INTRODUCTION TO BUSINESS PLANNING

Business Planning

§Learn to keep your eyes open for new ideas
§Develop ways of evaluating ideas (yours and others’) (5Qs)
§Understand how to develop a business model that allows you to provide a unique, valuable advantage to a customer (5Qs)
§Practice expressing yourself clearly (60-s pitch)

The Business Plan
The format of a business plan is the easy part:
We give it to you.
There are lots of places on the web to get examples.
It’s what you put into it that is important!
Skill to develop: 5-Questions Assessment
Then, it’s how well you defend your decisions and assumptions.
Skill to develop: 60-second Pitch
To justify—TO SELL!—your idea to somebody else.

Screening Ideas: Are they Opportunities?5 Questions
1.What important customer problem can you solve?
2.How are you going to do it?
3.How many customers are there that are willing to buy from you?
4.Why can only you provide the solution?
5.How can you defend against others?
Ask these questions BEFORE somebody else does!

Screening an Opportunity:1st Question

1.What important customer problem can you solve?
How valuable?
How painful?
Remember, you need to change somebody’s behavior to buy your product.

Screening an Opportunity:2nd Question

2.How are you going to do it?
Business model:
Product
Distribution
Location
Technology/Innovation
Service
Brand

Screening an Opportunity:3rd Question

3.How many customers are there that are willing to buy from you?
How many customers are there? (Market size)
How many will buy from you? (Market share)
Who will be your first customer (besides your Mom)?
Who will be your 100th?

Screening an Opportunity:4th Questions

4.Why can only you provide the solution?
How are you unique? What do you provide that nobody else can?

Screening an Opportunity:5th Question

5.How can you defend against others?
Location, brand, patent (or other IP), great service, great taste, great fashion sense….
Selling an Opportunity:60-second Pitch
Many times there is a person who needs to approve the idea or projects (usually controls the money!)…
§Boss
§Banker
§Father (or Mother)
§Director of Science Park

Selling an Opportunity:60-second Pitch

Many times the person who controls the money, has very little time, and other problems on his or her mind.
How do you get their attention?
Answer: Explain your idea in terms that the listener can relate to…
…need to be direct, clear, concise, and enthusiastic.

The Business Plan
Understanding business plans is not only important for those who are starting businesses…
More and more banks are requiring business plans for loans, for new projects and on-going operations,
Business plans are used in large companies to justify projects,
No matter where you work, it is increasingly likely that you will need to evaluate somebody else’s business plan.
Things to Think About
Defend means defend! If you don’t believe in your idea no body else will.

Format
§You must get your ideas across clearly and concisely.
§Present your “best” idea first (if you have more than one).
§For each idea: 3 slides, 3 minutes
Some tips:
§Don’t waste time on long introductions.
§Be passionate, convincing, interesting.
§Tell a story.