Draft Business Plan Tool development is very context dependent. Most business plan guides follow a similar generic structure, and offer some additional insight or perspective, as there are always common categories that most businesses will need to convey to most audiences. The innovation context for plant pests control products and plant protection, however, often is a mismatch to the nuances of generic business plans for several reasons. In plant health the many innovative technologies are developed differently, or for different objectives. These differences were found to be due to several factors:
Not aimed at a profit motive
The developer may be public sector and/or financed through public support as part of an ongoing programme, in which the innovation has arisen as a public good or is not necessarily the objective of the programme; or the innovation may arise within a project or programme that has defined public good or charitable objectives. Even though an innovation may not be aimed at profit, there may be a need for commercialisation and cost recovery, or at the very least a method of delivery that enquires planning similar to many aspects of more traditional business planning.
Mixed group of developers
The innovation may result from collaboration or sequential refinement by a mix of players and sectors, including public-private or academic-public, that are either willing to share the benefits either (because of an altruistic aim) or under a contractual requirement to share benefits, e.g. due to philanthropic or crowd funding. The sequential or supplemental enhancement of products also complicates potential for IP protection, when the additional results cannot be exploited independently of existing technology, for example. Integrated Pest Management (IPM) is made up of many such enhancements that improved on earlier ideas.
Complex or unprofitable intellectual property options
The complexity of trying to establish or protect IP may limit interest/value in pursuing a typical commercialisation pathway. This can occur because of the nature of the innovation, for example because it is something less tangible such as a technology package, extension message, set of sequential instructions, or improved interpretational method complementing other technologies. If a business has simply a better product than competitors, for a product sufficiently difficult to produce, costs of IP protection may not be warranted.
Improvements or new approaches to IP already in the public domain
The innovation may be based on technologies or aspects that are either already in the public domain or not easily covered by traditional IP protection. Some innovations may be supplemental to existing technologies and it could prove difficult to harness the value added through IP protection. In these cases, it may be more important to maintain branding reputation, best service, or quality management of delivery. These mechanisms for exploitation of innovation may also occur for non-biological products as well, of course. Each can be represented and thought through in the framework of a business plan, but will have unique characteristics making parts of a Model Business Plan less relevant or needing more elaboration.
We know that writing a full business plan can be a daunting experience at first, therefore we have created a business plan template to help you start. Using the tool below, you can work through all the sections which need to be covered in your plan. We have broken this down into a series of questions which can be answered in one or two sentences. Once completed, you will have the first draft of your full business plan.
Remember that every business is unique, and the templated is just a guide. Make sure to include all relevant information to your specific venture, and if something is covered in our template, then remember to add it in afterwards.
To help you on the way, the guide includes several helpful external references and guides to ensure that you are able to complete each section.
This section should be completed last once all subsequent sections have been filled. From this section, any reader should be able to understand in general terms everything contained in the rest of the business plan, but without going into too much detail.
Two-page synopsis of the following
Introduce yourself and your project
Define the problem you are solving
How does your solution solve this problem?
What has been your traction to date?
How big is the market that you’re trying to break into?
What is your unique selling point?
Why can your team achieve your goals?
What are your next steps?
What is the purpose of this business plan?
The above points (and the rest of the business plan) should always be curated to match the purpose of your business plan. Why have you decided to create the business plan in the first place?
Are you: looking for investment; marketing to potential customers; expanding your team; formalizing your business idea into a coherent document; or simply creating an internal document to keep your team on track?
The executive summary should explain the fundamentals of the proposed business with the purpose identified above in mind. Please view the Stakeholder Guide for more information.
Use this to consider how to convey the following suggested points:
What will your product be? Who will your customers be? Who are the owners? What do you expect your business and your industry will look like in the future?
Highlight the strengths of the business and why you should be supported. Indicate the expected turnover and profitability for the following year. If you have started conducting business already, briefly describe your performance to date; for example, provide details of turnover and profitability for the previous one or two years. How does your business’s performance compare against your competitors? What traction have you gained, and have you reached any milestones?
Your executive summary should be passionate, professional, complete, and succinct. If applying for investment, state clearly how much you want, precisely how you are going to use it, and how the money will make your business more profitable, thereby ensuring repayment.
You should include the same elements in the executive summary that you would cover in a five-minute interview or pitch
The executive summary section is meant to be a brief but complete overview of the entire business plan (much like the purpose of an executive summary for an academic paper). The following sections should go into much more detail so that the reader can get a full understanding of who you are and what you are doing. The first section that is usually included is an overview of the business; this template should be used as a guide for what can be included in each section.
Overview of section
This section should include:
Please use the following table as a guide for what should/could be included in this section. You should consider writing a paragraph or two for each of the sections in the table, if applicable to your group (space has been provided to write directly into the table). If you believe that anything additional should be included which is specific to your company, then feel free to add it in. This is template is simply a guide; every company is different!
Your Vision and Mission
Has your business started (has the business been incorporated, registered as a charity/university etc), and explain who owns it. What was the trigger to launch the business? Explain the legal structure of the business (company, sole trader or partnership).
If the business has already started, outline its history and performance to date. How high is the sales turnover? How profitable is it? What is its net worth? Provide summary figures here and detailed profit and loss account and balance sheets in the appendices.
Performance vs others
Again, if you have started (including pilot projects or trials), how does your current performance compare to your competitors or other people working on similar projects?
How has the business/group been funded to date? For example; equity, loans, grants, profit.
Provide any notable achievements to indicate successes that you have had so far.
Is your business/group a private limited company? If so, who owns what (equity etc)? If you are not a limited company, what is your legal structure?
What mechanisms/methodologies are in place to ensure that projects/work stay on track?
Do you intend to expand your team? If so, what are the related costs and who do you need/want to hire?
Products and Services
Describe what you are selling, or intend to sell, in language which any reader will understand. This may be a product, service, technique, package, or other. Even if you do not intend to make a profit with your business, you must still ‘sell’ what your business is offering.
Avoid specific sectorial terminology wherever possible; a reader wanting more detailed information on technical aspects of your product will ask for it. Include such information in an appendix: technical specifications, drawings, photos, sales brochures, and other bulky items.
Explain why customers will want to buy the product or services (again, even if you are providing a service and do not intend to make a profit, your users still need to buy into your approach).
What is it that you are selling? Provide a brief description to set the scene for the more detailed description below. Is this a traditional product, a service, a technique, a package or something else? Be clear here.
What problem does your user have? Why is this an issue to them? Does it cost them money, effort, stress? Why is a solution needed?
How does your product/service solve this problem for your customer/user?
Features are defined as surface statements about your product, such as what it can do, its dimensions and specs and so on.
Why are you taking this approach? What are the differences between what you do and what is already available?
Are you unique?
Are any of the features or techniques used in your approach are unique? If yes, how have you protected this (patent, design registration, copyrights), or is this not applicable to your business model?
Is/has your product/service/technique being/been used? Pilot/trials/sales? How is your technology
Where do you acquire raw materials and other inputs?
What is your limit to scale or expansion? If you are making a physical product, what could restrict you from making more units? If you are providing a service, what would limit how many people you can reach, or areas you can work in?
Provide a short summary to conclude on.
This section is all about the market. This means showing that a market exists (without a significant market you should reconsider whether it is worth undertaking the venture), identifying who your users/customers are, identifying who else is working/selling within your market, how you have created a niche.
Your market analysis summary should include the following sections:
Who are your users/ customers?
Define carefully who you perceive to be your customer/user groups or niche markets. If your market research suggests that you aim your sales / marketing strategy at a precisely defined target market or segment, then state this.
You need to show that a market exists. What is the overall size of the market? Estimate likely demand for your product or service in the short and long-term and justify this estimate. It is on the basis of such information that you will estimate your sales turnover. If you are not intending to make a profit, you still need to ensure that the business has a large enough market to generate revenue to sustain the activities of the business. For example, if you are reliant on grants or research funds.
https://www.thebusinessplanshop.com/blog/en/entry/tam_sam_som Current Market Demand
What evidence is there to suggest that there is a demand for your business outputs from the identified users/customers? Are your users/customers currently using/paying for a similar product or service? Have you conducted any market research?
Trends in target market—growth trends, trends in consumer preferences, and trends in product development. Does your product match the market trends, or is it a traditional approach? Justify the approach that you have taken.
How are you going to meet this need with your products and services?
What is the growth potential and opportunity for a business of your size? This is aimed at profit making businesses to understand what the potential return may be if the business is successful; a scalable business has more potential for big returns. However, non-profits should also consider their growth potential if applicable.
What barriers to entry do you face in entering this market with your new company? Again, this is primarily targeted to profit-making organisations, but non-profits should consider potential barriers to reaching your target market.
In the Products and Services section, you described your products and services as you see them. Now describe them from your customers’ point of view (User experience perspective).
What support will you give to your customers/users? After-sales support or service? Some examples are delivery, warranty, service contracts, support, follow-up, and refund policy. If you are providing a service, will you make sure that the customer’s needs have been met?
Provide any other details that your customer/user may be interested in. If there is anything unique about your business from their perspective, make sure this is detailed here.
Identify your targeted customers/users, their characteristics, and their geographic locations, otherwise known as their demographics. The description will be completely different depending on whether you plan to sell (or provide your service) to other businesses or directly to individuals. If you sell at the consumer level, but sell it through a channel of distributors, wholesalers, and retailers, you must carefully analyze both the end consumer and the middleman businesses to which you sell.
You need to explain to the reader the extent of the competition. What competition is there? How many competitors will you have? Is there likely to be further competition in the future? Explain why your product is going to be preferable to those of your competitors. What is your product’s unique selling point?
What products and companies will compete with you? List your major competitors (even if your business does not make a profit, you will still need to consider your competitors who may prevent you from conducting business activities): (Names and addresses)
Will they compete with you across the board, or just for certain products, certain customers, or in certain locations?
Will you have important indirect competitors? (For example, video rental stores compete with theaters, although they are different types of businesses.) Comparison
Based on the above, write a short paragraph stating your competitive advantages and disadvantages.
Now that you have systematically analyzed your industry, your product, your customers, and the competition, you should have a clear picture of where your company fits into the world. You might want to include a SWOT analysis here.
You described the purpose of your business in the business summary section. That purpose should be translated into marketing objectives and goals which will support its realization.
Objectives should be quantifiable, measurable, challenging and achievable. Typical objectives might be profitability, sales growth, diversification and improvement in market share.
Objectives might include, for example:
to sell 220 units and generate £100,000 over the next 12 months
to deliver a service to 1000 users over the next 24 months; or,
to capture 18% of the defined market.
Whether you are selling a product, service or other, and whether you are intending to maximize profit or are working as a charity, you should always work towards well defined objectives. This will ensure that your business and team are moving in the right direction, and that you are on the right track to achieve what you set out to when you established the business in the first place.
The marketing plan to achieve these objectives should be described using the 4Ps (product, place, price, promotion). Your chosen “positioning” will also affect how you implement the 4Ps.
Your marketing plan should include the following sections:
What are your business/group’s key objectives? Objectives should be quantifiable, measurable, challenging and achievable. Typical objectives might be profitability, sales growth, diversification and improvement in market share.
You have described already what your product or service is. Outline plans for future development over, say, the next two years. Will you phase in additional products or services as you start to make more money, or reach? Will you pilot an initial product/service to test the market? Will you add to the product/service range later?
How and where are your products or services produced? Explain your methods of: Production/implementation techniques and costs; Quality control; Customer service; Inventory control; Product/service development.
This is primarily for groups creating products, however, if you are delivering a technique or service, consider the points which are applicable to you. Legal Environment
Consider and describe the following: Licensing and bonding requirements; Permits; Health, workplace, or environmental regulations; Special regulations covering your industry or profession; Zoning or building code requirements; Insurance coverage; Trademarks, copyrights, or patents (pending, existing, or purchased).
Consider and describe the following: Number of employees; Type of labor (skilled, unskilled, and professional); Where and how will you find the right employees; Quality of existing staff; Pay structure; Training methods and requirements; Who does which tasks; Do you have schedules and written procedures prepared; Have you drafted job descriptions for employees? If not, take time to write some. They help internal communications with employees; For certain functions, will you use contract workers in addition to employees?
The location of your business and the way you will distribute your product to your clients are both important. How will the product or service be sold to customers - directly or via dealers or agents (such as wholesalers or retailers)? How will the product be transported to its point of sale? This is especially key if you provide a service internationally. Why have you chosen your location as a base for your business?
What qualities do you need in a location? Describe the type of location you’ll have. Physical requirements: Amount of space; Type of building; Zoning; Power and other utilities.
If you are working internationally, do you have bases in other key areas? If not, how do you liaise between nations? Does this affect who you can/will hire?
Do you have any access considerations? Is it important that your location be convenient to transportation or to suppliers? Do you need easy walk-in access? What are your requirements for parking and proximity to freeway, airports, railroads, and shipping centers? Include a drawing or layout of your proposed facility if it is important, as it might be for a manufacturer.
Estimate your occupation expenses, including rent, but also including maintenance, utilities, insurance, and initial remodeling costs to make the space suit your needs. These numbers will become part of your financial plan. (This is an important aspect for non-profits to consider; if you are not intending to make a profit from your products/services/innovation, it is important to carefully consider your overheads, and how you intend to cover them).
What kind of inventory will you keep: raw materials, supplies, finished goods? Average value in stock (i.e., what is your inventory investment)? Rate of turnover and how this compares to the industry averages? Seasonal buildups? Lead-time for ordering?
Explain how you propose to position the business (and the product/service) in the market place. Is the product/service a quality product targeted at a quality market (and therefore able to command a premium price)? This is known as differentiation. Is the product a commodity - with nothing to choose between competitors except price? This is called cost leadership.
If you are not intending to make a profit, what pricing structure or income will you have in place to ensure sustainability of the technology? Price Justification
The price must cover all your costs and provide a profit (if applicable). You will need to explain how you reached your decision on price. If you choose a differentiation strategy, quality and service is, within reason, more important than price. If you choose a cost leadership strategy you will need to set the price by reference to the market - and then control your costs to enable you to sell at that price whilst still making a profit. The latter is often a difficult strategy for small businesses so most, either consciously or unconsciously, choose the differentiation route.
Finally, you need to explain your promotional strategy - how you intend to break into the market and let the customer know you exist.
Explain how you will promote what you must offer, for example, through advertising, direct mail, door-to-door leaflets, social media campaigns, etc. Why?
How you promote your technology will be unique to each group, based on your market, the technology you are offering, the image that you want to promote, your customers, whether you are profit making or not etc. However, you decide to promote your technology, make sure that it is justified. For every action you wish to take, make sure there is a logical reason for doing this.
Management and Organisation
It is important to demonstrate that you can carry out the tasks to make the business work. Focus only on the key points: People, Production, Premises.
Who will manage the business on a day-to-day basis? What experience does that person bring to the business? What special or distinctive competencies? Is there a plan for continuation of the business if this person is lost or incapacitated?
If you’ll have more than 10 employees, create an organizational chart showing the management hierarchy and who is responsible for key functions.
Include position descriptions for key employees. If you are seeking loans or investors, include resumes of owners and key employees.
The team is one of the most important aspects to a business plan. If the investor does not believe that the team can deliver on what it promises, then even the best business plan will be compromised.
List the following:
Board of directors
Management advisory board
Consultant or consultants
Mentors and key advisors
The financial plan consists of a 12-month profit and loss projection, a four-year profit and loss projection (optional), a cash-flow projection, a projected balance sheet, and a break-even calculation. Together they constitute a reasonable estimate of your company's financial future. More important, the process of thinking through the financial plan will improve your insight into the inner financial workings of your company.
Guides have been provided via hyperlink for each element. Please use these to create your financial plans. 12-Month Profit and Loss Projection
Many business owners think of the 12-month profit and loss projection as the centerpiece of their plan. This is where you put it all together in numbers and get an idea of what it will take to make a profit and be successful.
Your sales projections will come from a sales forecast in which you forecast sales, cost of goods sold, expenses, and profit month-by-month for one year. Profit projections should be accompanied by a narrative explaining the major assumptions used to estimate company income and expenses. Research Notes: Keep careful notes on your research and assumptions, so that you can explain them later if necessary, and so that you can go back to your sources when it’s time to revise your plan. http://www.nolo.com/legal-encyclopedia/free-books/small-business-book/chapter14-2.html Four-Year Profit Projection (Optional)
The 12-month projection is the heart of your financial plan. This section is for those who want to carry their forecasts beyond the first year.
Of course, keep notes of your key assumptions, especially about things that you expect will change dramatically after the first year. https://www.entrepreneur.com/article/76418 Projected Cash Flow
If the profit projection is the heart of your business plan, cash flow is the blood. Businesses fail because they cannot pay their bills. Every part of your business plan is important, but none of it means a thing if you run out of cash.
The point of this worksheet is to plan how much you need before startup, for preliminary expenses, operating expenses, and reserves. You should keep updating it and using it afterward. It will enable you to foresee shortages in time to do something about them—perhaps cut expenses, or perhaps negotiate a loan. But foremost, you shouldn’t be taken by surprise. http://www.business.vic.gov.au/money-profit-and-accounting/getting-paid-on-time/cash-flow-statement-projection-with-template Opening Day Balance Sheet
A balance sheet is one of the fundamental financial reports that any business needs for reporting and financial management. A balance sheet shows what items of value are held by the company (assets), and what its debts are (liabilities). When liabilities are subtracted from assets, the remainder is owners’ equity.
Use a startup expenses and capitalization spreadsheet as a guide to preparing a balance sheet as of opening day. Then detail how you calculated the account balances on your opening day balance sheet. http://quickbooks.intuit.com/r/bookkeeping/5-simple-ways-create-balance-sheet/ Break-Even Analysis
A break-even analysis predicts the sales volume, at a given price, required to recover total costs. In other words, it’s the sales level that is the dividing line between operating at a loss and operating at a profit.
Expressed as a formula, break-even is:
Breakeven Sales =
1- Variable Costs
(Where fixed costs are expressed in dollars, but variable costs are expressed as a percent of total sales.)
Include all assumptions upon which your break-even calculation is based.
http://www.inc.com/guides/2010/12/how-to-perform-a-break-even-analysis.html Sensitivity or Risk Analysis
Sensitivity analysis looks at “what if...?” questions. What will be the effect, say, of a 10% fall in sales or a 20% increase in raw material prices? You can help the business plan appraiser by briefly considering such questions yourself and assessing the likely risks particularly of falling sales or rising prices.
http://www.investopedia.com/terms/v/variable-cost-ratio.asp Financial Requirements
Indicate how much money or other assets will be invested by yourself (and any partners). Give details of how much is sought from other sources and explain whether it is wanted as overdraft (for working capital), as term loans (for equipment for example), as equity, or as a combination of these.
If any security, for example, in the form of a house, is available, then say so. Most banks look for at least some security, particularly if they are being asked to provide the bulk of the finance. The offer of security is a demonstration of your commitment to, and confidence in, the business. It is also a demonstration of your willingness to take risks, especially if you have little cash of your own to invest.
The obtained results need to be assessed to measure any possible deviation from initial forecasts, and if so, to analyze the causes of this deviation and take the appropriate corrective actions. Moreover, knowing that markets change over time, it is necessary to control and re-evaluate the realization of the business plan. If necessary, it may even be advisable to change the objectives initially set.
We suggest you clarify which crucial parameters you will follow to monitor your performance and the likely evolution of market conditions.
In addition to anything mentioned above, you might include:
Quotations for equipment and necessary insurance
Legal information - partnership agreement, leases etc
A copy of your primary research questionnaires; and
Relevant secondary research information.
Feasibility study showing the technical and financial sustainability of the initiative
Financial statements, balance sheets and explanatory notes of the last four years, Chart of account and budgets 2015and 2016. Does the company use the IAS or national accounting standards? If not, it is necessary that financial and economic information are reclassified according to IAS/IFRS Gaap
Information about amortizations, mortgages, leasing (relevant)
Shareholders expectations (dividends, capital increase, reinvestment of earnings).