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Business Plan Outline Example

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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

Table of Contents

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.

                                           Total sales

Break-even turnover =        Fixed cost       =   Sh.

                                           Contribution margin %

Break-even units  =  Contribution margin  =  Sh.

                                                  Fixed costs

 Desired Financing

ITEM AMOUNT
  • Pre-operational costs
  • Working capital
  • Fixed assets
TOTAL DESIRED FINANCING

Capitalization

ITEM AMOUNT
  • Total investment
  • Owners contribution
  • Borrowed funds

Profitability

  • Gross profit percentage

Gross Profit                             x 100 = Sh.

  Sales                    

  • Return on equity

Net Profit after tax                             x 100 = Sh.

  Owners equity                       

  • Gross profit percentage

Net Profit after tax                              x 100 = Sh.

  Total investment  

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