CHAPTER 1:

PLANNING THE ENTERPRISE

Group 1

Bombales, Mario
Cruz, Harvey
Padolina, Kinlee
Portugal, Franscel
Quimson, Jasper Jeison
 Business Plan

A road map that provides directions so a business can plan its future and
helps it avoid bumps in the road.
The time spend making the business plan thorough and accurate, and
keeping it up to date, is an investment that pays big dividends in the long
term.
The business should conform to generally accepted guidelines regarding
form and content.
Each section should include specific elements and address relevant
questions that the people who read your plan will most likely asked.
The business plan is a document covering
all aspects of the business, beginning with
the objective of the business — which
usually is to produce a good or service that
the public wants, at a cost of production
that will return a profit to the owner.
Reasons Why We Need A Business Plan

To raise money for the business

To make sound decisions
To help us identify potential weaknesses
To communicate the ideas with
stakeholders
DIFFERENTIATE BUSINESS AND
ENTREPRENEURSHIP
 What is Business?

The activities of individuals or groups that

are involved in developing, producing and
distributing the goods and services needed
to satisfy other people’s needs or desires.
 What is Entrepreneurship?
is the act of creating a business or businesses while
building and scaling it to generate profit.
it is what people do to take their career and dreams
into their hands and lead it in the direction of their
own choice.

* Entrepreneurs are the innovative owner-managers

who create new product or service or suggest a
better way of using existing products or services.
 Forms of Business
and its Advantages and
Disadvantages
 Sole Proprietorship
A business owned by only one person. Usually adopted by small business entities.

Advantages:
• Ease of formation and dissolution
• Secrecy
• Unique Tax Advantage

Disadvantages:
• Unlimited liabilities
• Limited capital
• Inadequate management and employee skills
• Limited life
 Partnership
A business owned by a 2 or more person who contribute resources into the entity.

Advantages:
• Ease of formation
• More capital
• More specialized management and skills.

Disadvantages:
• Unlimited liabilities
• Possible owner conflicts
• Difficult in dissolution
• Limited life
 Corporation
• A business that has a separate legal personality from its owners. Ownership in a stock
corporation is represented by shares of stocks.

Advantages:
• Limited liability
• Ease of raising capital
• Representative management
• Perpetual life

Disadvantages:
• High taxes and fees
• Government regulation
• Restricted powers
Contents of Business Plan
 Cover Page

a. Company Name
b. Logo
c. Contact Person
d. Address and Phone Number
e. Date and State of Incorporation
f. Confidentiality and Nondisclosure Statement

➢ Table of Contents and Table of Appendices – refer the reader to the sections and
subsections of the business plan.

➢ Executive Summary – serves as an impression to the readers.

 Body of a Business Plan
Part I: Background and Purpose
• History – brief overview of the company
• Current Status of the Company
• The Product or Service Concept
• Business Objectives
Part II. Market Analysis
• Industry Analysis
• Market Segment
• Competition
• Sales Forecasts
Part III: Product or Service Development
• Research and Development
• Production Requirements and Process
• Propriety Features and Protections Thereof
• Quality Assurance Measures
• Contingency Plans
Part IV: Marketing
• Survey Results
• Marketing Strategy
• Contingency Plans
Part V: Financial Data
• Current Financial Position
• Accounts Payable
• Cost Control Measures
• Break-even Analysis
• Financial Ratios
• Financial Projections
Part VI: Organizational Structure and Management
• Key Personnel – describe the qualifications and
responsibilities of management. The quality of management
is often the key factor in obtaining debt or equity funding.
• Other Personnel
• Directors and Advisors
• Professional Advisors
• Key Future Personnel
• Forecasted Labor Force
Part VII: Risk Factors
• Cost Overruns
• Failure to Meet Production Deadlines
• Problems with Labor, Supplies, or Distributors
• Sales Projections not Met
• Unforeseen Industry Trends
• Competition
• Unforeseen Economic, Social, or Political Developments
• Technological Developments
• Inadequate Capital
• Business Cycle
• Other Risks
 Part IX: Conclusion
• Summary
• Timetable for Funding and Future
Developments
Appendices:
• Photograph of Product or Service
• Sales and Profitability Objectives
• Market Surveys
• Production Flowchart
• Marketing Materials
• Advertisement
• Press Releases
• Historical Financial Statement
• Table of Current Profit and Loss Statement
• Projected Profit and Loss Statement
• Cash Flow Projection
• Balance Sheet
• Projected Balance Sheet
• Asset Acquisition Schedule
• Break-even Statement
• Key Contracts
Source