ABDM3574
Entrepreneurship
Lecture 4
Writing a Business
Plan
The Business Plan
• A business plan is a written narrative, typically 25 to
35 pages long, that describes what a new business
plans to accomplish.
• For most new ventures, the business plan is a dual-
purpose document used both inside and outside the
firm.
• Inside – firm’s employees , internal stakeholders
• Outside – investors, external stakeholders
Guidelines for Writing a
Business Plan
(a) Structure of the Business Plan
• Business plan should follow a
conventional (=traditional,
generally accepted) structure.
• Although some entrepreneurs
want to demonstrate creativity,
departing from the basic structure
of the conventional business plan
is usually a mistake!
Guidelines for Writing a
Business Plan
(b) Content of the Business Plan
• The business plan should give clear and
concise information on all the important
aspects of the proposed venture.
• It must be long enough to provide
sufficient information, yet short enough to
maintain reader’s interest.
• For most plans, 25 to 35 pages is sufficient.
4-4
Guidelines for Writing a
Business Plan
(c) Style or Format of the Business
Plan
• The appearance must be carefully
thought out
• Should look sharp
• Avoid too many clip art, different
font sizes and colors
Outline of Business Plan
• Firm’s business plan may vary
(=differ) and may not include all
the elements/sections
• Plan depends on nature of business
and personalities of founding
entrepreneurs
Outline of Business Plan
Sections:
• I: Executive Summary
• II: Company Description
• III: Industry Analysis
• IV: Market Analysis
• V: Marketing Plan
• VI: Product (or Service) Design and Development Plan
• VII: Operations Plan
• VIII: Management Team and Company Structure
• IX: Financial Projections
• Appendices – information used to support the plan
• Eg.: legal documents, site maps, statistics, etc.
Section I: Executive Summary
Executive Summary
• A short overview of the entire business
plan
• Should not exceed two single-space pages.
• Provides busy reader with everything that
needs to be known about the new
venture’s distinctive nature.
• Busy investors will only read Executive
Summary first.
Section I: Executive Summary
•Should be created AFTER the plan is
finished.
•The executive summary is said to be
the most important section of a
business plan.
first impression is important!!
4-9
Important for your business plan assignment
May include:
•Why your business exists
•What your goals are
•How you will achieve those
goals
•Competitive advantage
•Financial outlook
•Technology patent
Section II: Company Description
Company Description
• Beginning of main body
• A general description of the
company
• A brief introduction overview of
the company
• Either industry analysis first or
company description first.
• For our assignment purpose, write
company description first!
Section II: Company Description
• Items to include in this section:
i. Company history
ii. Mission statement
iii. Vision and objectives
iv. Products and services
v. Current status (optional for
your assignment)
vi. Legal status and ownership
vii. Key partnerships (if any)
i. Company history
where the idea for the
company came from; should
be brief
e.g. solving problems? filling
gaps?
e.g. any touching story (IF
any...)
ii. Mission statement
why a company exists and
what it aspires to become
show priorities of the firm
• Clear, memorable,
concise....sometimes
inspiring!!
Examples of good mission statement
– next slides!
We create happiness by
providing the finest in
entertainment for people
of all ages, everywhere.
“To Refresh the World... in
body, mind, and spirit.
To Create Value and Make
a Difference... everywhere
we engage."
To give people the power
to share and make the
world more open and
connected
4-15
iii. Vision and objectives
Vision:
Future
What we intend to be
Eg.: Ford:- To become the world’s
leading consumer company for
automotive products and services.
4-16
Objectives:
Short-term
Specific
Measurable
iv.Products and services
Explanation of your product/service;
how your product/service is unique
v. Current status
how far along your company is in its
development
• Include key milestones – noteworthy or
significant event e.g. winning award etc.
• ** Current Status is optional for your
assignment
vi. Legal status and ownership
who owns the business; how the
ownership is split up; current form
of business ownership (i.e. sole
proprietorship, partnership, limited
company etc)
=> Ownership Structure in your
assignment
vii.Key partnerships (if any)
any collaboration (cooperation)
4-19
Section III: Industry Analysis
• Industry a group of firms producing a
similar product or service
• Example: airline industry, manufacturing
industry, banking industry etc.
• Industry Analysis business research that
focuses on the potential of an industry.
• To understand the industry
5-20
Section III: Industry Analysis
• Industry Analysis
• Describe the industry that the new business
will enter in terms of its size, growth rate,
and sales projections.
• To determine if the niche market it
identified during feasibility analysis is
favorable for a new firm.
• Focus strictly on the industry only.
• Understand industry’s promising areas and
points of vulnerability (=easily harmed)
Section III: Industry Analysis
• Items to include in this section:
• Industry size
• Growth rate and sales projections
• Industry structure concentrated or
fragmented
• Nature of participants
• Key success factors
• Industry trends environmental and
business trends
• Long-term prospects
Three Key Questions in Industry Analysis
Before pursuing the idea of starting a firm:
1. Is the industry accessible is it a realistic
place for a new venture to enter?
2. Does the industry contain markets that
are ripe (=mature, ready) for innovation
or are underserved?
3. Are there positions in the industry that avoid
some of the negative attributes of the
industry as a whole?
- Can we avoid the weaknesses? 5-23
