Entrepreneurship. The Business Plan: Creating & Starting the Venture. Business Plan. “is a written document prepared by the entrepreneur that describes all the relevant external and internal elements involved in starting a new venture.”
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Entrepreneurship The Business Plan: Creating & Starting the Venture
Business Plan • “is a written document prepared by the entrepreneur that describes all the relevant external and internal elements involved in starting a new venture.” • It is a road map that integrated functional plans and answers questions such as: - Where am I now? - Where am I going? - How will I get there?
Scope & Value of the Business Plan • Is read by employees, investors, bankers, venture capitalists, suppliers, customers, advisors & consultants. • Is important because: • It helps determine the viability of the venture in designated market. • It provides guidance to the entrepreneur in organizing his or her planning activities. • It serves as an important tool in helping to obtain financing.
Information Needs • Establishing goals & objectives help in defining what kind of information is required from what sources. • Market Information: such as • Target market • Market potential for product or service • Industry & environmental trends (Macro & Micro environment) • Competitors • Product/service required features
Information Needs Market Positioning Market Objectives
Information Needs • Operations Information: such as: - Location - Manufacturing operations - Raw materials - Equipment - Labor skills - Space - Overheads
Information Needs • Financial Information Needs: all the information required for budgeting such as: - Capital expenditure - direct operating expense - forecast for revenue and sales
Review & Discussion • If a business plan is to be used to raise capital, the why would the entrepreneur want to advertise the firm’s major risks by detailing them in the business plan?