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.

WSBDC Contacts
Region I: Bill Ellis (307) 352-6894 Toll Free in WY 800-348-5205 e-mail: bellis@uwyo.edu Serving Sublette, Lincoln, Uinta, and Sweetwater counties. Region II: Robbi Welch (307) 754-2139 Toll Free in WY 800-383-0371 Fax: (307) 754-0368 e-mail: director@wir.net Serving 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@wyoming.com Region III: Leonard Holler (307) 234-6683 Toll Free in WY 800-348-5207 e-mail: sbdc@tribcsp.com Serving Converse, Natrona, Niobrara, and Platte counties. Region IV: Arlene Soto (307) 632-6141 Toll Free in WY 800-348-5208 e-mail: sewsbdc@wyoming.com Serving Goshen, Laramie, Albany, and Carbon counties Region IV Satellite Office: Bill Schepeler (307) 766-3515 e-mail: WTSchep@uwyo.edu Region V: Jill Kline (307) 682-5232 Toll Free in WY 888-956-6060 e-mail: sbdc@vcn.com Serving 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

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 6. Marketing and Sales 7. Competition 8. Management Team 9. Financials 10.Current Status
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1. Executive Summary 2. Problem 3. Solution 4. Business Model 5. Secrets

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
1. 2. 3. 4. 5. 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.html

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?DCMP=OTC-sba_course
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Thank you! Questions?

Jill Kline, Region V Director (307) 682-5232 1-888-956-6060 sbdc@vcn.com
Serving Sheridan, Johnson, Campbell, Crook, and Weston counties.
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