Business Plans _ Global Beer

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					Business Plans
  Simonyi Center
Purpose of Business Planning
  Provide a roadmap for success of the
  Force the entrepreneur to formalize their
  vision and do the research to answer hard
  questions about the company, its industry
  and the competitive landscape
  Set goals, strategies, policies and procedures
  for the firm
  A tool for raising capital
Business Plans Must Tell:
  What Problem you are solving and how
  serious it is.
  Who has this Problem and Why it is
  Important to them.
  How Large is the Market and How Fast
  is it Growing.
  How Large your Company will be in 3 to
  5 Years.
Business Plans Must, cont.
  Who are You and Why are You
  Qualified to Solve this Problem.
  How much Money you need to Make
  this Happen.
  What are your Key Milestones.
  How much the Investors will Make on
  Their Investment in 3 to 5 Years.
  What   messages . . . to reach
  What   market(s) . . . with
  What   pain . . . that need
  What   product(s) . . . distributed through
  What   channel(s) . . . against
  What   competition . . . with
  What   pricing and packaging . . . to deliver
  What   value . . . in
  What   time frame?
What is the Customer’s Pain?
  Must Have or Nice to Have?
  Who Are Your Customers?
  What Are They Buying?
  Why Are They Buying?
  Who Are Your Competitors?
  What is your Business Model?
Business Plan Components
  Executive Summary
  Customer Need and Business
  Business Strategy and Key Milestones
  Marketing Plan
  Operations Plan
  Management and Key Personnel
  Financial Projections
Business Plan Details
  Executive Summary
     The Purpose of the plan including how much
      money is required, what it will be used for and
      how much investors will make at exit
     What is going to give you an unfair advantage!
     Business opportunity, business model, market,
      product/service description, technology and
      management team
     Summary of five-year income statement, profit,
      head count and capital requirements
BP Details, continued
  Customer Need and Business Opportunity
    Product/service idea and technology
    Strategic Value Triangle for end users and
  Business Strategy and Key Milestones
    Plan to out-maneuver the competition

    Show each milestone with the cumulative
     cash needed and head count
BP Details, continued
  Marketing Plan
     Basic need and company solution
     Ideal customer and value proposition
     Market segmentation and size of markets
     Channels of Distribution
     Strategic Partners
The Marketing Plan
  Current Marketing Situation
  Basic need and company solution
  Ideal customer and value proposition
  Marketing Strategy
  Market segmentation and size of markets
  Channels of Distribution
  Strategic Partners
Marketing Plan, cont.
  Business model and branding plan
  Sales strategy and plans
  Customer support
  Action programs
  Five-year sales forecast
  Competition, positioning and unfair
BP Details, cont.
  Marketing Plan, cont.
     Business model and branding plan
     Sales strategy and plans
     Customer support
     Five-year sales forecast
     Competition, positioning and unfair
How Do Businesses Compete?
  They Fill Needs That Are Not Being Met
  They Find Customers and Suppliers
  Who Are Weaker Than They Are
  They Get More Out of Less
  They Use Other People’s Money (OPM)
  The Try to Stay Out of the Way of
  Larger & Meaner Competitors (Nibble
  at the Edges)
Who Are Your Competitors?
They Know All About You

   What Type of People Are in Charge?
   Why Do They Want Your Customers?
   Do They Know Who Your Most
   Profitable Customers Are?
   Can You Win A Price War With Them?
   Do They Have A Glass Jaw or Do They
   Bite Ears?
   Whose Market Share Will You Take?
BP Details, continued
  Operations Plan
     Engineering plan
     Web site plan
     Manufacturing or outsourcing plan (Make/Buy)
     Facilities and administration plan
  Management and Key Personnel
     Organization Chart
     Staffing plan (timing) and head count projections
BP Details, continued
     Detailed resumes of founders and key employees
     Incentive compensation plan and stock option
     Company culture plan
  Financial Projections
     Overview and key assumptions
     Five-year forecasts – Balance sheet, Income
      statement and Cash Flow Stmt by month for one
      year, by quarter for two years and annually for
      remainder of years.
BP Details, continued
     Income Statement
     Balance Sheet
     Cash Flow Statement
     Best, Worst and Expected Case Versions
     Valuation Analysis
     Exit Options
     Return on Investment for each option
 The remaining slides are summary of
 business plan requirements from local
 venture capital firms.
Every Business Plan Must Answer
These Questions

   Who are the people involved?
   What have they done in the past that
    suggests they will be successful in the
   Who is missing from the team and
    what will they do to get them to join?
Key Questions, continued
     What is the nature of the opportunity?
     How will the company make money?
     How is the opportunity likely to evolve?
     Can entry barriers be built and maintained?
     Macro economy
     Tax
     Regulatory
     Socio-political
     Cultural
 Is the Total Market for the product or
 service large and/or rapidly growing?
 Is the industry one that is now or can
 become structurally attractive?
 Who is the customer and how do they
 make decisions?
 Is this a compelling purchase for the
OPPORTUNITY, continued
 How will the product or service be priced?
 How will you reach the target customer?
 How much does it cost to acquire a customer
 in time and $?
 How much does it cost to produce and deliver
 the product or service?
 How much does it cost to support a
 How easy (expensive) is it to retain a
OPPORTUNITY, continued
 Buy Low, Sell High, Collect Early & Pay Late
   When do you have to buy and pay for resources?

   How long does it take to acquire a customer?

   How long before the customer sends you a check?

   How much capital equipment is required to

    support a dollar of sales?
   Accounts Receivable vs. Accounts Payable
 Who are the current competitors?
 What resources do they control and what are
 their strengths and weaknesses?
 How will they respond to our decision to
 enter the business and what can we do?
 Who else might notice and enter our market?
 Can we co-op competitors by forming
    New Product Development Process
             Marketing    Business
  Concept                              Product
Development                          Development
and Testing

   Idea                                 Testing

      Generation           Commercialization
Market Development Strategy Checklist
    Target Customer
    Compelling Reason To Buy
    Whole Product
    Partners and Allies
    Next Target Customer

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