—traditional or lean startup. According to the Small Business Administration, the
traditional business plan is the most common. They are standard, with much more detail in
each section. These tend to be much longer and require a lot more work.

Lean startup business plans, on the other hand, use a standard structure even though
they aren't as common in the business world. These business plans are short—as short as one
page—and have very little detail. If a company uses this kind of plan, they should expect to
provide more detail if an investor or lender requests it.

Special Considerations

Financial Projections
A complete business plan must include a set of financial projections for the business.
These forward-looking projected financial statements are often called pro-forma financial
statements or simply the "pro-formas." These statements include the overall budget, current
and projected financing needs, a market analysis, and the company's marketing strategy.

Other Considerations for a Business Plan

The idea behind putting together a business plan is to enable owners to have a more defined
picture of potential costs and drawbacks to certain business decisions and to help them
modify their structures accordingly before implementing these ideas. It also allows owners to
project what type of financing is required to get their businesses up and running.

If there are any especially interesting aspects of the business, they should be
highlighted and used to attract financing. For example, Tesla Motors.'s electric car business
essentially began only as a business plan.

A business plan is not meant to be a static document. As the business grows and
evolves, so too should the business plan. An annual review of the plan allows an entrepreneur
to update it when taking markets into consideration. It also provides an opportunity to look
back and see what has been achieved and what has not. Think of it as a living document that
grows and evolves with your business.

Developing a Business Plan

Preparing a business plan draws on a wide range of knowledge from many different
business disciplines: finance, human resource management, intellectual

4
property management, supply chain management, operations management, and marketing,
among others.

Every business owner needs a way to organize and present information about how he
or she intends to develop, grow, and manage his or her business. A business plan is the
perfect tool. When well-crafted, a plan will catch the attention of potential investors and
customers while encouraging them to support the business. When seen this way, a business
plan becomes the foundation for any successful business.
A business plan can be constructed by building upon four essential cornerstones:
 Business Idea
 Market Analysis
 Marketing Strategy
 Financial Analysis

Business Idea
The Business Idea section sells the business’s vision and briefly outlines how that vision
will be accomplished. A basic idea can be expanded into a plan by including three key
elements:
 Business Summary – A simple description of the business, the need for its product or
service, its intended audience, and its competitive advantage. When shared with
others, it shouldn’t take longer than 30 seconds.
 Keys to Success – A series of short statements that describe the value the business
promises to deliver to its potential customers.
 Management and Staff Summary – Short statements that draw attention to the
personal strengths of the people who will be part of running the business.

Market Analysis
Before taking on the risks of a business, it is important for business owners to know
general market conditions, where the new business will fit inside a particular industry, who
their customers will be, and who will be the competition.
Sources for this information can be found through:
 Local chambers of commerce
 Networking contacts
 Online resources
 Universities
 Competitor businesses

Marketing Strategy
Once market and industry information is obtained, and customer and competitor profiles
have been developed, the marketing strategy is written next. A good strategy should include
these four P’s:
 What specific Product or service does the business offer?
 What Pricing structure will be used?
 Where your business will be located (Place)?
 What will be done to Promote the business?

A marketing strategy is about determining a proper balance between each of these

elements. If the business will be more successful in a high traffic area, then location has more
importance. If the competition is high, better advertising and pricing could help.

5
Financial Analysis
This is the section of the business plan for exact numbers and business costs. If a business is
selling a lot of product but still losing money in the long run, the business will fail. Based on
the previous information collected, the business owner can provide a fairly accurate estimate
of the business’s costs and what will affect them. The following suggestions will also help:

 Start-Up Costs – All businesses need some starting capital (money invested in the
business) to deal with initial costs. These are the items that are one-time purchases.
 Monthly Expenses – These are the ongoing costs like inventory, utilities, and
insurance. Also included in this section is a breakeven point analysis (what the
business needs to make to cover costs and show a profit). These numbers can help
determine start-up costs and financing options.
 Financing Options – These are the possible sources for the capital to start a business.
 Sales Forecasts – This is an estimate on how much product the business will need to
sell to cover expenses, and what can reasonably be sold based on the market research
conducted earlier.

Tips for Creating a Good Business Plan

The following are some pointers to consider before creating your business plan:
 Very few people would argue that planning is unnecessary. However, it involves a
great deal of work. Be prepared to spend weeks — or months — completing your
plan.
 While this undertaking may appear overwhelming at first, don't get discouraged.
Break the project into manageable chunks. One effective approach is to put each of
the following steps behind a separate tab in a three-ring binder. Fill in your plan,
making steady progress toward your goal.
 Although you may have volumes of supporting material, aim for a plan that is brief
and succinct but includes everything important to the business. A proposal of 10-15
typed pages, double-spaced is often ideal. Leave secondary issues and details for
discussion for a later meeting.
 Focus on your intended reader. Use the plan to organize your effort around your
objectives is to ensure that you have all the bases covered. Investors or lenders are
interested in determining whether you will be able to achieve your objectives.
 Avoid highly technical descriptions of your products, processes, and operations. Use
layman's terms.
 A business plan is a "living" document. Update it as your knowledge grows and
whenever your strategies become more concrete.
 Be realistic — base your projections on the results gathered from your analysis. Be
honest about positive and negative findings.
 Discuss your company's business risks. Your credibility can be seriously undermined
if existing risks and problems are uncovered by lenders or investors on their own.
 Don't make vague or unsubstantiated statements. For example, do not just say that
sales will double in the next two years or that you are adding new product lines. Back
up your statements with underlying data and market information.
 You may have two sets of business plans — one internal, one external. To be an
effective management tool internal business plans usually are more detailed than
those presented externally.

Following is a ten step process you can use to develop your business plan.

6
  Begin the Plan with a Summary
 Describe Your Company — Its Business, Goals and Objectives
 Analyze Your Market and Determine Your Marketing Strategy
 Describe Your Product/Service and How they are Produced
 Describe Your Management Organization
 Describe Your Operations
 Summarize Your Financial Needs
 Determine Your Proposed Financing
 Outline Your Plan(s) for the Future
 Other Considerations

Principles of Business Planning

Plans Must Be Ongoing
Planning never ends. "Everyone's business changes every year, and often every six
months," says Dan Debelak in his book "Successful Business Models." You can't create an
initial plan and expect it to remain accurate as competitors, customers, business methods and
the economic environment all change. Good business planning must occur on a regular basis.

Plans Must Consider Your Competitive Advantage

Know and incorporate your competitive advantage into your business planning.
Businesses don't operate in a bubble. You can have a business model that looks great on
paper, yet still fail in running it because your competitors have managed to be a little faster,
cheaper, better or more innovative than you. Get to know your competitors, and evaluate the
advantage you have or can create over them. Include that advantage as a key component in
your planning.

Plans Must Incorporate Short- and Long-Term Goals

Short-term goals and long-term vision combined result in a good plan. A one-sided
plan dooms you to failure; don't make the mistake of focusing only on present issues, the
current crisis of the moment or annoying problems as they crop up. Instead, deal with
problems as they arise, but include your long-term vision with corresponding goals in your
planning as well. A solid business must do more than survive the crisis of the moment; it
must continually be making progress.

Plans Must Relate to the Bottom Line

Numbers matter. Good business planning has to add up to a better bottom line. Figure
out how your plans will improve sales, increase efficiency and/or reduce costs. If your plan
can accomplish at least one of those objectives, it can be helpful. If you can create a plan that
manages to accomplish two out of three, run with it.

Plans Must Include Strategies

A plan without real strategy is incomplete. A plan tells you what you want to do; a
strategy details how to do it. Without real action points and measurable results, which a good
strategy contains, a plan simply functions as a nice document to pass around, but it won't help
your business prosper.

Plans Must Affect the Customer

The customer does not care about your plan, so your plan had better care about your
customers if you want to keep them. According to Debelak, "Great customers are probably

7
the most important element for a highly profitable business." Make sure that your plans relate
to real customer needs and result in increased customer satisfaction.
Guidelines for successful business plan implementation:

Objectives- the entrepreneur should have a clear idea on what is his purpose of putting up his
enterprise.

Tasks- this means that the entrepreneur must know what the tasks are he has to perform in
order that his objectives will be realized.

Time allocation- This means that the entrepreneur should have a timetable or a schedule to
follow every task, so that it will be accomplish on time and realize his objective.

Progress- This means that the entrepreneur should monitor the development of the tasks and
the accomplishment of the objective.

REFERENCES:

A. Book

De Guzman, Ines A. 2016. The Young Entrepreneur. Golden Cronica Publishing,

Inc. Quezon City

B. Online Sources

https://www.academia.edu/45032285/ENTREPRENEURSHIP_12_Q4

https://www.investopedia.com/terms/b/business-plan.asp
https://www.latterdaysaintjobs.org/ers/ct/articles/developing-a-business-plan?
lang=eng

https://en.wikipedia.org/wiki/Business_plan

https://edwardlowe.org/how-to-develop-and-use-a-business-plan/

https://bizfluent.com/list-6732864-principles-business-planning.html

https://quizizz.com/admin/quiz/581c737dea7761ff7685aadd/business-plan#

https://www.proprofs.com/quiz-school/quizshow.php?title=the-business-plan&q=1

8
Name: __________________________________________________ Date: _____________

Grade-Section: ___________________________________________ Score: ____________

Quarter 4-ENTREPRENEURSHIP

Worksheet No. 6
Title of the Activity #1: CHOOSE THE BEST

Most Essential Learning Competency: Manifest understanding of starting and operating

a simple business

K to 12 BEC CG: CS_EP11/12B-ENTREP-IVa-i-2

Directions: Read each statement carefully. Write the letter of the best
answer on the space provided before each number.

_____ 1. What is a business plan?

A. A gallery of photos that explains the location and construction of the business
B. A written plan that is a description of all the aspects of the business and includes
the business's goals
C. A collection of plans that are combined from different business and then analyzed
and compared to your business
D. none of the above

_____ 2. What is the most important part of your business plan?

A. Executive Summary
B. Background
C. Table of Contents
D. Financial Plan

_____ 3. What are the advantages of creating a business plan?

A. It allows the entrepreneur to focus on what they want to accomplish
B. Allows the process they will take to do it become simple and easy
C. Allows them to accomplish their desired task
D. All of the above

_____ 4. Why are business plans used for potential investors and banks?
A. for start-up funds
B. They are not used by investors and banks
C. They are only used by banks NOT investors
D. none of the above

_____ 5. Which of the following is NOT a part of the business plan?

A. Index Venture

9
 B. Funds
C. Creation Process
D. all of the above
_____ 6. Which of the following statement below is the disadvantage of creating a business
plan?
A. It will be more complicated to identity the company’s competition
B. distracts entrepreneur's from allowing their business to grow
C. Leads away from the desired task that was the goal to be accomplished
D. none of the above

_____ 7. A business plan is NOT intended for

A. Your competition
B. Your bank
C. Potential investors
D. None of the above

_____ 8. The purpose of a business plan includes which of the following?

A. it explains your idea for a product or service
B. it sets specific objectives and describes how they will be achieved
C. it describes the backgrounds and experiences people who will run the business
D. all of the above

_____ 9. A business plan is important for a new business for all of the following reasons
EXCEPT
A. it makes you think about all aspects of your business
B. it can help you communicate your ideas to others
C. it guarantees you will get financing for your business
D. it can serve as a tool for managing your business

_____ 10. Which of the following organizations can provide assistance when writing your
business plan?
A. bank
B. chamber of commerce
C. Small Business Development Center
D. all of the above

_____ 11. Writing a business plan _____.

A. is a quick and easy process
B. requires patience, research, thought, and time
C. is quick but difficult
D. none of the above

_____ 12. Why complete a Business Plan?

A. To get finance
B. To impress your mum
C. To set out clear goals for your start-up
D. To make sure you know what you are doing

_____ 13. Which section is completed last?

A. Finance detail

10
 B. About your business
C. Marketing budget
D. Executive summary

_____ 14. Statement 1: Having a traditional business plan is a necessity if you plan on
seeking financial support, as a bank will need to review it when assessing whether you’re a
desirable candidate for a loan.
Statement 2: A business plan is absolutely vital as it navigates your business on the
road to success.

A. Only statement 1 is true C. Both statemenst are true

B. Only statement 2 is true D. Both statements are false

_____ 15. The following are the three important reasons for writing a business plan EXCEPT
A. it serves as an operational road map
B. it lists goals to aim for
C. it is a requirement of lenders if you should approach them for start-up capital.
D. it makes the business more engaging

11
Name: __________________________________________________ Date: _____________

Grade-Section: ___________________________________________ Score: ____________

Quarter 4-ENTREPRENEURSHIP
Worksheet No. 6
Title of the Activity #2: WORD SUPPLY
Most Essential Learning Competency: Manifest understanding of starting and operating
a simple business

K to 12 BEC CG: CS_EP11/12B-ENTREP-IVa-i-2

Direction: Fill in the blank with the correct term or word to make each
statement correct. Choose your answer inside the boxes.

DIRECTION NATURE AUDIENCE

MANAGERS FEASIBILITY INVESTORS
CUSTOMERS GOALS COMPANY
DATA OPPORTUNITY STRATEGY

1. For any business to be successful, it must be started and operated with a clear
understanding of its ____________________________, its internal strengths, its competitive
environment, and a vision of how it will evolve to compete in the future.

2. By expending the effort to develop a comprehensive business plan, you will have a
powerful tool for attracting ______________________.

3. A business plan is a formal written document containing the ________________________

of a business, the methods for attaining those goals, and the time-frame for the achievement
of the goals.

4. Business plan also describes the _______________________ of the business, background

information on the organization, the organization's financial projections, and the strategies it
intends to implement to achieve the stated targets.

5. In its entirety, business plan serves as a road-map (a plan) that provides _______________
to the business.

6. Business plans are decision-making tools. The content and format of the business plan are
determined by the goals and __________________________.

7. A well-prepared business plan is more than a necessary tool to seek funding. It should also
be a functional road map for your growth ____________________.

8. A good business plan should be based on current __________________________.

12
9. A Business Plan is a document in which a business _________________________, or a
business already under way, is identified, described and analyzed, examining its technical,
economic and financial 10. ________________________.
Name: __________________________________________________ Date: _____________

Grade-Section: ___________________________________________ Score: ____________

Quarter 4-ENTREPRENEURSHIP
Worksheet No. 6
Title of the Activity #3: TRULSE

Most Essential Learning Competency: Manifest understanding of starting and operating

a simple business

K to 12 BEC CG: CS_EP11/12B-ENTREP-IVa-i-2

Direction: Read each statement carefully. Write TRUE is the statement is

correct, FALSE if otherwise.

1. If your executive summary is more than three pages it will most

likely not be read.
2. A business plan is a written document that describes some steps
necessary for opening and operating a successful business.
3. Ignoring competition is a mistake you should avoid making
when creating your business plan.
4. The preparation of a business plan is optional for some small
businesses.
5. According to research, without a business plan firms are more
likely to close down.
6. Whether you choose to run a product business or a service
business, it is important to do your research and understand how
best to satisfy your customers

7. In a business plan, it is NOT important to describe the industry

in which you will operate.
8. Companies are advised to up-date their business plans once a
year as part of their annual or perennial budget deliberations.
9. It isn't necessary to include the location of your business in your
business plan.
10. The introduction, marketing, financial management, operations
and concluding statement are found in the main body of a
business plan.

13
Name: __________________________________________________ Date: _____________

Grade-Section: ___________________________________________ Score: ____________

Quarter 4-ENTREPRENEURSHIP
Worksheet No. 6
Title of the Activity #4: IDENTIFY ME

Most Essential Learning Competency: Manifest understanding of starting and operating

a simple business

K to 12 BEC CG: CS_EP11/12B-ENTREP-IVa-i-2

Directions: Identify the part of a business plan being described or referred to

in each statement. Below are the different parts of a business plan for your
choices.
Title page
Table of Contents
Summary/Overview
Market Analysis
Description of the Company
Organization & Management
Marketing & Sales
Description of Product or Service
Funding
Financials
Appendix

1. It focuses on what you are selling and the benefits that the
customers will receive (the cost of the marketed items/acts)
2. It outlines the structure of the company, identifies the owners
of the company and their percentage, and lists board
members.
3. It shows the knowledge of the industry and includes statistics
on marketing data for the company’s products/services, and
evaluates competition
4. This part should draw the readers’ attention in order to
continue reading the business plan
5. Includes a biography listing the owner’s skills and their
background information
6. Includes long and short term business goals and financial
highlights of marketing
7. It includes supporting documents that provide additional
information and backs up statements made in the body of the
report.
8. Includes the purpose of the plan

14
 9. It explains the process of attraction of customers to your
business and how you determined the appropriate customers
10. It includes the cash flow projection and the repayment plan.

Activity #1.
1. B
2. A
3. D
4. A
5. D
6. D 11. B
7. A 12. C
8. B 13. D
9. C 14. C
10. D 15. D

Acivity #2.

1. customers 2. Investors 3. Goals 4. Nature 5. Direction

6. audience 7. Strategy 8. data 9. Opportunity 10. feasibility

Activity #3.

TRUE 1.
FALS 2.
E
TRUE 3.
FALS 4.
E
TRUE 5.
TRUE 6.
FALS 7.
E
TRUE 8.
FALS 9.
E
TRUE 10.

Activity #4.

Product/Services 1.
Organization 2.
Market Analysis 3.
Product/Service 4.
Management team 5.
Company description 6.
Appendix 7.

15
Executive Summary 8.
Market Research/analysis 9.
Financial Plan 10.

16