Guide to preparing a business plan Updated January 2015

1. BUSINESS PLANS
IN A NUTSHELL
The Why, What,
when and How?

2. Do you need a business plan?
NO – If you at early stages of setting up a
business?

3. BUT

4. You become what you think about
4

5. SO

6. I RECOMMEND
http://leanstack.com/

7. AS
7
Business Planning is Vital

8. BUT AT A
POINT IN TIME
YOU WILL
NEED A
PROFESSIONAL
BUSINESS
PLAN
DOCUMENT

9. Business Plan Can Help You To
• Attract finance
• Clarify and share vision with
Employees/Management Team and Customers
• Execute – Set & Review Targets

10. Use a Template – Business Cube
I. Executive Summary
II. Main Text
III. Schedules including
financial information
IV. Detailed Appendices

11. Another Business Plan Template
• Executive Summary [2 pages]
• Promoters and other information [1]
• The Proposal [1]
• Background Information [1]
• The Product / Service [1-2]
• Market Opportunity [1]
• Marketing Strategy & Sales [1-2]
• Management Team [1]
• Operations [1]
• Strategy for future growth [1]
• Financing [1]
• Action Plan [1-2]
• Appendices [5-10+]

12. EXECUTIVE SUMMARY
• Overview of the Business
• Realise why you have such enthusiasm
• Share the vision
• Outline the Financial returns
• Be clear, concise and make the rest of
the plan appear interesting from here!

13. PROMOTERS AND OTHER
INFORMATON
• Name/Legal Status of the business
• Name of directors / Shareholders/Proprietor
• Details of Company Secretary
• Registered Office / Trading Address
• Contact Details
• Accountants and Financial Advisers
• Bankers
• Solicitors and Legal Advisers

14. CONTENTS
• Structure of Document
• Appendices
• Structure the document correctly and number
each page, section and paragraph
• Use CONTENTS creator in Word
• May need an appendix called Jargon Buster

15. THE PROPOSAL
• What is primary purpose of the Plan?
• Raise additional funding, finance working capital,
purchase of equipment, fund a promotions
campaign?
• And what do they get in return?
• Outline early what the purpose/objective is to
allow the reader to be clear as they read through
the plan

16. BACKGROUND INFORMATION
• History of the business
• Key Personnel
• Financial History
• Present Financing arrangements
• The reader will want to understand how you
got to this point and how it was funded

17. THE PRODUCT/ SERVICE
What it is and what it does!
• Features
• Benefits to the Customer
– The Business Case
• Use pictures to illustrate
• Address Intellectual Property
• Identify the key points about the product, what sets
it out from the competition and why this business is
going to be successful
Image 1319105

18. MARKET OPPORTUNITY
• specific market/demand
opportunities the business is
seeking to exploit
• the size of the Target
Assessable Market (TAM)
– Number and value of potential
customers that your business
can address given current
business model (route to
markets) and resources
• the segment of the market to
be served/targeted
• Typical customer buying
behaviour and key
purchasing criteria
• key/relevant external
factors influencing market
demand (e.g. social,
economic, legislative and
technological factors)
• This section should enable the potential investor to
understand the key demand drivers and potential for
growth of your business.

19. MARKETING STRATEGY
• Customer
– Profile & The Problem to be Solved
• Competition
• Pricing
• Marketing Communications Plan
– Branding & Promotion
– Routes to Market/ Partners
• Sales Plan
• This section should demonstrate domain knowledge and that
you have a plan of action (and know the costs involved).

20. MANAGEMENT TEAM
• Brief CV’s of senior management
• Details of non-executive team
• Qualifications / Skillsets
• Present Organisation Chart
• How to fill gaps – the non-traditional
team

21. OPERATIONS
Dependent on type of business being
established
• Premises
• Distribution
• Sourcing materials
• Health & Safety

22. STRATEGY FOR FUTURE GROWTH
• Plans for expansion
• Growth potential
• Future products/services
– R&D
• Exit Strategy (if applicable)

23. FINANCING
• Outline your assumptions
• Your Business Model
• Present key financial figures (graphs are great)
– Revenues (# Customers & Average Value)
– Costs
– Resulting Profits
• Plus details of Initial or New Investment required
– Cash flow to cover operating costs until profit is achieved
– Capital expenditure
• Be Realistic!
• Do not overvalue the business !

24. Sources of Finance
If business needs an initial injection of capital:
• Personal Savings
• Family & Friends
• Suppliers
• Financial Institutions
– Loans, overdrafts, lines of credit
– Hire Purchase
• Enterprise Agencies

25. Financial Projections is First Appendix
• Profit and loss, balance sheet and cash flow
statements.
– Cashflow Year One, broken down by month or quarterly
– Annual for year 2 and 3
• Accompanied by notes on how figures were
calculated
• BANK – personal financial situation and history (they
will do a full credit check).

26. Projections
• Both shape and tell the story of the business ..
and need to solidify the credibility of the
entire plan.
• To create clear revenue targets is first task.
• Then work out direct costs (Cost of Sales)
• And detail all other expenditure (must be
logical in terms of scale and growth)

27. Projections based on
• What is reasonable as most likely to occur, your
best guess based on research
• Using a bottom up approach utilising
• Market feedback, knowledge of the industry and
general economic trends.
• Being a Projection of the future as a Snapshot in
Time
Incorporating
• An estimate of how a proposed financial package
will change the future events in the company.
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28. Projections will be reviewed
Credibility of the financial model
• Are costs logical
• Are Ratios (gross margin, profit margin etc etc)
appropriate for industry
• Are assumptions relating to turnover (sales, routes to
market and internationalisation) robust
• Is the funding available?
• Does the overall proposal fit the portfolio

29. ACTION PLAN
• Concrete Actions
• Four Key Areas
– Product
– Marketing
– Finance
– Team

30. Schedules & Appendices
Schedules
• Financial Projections
Appendices
• SWOT Analysis
• Competition
• Market Research Summary
• CV’s of Major Promoters

31. HOW TO WRITE YOUR BUSINESS
PLAN DOCUMENT
Presentation + Message = Meet Objectives

32. Preparing your Business Plan
• Learn how your business works
– Business Model … product, market, route to
market, customers, and pricing
• Develop Financial Projections
– How much money is needed?
– Formulate your assumptions – bottom up
• Write the Document
This is what I do
with clients

33. 10 Critical questions for a Startup or
New Product
1. Who are you?
2. What is the new product
3. Who will buy your product?
4. Why will they buy your product?
5. What price will your customers pay?
6. How many will they buy at this price?
7. How many can you make?
8. How much does a unit of product cost to make?
9. How much investment do you need?
10.Why are you writing this plan?
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34. 34

35. Brainstorm & use a presentation
Prepare a business plan presentation with circa ten slides
which summarises key issues for your business:
1. Problem
2. Solution (product/service offering)
3. Unique Selling Point
4. Competition
5. Market
6. Marketing communication
7. Business model
8. Financials – set up investment and projections
9. Promoter & Team
10. Action Plan

36. Or a mindmap
Source: http://www.usingmindmaps.com/mind-map-business-plans.html

37. What not to do -
• Mistake length for substance
• Be unrealistic in expectations
• Leave unanswered questions
• Not identify the critical items amid the detail
– e.g. Business Model ... How you make money

38. • Use a Business Plan Template
• Use the plan to emphasise your UVP Unique
Value Proposition
• Goals Setting Makes Business Planning Real
– Don’t let your business plan gather dust
• Professional presentation of the business plan
is important
• Get your plan reviewed by a Business Plan
Expert (i.e. Me!)
Some final thoughts

39. Investor Business Plan Presentation
39

40. This presentation was re-uploaded
to slideshare by Donncha Hughes in
January 2015
donncha@startuphughes.com
www.startuphughes.com