Creating a Winning E-Business Second Edition

1. Creating a Winning E-BusinessSecond Edition Creating an E-Business Plan Chapter 3

2. Learning Objectives • Organize a business plan • Prepare an executive summary • Write a mission statement • Prepare a marketplace analysis • Create operational, financial, and management plans Creating a Winning E-Business Second Edition, Chapter 3

3. Learning Objectives(continued) • Understand legal forms of businesses • Describe e-business partnerships Creating a Winning E-Business Second Edition, Chapter 3

4. Business Plan Organization • Business plan • Formal business planning document • Identifies the business and its mission • Names the key management team members • Describes the products or services to be offered • Provides a marketplace analysis • Identifies customers and competitors • Determines resources for profitable operations • Sets a timetable for profitability Creating a Winning E-Business Second Edition, Chapter 3

5. Business Plan Organization(continued) • Government and for-profit sources for business planning information and templates • SCORE • SBA • BizPlanIt • Bplans.com • E-Future Centre Creating a Winning E-Business Second Edition, Chapter 3

6. Business Plan Organization(continued) Creating a Winning E-Business Second Edition, Chapter 3

7. Business Plan Organization(continued) Creating a Winning E-Business Second Edition, Chapter 3

8. Business Plan Organization(continued) • Business plan components • Cover sheet and title page • Table of contents • Executive summary • Business description • Vision/mission statement Creating a Winning E-Business Second Edition, Chapter 3

9. Business Plan Organization(continued) • Business plan components (continued) • Information on products/services • Industry, customer, competitor analyses • Operational, financial, and managerial plans • Identification of critical risks • Exit strategy Creating a Winning E-Business Second Edition, Chapter 3

10. Business Plan Organization(continued) • Cover sheet • Title of document and preparer’s name • Plan copy number • “Confidential” notation • Title page • Cover sheet information and • Contact numbers • Key team members’ names • Name of person receiving the plan Creating a Winning E-Business Second Edition, Chapter 3

11. Business Plan Organization(continued) Creating a Winning E-Business Second Edition, Chapter 3

12. Business Plan Organization(continued) Creating a Winning E-Business Second Edition, Chapter 3

13. Business Plan Organization(continued) • Table of contents • Lists all the major sections and subsections of the plan • Prepared after rest of plan is complete • Carefully checked for omissions and page number errors Creating a Winning E-Business Second Edition, Chapter 3

14. Business Plan Organization(continued) Creating a Winning E-Business Second Edition, Chapter 3

15. Business Plan Organization(continued) • Executive summary • A condensed version of the complete plan • Used by interested parties to quickly assess the business idea and weed out plans • Keep it short (one to three pages) • Use clear and concise language and action words • Create last after plan details are developed Creating a Winning E-Business Second Edition, Chapter 3

16. Business Plan Organization(continued) Creating a Winning E-Business Second Edition, Chapter 3

17. Business Plan Organization(continued) • Vision statement • A formal statement of a business’s hopes and desires • Written to guide and inspire employees • Mission statement • A formal statement that explains a business’s reason for existing Creating a Winning E-Business Second Edition, Chapter 3

18. Business Plan Organization(continued) • Business description • Summary of business’s background • Information about legal form of business • Business’s history to date • Key personnel • Future goals Creating a Winning E-Business Second Edition, Chapter 3

19. Business Plan Organization(continued) Creating a Winning E-Business Second Edition, Chapter 3

20. Business Plan Organization(continued) • Products or services section • Description of products or services offered • Anticipated sales for each product or service • Describes benefits of product or service to customers Creating a Winning E-Business Second Edition, Chapter 3

21. Business Plan Organization(continued) Creating a Winning E-Business Second Edition, Chapter 3

22. Business Plan Organization(continued) • Marketplace analysis • Information about the specific industry of which business is a part • Description of targeted customers • Description of major competitors • Overview of marketing and sales strategies Creating a Winning E-Business Second Edition, Chapter 3

23. Business Plan Organization(continued) Creating a Winning E-Business Second Edition, Chapter 3

24. Business Plan Organization(continued) • Operational plan • Describes a business’s physical location and equipment • Notes the manufacturing or service actions needed to get products/services to market • Summarizes Web site operations Creating a Winning E-Business Second Edition, Chapter 3

25. Business Plan Organization(continued) Creating a Winning E-Business Second Edition, Chapter 3

26. Business Plan Organization(continued) • Financial plan • Explains how your e-business idea, goals, and strategies translate into profits • Provides standard financial statements for income, expense, and cash flow data • Pro forma balance sheet • Projected income statement • Planned cash flow statement • May include “deal plan,” break-even analysis, ratio analysis Creating a Winning E-Business Second Edition, Chapter 3

27. Business Plan Organization(continued) Creating a Winning E-Business Second Edition, Chapter 3

28. Business Plan Organization(continued) Creating a Winning E-Business Second Edition, Chapter 3

29. Business Plan Organization(continued) Creating a Winning E-Business Second Edition, Chapter 3

30. Business Plan Organization(continued) Creating a Winning E-Business Second Edition, Chapter 3

31. Business Plan Organization(continued) Creating a Winning E-Business Second Edition, Chapter 3

32. Business Plan Organization(continued) • Management plan • Organizational structure of business • Information on • Key members of management team • Outside advisors • Mentors • Consultants Creating a Winning E-Business Second Edition, Chapter 3

33. Business Plan Organization(continued) Creating a Winning E-Business Second Edition, Chapter 3

34. Business Plan Organization(continued) Creating a Winning E-Business Second Edition, Chapter 3

35. Business Plan Organization(continued) • Appendices • Resumes • Pictures of products • Explanation of services • Legal documents • Other supporting documentation Creating a Winning E-Business Second Edition, Chapter 3

36. Legal Forms of Organization • Sole proprietorship • Business started by an individual • Owner and business are one in the same for tax and legal liability issues Creating a Winning E-Business Second Edition, Chapter 3

37. Legal Forms of Organization (continued) • Partnership • Legal business entity with two or more co-owners • Follows a partnership agreement • General partnership: Tax and legal liabilities flow through to individual partners • Limited partnership • General partner manages and assumes unlimited liability • Limited partners have liability for amount of their capital contribution and their accepted debt Creating a Winning E-Business Second Edition, Chapter 3

38. Legal Forms of Organization (continued) • Corporation • Separate legal and taxable entity from its owners • “C” corporation owners are it shareholders • Liability is limited to investment in business • Profits are taxed twice: once for the corporation and again when distributed to owners as stock dividends Creating a Winning E-Business Second Edition, Chapter 3

39. Legal Forms of Organization (continued) • Corporation (continued) • “S” corporation gives owners partnership status and corporate liability protection • Limited liability company (LLC) • Tax status of sole proprietorship or partnership • Liability status of a corporation Creating a Winning E-Business Second Edition, Chapter 3

40. E-Business Partnerships • Strong positive relationships with strategic partners are critical • Partnerships that help build market awareness • Public relations firms • Marketing consultants • Partnerships that assist in operations • Suppliers • Distributors • Web hosting companies Creating a Winning E-Business Second Edition, Chapter 3

41. Chapter Summary • A business plan is used to • Check feasibility of business • Seek funding • Guide operations • A business plan includes • Cover sheet and title page • Table of contents and executive summary • Marketplace analyses • Operational, financial, and marketing plans Creating a Winning E-Business Second Edition, Chapter 3

42. Chapter Summary(continued) • Business plan appendices can include • Resumes • Pictures of products and information on services • Legal documents • Other supporting details for the overall plan Creating a Winning E-Business Second Edition, Chapter 3

43. Chapter Summary(continued) • Business description should include legal form of business • Business plan should note key strategic partnerships Creating a Winning E-Business Second Edition, Chapter 3