Page 104 - DMGT310_ENTREPRENEURSHIP_AND_SMALL_BUSINESS_MANAGEMENT

Unit 7: Building the Business Plan

company), what would be the form of ownership (whether it would be a single proprietor, Notes
partnership, cooperative society or a company under company law). It would also label
the address of the proposed headquarters.
V Funding Requirement: Since the investors and financial institutions are one of the key
bodies examining the project report and it is one of the primary objectives of preparing
the project report, a careful, well-planned funding requirement should be documented. It
is also necessary to project how these requirements would be fulfilled. Debt equity ratio
should be prepared, which can give an indication about how much finance would the
company require and how it would like to fund the project.

VI The Product or Services: A brief description of product/services is given in this subsection.
It includes the key features of the product, the product range that would be provided to the
customers and the advantages that the product holds over and above the similar products/
substitute products available in the market. It also gives details about the patents,
trademarks, copyrights, franchises, and licensing agreements.
VII The Plan: Now the functional plans for marketing, finance, human resources and operations
are to be drawn.

1. Marketing Plan: Marketing mix strategies are to be drawn, based on the market
research. The market research will provide information about the following
parameters: (i) Market demography like profiles of customers and end-users;
preferences and needs of the customers (ii) Strengths and weaknesses of competitors
(iii) SWOT analysis of the market.
A thorough market research is the backbone of success and failure of any product in
the market. Based on the information collected through market research, marketing
mix strategies for product/services, price, promotion and distribution are presented
meticulously and reasons are displayed in relation to why the targeted market is so
attractive. How can the market provide gains to the organization? What marketing
strategies would ultimately lead to the success of the organization? The budgets for
the marketing plan are drawn at the end.
2. Operational Plan: The operational plan would give information about (i) Plant location:
why was a particular location chosen? Is it in the vicinity of the market, suppliers,
labour or does it have an advantage of government subsidies for that particular
location or are there any other specific reasons for choosing the particular location?,
(ii) Plant layout is also at times mentioned in the project report to provide a pattern
of arrangement of the organization and would indicate the exhaustive planning for
the business, (iii) Plan for material requirements, inventory management and quality
control are also drawn for identifying further costs and intricacies of the business.
Finally, the budget for operational plan is also drawn.
3. Organizational Plan: The organizational plan indicates the pattern of flow of
responsibilities and duties amongst people in the organization, it provides details
about the board of directors, it can also enlist the manpower plan that would be
required to put life into the company and it would also enlist the details about the
laws that would be governed in managing the employees of the organization. In the
end the organizational plan is also budgeted.
4. Financial Plan: The financial plan is usually drawn for two to five years for an existing
company. A summary of previous financial data is given, whereas for a new
organization the following projections are drawn:
(a) Projected Sales

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