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Business Planning

Taking your ideas to the next level!

New River Community and Technical College


Getting Started! Who am I? o What is it? o


56% of start-up businesses do not survive past four years.

U.S. Bureau of Labor Statistics


You don’t plan to fail– you fail to plan.


You need to create your plan to benefit YOU and YOUR business first.


Executive Summary : •Business Unique Features •Specify what Management Team Plans to Accomplish


Industry Analysis : •General Overview of the Industry •Background of Industry •Industry Trends •Growth Rate of the Industry •Outlook for the Future •Seasonal Factors (if applicable)


Industry – A group of businesses who sell similar products or services to a similar group of customers with similar needs.


GENERAL CLASSIFICATION •GROUP – restaurants •SPECIALIZATION – nice dinners •CUSTOMERS – upper middle class


MORE SPECIFIC CLASSIFICATION •GROUP – sit-down/dine-in restaurants •SPECIALIZATION – steak or chicken dinners priced $10-$15 •CUSTOMERS – Lewisburg families with income $40,000 - $60,000 a year


www.yahoo.com (my industry) industry news http://biz.yahoo.com/industry


Your Mission‌ Your Business Vision


What do you want anyone who comes in contact with your company to say about it?


Price = $10 Cost = $8 Profit = $2 Profit Margin = 20%


5 Steps to Market Research • • • • •

Information needed to fill in gaps Conduct a situation analysis Identify and plan primary research Conduct secondary research Analyze data and prepare conclusions


Conducting a Competitor Analysis


www.yellowpages.com www.whowhere.com www.anywho.com


S.W.O.T. ANALYSIS

Strengths

Weaknesses

Opportunities

Threats


S.W.O.T. ANALYSIS

Strengths

Weaknesses

Opportunities

Threats


S.W.O.T. ANALYSIS

Strengths

Weaknesses

Opportunities

Threats


S.W.O.T. ANALYSIS

Strengths Weaknesses

Opportunities

Threats


S.W.O.T. ANALYSIS

Strengths

Opportunities

Weaknesses Threats


S.W.O.T. ANALYSIS

Strengths

Weaknesses

Opportunities

Threats


S.W.O.T. ANALYSIS

Strengths

Weaknesses

Internal

Opportunities

Threats

External


S.W.O.T. ANALYSIS

Strengths

Weaknesses

Opportunities

Threats


Strategic Action Plan • Product/Service Objectives – 1 year – 3 year – 5 year

• Sales Objectives – 1 year – 3 year – 5 year

• Marketing Objectives – 1 year – 3 year – 5 year


Product/Service Objective how you want your product/service to evolve over the time period


Sales Objectives “Coffee shop will sell xamount of coffees during an average month in the first year.” “By the third year, we expect an x-percent increase for xamount of coffees sold that year, etc.”


Marketing Objectives

“Suzy’s Coffee House will market primarily by mail during the first year, by spending approximately $500 a month to mail 1500 households.”


Marketing Objectives

“During the third year, Suzy’s plans to have evolved by also advertising by radio, by doing 5 commercials per week, and continuing to mail 1500 households a month,” etc.


Summary of Production & Marketing Strategies what you will produce how you will produce it what you will market how you will market it


Control Systems “Suzy’s Coffee House has a person in charge of regular inventory to make sure theft has not occurred.” “They also have a certain person designated to open the cash drawer and do a bank run.”


Management!

President

Director

Sales

Maintenance

IT


65% of office product purchasers say there are no free snacks at their place of business.

Quill Corporation


$

Variable

Fixed

Units


Y = A(x) – B(x) A = Selling Price B = Variable Costs

Y = Fixed Costs


Y = A(x) – B(x) A = $0.50/box (sales price) B = $0.25/box (variable cost)

Y = $500/month (fixed cost)


$500 = $0.50(x) – $0.25(x) $500 = $0.25(x) $0.25 $0.25 2,000 = x


Excellent Storage! The Appendix


Overall Formatting and Presentation


Next Step?


Business Planning