BM1911

THE BUSINESS PLAN

The Need for a Business Plan

Technopreneurs are well aware of the risks involved in their business. They thought about these risks way
before operating the enterprise. Even if the enterprise is already operating, hassles and problems can still
occur. It can be manageable if the problems occur one at a time, but there are times that it happen
simultaneously. In order to avoid any mishaps in the course of the business, a technopreneur must
formulate an effective business plan.

According to Medina (2014), planning may be seen as a systematic approach to attain certain objectives,
and it attempts to eliminate errors due to on-the-spot decisions. Business planning gives the
technopreneur ample amount of time to consider relevant factors and risks that will and may affect the
business before a decision has to be made.

In definition, a business plan is a document that helps a technopreneur know what resources are needed
to attain the objectives of the enterprise (Morato, 2017). Moreover, business plans are made to keep the
enterprise on the right track. A business plan is written for two (2) main purposes:
1. To serve as a guidance during the lifetime of the enterprise; and
2. To achieve the requirements in acquiring investors.

Parts of the Business Plan

Business plans differ from one enterprise to another. Usually, they contain the following:
I. Title Page
a. It must contain the following information: business name; business address; contact
information of the business (telephone number/mobile number/e-mail address/website);
name(s) of business proponent(s), and date of output submission.
b. The required information must be presented based on the order provided above, vertically
from the top down to the bottom of the cover page.
II. Table of Contents
a. It must present the list of section titles of the business plan together with their
corresponding page numbers.
III. Executive Summary
a. It summarizes the plan and states the objectives of the business.
b. This part must also present the amount of initial capital investment and the sources of
capital for the proposed business. If in case the technopreneur will borrow money from a
bank, another business, or person, the manner of amortization payment with
corresponding interests must be clearly presented.
IV. Background of the Business Venture
a. It must include a brief description of the company, highlighting the reason why the
proponents choose to undertake the business venture.
b. This section must also include the mission and vision statements of the proposed
business.

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c. This part also describes the product or service the business offers and relays to the
readers its edge over its competitors.
d. It must highlight the following information: important features of the product or service;
detailed description on how to use the product or how the service will be given/delivered;
and the uniqueness or competitive advantage of the product or service.
V. Marketing Strategies and Industry Analysis
a. This part must present a brief description of the industry where the proposed business
belongs to. It must also include an explanation of the current size, growth potential, and
the existing distribution channels in the given industry.
b. It must also present the industry analysis tool used to analyze the competition (SWOT,
TOWS, and PESTEL analysis).
c. It must also present in detail the following information: target market profile; pricing;
market penetration; and advertising and promotion.
VI. Management and Organizational Plan
a. It must include in detail the following information: business location, start-up needs, and
product development flow.
b. This part must also present if the enterprise came from a new idea or an improvement of
an existing idea. The ownership status of the enterprise should also be written whether if
it is a sole proprietorship, partnership, corporation, or cooperative.
c. This part must also include the management team of the proposed business. It must
present in detail the managers, supervisors, and workers required to execute the
activities of the proposed business. It must also provide a brief description of duties and
responsibilities for each identified role.
d. It must also present an organizational chart or a representation of the organizational
structure, which identifies the relationships of the positions or jobs within it.
VII. Financial Plan
a. This section projects how the enterprise is expected to perform financially over the next
couple of years. The financial projections must cover at least five (5) years from the
proposed start of the business.
b. It must include an income statement showing the projected income, expenses, and profits
of the business. Also, it must include a balance sheet reflecting the financial status of the
business entity. Competitor’s financial statements can be used as a benchmark for the
projected financial statements.
VIII. Auxiliary Documents
a. This section gives specific information that certain individuals (such as creditors and even
investors) may want to review, such as technopreneurs' resume.
IX. Bibliography
a. This section must present all the references used in accomplishing the business plan. The
entire paper must follow the official style of writing of the American Psychological
Association (APA).
Refer to this link for APA style guidelines:
https://owl.purdue.edu/owl/research_and_citation/apa_style/apa_formatting_and_styl
e_guide/general_format.html

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Business Model Canvas

The business model canvas is a structured version of a business plan. It is often used by start-up
businesses like technopreneurial enterprises. It is a visual chart developed by Alexander Osterwalder,
with areas describing a business entity's value proposition or the belief of a client or customer about
how value will be delivered, felt, and attained. It also describes the business' infrastructure, customers,
and state of finances. The following are the nine (9) "building blocks" of the business model canvas
(Vermeulen, 2018).

1. Key partners – This area discusses the alliances or partnerships made by the enterprise. This
is beneficial if the enterprise has competition.
2. Key activities – This section includes the prime activities of the enterprise, which are the basis
of the value proposition.
3. Key resources – This area dictates what the company needs to operate. This can be categorized
as physical, intellectual, money, or workforce.
4. Value propositions – This section is about the core of the enterprise, its promise to the
customers. It includes how customer's needs could be met. When the organization knows what
the added value for the customer is, a great relationship may be developed with existing
customers, which may be helpful in the scouting of new customers.
5. Customer relationships – This area details the enterprise's relationship to its customers and
clients. This section also divides the customer's into groups to address different customer
needs.
6. Channels – This section is a way to introduce the products or service to partners and
customers. It has five (5) stages: awareness of the product, purchase, delivery, evaluation and
satisfaction, and after sales.
7. Customer segments – This area details how customers are divided or grouped into segments.
The purpose of which is to identify their specific needs and give them what they really need to
heighten customer satisfaction.
8. Cost structure – This includes the costs incurred by the business such as product cost, labor
cost, raw materials, etc.
9. Revenue streams – This section details how the enterprise will make profit from the customer
segments. It gives the enterprise an insight on how much profit it could generate for it to break
even. Source of revenue can be through the sale of goods or provision of services.

Note: The business model canvas could be placed right after the Table of Contents or can be
included in the Executive Summary.

Business Types
Siquete (2016) identified the following three (3) major business types:
1. Sole Proprietorship - This is a type of business that is owned and managed by one (1) person. It
usually employs a few employees and does not have that too much business transactions.
Financial records for this type of business are not that complicated. This type of business falls
under the small to medium enterprises (SMEs) and enjoys some exception for legal and tax cuts.
2. Partnership - This is operated by two (2) or more people, who are experts in the skill where their
enterprise is categorized. There are two (2) types of partnership: general and limited.

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a. General partnership – The partners here manage the enterprise and assume the responsibility
for the partnership's liability, debt, and other obligations.
b. Limited partnership – This includes a general partner who accomplishes the business and has
unlimited personal liability for the debts and obligations of the partnership and a limited
partner who has limited liability and cannot participate in managing the enterprise.

3. Corporation – This is a business entity that is owned by shareholders who elect a board of
directors to supervise the enterprise’s activities. A corporation can be profit-oriented like food
and manufacturing companies, telecommunications, oil and gas companies, and labor services
like maintenance providers, or non-profited oriented like non-government organizations or
charity institutions.

References
Balachandran, B. V. (2018, May 03). The next big thing in the start-up ecosystem - technopreneurship.
Retrieved February 13, 2019, from https://www.entrepreneur.com/article/312888
Medina, R. (2014). Entrepreneurship and small business management. Quezon City: Rex Bookstore.
Morato, E. A. (2017). Entrepreneurship. Quezon City, Philippines: Rex Printing Company.
Siquete, C. V. (2016). Business ethics and social responsibility: A textbook for senior high school K to 12
curriculum compliant. Intramuros, Manila: Mindshapers Co., Inc.
Vermeulen, F. (2018, January 12). The first step of business model innovation: Focus. Retrieved February
28, 2019, from https://www.forbes.com/sites/freekvermeulen/2018/01/11/the-first-step-of-
business-model-innovation-focus/#668bc8935022

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