Chapter 4 outline

Chapter 4 outline - Chapter 4 1) The business plan a....

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Chapter 4 1) The business plan a. Definition i. A written narrative, typically 24 to 35 pages long, which describes what a new business intends to accomplish and how it intends to accomplish it. b. Reasons for writing a business plan i. Internal Reason 1. Forces the founding team the founding team to systematically think through every aspect of their new venture. ii. External Reason 1. Communicates the merits of a new venture to outsiders, such as investors and bankers. c. Who Reads the Business Plan and What are they looking for? i. A firm’s Employees 1. Important to both management and “rank and file” employees. 2. Helps employees operate in sync and move forward in a consistent and purposeful manner. ii. Investors and Other External Stakeholders 1. To appeal to these people a business plan must be straight forward and realistic, should not be overly optimistic or project statements about the business’s credibility. 2. Important to show external stakeholders the feasibility analysis that has been done. 3. Plan should disclose all resource limitations that will hinder the business in generating its first profit. d. Guidelines For Writing a Business Plan i. Structure of the Business Plan 1. Should follow the conventional structure. 2. Business plan should not be written using a software package due to the “canned” look that it will take on.
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3. Along with the facts and figures a business plan should demonstrate a sense of anticipation and excitement about the possibilities that surround a new venture. ii. Content of the Business Plan 1. Give clear and concise information on all the important aspects of the proposed new venture. iii. Style or Format of the Business Plan 1. Should be crisp and sharp, but should not appear to have been expensive since investors expect an entrepreneur to have limited resources. 2. Should include a cover letter introducing the entrepreneur and clearly stating why the business plan is being sent to the individual receiving it. 3. Avoid getting carried away with the design elements such as print styles, colors, and clip art. 4. Types of Business Plan Formats a. Summary Plan i. 10 -15 pages ii. Works best for new ventures in the early stages of development that want to test the waters to see if investors are interested in their idea. b.
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Chapter 4 outline - Chapter 4 1) The business plan a....

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