INSTITUTE OF ACCOUNTANCY

ARUSHA (IAA)

DEPARTMENT: BUSINESS MANAGEMENT

MODULE: FUNDAMENTAL OF ENTREPRENEURSHIP
LECTURER: MR. MADABA, R
BUSINESS PLANNING
Developing
a Business
plan
By MR. Madaba, R
 CONTENTS

 What is a business
plan
 Benefits of a business
plan
 Who needs a business
plan
 Business plan structure
 What is a business plan?

 This is the written document that describes the

objectives of the proposed business venture and the
steps necessary to achieve those objectives.
 It describes the current status, expected needs, and
projected results of the new business.
 It is the short narrative document which tells what the
business is all about.
 Benefits of a business plan

 Business plan sets the direction for the business and

keeps it on track once it's up and running.
 It helps in learning about the industry, set specific
goals for the product or service, allocating
timeframes for achieving the set goals, maximize
use of available resources and gives a competitive
edge.
 Helps in securing finance for the business.
 cont..

 Assists in daily monitoring of the business

 Increase opportunity for success
 Minimize risk of failure
 Provide measurable bench mark for comparing
forecast and actual sales.
 Remember, “failing to plan is planning to fail”
 Who needs a business plan

 The entrepreneur
 Management team
 Shareholders
 Bankers, creditors and
other financiers
 Customers
 Employees
 Business plan structure
 Cover page
 Executive summary
 Business description
 Resources needed
 Management plan
 Environment and market
analysis
 cont..

 Competitors analysis
 Marketing plan
 Financial information
 Appendix
 COVER PAGE

 This is the front page of a given business plan.

 It includes business name, company name, name/s of
key people and contact information.
 It needs to look smart, keeping in mind that first
impression matters most.
 EXECUTIVE SUMMARY

 Brief summary of the key points contained in the

business plan.
 It must include the most important information in
each section of the plan.
 It is written in such a way that persuade a reader
that this business will be successful.
 cont..

 It is usually written after the rest of the plan is

completed.
 BUSINESS DESCRIPTION

 This is the explanation of what the business idea is

all about.
 In this area the reader expects to see the following:
o Background information
o Problem to be solved
o Service or product offered
o Uniqueness of the idea
 cont..
 Where do business ideas come from?
o Improving existing product or service (value
addition)
o Solving an existing problem
o Market research
o Brainstorming
o Customer feedback
 cont..

o Imitation
o Passion and personal interests
o Personal experiences
o Inspired by nature
o Inspired by history
o Watching trends
 cont..

o Exposure:
 reading,
 attending conferences and events,
 attending exhibitions,
 listening to experiences shared by entrepreneurs
 etc.
 cont..

 Business ideas need to be

smart
o Specific - Well defined
and focused
o Measurable - Have
measurable Outcomes
 cont..

o Attainable - Attainable and not impossible to

achieve
o Relevant - Achievable business goals are based on
the current conditions and realities of the business
climate. Within reach, realistic, and relevant
o Time-based - Targets and timeline set and progress
monitored
 RESOURCES NEEDED

 Both financial and non financial resources are needed

in the execution of a business plan.
 Plan for resources may include the following:
o Financial resources (amount and source)
o Non financial resources
o Human resources
o Other resources
 ENVIRONMENT AND MARKET ANALYSIS

 The goal of this process is to

collect and analyze an amount
of information to determine
whether there is enough of
needs/wants for the
products/services to support a
viable business idea and allow
it to grow.
 cont..

 Also show whether the environment is supportive

of the business idea.
 SWOC (Strength, Weakness, Opportunities and
Challenges) and PESTEL (Political, Economic,
Social, Technological, Environmental, and Legal )
analysis will be conducted.
 COMPETITORS ANALYSIS

 A competitor analysis, also

referred to as a competitive
analysis, is the process of
identifying competitors in the
industry and researching their
different marketing strategies.
 cont..

 This information can be used as a

point of comparison to identify
company’s strengths and weaknesses
relative to each competitor.
 Who is your competitor(s)
 How do they organized: Individually
or as a group
 cont..

 What is your position against your competitors:

o Strengths
o Weakness
 MANAGEMENT PLAN
 For a business idea to be successful it needs to be
well managed.
 In this part of the plan the following components are
expected to be seen
o Organization structure
o Mission and vision
 cont..

 The expected management plan should reflect the

realistic position of the business.
 Any type of organization structure is acceptable eg
functional, divisional, etc.
 MARKETING PLAN

 A marketing plan is a roadmap

that helps to set goals,
understand the target audience
and optimize the impact of the
marketing campaigns.
 cont..

 Marketing plan should show:

o Market segmentation
o Target market
o Market positioning
o Marketing tools
o Company branding strategy
(including company logo)
 cont..

o Key marketing message

o Distribution system/ channel
 Market segmentation
o This is the process of dividing a target market into
smaller, more defined categories. It segments
customers into groups that share similar
characteristics such as demographics, interests,
priorities, personal traits, needs, or location.
cont..
 cont..
 Target market
o Target market is a cluster of
potential customers to
whom a business needs to
sell products or services.
o Target market is a part of
the selected market
segment.
 cont..

 Market positioning
o This is a strategic exercise used to
establish the image of a brand or
product in a consumer’s mind.
o It is achieved through the four Ps:
promotion, price, place, and product.
 cont..

 Marketing tools
o These are tools that
companies use to develop
and promote their
products and services. In
this context, the word
‘tools‘ refers to
techniques, strategies, and
materials.
 cont..

o It is important to know which tools are best for your

business. In other words, which tools do you need
to achieve your primary goals and objectives.
o In most cases, people use multiple marketing tools at
the same time.
o Some of popular marketing tools: Television, Radio,
Newspapers, Print ads, Magazine, etc.
 cont..

o Publicities: Endorsements – use of celebrities

o Testimonials – customer reviews
o Public relations plans eg networking events
o Digital marketing
 FINANCIAL PLAN

 This defines:
o How much is needed to make the plan practical.
o Financial plans need to be realistic and specific.
 cont..

 Required fund: amount

and sources
 Expenditure plan
 Profitability plan
 Financial projections
 Key assumptions
 INDIVIDUAL ASSIGNMEN

Question
 Select the company name  The assignment should
and product of your be typed.
choice and prepare a  Submission deadline:
business plan. Second week of June,
2023.