BUSINESS PLAN (ENT530) : GUIDELINES & TEMPLATE

PRINCIPLES OF ENTREPRENEURSHIP
(ENT530)

WRITTEN REPORT BUSINESS PLAN (30%)

OVERVIEW

A business plan venture is a document that details out what a business wants to accomplish with its
new product or services. It is a detailed road map used to convert ideas and visions int o a real and
functioning product or services that is profitable and viable for the business to market.

INSTRUCTIONS

1. This is a group project and the students are required to form groups comprising of 5
MEMBERS ONLY.

2. Each group needs to choose and write one viable business idea (product or service).

3. The group needs to write and present final report of the business plan using the given format.

4. Use Times New Roman 12 or Arial 11 with 1.5 spacing for written business plan report.
5. The report must be submitted on or before ______________. Failure to do so will jeopardize
the student’s grade for this subject.

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BUSINESS PLAN WRITTEN GUIDELINES & TEMPLATE

1. COVER PAGE (2marks)

EN530

BUSINESS PLAN

BUSINESS PLAN TITLE (NAME OF BUSINESS)

Faculty :

Program Code :

Group :

Course :

Semester :

Group Name :

Group Members :

Submitted to

DR ARIF……

Submission Date

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2. TABLE OF CONTENTS (2 marks)

CONTENTS PAGE NUMBER

Cover Letter (4 marks

Executive Summary (4 marks)

1. Company Profile (5 marks)

2. Environmental And Industry Analysis (10 marks)

3. Description of The Venture (5 marks)

4. Production Plan (5 marks)

5. Operation Plan (5 marks)

6. Marketing Plan (5 marks)

7. Organization Plan (5 marks)

8. Financial Plan (10 marks)

9. Conclusion (15 marks)

10. Appendices:

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BUSINESS PLAN OUTLINE

Note:

Before you begin writing within this section make sure that you have done some research. Business plan
research helps you make informed decisions and create a successful direction for your business plan.

 Gather information sources

 Record relevant information
 Analyze the information you have gathered and note the associated opportunities and risks
 If you are going to submit the blueprint to investors, research what types of investment opportunities
are available to you, why you need investment (banks, government, private equity investors, etc.)

1. EXECUTIVE SUMMARY

The executive summary is usually short and concise. The summary articulates what the
opportunity conditions are and why they exist, who will execute the opportunity and why they
are capable of doing so, how the company will gain entry and market penetration; it answers
the questions: “for what reason does this venture exist and for whom?”

Essentially, the executive summary needs to reflect the criteria presented in the Business
Opportunity Analysis Exercises. This is your chance to clearly articulate how your business is
durable and timely, and how it will create or add value to the end user. This summary:

 This section is prepared after the total plan is written.

 It should be two to three pages in length.
 The summary should concisely highlight the key points in the business plan.
 Questions that should be addressed include:
o What is the business concept or model?
o How is this business concept or model unique?
o Who are the individuals starting this business?
o How will they make money and how much?
 Any supportive evidence that might strengthen the case should be included.
 Remember that this section is only meant to highlight key factors and provide a strong
motivation to the potential investor to read it in its entirety.

2. COMPANY PROFILE
 Details of company:
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 The name and address of the company.

 The name of the entrepreneur(s), a telephone number, fax number, e-mail address, and
website.
 A paragraph describing the company and the nature of the business.
 The amount of financing needed.
 It also sets out the basic concept that the entrepreneur is attempting to develop.

3. ENVIRONMENTAL AND INDUSTRY ANALYSIS

 The entrepreneur should first conduct an environmental analysis to identify trends and
changes occurring on a national and international level that may impact the new venture.
 Examples of environmental factors are:
 Economy
 Culture
 Technology
 Legal concerns
 All of the above external factors are generally uncontrollable.
 Next the entrepreneur should conduct an industry analysis that focuses on specific
industry trends such as:
 Industry demand
 Competition
 There are numerous sources that the entrepreneur can consult to attain general industry
and competitive data.
 The last part of this section should focus on the specific market.
 This would include such information as who the customer is and what the business
environment is like.
 This information is significant to the preparation of the marketing plan section.
 There are also numerous sources of data for this information as well.

4. DESCRIPTION OF THE VENTURE

 The description of the venture should be detailed in this section.

 This should begin with the mission statement or company mission, which describes the
nature of the business and what the entrepreneur hopes to accomplish with that business.
 Key elements should be described in detail, including the product or service, location and
size of the business, personnel, background of the entrepreneur, and history of the venture.
 The emphasis placed on location is a function of the type of business.
 In assessing the space the business will occupy, the entrepreneur should consider
parking, access from the roadway, access to customers and suppliers, and zoning laws.

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 An enlarged local map is helpful.

 Maps that locate customers, competitors, and alternative locations can be helpful.

5. PRODUCTION PLAN

 If a new venture is a manufacturing operation, a production plan is necessary.

 This plan should describe the complete manufacturing process, including whether or not
the process is to be subcontracted.
 If the manufacturing is carried out by the entrepreneur, the plan should describe the
physical plant layout and machinery and equipment needed.
 If the new venture does not include any manufacturing functions, this section would be
eliminated.

6. OPERATIONS PLAN

 All businesses—manufacturing or non-manufacturing—should include an operations plan

as part of the business plan.
 This section describes the flow of goods and services from production to the customer.
 This would be a convenient place to discuss the role of technology in the business
transaction process.
 If the venture is not manufacturing, this section would be titled operational plan.
 The entrepreneur would need to describe the chronological steps in completing a business
transaction.

7. MARKETING PLAN
 The marketing plan describes how the products will be distributed, priced, and promoted.
 Marketing research evidence to support critical marketing decision strategies and
forecasting sales should be described in this section.
 Potential investors regard the marketing plan as critical to the venture’s success.
 Marketing planning will be an annual requirement and should be regarded as the road map
for short-term decision making.

8. ORGANIZATIONAL PLAN
.

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 The organizational plan section is the part of the business plan that describes the
venture’s form of ownership.
 If the venture is a partnership, the terms of the partnership should be included.
 If the venture is a corporation, this should include the number of shares authorized, share
options, and names and addresses of the directors and officers.
 It is helpful to provide an organization chart indicating the lines of authority.
 This chart shows the investor who control

9. FINANCIAL PLAN

 The financial plan determines the investment needed for the new venture and indicates
whether the business plan is economically feasible.

 Three financial areas are discussed:

 The entrepreneur should summarize the forecasted sales and variable and fixed
expenses for one month.

 The economics of one Unit that contribution profit margin per unit.
 Income Statement projections figures for three years are needed.

9.1 Sales Forecast

Example of sales forecast and influence on sales as below in the table given:

Factor Influence on sales

Market Analysis Given the large number of target households in the Greater Columbus area
(27,690 households), Eva must only sell to less than 0.08% of this potential
market to meet her sales estimates. Eva believes this is highly feasible.
Maximum Capacity Eva has a maximum capacity of 7 units per week (42 hours), which means
she can serve a maximum of 28 customers per month. As a result, Eva’s
sales estimates are aligned with her maximum capacity.
Breakeven Units Eva must sell at least 7 units per month to cover her operating expenses.
Eva’s sales estimates are above her breakeven point.
Seasonality Eva’s business will not be affected by seasonality because her clients will
continue to eat dinner, regardless of the time of year.

Month Units Revenue

January 20 $6,500.00

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February 20 6,500.00
March 20 6,500.00
April 20 6,500.00
May 21 6,825.00
June 21 6,825.00
July 21 6,825.00
August 21 6,825.00
September 22 7,150.00
October 22 7,150.00
November 22 7,150.00
December 22 7,150.00
Sales Forecast Year 1 252 $81,900.00
Sales Forecast Year 2 (10%)
Sales Forecast Year 3 (20%)

9.2 Definition Of One Unit

 Example: One unit is defined as cooking five dinners for a client in the client’s kitchen.

9.3 Variable Expenses

Example of variable expenses as below in the table given:

Materials
Bulk Quantity per Cost per
Material Description Bulk Price
Quantity Unit Unit
Misc groceries (specific ingredients vary $100.00 5 dinners 5 dinners $100.00
from client to client)
Total Material Costs per Unit $100.00

Labor
Cost of Labor per Hour Time (in hrs) to make one unit Total Labor Costs per Unit
$25.00 6 hours $150.00

EOU
Material Costs Labor Costs TOTAL EOU
$100.00 $150.00 $250.00

9.4 Economics Of One Unit

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Example of economics of one unit as below in the table given:

Selling Price per Unit $325.00

Variable Expenses per Unit
Costs of Goods Sold
Materials $100.00
Labor 150.00
Total Cost of Goods Sold $250.00
Other Variable Expenses
Commission $0.00
Packaging 0.00
Other 4.00
Total Other Variable Expenses $4.00
Total Variable Expenses $254.00
Contribution Margin per Unit $71.00

9.5 Fixed Expenses For ONE MONTH

Example of fixed expenses for One Month as below in the table given:

Expense Type Monthly Cost Explanation

Insurance $117.00 As a food services business, it is imperative that Eva’s Edibles is
insured to protect against liability
Salary 0.00 Eva will be paid an hourly wage
Advertising 146.00 Advertising will include direct mailings and postage, as well as
marketing collateral and samples to be distributed at in-store
promotions local events
Interest 0.00 Eva’s Edibles has a financing strategy that does not include
repaying loans with interest
Depreciation 23.00 Eva will depreciate her cooking equipment over a 5-year period of
time ($1,373 over 60 months)
Utilities 100.00 Because Eva cooks in her client’s kitchens, the only utility she will
pay will be service for her mobile phone.
Rent 0.00 Because Eva cooks in her client’s kitchens, she will not incur costs
related to rent
Other Fixed 107.00 These costs are associated with automobile maintenance and gas
Expenses to drive to promotional events
Total Fixed $493.00
Expenses

9.6 Income Statement for FIRST YEAR of Operations

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Example of Income Statement for First year of operations as below in the table given:

REVENUE $81,900.00
Gross Sales $81,900.00
Sales Returns 0.00
Net Sales $81,900.00
VARIABLE EXPENSES
Costs of Goods Sold
Materials $25,200.00
Labor 37,800.00
Total Cost of Goods Sold $63,000.00
Other Variable Expenses
Commission $0.00
Packaging 0.00
Other 1,008.00
Total Other Variable Expenses $1,008.00
Total Variable Expenses $64,008.00

CONTRIBUTION MARGIN $17,892.00

FIXED OPERATING EXPENSES

Insurance $1,404.00
Salaries 0.00
Advertising 1,752.00
Interest 0.00
Depreciation 276.00
Utilities 1,200.00
Rent 0.00
Other fixed expenses 1,284.00
Total Expenses $5,916.00

PRE-TAX PROFIT $11,976.00

Taxes (15%) 1,796.40

NET PROFIT (Year 1) $10,179.60

NET PROFIT (Year 2) (10%)
NET PROFIT (Year 3) (20%)
9.7 Startup Investment
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 Total start-up investment incorporates both start-up cost and working capital
needed to start a project. The most common source of finance for new venture is
the entrepreneur’s own equity contribution. The equity contribution can be in the
form of cash or assets. The next most common source of finance is term loan. This
is a form of long term financing offered by most commercial banks. The term loan
can be used to finance fixed assets as well as working capital requirements. The
interest rate and the loan period depend on the current interest rate and the amount
of loan required respectively. Example of Start up investment as below in the table given:

Item Why Needed Vendor Cost

Victorinox Swiss Army Needed to chop vegetables and tri Macy’s $618.00
Cutlery Set (8 Piece) meat
Anolon Nouvelle Copper Needed for basic cooking Amazon.com 450.00
Hard Anodized Nonstick
10-Piece Cookware Set
Misc cooking equipment Need specialty equipment for Amazon.com 305.00
preparing gourmet meals
Spices, oils, etc. Needed to season food Wholefoods 100.00
Wheeled cart Needed to transport all cooking Globalindustrial.com 269.00
supplies and groceries
Total Startup Expenditures $1,742.00
Emergency Fund (1/2 of startup expenditures) 871.00
Reserve for Fixed Expenses (covers 3 months of fixed expenses) 1,479.00

Total Startup Investment $4,092.00

10. CONCLUSIONS

End with a brief conclusion and the next step of action to be taken. The conclusion can include
the entrepreneur’s decision on how to proceed next. It can be a statement providing viability of
the proposal business and seeking grants or loan approval.

11. APPENDICES

 The appendix contains any backup material not included in the text of the document.
 Reference to any of the documents in the appendix should be made in the plan itself.
 Possible documents:
 Letters from customers, distributors, or subcontractors.
 Secondary or primary research data.
 Leases, contracts, and other agreements.
 Price lists from suppliers and competitors.

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