Writing a Business Plan.docx
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Writing a Business Plan.docx
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WritingaBusinessPlan
WritingaBusinessPlan
Introandinstructionsforuse:
Completeasmanysectionsinthisdocumentaspossible,orasneeded.
ThetextinREDisinstructionalandshouldbedeletedbeforeprinting.
Thispageshouldbedeletedbeforeprinting.
Whenyou’refinished,rightclickonthetableofcontentsandchoosethe‘UpdateField’optionsothetablereflectsthecontentsofyourdocument.
BusinessPlan
PreparedBy:
TableofContents
1.BusinessSummary
1.1BusinessOverview
Theoverviewshouldprovidethereaderwithaclearsummaryofwhatyourbusinessdoesorwilldo.Innomorethanapage,itshouldbrieflyanswerthefollowingquestions:
▪Whatdoesyourbusinessdoandhowlonghasitbeenoperating?
▪Whatindustryisitin?
▪Whatsetsyourbusinessaboveyourcompetitors,e.g.differentlocation,cheaperprice,betterservice?
Outlinetheproductsorservices,whowillbuythem,whereyoufeelthebusinesswillbeintwotofiveyearsandhowthiswillbeachieved?
1.2Product/ServiceFeatures
Whatarethemainbenefitsofyourproductorservice?
Inthissection,summarisewhatmakesyourofferingspecialfromyourcustomers’pointofview.
Describe:
▪Whatyouareselling.
▪Howyourproductorservicewillbenefittheconsumer.
▪Thedemandforyourproductsandservices–willtheycreateasteadycashflow?
▪Whatmakesyourproductorservicedifferentorunique?
1.3Location
Yourchoiceoflocationcanmeanthedifferencebetweenthesuccessorfailureofyourbusiness.Ifyourbusinessdependsonpersonalcontactwithyourcustomers,yourpremisesshouldbeeasytoreachandprovideasenseofsecurity.Ifyou’rerelyingonpassingtrade,youshouldestimatepedestriantrafficaroundyourchosenlocationanddesignyouropeninghourstocatertotheirneeds.
Consider:
▪Whattypeofpeoplepassyourshopfront?
Willtheybeinterestedinyourproductorservice?
▪Whatkindofspacewillyouneed?
▪Istheareadesirable?
Isthebuildingdesirable?
▪Isiteasilyaccessible?
Ispublictransportavailable?
Isstreetlightingadequate?
Canyouoffercustomerparking?
▪Istheareaexperiencinganymarketshiftsordemographicshiftsyoushouldbeawareof?
1.4MarketAnalysis
Marketingplaysavitalroleinsuccessfulbusinessventures.Howwellyoumarketyourbusiness,alongwithafewotherconsiderations,willultimatelydetermineyourdegreeofsuccessorfailure.Keyinformationincludes:
▪Brieflyoutlinewhatmarkettheproductorserviceisgoingtobeaimedatandwhy?
▪Arethesemarketsgrowing,remainingconstantordeclining?
▪Willyourmarketsharegrow,remainconstantordecline?
▪Ifyourbusinessisafranchise,howisyourmarketsegmented?
▪Areyourtargetmarketslargeenoughtosupportyourexpansion?
▪Howwillyouattract,holdandincreaseyourmarketshare?
Ifyouareafranchise,willthefranchiserprovideassistanceinthisarea?
▪Whatisyourpricingstrategy?
▪Whatresearchistheretosupportyourbusinessexpectations?
1.5MarketStrategy
Itisessentialtoshowthatthereisasoundcustomerbaseforthebusiness.
▪Howyouhavecarriedoutyourcustomerandmarketresearch?
Includewhereyougotyourinformationfrom.
▪Whatuniquesellingproposition(USP)doyouhavethatyouexpectyourcustomerstorespondto?
FormoreinformationaboutUSPsandGuarantees,pleaseseeourvideoon‘Marketingyourbusiness’.
1.6KeyFinancialObjectives
Effectivefinancialmanagementrequiresyoutoplanasound,realisticbudgetforyourbusiness.Ifyou’restartinganewbusiness,firstdeviseastart-upbudget.Thiswillincludeone-offcostslikeofficialregistration,majorequipment,rentalandutilitybondpayments.Youroperatingbudgetthenestimateshowmuchitwillcosttokeepitopen.
Summarisethekeyinformationcontainedinthefinancialplanhere:
▪Whatmajorinvestmentswillberequiredtogetyourbusinessofftheground?
▪Whenwillyoubegintobreakeven?
▪Whatfinancialdatahaveyoubasedyourestimateson?
Istherecomparableindustrydatatobackthemup?
1.7BusinessStructure
Whenchoosingyourownershipstructure,it’simportanttoweighuptherisksandcostsoftheavailableoptions.Youcanfindmoreinformationonbusinessstructureshere.Provideacleardescriptionoftheownershipstructureandwhyyou’vechosenit–e.g.soletrader,partnership,company(thisshouldincludeyourexitstrategy).Alsooutlineotherwaysyou'llprotectyourbusiness,e.g.trademarks,patents,registeringawebsiteaddress.
1.8Management&Ownership
Thoughtheycan’tbelistedonthebalancesheet,peoplearethechiefassetinanybusiness.Yourexperienceandexpertise,togetherwiththatofyourmanagementteam,staffandcontractors,arethekeyvalueaddersinyourbusiness.Providethefollowinginformationaboutyourselfandyourteam:
▪Whatspecialisedskillsandexpertiseareyouandyourpeoplebringingintothebusiness?
▪Whatotherrelevantexperiencedoesyourteamhave?
▪Whatwilleachpersonintheteamberesponsiblefor?
▪Whatotherstafforcontractorswillberequired?
Howmuchwilltheygetpayed?
1.9KeyObjectives
Listingyourkeyobjectivesgivesthereadersofyourbusinessplananinsightintowhereyou’retakingyourbusinessandwhatyou’remeasuringyoursuccessorfailureagainst.Makesureyourobjectivescanbeprovenandmeasured.Clickhereformoreinformationaboutdevelopingyourkeyobjectivesforsuccess.
YourkeyobjectivesshouldbeSMART:
Specific,Measurable,Achievable,Realistic,Timely.
Yourkeyobjectivesshoulddescribewhatyouwanttoachieveineachfunctionalbusinessarea.Forexample:
▪Financialtargets–Toachievea5%increaseinnetprofitoverthenext6months.
▪Salestargets–Tosell100unitsperweekforthenext6months.
▪HRtargets–Tobuildyourteamto3peopleoverthenext6months.
▪Customersatisfaction–Tomaintainandexpandyourreputationforhighqualityserviceandsalesbycreatinganinternaltrainingandskillsdevelopmentprogramforstaff.
2.
DetailedPlan
2.1TargetMarket(CustomerAnalysis)
Identifyyourtargetmarket(s)anddescribeyourcustomers.Referenceanyresearchfindingswhichbackupyourchoiceofsegments.Itisessentialtoshowthatthereisasoundcustomerbaseforthebusiness.Explainhowyouhavecarriedoutyourcustomerandmarketresearch,includinginformationsources.Thisshouldincludetheuniquesellingpropositionyouexpectyourcustomerstorespondto.
Thereareanumberofresourcesyoucanusetofindoutmoreaboutyourcustomersandprospects.AgoodplacetostartistheAustralianBureauofStatisticswebsite,whereyoucanfindlotsofinformationsortedbydemographicandgeographicallocation.
1.Howoldareyourcustomers?
2.Aretheymaleorfemale,orboth?
3.Whatlevelaretheyeducatedto?
4.Wheredotheylive?
5.Whatdotheyearn?
6.Howmuchoftheirincomeisdisposable?
2.2TheCompetitor
Outlineyourknowndirectandindirectcompetitorsandhowyou'llpositionyourproductorserviceagainstthem.Knowingwhoyourcompetitioniscanbeasimportantasknowingyourownproduct.
Askyourself:
1.Whoareyourfivenearestdirectcompetitors?
2.Whoareyourindirectcompetitors?
(Thesearebusinesseswhichmightnotproducethesameproductorserviceasyou,butcouldreduceyourmarketsharewithanalternativeoffering.)
3.Howaretheirbusinessesdeveloping?
Aretheysteady?
Increasing?
Decreasing?
4.Whathaveyoulearnedfromtheiroperations?
Fromtheiradvertising?
5.Whataretheirstrengthsandweaknesses?
6.Howdoyoucompareon:
▪Pricing?
▪Product?
▪Promotion?
▪Distribution?
2.3Product/Service
Defineanddescribetheproductorservicethatyou’reofferingandhowitwillbedisplayedormadeavailabletobestappealtoyourcustomers.Discuss:
▪Branding
▪Packaging(whereapplicable)
▪Ongoingproductorservicedevelopment
▪Anyotherimportantcharacteristics
Whataretheirfeaturesandtheirbenefits,andhowdotheycomparetothemajorcompetitors?
Askyourselfhowyourproductsand/orservicesaregoingtoappealtoyourtargetmarketandhowmuchofityou’llbeabletosell.
1.Whatisit?
2.Howmuchdoesitcost?
Howmuchareyougoingtochargeforit?
3.Howdoesitaddvaluetocustomers’lives?
4.Isitanecessityoradiscretionarypurchase?
5.Howmuchofitarepeoplelikelytobuyandatwhatintervals?
6.Istherepotentialtogrowthemarketbydevelopingtheproductorserviceoffering?
2.4ProductorServiceProduction
Describehowyourproduct(s)orservices(s)arebeingproducedandcosted.
▪Aretheybeingmanufactured?
Boughtin?
Breakdownservicechargesandimportcosts.
▪Whyaretheproduct(s)orservices(s)beingproducedandcostedthewaytheyare?
Includeyourbusinessdealingswithyoursupplier/s.
Yourpricingstrategyisanothermarketingtechniqueyoucanusetogiveyourselfacompetitiveedge.Getafeelforthepricesyourcompetitorsareoffering.Determinewhetheryourpricesareinlinewithcompetitorsinyourmarketareaandinlinewithindustryaverages.
Somepricingstrategiesare:
▪Paritypricing(offeringasimilarpricetoyourcompetitor)
▪Pricingbelowcompetition
▪Pricingabovecompetition
▪Servicemarginsasapercentageofthecostsof:
-Servicecomponents
-Materialcosts
-Labourcosts
-Overheadcosts
Aprice/qualitymatrixwillhelpyoutoreviewyourcompetitors’pricingstrategies.Determinewhichofthestrategiestheyuse,ifitiseffectiveandwhyitiseffective.
Price/Quality
High
Medium
Low
High
‘RollsRoyce’strategy
‘Wetryharder’strategy
‘Bestbuy’strategy
Medium
‘Outperforms’strategy
‘Pieceoftherock’str
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