Business Planning

To start a business, an entrepreneur must have an idea. For success, the entrepreneur devises   a   business   plan   which   guides   planning   and development.

  • The plan details among other things decisions made concerning the form of ownership, the financial resources needed, whether to buy an existing business, start a new one, or buy a franchise.
  • A business plan is a meticulous statement of the rationale for a business and a step-by-step explanation of how to achieve its goals.
  • The document should convincingly demonstrate that the business can sell enough of its products to make satisfactory profit or to be attractive to potential financiers.
  • It is an indication of the owner’s ability and commitment to the business.
  • Looks at the project/business as a whole,
  • Points at needs that may be overlooked,
  • Gives a framework for decision making,
  •    Provides a yardstick against which actual future performance of the business can be measured,
  • Spots problems and find solutions before hand
  • Sets reasonable objectives and figure out how to achieve them, and
  • Communicates business ideas to relevant parties

When is a business plan done?

  1. When starting a new business
  2. When planning for expansion of a business
  3. When applying for a loan
  1. Executive Summary
  2. Business background and objective
  3. Market plan
  4. Production plan
  5. Financial plan
  6. Organization and management, critical risks and problems
  7. Action plan
  8. Summary & conclusion & Appendixes

 

  1. Executive Summary gives an outline of the main focus of the plan and  highlights the key elements of the business
  • Brief history of the business concept
  • A description of the product
  • Market
  • Marketing strategies
  • An assessment of the competition
  • Operations strategy
  • Financial needs and projections
  • Critical risks and analysis

This should enable the reader to understand at a glance the business.
  1. Business description  describe
  • The background of the business owner
  • The type of business
  • The location of business
  • The products/services offered
  • The entry and growth strategies of the business

 

(1) Provide background information of the business and describe the conditions and prospects of the enterprise.

      (2) Describe the composition/ownership of the enterprise and the spirit /motivation behind the formation.

(3) Specify the type of business and products to be marketed. The physical location of the business should also be provided.

(4) Describe the market entry strategy in addition to strategies required to take the business to the anticipated level.

Rounded Rectangle: Group discussion• Do small horticultural enterprises need marketing plans?• When are business plans done and for what reasons• Planning is of paramount importance to any enterprises but not many enterprises do planning what are the probable reasons for this?

 

  1. Marketing plan

This describes how the business intends to sell its products or services.
  • It should clearly identify and describe the targeted customer(s).
  •    Other movers or dealers of similar or substitute products should also be identified and a description on how the competition is to be handled given. Pricing is an area that needs great attention for each group.
  •     Reasonable prices as would draw customers in addition to creating the anticipated incomes to the business should be described.
  •     Consumer awareness partly influences the rate of consumption and thus a good business plan for the market group should clearly describe the promotional tools, channels and campaigns to be applied.
  •     Customers may not be confined in a similar place meaning the need to identify good distributors to access products to the customers. Distribution strategies should be described.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  1. The organizational plan/management plan

This explains how the business will be coordinated to accomplish its objectives. The main objective is to demonstrate that the leadership and management are capable and able to fulfill the goals of the company. The roles of each personnel within the group, required to drive the objectives of the business, should be clearly described to avoid role duplication
  • The organizational structure
  • The key management personnel
  • Duties and responsibilities of the personnel
  • Salaries and incentives for the personnel

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  1. The operational pan

The objective of thissection is to proe that the busness is able to produe productsand servicesat a profit
  • Describes how the product(s) will be manufactured
  • Gives a breakdown of the equipment and costs that will be incurred during the  production process

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  1. The financial plan  This section;
  • Describes the estimated budget for starting and running the business
  • The business group should work out a budget for all the operations to be undertaken and explain how the activities are to be financed.
  • An accountant should draw this section although the owner of the business must participate
  • provides a proposal for financial sources
1.Forms of Business

There are different legal forms of business ventures. Including sole proprietorship, partnership, and limited company. What staff do you need for your business? What skills and experience are needed? How many employees do you need?
2.Financial Planning

Costing, Revenue and profit projections To be able to set prices and make financial plans, you need to calculate the cost of your products or services.

 

 

3.Start up Capital

Startup capital is the amount of money you need to start your business. Money is needed for equipment, materials, rent wages, etc.
a) Sources of start-up capital

How will the business be financed? Loan (MFI) / savings
Sources of information for Business Planning

The following list suggests possible sources of assistance in, developing a Business Plan.

  • Government organizations, which assist people who want to, start small businesses.
  • Non-governmental organizations that assist people who want to start small businesses through advice and training.
  • Accountants, lawyers, business consultants and professionals.
  • People with experience in the line of business one plans to start can give specific advice.
  • Financial Institutions can give assistance to entrepreneurs who apply for a loan.
  • Associations like chambers of commerce and employers’ organizations sometimes have small business units that can give assistance.