You have an idea for a business venture and you are convinced that it will be a hit and will earn a lot. Well, that is what you think but do others think about it the same way? This is why you need to learn more about your target customers through writing a business plan. How do you write a business plan for a business in the Philippines? Read on…
There is no such thing as an all-purpose business plan and copy pasting content online would not help you either. You should write your business plan according to the unique factors and conditions of your enterprise.
What the main components of a business plan?
- Marketing Plan
- Technical Plan
- Organizational Plan
- Financial Plan
- Profitability Plan
Business Plan Introduction
A good introduction states the goal for the business plan and how you plan to achieve these goals. Writing the introduction will depend on whether you are an existing business or a new business.
For a new business explain what the business will be, how the idea for your business was conceived and how the business is expected to develop.
For an existing business you need to provide your business name, date and place of registration, date when operations began, brief history of the business, names of owners, and partners or major investors.
Business Plan’s Marketing Plan
- What are your products or services? Tell everyone what you intend to provide or sell in your business and why people would patronize them. Tell them what’s unique about the product or service that you are providing.
- Who is your market? Which segment of the market do you want to sell? State here your target clients and why you are targeting them. Do not be very broad even if you are targeting the general public specify which you think are the sectors that specifically would be targeted by your product or service.
- Who are your competitors? In today’s business not knowing your competitors and the competition landscape is like swimming into an ocean full of sharks without wearing the tools to survive. Identify your competitors and describe them in terms of their size, profitability, market share, business standing whether they are profiting or not, quality of products or services, pricing strategy, warranties, packaging, methods of selling, channels of distribution, credit terms, location, advertising/promotion, reputation, and inventory levels.
- What will be your pricing policy? What will be the price for your products and services after considering various factors like competition, cost of goods or services sold and other considerations.
- What will be your marketing method? In this section you should include how you intent to reach out to your target market like promotion and advertising, your channels of distribution, method of selling, and branding. This is very important since it is a major foundation for your business.
Business Plan’s Technical (Production) Plan
In this section you need to include the materials requirements that you will be needing to produce your product or to create a very good service for your business. Where will you get the materials and how much the cost would be.
Besides the material requirements you also need to include the equipment that you will be needing, it’s cost and why it is needed for the business. If you are manufacturing a product, you need to provide the production process at each step so that it would be easier for you to picture it. If it is a complex process include a diagram.
You might want to consider business solutions like hardware and software requirements for your business and for that you can visit www.mseedsystems.com.
Business Plan’s Financial Plan
You have a good business idea, you planned how to market it and you know how to deliver it to your target clients but how much would it cost and how much do you need to make it happen?
Fixed capital includes cost of land and building or lease deposits on them; cost of improving the land or renovating the building; furniture, furnishings and fixtures; and machinery and equipment. These are usually very rare recurring expenses and usually recurs after a long period of time.
Working capital is your start up fund to make the business run well until you can earn enough income to make it self sufficient. Your Return On Investment (ROI) depends on your cost of operation and usually takes one to six months or even longer. Working capital is needed to purchase usual daily and monthly expenses like supplies, wages and salaries, and utility bills among others.
Pre-operating capital meanwhile includes the money you spend for business registration, licensing or franchise fees, payment for a consultant or lawyer if applicable and others. This is all your the expenses you will incur before your business officially opens.
After laying out all your capital requirements you need to prepare a budget. Create a budget in a way to show your expenses during the first 6-12 months of your business from pre-operation to operation phase. Include all the costs that you will incur including purchase of equipment, renovation and the usual daily and monthly expenses.
Business Plan’s Profitability Plan
Not all business plan’s include a profitability plan. In fact I added this section myself. Why? Imagine that you presented all your plans but one question remains, how would your business earn and how profitable would it be.
In this section you need to present a projection of the following either within a 6 month or 1 year period. You might need some help from someone who knows accounting with this:
- Cash Flow – create a sample projected monthly cash flow based on projected income per day. A cash flow includes both the cash receipts and the expenses that you have to pay.
- Income Statement – based on the cash flow create an income statement projection. Your income statement should include your total gross sales less the cost of the goods and services you sold less any other expenses including taxes.
- Balance Sheet – a balance sheet contains all your assets, your liabilities and your capital. This will show how your capital will improve throughout the projected period and how you will also raise your capital either through income or through borrowings.
Now you are ready to write your business plan and start your business in the Philippines. If you have any questions you can contact us via Facebook/bizh2o or Twitter/bizh2o. If you need business solutions to support your business like software and hardware you can visit www.mseedsystems.com.
Reference: “Do You Want To Go Into Business?”, SME Roving Academy Gabay-negosyo sa pag-asenso. Bureau of Micro, Small and Medium Enterprise Development (BMSMED), Department of Trade and Industry.