it just a format of business plan,for more info on about you project and plan plz mail or contact with me. soundsleep39@yahoo.com

1. BUSINESS PLAN
1

2. CONTENTS
Elements of a Business Plan
• Executive Summary
• Business Description
• Define Your Market
• Identify and Analyse Your competition
• Design and Development Plan
• Operations and Management Plan
• Financial Statements
2

3. INTRODUCTION
What is a Business Plan?
• A business plan is a document which
highlights (for the given year):
– The plan as to how the company will be run
– The goals of the company
– The money required to meet those goals
– The strategy employed to meet those goals
(including marketing)
3

4. INTRODUCTION (I)
Why should I create a business plan?
• A business plan forces a business to assess
the market place
• It forces a business to identify a clear
marketing strategy
• It also serves as a benchmark which the
companies performance can be measured
against.
4

5. INTRODUCTION (II)
There are seven essential sections of a
business plan. These are the:
• Executive Summary
• Business Description
• Define Your Market
• Identify and Analyse Your competition
• Design and Development Plan
• Operations and Management Plan
• Financial Statements
5

6. EXECUTIVE SUMMARY
The executive summary follows the title page
of the business plan
The purpose of the executive summary is to
explain to the reader what the business wants
The summary should be short and concise
(maybe half a page, typically no longer than a
page)
• People do not have time to waste reading long
documents
6

7. Key Elements of an Executive
Summary
1. THE BUSINESS CONCEPT
• What is the business you are proposing, its
products and the advantages over the competition
2. THE FINANCIAL FEATURES
• Highlight the forecasted sales, profits, cash flows
and return on investment
3. THE FINANCIAL REQUIREMENTS
• What are the start-up costs and the cost of
expansion. How will this money be used?
7

8. Key Elements of an Executive
Summary (I)
4. CURRENT BUSINESS POSITION
• This includes any relevant information
about the company, its formation date, its
owners and key personnel
5. MAJOR ACHIEVEMENT
• Are there any developments which are
essential to the success of the business?
These may include prototypes, patents or
crucial contracts
8

9. Business Description
This section often begins with a short
description of the industry, its present
outlook and future possibilities
• Include any products or developments that might
affect your business
State whether the business is new or already
in existence; and the type of operation, e.g.
is it retail, food service, manufacturing or
service-oriented?
State who your customers will be and how
your product will be distributed and
advertised 9

10. Business Description (I)
Describe the product or service you
intend to market
Show how your business will gain the
competitive edge
Explain how the business will be
profitable
10

11. Define Your Market
Define the entire market for your
industry
• in terms of size, structure, growth
prospects, trends and sales potential
Define the specific market that you will
be targeting (market segmentation)
Define your niche in this market
11

12. Define Your Market (I)
After defining your market you must:
• Estimate your market share for the period
of time the business plan covers
• Position your business
• Price your product
• Determine the distribution strategy
• Create a promotion plan
• Estimate your sales potential
12

13. Identify and Analyse Your
competition
Determine who your competitors are
What strategies are they using to sell
their products or service
What are they strengths and
weaknesses
13

14. Design and Development Plan
The design and development plan
allows investors to understand:
• The design of your product
• How it is produced
• How it will be marketing
• The development budget required to allow
the company to meet its goals
14

15. Design and Development Plan
(I)
The sections included in the development
plan include:
• Product development
• Market development
• Organisational development
Each of these sections should be described
from a funding point of view
Finally, identify measurable goals for the
overall design and development plan
15

16. Operations and Management
Plan
Describes how the business functions
• It explains business logistics:
– The responsibilities of the management team
– The task assigned to each company division
– Capital and expense requirements related to the
operation of the business
• And the financial tables
– The operating expense table
– The capital requirements table
– The cost of goods table
16

17. Financial Statements
The three common financial statements
are:
• The balance sheet
– A statement of your assets, liabilities and
equity
• The Income statement
– Reflects when sales are made and expenses are
incurred
• The statement of cash flows shows
– The amount of cash required to meet
obligations, when it is required and from where
it will come
17

18. Introduction
Focus your thinking
Establish realistic strategy
Financing and other support
Reaction by others
18

19. Definition
Document that can convince the reader
that the business can produce enough
revenue to make a satisfactory profit
and therefore attractive as an
investment opportunity
19

20. Many reasons to build one
BP should sell the writer/reader on the
business:
• Writer: so that you can go out and do it,
• Reader: to invest in it
Confidence of knowing the issues
Improve chances of success
20

21. Many Purposes in real life
Bank Financing
Strategic alliances
Large contracts
Key employees
Mergers and acquisitions
Mgt team motivation
Ours here : Investment by VC or
Angels
21

22. Principles of BP
No right way: plans can differ
Be creative but set a limit
Concise and focused
Captures energy and personality of
business leader
Include negatives and issues
Spend some time on it
22

23. Sections of Business Plan
Cover Page: contact name and info
Table of contents
Executive summary
The company: past, present and future
The market
The Product/service
23

24. Sections of Business Plan -
continued
Sales and Promotion
Financial projections
• Profit and loss
• Balance sheet
• Cash flow
24

25. OTHER SECTIONS: TECHNOLOGY
BASED
Management team: people who fund
other people value management skills
above “ideas”
Risk factors: shows that you know
what could go wrong and plan to avert
it
Marketing plan: if this is “innovative”
how are you going to get people to use
it
25

26. PACKAGING THE PLAN
It is a ”living” document
No right/wrong way: the need of reader
is essential
What are the challenges/ questions that
can be raised by reader: answer these.
26

27. Packaging the Plan
Include supporting materials
Don’t make unsupported statements
Designate an outside reviewer/ reader
that can critique plan
27

28. EXAMPLE………
28

29. What’s the Business
Objective?
Long Term ISP business
Growth and Sale
National Agenda
Leverage from other activities
Risk protection
29

30. Business Planning Process
Identify Market opportunity
Identify Costs
Model Tariffs
Model Business Requirements
30

31. Market Identification
Define Market segment
• size
• uptake
• competitive position
• market position
31

32. Identifying Costs
Capital Costs
Recurrent Costs
Marketing Costs
Staff and Administrative Costs
32

33. Capital Costs
Equipment
• Core routers
– capital cost depreciation at 30% p.a.
• Access servers
– capital cost depreciation at 30%pa
– capital cost per access port charged to customer
33

34. Capital Costs
• service platforms
– ratio of service platforms to customer numbers
– depreciation at 30% pa
• staff equipment
– fixed capital cost per staff member
– can be converted to recurrent via capital
depreciation at a rate of 30% pa
34

35. Recurrent Costs
equipment housing costs
• equipment location costs
lease line costs
• Telco Leases
• Radio Equipment Costs
– can be converted to recurrent cost of
ownership at 20% depreciation of capital value
35

36. Marketing costs
advertising
staff
publications, seminars, other marketing
activities
Total can be considered as a
connection cost per client
36

37. Staff and Administrative costs
technical support staff
• usually fixed number
• staff churn cost (30%)
support desk staff
• usually incremental off the customer base
administrative staff
• usually fixed number
Other administrative costs
• billing costs
• debt risk factor 37

38. Lets put this together for a
medium sized national ISP
Cost Totals
Cost proportions
Scaling overheads as a percentage of
capacity costs
generation of the business model via
marginal cost examination
38

39. Costs
Leased Line costs - recurrent
expenditure
Link Cost Calculation Worksheet
The costs used here are not derived from any particular network - they are a simple example only
Target Line Loading Factor50% Line loading before more bandwidth is required
39

40. International Line costs
International Circuit cost calculation
Capacity of the circuit Kbps 2048
Cost of the circuit - total lease cost monthly 120,000$
Megabytes monthly 685,670
Max sustainable loading factor 50%
Max sustainable traffic level 342835
Break even cost per megabyte at target load 0.35$
40

41. Domestic Line costs
Domestic Circuit cost calculation
Capacity of the circuit Kbps 2048
Average cost of the circuit - total lease cost monthly 8,000$
Megabytes monthly 685,670
Max sustainable loading 50%
Max sustainable traffic level 342,835
cost per megabyte 0.02$
line imbalance 0.75
Topology Factor 1.5
cost per megabyte 0.02$
41

42. Marginal Transmission cost
Traffic Balance
International 65% 0.24$
Trunk 22% 0.01$
Local 13% -$
Total Delivered cost per Mb 0.25$
42

43. Marginal Cost
Total Delivered cost per Mb 0.25$
Overheads
Fixed rate overhead calculation 20%
Marginal Cost 0.30$
• Calculate staff and equipment costs as a
fixed overhead on the traffic volume - this
allows the business to generate working
capital to expand
43

44. Capital Investment cost
Marginal Cost 0.30$
Return on cashflow 5%
Target Average Retail Price per delivered Megabyte 0.31$
• The enterprise will require initial capital
investment which must generate positive
earnings, which must be factored into the model
44

45. Retail Pricing Model
Use a 64K access line as the basic unit
of connection
Assume an average line loading of
business usage
• average line occupancy of 20%
Determine retail pricing from marginal
cost at average line occupancy
Flat Rate pricing
45

46. Retail Pricing Model
Retail Model
64K connection Costs
Maximum delivery capacity (Mb) monthly 21427
Average line occupancy 27%
Average line delivery (Mb) monthly 5,785
marginal cost 0.31$
Net service cost (transmission) monthly 1,806.46$
Max service liability (avg traffic flow) monthly 6,690.60$
Max service liability (absolute risk) monthly 9,450.00$
Fixed Flat rate tariff Monthly 1,806.46$
46

47. Risk Reduction
Reduce risk of over exposure by using
‘high’ and ‘low’ volume tariff steps
Client Spread
0
10
20
30
40
50
0% 20% 40% 60% 80% 100%
Line Occupancy
NumberofClients
47

48. Stepped Retail Tariff
Fixed Flat rate tariff Monthly 1,806.46$
Dual Rate Tariff 40%
Low band average line occupancy 18%
High band average line occupancy 59%
Low monthly 1,204.31$
High monthly 3,934.07$
48

49. Additional Services
Offer services at a variety of access
speeds
Use differential tariffs to encourage
reselling
Use a flater tariffs to strength direct
retail position
49

50. Additional Services
Tiered Access Pricing
Tier Factor
leased PSTN modem, rated at 19.2K 19.2 1.40
64K 64 1.20
128K 128 1.10
256K 256 1.05
512K 512 1.00
Retail Schedule
Fixed 2 Tier
Low High
leased PSTN modem, rated at 19.2K 759$ 281$ 918$
64K 2,168$ 1,445$ 4,721$
128K 3,974$ 2,649$ 8,655$
256K 7,587$ 5,058$ 20,654$
512K 14,452$ 9,634$ 31,473$ 50

51. Dial Access
Transmission is a minor cost for dial
access
Also must factor in:
• modem capital cost and limited service life
• phone support with large after hours component
• marketing cost
• customer churn rate
• target market capture level (competitive price
sensivity)
51

52. Dial Access
Modem Access Pricing
Cost per modem hour
Average modem speed kbps 26
MBytes/hour 10.4
Average line loading level 10%
At Marginal Retail 0.32$
Service Activity Loading 300%
Retail - minimum level hourly 1.30$
Initial retail marketing margin 30%
Retail hourly 1.69$
52

53. The Business Challenge
How to manage exponential
GROWTH
53

54. The Business Plan
Establish tariff position
Estimate Market size for the service
Calculate Revenue
Calculate service provision costs
Revenue - costs = bottom line
54

55. Estimate Demand
Business Plan
Year 1 Year 2 Year 3 Year 4
Services In Operat ion (SIO)
Type
dial 300 2000 4000 10000
dial modems 30 200 400 1000
pstn 10 20 40 150
64K 20 40 100 200
128K 4 6 15 40
256K 0 2 8 25
512K 0 0 5 15
TOTAL 64 268 568 1430
55

56. Calculate Revenue
Revenue $ $ $ $
Connection charges 210,000 588,000 832,000 2,250,000
Access charges
dial 73,962 394,466 739,623 1,479,246
pstn 7,587 15,174 30,349 113,807
64K 72,837 145,673 364,183 728,365
128K 26,707 40,060 100,150 267,067
256K 0 29,210 116,842 365,131
512K 0 0 121,394 364,183
TOTAL 391,093 1,212,584 2,304,541 5,567,800
56

57. Capacit y calculat ion
Calc Line Lease 132 427 1,116 2,827
Act ual Line Lease 128 512 1,024 3,036
Scale the Network
Estimate communications capacity to
service the client base
57

58. Cost s
Equipment 140,000 420,000 640,000 1,800,000
Line Lease 82,500 330,000 660,000 1,956,797
Staff 250,000 350,000 450,000 500,000
Marketing 0 50,000 100,000 150,000
Overheads 120,000 120,000 140,000 200,000
TOTAL 592,500 1,270,000 1,990,000 4,606,797
Estimate Costs
Factor in service provision costs
58

59. The Bottom Line
Revenue 391,093 1,212,584 2,304,541 5,567,800
Cost s 592,500 1,270,000 1,990,000 4,606,797
Profit / loss (201,407) (57,416) 314,541 961,003
Am I winning or losing at this tariff and
market level?
59

60. THANK
YOU
60