Download Chapter 4

Creating an E-Business Plan
Chapter 4
E-Business Plan Organization
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Used to seek funding for a new or existing ebusiness
Serves as a “Blueprint” for operations after
the business is founded
Develop a plan, taking time, effort, and
thought
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View is critical, objective, & unemotional
Sources of help for the e-entrepreneur
3 to 5 year outlook
Business Plan Help Sources
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Small Business Administration (SBA)
Service Corps of Retired Executives
(SCORE)
Small Business Advancement National
Center (UC Arkansas)
Commercial Sources, i.e., BizPlanit.com,
bplans.com
Small Business Administration
Startup Help
Elements of a Plan
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Coversheet
TOC
Executive summary
Description of idea
Information about products or services
offered
Elements of a Plan (cont’d)
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Industry analysis, target market, &
competition
Operating, marketing, financial and
management plans
Identification of critical risks
Exit strategy
Cover Sheet and Title Page
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Identifies the name of the business and
author
May identify the addressee of proposal
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Hints:
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# each copy
Keep list of who has a copy
Clearly mark confidential & no coping allowed
Table of Contents
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Lists all sections and subsections by page
number.
Must be well organized and accurate.
Can come at the beginning or the end of the
process
Common mistakes:
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Missing sections/sub-sections
Too much detail
Sloppy layout
Incorrect page numbering
Executive Summary
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An overall view of the entire plan
May be used to screen plans by bankers and
investors
Should highlight key points including the idea,
the competitive situation, the financials and
the “players”
May be easier to write after the plan is
complete
Similar to what other type of document you
should be or will be familiar with?
Vision and Mission Statements
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An overall statement of the business's goals
and philosophy
Vision
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Long-term dreams/goals
Should inspire, guide, & encourage people toward
achieving goals
Mission
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Challenging but achievable actions to achieve the
vision
Vision and Mission Statements
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Interchangeable with “goals”, “aims”,
“philosophy” and “direction”
Should consider:
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Define your purpose of the statement
Audience (customers, shareholders, staff,
competitors, government, press, & public)
Who benefits from the statement
Focus on themes (p. 122)
A Vision Statement
A Mission Statement
Business Description
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Provides the reader with an outline of the ebusiness’s background and concept
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P. 124
Products and Services
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A description of each product or service you
plan to offer
Level of detail is important
Enough for the reader to understand and not
be confused
Include high-quality pictures or graphics,
where appropriate
Products vs. Services
Industry Analysis
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An analysis of the business environment
Focus on the basic industry segment
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What are some “industries”?
Info should be based on verifiable data and
market research by:
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Government agencies
Industry trade associations
Qualified studies from reliable organizations
Marketing Plan
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Critical elements of the plan
Target market description
Demographic, geographic, and
psychographic characteristics of market
Competitive analysis
Objectives, tactics, and strategies
Budget and timeframe
Marketing Plan (cont’d)
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Marketing Objectives should be clearly stated,
measurable, and lead to sales
Marketing Strategies describe the features of the
products, services offered, and pricing strategies
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4Ps – product, price, promotion, & place (distribution)
Marketing Budget is an estimate of the costs for all
activities described in the marketing strategies portion of
the plan
Marketing Plan Common Mistakes
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Defining the target market too widely
Not specifically identifying advertising and
promotion activities
Omitting details about when, where, and how
to reach the target market and cost
Operations Plan
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Description of the business:
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Location, equipment needs
Labor needs
Manufacturing
Logistics
Integration of Internet services
GroceryWorks example – p. 131
Financial Plan
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Shows the reader how all the ideas,
concepts and strategies described elsewhere
come together in a profitable (hopefully) way.
The plan should include pro forma:
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Balance sheet
Income statement
Cash flow statement
Financial Plan Common Mistakes
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Failing to include projections
Presenting unrealistic sales and profit
projections
Underestimating
Failure to plan for unexpected costs
Management Plan
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A strong management team is critical as many
investors base their decision on this factor.
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Typically 3-5 people
The plan should list and describe the experience
base and background of the key individuals who will
be involved in the day-to-day operation of the firm.
Board of advisors – outside advisors
The plan should detail those areas that will be
outsourced.
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Typically accountants, attorneys, bankers, insurance agents,
and technology experts.
Issues, Analysis, and
Critical Risks
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Identifies threats or opportunities faced from
outside influences.
These include economic outlook, innovations,
environmental and governmental factors.
Exit Strategies
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How will investors get their money back?
Describe long term plans
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Public Offering (IPO)
Acquisition/merger
Sale to others
Discussion of these issues adds credibility
Legal Forms of Organization
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There are three basic forms of legal organization for
a firm
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Sole Proprietorship
Partnership
Corporation – “C”, “S”, and “LLC”
Complex legal and tax issues are involved; form
chosen is highly contingent on individual
circumstances. Seek counsel from attorney and
accountant.
E-Business Partnerships
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Many e-businesses establish partnerships
with firms in their value chain.
Potential partnerships should be detailed in
the business plan.
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PartsAmerica.com
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