ENTREPRENEURIAL MIND

CHAPTER 6
Opportunities or Idea: Using Business Plan to
Determine when Business Opportunity Exist

LEARNING OUTCOMES

After reading this module, you are expected to:

1. Describe the features of a business plan.

2. Discuss the purpose of a business plan.
3. Explain how a business plan is helpful in determining when an idea has the potential to become a
successful business.
4. Examine the elements of the end- of term business plan project that will be assigned to the class.

INTRODUCTION

A business plan is an essential roadmap for business success. It describes the direction, the
company is taking, what its goals are, where it wants to be, and how it is going to get there. A business
plan is also a written summary of an entrepreneur’s proposed business venture, its operational and
financial details, its marketing opportunity and strategies, and its managers’ skills and abilities.
The business plan holds great value for the entrepreneur and the company as an internal tool for
structuring and streamlining the venture’s activities. Furthermore, it is the most important tool to
communicate to externals what the company is all about. It is a mandatory document that needs to be in
shape when communicating to potential investors and partners. They are the most commonly the target
audience of a venture’s business plan.

LET’S DISCUSS

Duration
Chapter 6: Opportunity or Idea: Using Business plan to determine when Business Opportunity Exists [3
Hours]

6.1 WHAT IS A BUSINESS PLAN?

The purpose of a business plan

is not only used for internal business
operation but also getting creditors. A
business plan is just not a phrase with
only two words it is the vision of your
life and a plain pathway to journey
where you would like to reach. Think
about, Bil Gates, Steve Jobs, or Mark

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Zuckerberg, what are the silver stone to achieve their target, nothing a plan and an idea to enrich
himself in an invincible position.
https://www.coverwallet.com/business-tips/business-plan-for-
small-business

A business plan is the combination of some comprehensive action schedules and innovative
ideas with the practical phenomenon to establish a self-oriented business or a corporate business.
It is the meaning of "What is a business plan". After understanding the concept of a business
plan, we must know the purpose of a business plan- Without knowing the purpose, the plan
becomes worthless.

It generally includes the followings:

 The company
 Marketing plan
 Product and service plan
 Market penetration and sales plan
 Management and organization plan
 Management system and control plan
 Financial plan
 Growth plan
 Investors highlights

6.2 PURPOSE OF A BUSINESS PLAN

The objectives and targets of a business plan are very straightforward and goal oriented.
The main purpose of a business plan is to guide the entrepreneur from where he should start and
where he must reach.
The purpose of preparing a business plan is to determine the chronological action plan to
start a business. The business plan helps to identify the opportunity, threats, strength, and
weakness of the organization.

The entrepreneur will easily

know the product details, market
details, contingency plan, competition
strategy, a source of financing, and the
management mechanism after the
launching product to the market.

https://www.thebusinessplanshop.com/blog/en/
entry/business_plan_outline

Writing down a business plan helps

you explain your views and form the
steps you need to take to be effective in
your business. There are a number of pieces that all have to come together to make your business
lucrative.
A business plan ensures that you won't skip any important steps that could ruin your
labors down the line. Be specific, Use assesses able milestones, accountable duties, and

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trackball performance opportunities, for a beginner. A business plan is clearly predicted the
big picture and identify potential problems before you make errors.

The other objectives of a business plan are:

 To start-up business, the start-up plan discovers cost estimation of a possible idea. It
identifies preliminary cost items and their management. This plan signifies sunk costs
which are irrecoverable.
 To flourish an idea of financing, i.e., sources of fund, cost of fund, and how to utilize the
fund effectively.
 To provide an idea about the breakeven point of your sales target and estimate of return
at the end of the point.
 To express details idea about the control systems and control mechanism about the
business.
 To give an idea about the growth plan or corporate plan for the organization.
 To guide day to day operating activities business plan plays a vital role.
 To compare the periodical performance of a company such plan is crucial.
 To get a government license, it helps the authority to give permission.
 To measure management efficacy, it is considered as a valuable evident.

6.3 STEPS OF MAKING A BUSINESS PLAN

A business plan is not a work by time. It is a systematic and chronological work. To make a successful
business plan following steps should be followed.

 Set a specific goal of your business

 Find out the major and non-major
activity of your business
 Select the key personnel of the
organization
 Elucidate the core products of your
business
 Make an extensive analysis of the
financing
 Prepare a contingency plan and
 Finally, write a business plan

https://pestleanalysis.com/creating-effective-business-plans/

6.4 THE IMPORTANCE OF BUSINESS PLAN

The importance of the business plan will not end with few words. In one word, it is your
success plan. It will help you to determine the main objective of your business. The business
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plan provides you with an extensive idea about business, success and your victory. The
successful business plan is the better half of your business. So, before starting, you should have
to make a complete and integrated business plan. Otherwise, your capital, your thoughts, your
idea, and your dream will be turned into an impracticable dream.

6.5 TEMPLATE OF BUSINESS PLAN

In a sample business plan template, the following elements include:

 Executive Summary
 Introduction a general idea about the business
 The Company Details
 Company Name
 Address
 Slogan Objectives
 Products
 Products and Services
 Name of products
 Products description
 Value proposition
 Management Plan
 Board of Directors
 Executive body
 Employee Staffs
 Market Focus
 Customer
 Customer choice
 Competitors Analysis
 SWOT Analysis
 Strengths
 Weakness
 Opportunities
 Threats
 Financial Plan
 Cost Analysis
 Source of fund
 Breakeven analysis
 Cost of Fund

Conclusion
Making a business plan is making you hope to live. So, it is the guideline of your vision.
A successful business plan will include all aspects like organizational, financial and strategical
approach. The future of a company can be projected by understanding the concept of a business
plan and its purposes. The template of the business plan should be designed to create a business
plan. As we mentioned earlier the steps of a business plan which is a guide to stick to the
pathway. You can generate an idea from business plan examples. So, let's start and go for
victory.

Date Developed: February 2023 Document No.

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Name: __________________________________ Date Submitted:
____________
Curr. Year and Sec.: _______________ Score: _______

Activity

TEST 1| Directions: This handout gives some reasons why every entrepreneur needs a business plan.
After reading the answer to the question, complete the exercise below.

Question. What is business plan and why do I need one?

Answer. A business plan is an invaluable tool for any businessperson or would-be businessperson. it is
a written document, which precisely defines your business. It identifies your goals and serves as your
firm's resume. It helps you allocate resources properly, handle unforeseen complications, and make the
right decisions. Because it provides specific and organized information about your company and how you
will repay borrowed money, a good business plan is a crucial part of any loan package.
A business plan lays out what the business will produce and explains how it will be produced and who
will be the consumers of the product/service the business is producing. Furthermore. it addresses who
will operate the business and who will supply the products/services required to run the business. Such a
plan also describes how the firm will attract new customers and retain previous customers. Finally, the
business plan contains statements that attest to the financial health of the company.
In short, a person in business without a business plan is lost.

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 STATEMENT FACT OPINION NOT SURE
1. A business plan is an invaluable tool
for any businessperson or would-be
businessperson.
2. A business plan lays out what the
business will produce and explains
how it will be produced and who will
be the consumers of the
product/service the business is
producing.
3. Finally, the business plan contains
statements that attest to the financial
health of the company.
4. In short, a person in business without
a business plan is lost.

Answer the following:

1. What do you learn about business plans from this handout?
2. In your own words, what are some of the reasons stated in the Q and A supporting the need for a
business plan?

TEST 2| Directions: A business plan has three primary purposes: 1) To serve as an Action Plan; 2) To
serve as a Road Map; and 3) To serve as a Sales Tool. Each of the three paragraphs below describes one
of the major purposes. Find the one sentence in each of the three paragraphs than contains the major idea
of that paragraph and underline that sentence.

PURPOSE OF A BUSINESS PLAN

Action Plan. A business plan can help to move you to action. You may have been thinking for years
about starting a business or engaging in some venture, but the process may seem too daunting, too large,
and too complicated. A business plan will help you to pull apart the pieces of starting a business and
examine each piece by itself. So instead of one large problem, you have a sequence of smaller problems.
And by solving the small problems, the large problem is automatically solved. So writing a business plan
can help to move you to action by breaking down a seemingly insurmountable task (starting a business)
into many smaller, less intimidating tasks.
Road Map. Once you have started your business, a business plan can be an Invaluable tool to help keep
you on track and moving in the direction you want go. In the rush of daily business, it very easy to lose
sight of your objectives and goals—a business plan can help to keep you focused. A business plan can
also serve to help others to understand your vision, including suppliers, customers, employees, friends,
and family.
Sales Tool. Finally, a business plan can serve as a sales tool. You will probably need outside financing to
start your business and a business plan is the tool you need to convince investors to come on board. You
may also want and need concessions from suppliers or customers - a business plan can help you get them.

Date Developed: February 2023 Document No.

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Finally, you may need to convince family members, or even yourself, that your ideas will bear fruit. A
well written business plan can serve to sell people close to you on the benefits of proceeding with your
concept.

Answer the following:

1. What is this handout about?
2. What does the author mean when he says "A business plan can help to move you to action"?
3. What does the author mean when he says "A business plan can be an invaluable tool to help keep
you on track and moving in the direction you want to go"?
4. What does the author mean when he says "A business plan is the tool you need to convince
investors to come on board"?
5. Which is the most essential purpose for writing a business plan: its use as an action plan, road
map, or sales tool? Defend your answer.

Date Developed: February 2023 Document No.

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Assessment
Each question will be graded based on these five (5) points rubrics.

LEVEL DESCRIPTION

Well written and very organized.

Excellent grammar mechanics.
5 - Outstanding Clear and concise statements.
Excellent effort and presentation with detail.
Demonstrates a thorough understanding of the topic.

Writes fairly clear.

Good grammar mechanics.
4 - Good
Good presentation and organization.
Sufficient effort and detail.

Minimal effort.
Minimal grammar mechanics.
3 - Fair
Fair presentation.
Few supporting details

Somewhat unclear.
Shows little effort.
2 - Poor Poor grammar mechanics.
Confusing and choppy, incomplete sentences.
No organization of thoughts.

Very poor grammar mechanics.

Very unclear.
1 - Very Poor
Does not address topic.
Limited attempt.

Date Developed: February 2023 Document No.

TEC 9 Date Revised: -
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 Date Developed: February 2023 Document No.
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