BUSINESS PLANNING

BUSINESS PLANNING AHMED JAMAL IDDRISU MDPI ACCRA TEL: 0202222518 EMAIL:jamal209@yahoo.com

OBJECTIVES By the end of the presentation participants will be able to: • Point out importance of planning in enterprise development • List benefits associated with business planning • Mention areas that entrepreneurs can focus when preparing business plans • List format and content of business plan for enterprises

BASIC STEPS IN BUSINESS PLANNING • “Give a man a fish and you will feed him for a day. Teach a man to fish and you will feed him for a lifetime. Teach a person to start a fish farm and you will feed a community for a lifetime”. Nickles, McHugh, McHugh (2002)

PLANNING • Planning is one of the most important functions of an entrepreneur and involves the following: • Anticipating and preparing in the present to face conditions that may arise in the future such as change, uncertainty and risk

PLANNING • Making decisions about vision and mission statements, policies, procedures and setting objectives to achieve the strategic goals of the business; • Deciding in advance what to do, who is to do it, how to do it, where to do it, and when to do it.

BUSINESS PLANNING • Business planning therefore involves: • Identifying and forecasting the company’s future business and market opportunities, and; • Organizing, through appropriate strategies and actions programmes, to reach the market and exploit the opportunities.

BUSINESS PLAN • The outcome of every planning function is a PLAN, which is a written document that specifies future courses of action that an organization undertakes to achieve its competitive edge in the market.

BUSINESS PLAN • A BUSINESS PLAN is a detailed written statement (document) that describes • The nature of the business • The target market • The advantages the business will have in relation to competition • The resources needed • The qualification of the owner(s)

WHY IS PLANNING IMPORTANT IN ENTERPRISE DEVELOPMENT? • What business (product/service) must be engaged in? • How to see the business outlook (state and features) in one, two, five or ten years from the present time? • What will be done (strategies) to get the business there?

WHY IS PLANNING IMPORTANT IN ENTERPRISE DEVELOPMENT? • Who (staff, customers, suppliers, government agencies and officials, etc) will help in getting the business there in the future? • When will activities and tasks be performed (every day, weekly, monthly, yearly, etc)?

WHY IS PLANNING IMPORTANT IN ENTERPRISE DEVELOPMENT? • Where will the activities and tasks be performed (Accra, Kumasi, Tamale, London, Lagos,); • How much will it cost to start up the enterprise, its profit levels over the years, etc? • What is expected returns and risks associated with the Business?, etc

CONTENT OF BUSINESS PLAN • The length and sequence of contents in a business plan vary with the complexity of the proposed venture. • However, certain key elements are always needed to describe WHY, HOW and WHEN economic success will be achieved.

OUTLINE OF A BUSINESS PLAN • EXECUTIVE SUMMARY • Short description of the business, major goals and objectives, economic benefits, amount of money required • Vision • Mission statement

COMPANY BACKGROUND INFORMATION • Registration, promoters, contact information, etc • Brief description of business activities since commencement

PRODUCTS AND SERVICES • Core competencies • Products or services • Product attributes and how they benefit the customer • Technology • Strategic objectives • Routes to success

MARKET ANALYSIS • Market size • Market growth • Market segments • Targeting and positioning • Customer dynamics • Customer buying decisions

MARKET ANALYSIS • Political dispensation • Economic trends • Legal issues • Environmental factors • Supply and distribution channels

MARKETING PLAN • Target market and how to reach it • Competitor analysis • Provide list of potential customers

OPERATIONAL PLAN • Product development process • key logistics • Description of the equipment required • Description of the production process • Quality control, etc

FINANCIAL PLAN • Important Assumptions • Investment plan • Sales forecast • Forecast Income and Expenditure Statement • Projected Balance Sheet • Forecast Cash Flow statement • Key Financial Indicators • Break Even Analysis • Managerial Decisions

THE MANAGEMENT TEAM Management and Organization • Board of Directors • Management structure • Key personnel • Organogram/ organizational structure

IMPORTANCE/BENEFITS OF A BUSINESS PLAN • Raising capital or seeking partnership with an investor (s) • Guiding the growth of the business to achieve higher levels of profitability, market share and competitiveness • Assess the performance of the organization periodically

IMPORTANCE/BENEFITS OF A BUSINESS PLAN • Make judicious use of company’s resources such as time, money, staff and their skills, customers, suppliers, equipment, etc. • Concrete statement of purpose, which is used to communicate with staff in a step-by-step agenda for achieving the vision and mission of the business.

CONCLUSION ‘Government can't create wealth, but it can create the conditions for private enterprise to flourish’. Bill Owens

END OF PRESENTATION THANK YOU FOR LISTENING. COMMENTS, QUESTIONS AND SUGGESTIONS

BUSINESS PLANNING