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What Is A Business Plan?

What Is A Business Plan?. Objectives. To develop a document that presents a picture of the business, where the business is going, and how it will get there To understand the organization of a business plan . “If you don’t know where you’re going, you may end up somewhere else.”

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What Is A Business Plan?

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  1. What Is A Business Plan?

  2. Objectives • To develop a document that presents a picture of the business, where the business is going, and how it will get there • To understand the organization of a business plan

  3. “If you don’t know where you’re going, you may end up somewhere else.” -Casey Stengel

  4. What Is A Business Plan? • A document that conveys your organization’s prospects and growth potential. It describes: – You and your products and services – The market and your role in it • Shows you are committed to achieving a vision • Good follow-up to developing a strategic plan • Keeps focus on end product

  5. Format of the Business Plan • Title Page • Executive Summary • Vision/Mission and Goals • Current Position • Strategic Analysis • Implementation • Projections

  6. Executive summary • Written last • Maximum of two pages • Major points of each section

  7. Vision/Mission & Goals • Where is the business headed? • What do you want the business to achieve? • What time frame?

  8. Current Position • How do you describe the farm? • History: important milestones • Products/services: What? How much? • Resources: Who owns what? What is their reward? • Management: Who? What do they do? • Organizational Structure: Who’s the boss? • Marketing: What tools? What customers? • Ownership Structure: Legal form?

  9. Production Resources Management Resources Land (shares) Land (cash rent) Machinery Paid Labor Unpaid Labor • Management Responsibility and Authority • Organizational chart Contribution Compensation Products/Services Pie Chart Of Gross Sales by Enterprise Current Position Farm Business

  10. Strategic Analysis • What opportunities and threats does the business face? • What are our strengths and weakness? • What do we do better than others? • What strategy will we use?

  11. Implementation • For each business unit • What size? • What resources will be needed? • How will the resources be acquired? • How will product/service be marketed? • What performance targets will be set?

  12. Implementation • For the firm as a whole • What is the scope of business? • How will it be financed? • How will the business be organized? • What are our social responsibilities? • How will we develop new management skills? • When will it happen? • How much will it cost/generate?

  13. Projections • What numbers can we put behind our plan? • What assumptions have we made? • What do we expect for our ROA and ROE? • What is our contingency plan? • What will we do in an emergency?

  14. Be sure that . . . • Your goals are tied to your vision • You can point to major opportunities • You’re prepared for threats • You’ve described your customers • You know your strengths/weaknesses • Your strategy makes sense • Your data is accurate • You’re really ready for change • Your plan is clear, concise, and current

  15. Keep in mind that. . . • This is an opportunity to work on the business • This is important and difficult work but not urgent • The value of the work will increase as you share, review, and update the business plan

  16. Now what? • Share your plan judiciously • Live it • Revisit and revise

  17. Strategic Business Planning for Commercial Producers

  18. References • The Business Plan: Roadmap to Success. www.sba.gov/starting/indexbusplans.html • Tiffany, Paul and Steven D. Peterson. Business Plans for Dummies. Foster City, CA: IDG Books, 1997.

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