Business Plan Outline Example

What is a Business Plan?

A document that outlines the aims and objectives of a project explains how and when they will be accomplished.

Why Write a Business Plan?

To obtain financing.
Guide for opening a business.
Guide for business expansion
Guide for managing a business.
To communicate clearly with interested parties.

When is a Business Plan Written?

After deciding to go into business.
Before starting the business.
When an entrepreneur wants to expand.

What Are the Types of Business Plans?

For retail businesses.
For wholesale businesses.
For service businesses.
For manufacturing businesses.
For any other type of business.

Who Writes the Business Plan?

Each prospective business owner/manager writes a business plan for the business he/she wants to open.

How Is a Business Plan Organized?

Top page
Cover page
Table of contents
Executive summary
Business description
Marketing Plan
Organizational Plan
Operational/production Plan
Financial Plan
Potential risks and problems
Appendices

The Business Plan

Top Page

Student details

Cover Page

Name of business:

Logo
Mission
Vision
Address and telephone, Email address, website
Prepared by:
Signature of owner
Name of owner:
Date
Contact details

Business Plan Outline Example

Chapter One

Executive Summary

Summarized statement on:

Business description
Opportunity and entry
Target market
Competitive advantage
Management team
Financial plan
Critical risks and problems, and solutions

Chapter Two

Business Description

Owner Details

Name:
Age:
Address:
Occupation:
Education/Professional Qualifications:
Business Experience:

NB: In a partnership, this information should be provided for all the partners

The Business Venture

Name of business:
Location of business:
The legal form of business:
The primary activity of the company:
Principal customers:
Location of customers:
Amount to be invested by owners:
Amount to be borrowed:
Total amount needed for the venture:

The product/Service

Name of product/service:
Features of product/service:
Benefits obtained from product/service:
Unique features of product/service

Entry Plan

The competitive advantage of the business:
Weakness of competition:
Pricing plan:
Plans to attract customers:

Growth Plan

Trends that signal business growth:
Opportunities arising from this trend:
Plans to take advantage of the opportunities:
State at least three short term goals
State at least three medium-term goals
State at least one long term goal

The Industry

Describe the industry under which your proposed business will fall
What is the trend of the industry?
What is the general size of businesses in the industry?
What is the average number of employees in the firms of the industry?
What is the primary capital requirement for entry into the industry?
Are there any seasonal factors that are experienced in the industry?

Chapter Three

The Marketing Plan

Potential Customers

Type of customers (individuals, institutions):
Total target market population:
Several customers who can buy product/service:

Competition

Names of the key competitors:
Location about your business:
Size of the competitors:
Comparisons between your product(s) or service(s) and those of the competitors:
Strengths and weakness of the competitors:
Plans to capitalize on the weakness of the competitors:

Pricing

Methods of calculating the selling price of your product/service:
Factors that will influence your price setting, e.g., competitor’s prices:
Actual selling price(s) of your product(s) or service(s):
Credit terms to be offered:
Discounts to be allowed:
Any after-sales service(s) and relevant costs:

Sales Tactics

Method of direct selling or personal selling:
Form of indirect selling:
Process of recruitment and retention of the sales force:
Utilization of distributors or agents:
Ways of selecting and motivating distributors or agents:
Geographical area you intend to serve:

Advertising and Promotion

Media to be used:
Product/service image to be portrayed:
Image to be projected regarding business:
Frequency of advertisements:
Cost per advertisement placement:
Measuring effectiveness of the advertisements:
Plans for the initial promotional campaign:
Procedures for regular promotional methods:
Price for each promotional event:
Measuring effectiveness of promotional campaigns:

Distribution

Channels to be utilized:
Means of transport you will use:
Transport cost per month:
Anticipated distribution problems:
Overcoming distribution problems:

Chapter Four

Organization Plan

Organizational Structure

Draw the organizational chart of the business

Key Personnel

Several positions:
Title of positions:
Duties of positions:
Remuneration level:
Incentive package:

Ordinary Employees

Numbers required:
Titles and duties:
Remuneration:
Incentive package:

Support Services

Banking:
Bookkeeping:
Legal:
Postal:
Management advice:
Other:

Chapter Five

Operational Plan

Draw the ground plan of the proposed workshop/ business premises

Production facilities

Give a detailed description of the machinery/tools/equipment which will be used in the business
Their cost
The source
repairs & spare part which may be required in future
describe the other fixed assets to be used in the business

Production Process

Give a detailed description of how the goods will be produced/ how the service(s) will be provided.

Production Cost

TYPE OF COST	MONTHLY COST
Source of materials
Materials required
Transportation
Workers/labour
Overhead expenses
Cost per unit
TOTAL COST

Complying With Operational Requirements

TYPE OF REQUIREMENT	COST
Licences
Taxes
Other approvals
TOTAL COST

Chapter Six

Financial Plan

Pre-operational Costs

ITEM	COST
Transport
Market research
Plan properties
Meeting people
Photocopying
Installations
TOTAL COST

Working Capital

ITEM	AMOUNT
Stock of raw materials
Work in progress
Stock of finished goods
Debtors
Cash
TOTAL WORKING CAPITAL

Pro-forma Income Statement

Pro-forma income statement for the year ending:

ITEM	AMOUNT
Sales: Cost of goods sold Gross profit
Expenses: Wages Rent Water Telephone Electricity Advertising Stationery Postage Transport Repairs
Net profit before tax Tax
NET PROFIT AFTER TAX

Pro-forma Balance Sheet

ASSETS	AMOUNT
Current Assets: Cash Debtors Stock of finished goods Stock of raw materials
Total Current Assets
Fixed Assets: Machinery and equipment (cost) Accumulated depreciation Vehicles (cost) Accumulated depreciation Furniture and fittings(cost) Accumulated depreciation Other (specify) fixed assets (cost) Accumulated depreciation
Total Fixed Assets
TOTAL ASSETS

LIABILITIES
Current Liabilities: Creditors Other (specify) liabilities
Total Current Liabilities
Long-term Liabilities Bank loan Other (specify)
Owner’s Equity
TOTAL LIABILITIES AND EQUITY

Projected Cash Flow Statement

YEAR 1
	1	2	3	4	5	6	7	8	9	10	11
Beginning balance Add cash sales Accounts receivable Others
CASH RECEIPTS
TOTAL CASH AVAILABLE
TOTAL CASH PAYMENT
ENDING CASH BALANCE

Calculate the expected break-even point of your proposed business

Determine the sales and total variable costs. Calculate the total contribution margin.

Total contribution margin:

Sales – Total Variable Costs = Sh.

Calculate the contribution margin percentage:

Contribution margin % =Contribution margin x 100 = Sh.

Sales

Determine the total fixed costs, ie. Operating expenses, for year 1:

Total fixed costs = Sh.

Calculate the break-even level of sales in shillings:

Break-even level = Fixed costs =Sh.

Contribution margin %

Break-even revenue:

Total sales

Less cost of sales

Contribution

Contribution Ratio (%) = Contribution x 100 = Sh.