Entrepreneurship Frances Jørgensen [email protected].
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Transcript of Entrepreneurship Frances Jørgensen [email protected].
• The Entrepreneur
• The call for entrepreneurship
• The Business Plan
• Who should develop a business plan?
• What are the important elements of the BP?
• Tips and Examples
The Entrepreneur is…
• The economists’ heffalump• A coordinator, organizer, manager, leader.• A gap filler• An innovator, characterized by
spontaneous undeliberate learning, or a creative imitator
• A risk bearer• A highly demanded but seldom found
The Business Plan
• …describes a business in its developmental stages, that describes the most important elements of how the business will be run and developed.
• …justifies your basis for starting the business—from your good ideas to your experience and expertise to your financial and market considerations, to your long term dreams and goals.
• …is a continuously evolving and developing platform for your business.
Who needs a business plan?
• Everyone considering the start of a new business venture– Smaller businesses– Highly technical business– Larger businesses
• Everyone in this class, as parts of the activity will be included in your final exam
Objectives of the Business Plan
• To structure and define your visions (for self and others)
• To build a solid basis for your business, based on factual data
• To aid in important decision-making and short/long-term planning
• To convince others (banks, investors, family, friends, potential customers and suppliers) that your plans have merit
• To start development of a habit of professionalism
• Cover Page• Executive Summary• Table of Contents• Company Description• Product/Services• Market Analysis• Marketing Plan• Operations Plan• Financial Plan• Management• Exit Strategy (not always)• Appendices
• Most important component, especially for the marginally involved
• A brief and precise picture of your future that: – Doesn’t tell too much, but just enough– Shows you are knowledgeable and prepared– Entices the reader to turn the page
• The LAST part of the BP to be completed (not started)!
Executive Summary Content
• Description of all actors, emphasizing your (relevant) special talents, qualifications, resources
• Description of service or product
• Customer information, including current relationships
• Most important “figures” (projected income, budgets, profits)
• Vision Statements: – Don’t be short/narrow sighted: Where would Lego be,
if their vision had been to sell small square interlocking building plastic blocks in many various sizes?
– The 30 second elevator test– Focus on the customer– The good, the bad, and the ugly (SWOT + your USP)
• Milestones:– Put your project management skills to use! Set short
term goals that are OBSERVABLE and CONSISTENT with long term goals (vision)
• History of your company (or project or idea)
• Focus on expansion and improvement (past, present, and planned)
• Be honest (include problems experienced and how they were overcome)
• Be clear about your present status and future (planned) needs
• Avoid highly technical, expert-sounding, jargon. • Describe the products/services so that they
appeal to the (future) customer; be descriptive so they can ”see”, ”feel”, ”smell” it! What does it mean to ME?
• What makes yours better? What does it do that others can’t? Product positioning!
• What is involved in production? Patents? Gov’t approval?
• Describe industry characteristics, market segments, trends, projected growth, target market and customers, customer behavior, complementary products/ services, barriers of entry, etc.
• Focus in on gaps in your product/service area.
• Who do you expect will buy/use your product/service? Why them?
• Tell how you will use the brilliantly composed market analysis to its fullest potential…– Detail how you will ensure that customers
know about your product/service AND will choose it over the competition.
– Provide more than one marketing tactic (cheapest to most expensive is usually wise)
• Demonstrate that what you promised in the executive summary is DOABLE!
• Provides the ”nuts and bolts” of running the business…the practical details:– Location, organizational structure, equipment,
labor requirements, HR plans, customer service/support, etc.
• Includes sales forecasts, profit-and-loss statements, cash flow projections, balance sheets, standard business ratios.
• Even if you have a qualified accountant, you MUST be able to respond intelligently to questions in all of these areas!
• A great management team with a so-so business idea is a better risk than a so-so management team with a fantastic idea!
• Use contacts, networks, etc. to strengthen your management team, as necessary. Be sure to toot your own horns…no time for modesty!
• Provides investors with a sense of security, that you won’t always be dependent and that this is a potential $ maker for him/her.
• Usually describes plans for 3-10 years in the future
• Verification of education, experience, etc.• Technical drawings, computer renditions of
product• Independent assessments of the
product/services• Reports drafted in your planning stages (e.g.
from accountants, market researchers, etc)• Throw out any documents that are not highly
Tips• Know your audience!
• Be dramatic, creative…but careful!
• Explain the WHY (the product, the market, the pricing, the partners, the location…)
• Take advantage of your research background! Don’t make unfounded claims or guesses…
• Include possible barriers, drawbacks, potential weaknesses, risks…as well as your plans for managing these!
• Stress your USP (unique selling proposition)
• Be realistic (higher quality for lower price won’t fool anyone!)
• Remember to proofread and spell check! Then do it again! Then have some one else do it!
• Create a Business Plan for:– Your dream business enterprise (product or
service-based)– An internal project in a company in which you
might be employed in the future, to be presented to the Board of Directors
• Use the class slides as guidelines for content; OMIT the Financial Plan section (others may be omitted with GOOD reason).