Components of a Business Plan

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Components of a Business Plan

• Jill Kline
• Wyoming SBDC

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Wyoming SBDC

• Strengthen Wyoming businesses and create economic
  growth by providing excellent management
  assistance, educational programs and helpful
  resources for Wyoming small businesses and
  entrepreneurs.

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WSBDC Contacts

• Region I Bill Ellis(307) 352-6894
• Toll Free in WY 800-348-5205e-mail
  bellis_at_uwyo.eduServing Sublette, Lincoln, Uinta,
  and Sweetwater counties.
• Region II Robbi Welch
• [phone]
• Toll Free in WY 800-383-0371Fax (307)
  754-0368e-mail director_at_wir.netServing Park,
  Big Horn, Washakie, Hot Springs, Fremont, and
  Teton counties.
• Fremont County Office Margie Rowell(307)
  857-1174
• Toll Free in Wyoming 800-969-8639 e-mail
  wsbdc_at_wyoming.com
• Region III Leonard Holler(307) 234-6683
• Toll Free in WY 800-348-5207e-mail
  sbdc_at_tribcsp.comServing Converse, Natrona,
• Niobrara, and Platte counties.

Region IV Arlene Soto(307) 632-6141 Toll Free
in WY 800-348-5208e-mail sewsbdc_at_wyoming.comSer
ving Goshen, Laramie, Albany, and Carbon counties
Region IV Satellite Office Bill
Schepeler(307) 766-3515e-mail
WTSchep_at_uwyo.edu Region V Jill Kline (307)
682-5232 Toll Free in WY 888-956-6060e-mail
sbdc_at_vcn.comServing Sheridan, Johnson,
Campbell, Crook, and Weston counties.
http//www.uwyo.edu/SBDC/offices.html
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Why develop a Business Plan?

• All the work you do in thinking up your idea,
  testing it, studying it, and producing it, has
  been for nothing if you cant sell it. Whether
  you start you own business to produce and sell
  your invention, subcontract out the manufacturing
  part, or sell your rights in return for a
  percentage of the proceeds, you need a business
  plan.
• - Pamela Riddle Bird, PhD, Inventing For
  Dummies
• CEO, Innovative Product Technologies, Inc.

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Why develop a Business Plan?

• You've just come up with an idea. What to do
  next? There is no exact order of what you should
  be doing. But we like to suggest two broad areas
  for inventors to embark on. First, learn all you
  can about running a business, even if you hope to
  license your idea. Second, write a business plan.
  Even if you hope to license your idea, (and
  that's actually a rarity among the successful
  inventors we've met) you'll still need to have a
  plan.
• - Mark Ellwood, Past UIA Board of Directors

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Why develop a Business Plan?

• A business plan is vital for enterprises
  needing investment, grant funding or significant
  borrowing more so for innovation ventures, as
  the greater number of unknowns makes it even
  harder to attract backing. But dont make the
  mistake of thinking that only other people need
  your business plan. Its primarily a tool to
  reveal possibly awkward truths about your
  business to you.
• - a Creative Investor

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Three Types of Plans

• Summary Plan
• 10 pages, 3 important points
• Comprehensive Plan
• 10-40 pages, seeking capital or alliances
• Operational Plan
• 40 pages, for going concerns, part of an annual
  process

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The Summary Plan

• The Business
• Legal Structure, Products or Services,
  Management, Personnel, Record Keeping
• Marketing
• Target Market, Competition, Advertising
• Financials
• Summary of Needs, Use of Funds, 3 Year Cash Flow
  Projections, Income Projections

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The Comprehensive Plan

• Marketing and Sales
• Competition
• Management Team
• Financials
• Current Status

• Executive Summary
• Problem
• Solution
• Business Model
• Secrets

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Executive Summary

• Define problem, solution, business model, and why
  your solution is better
• Write it last
• Grab readers attention
• No more than 2 pages!
• Most important part of your plan and usually
  written last

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Problem

• What problem are you solving?
• Describe how the state of the art is
  insufficient
• Get your reader to agree that the current
  situation isnt optimal
• If there isnt a problem, take your idea back to
  the drawing board

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Solution

• How do we solve the Problem?
• Explain what you sell
• State your value proposition

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Value Proposition Worksheet

• First Sentence
• For (target customer)
• who (statement of the need or opportunity),
• the (product/service name) is a (product/service
  category)
• that (statement of benefit).
• Second Sentence
• Unlike (primary competitive alternative),
• our product (statement of primary
  differentiation).

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Business Model

• Explain how you make money
• Who pays you?
• How do you collect?
• What are your channels of distribution?
• How do you integrate suppliers?
• Use examples if necessary
• Be complete

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Secrets

• Describe your technology, process improvement,
  etc.
• Use charts, diagrams, schematics, as much as
  possible
• Understand your Intellectual Property

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Marketing and Sales

• Define your primary, secondary, and other
  audiences
• Show some numbers
• How will you find, sell, and retain customers?
• Advertising and promotion budget
• Identify your leverage points

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Competition

• Everyone has competitors!
• Provide a complete view of the competitive
  landscape
• Direct and indirect competitors
• Current and anticipated competitors
• Competitor strengths and weaknesses
• Your competitive advantages

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Management Team

• Describe your key players
• Management Team
• Board of Directors
• Board of Advisors
• Major Investors
• Who are you missing?

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Financial Projections

• Cash Flow Projections
• Income Projections
• Balance Sheets
• Assumptions

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Current Status

• Describe your major milestones and tasks
• Technology
• Fundraising
• Customer Development, etc.
• Where are you now?
• Brag about your accomplishments
• Talk about the next steps

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Investor Pitch Slides
10/20/30 Rule

• Title
• Problem
• Solution
• Business Model
• Secrets

• 6. Marketing and Sales
• Competition
• Management Team
• Financials
• Current Status

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Good Reading

• Crossing the Chasm Geoffrey Moore
• The Art of the Start Guy Kawasaki
• Inventing For Dummies Pamela Riddle Bird

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Internet Resources

• WSSI Inventor Resources Page -
• http//uwadmnweb.uwyo.edu/SBIR/inventorresources.h
  tml
• Innovative Products Technologies, Inc. -
• http//www14.inetba.com/inventonecom/
• Business Plan Development Tools (online)
• http//www.uwyo.edu/sbdc
• http//www.sba.gov/starting_business/index.html
• Sample Plans
• http//www.bplans.com/samples/sba.cfm?DCMPOTC-sba
  _course

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Thank you! Questions?

• Jill Kline, Region V Director
• [phone]
• 1-888-956-6060 sbdc_at_vcn.com Serving Sheridan,
  Johnson, Campbell, Crook, and Weston counties.