Business Plan

1
Business Plan

• Key Contents
• Business Description
• What is the Business?
• Why will it succeed?
• Marketing Plan
• How do we do it?
• Customers, Competition, Advertising, Pricing

2
Business Plan

• Business Description
• Define the business
• Product or Service?
• physical? digital?
• New idea / competes with existing?
• New Business / Expand Existing Business?
• Basis for profitability
• Community Leverage
• Switching Costs
• Other

3
Business Plan

• Community Leverage
• Define the community
• Data that show size and characteristics of this
  market segment
• Need
• Convince me that this community has not been
  served
• Survey of existing services
• Answering the need
• Convince me that your business can do something
  new for this community
• Examples of other E-Commerce along similar lines
• Why is Internet a key part of the solution?

4
Business Plan

• Switching Costs
• Define the community
• Data that show size and characteristics of this
  market segment
• Need (artificial)
• How you will create need
• Examples of other E-Commerce businesses that
  created need along similar lines
• Analysis of switching costs
• How much switching cost to alternative vendor
  (customer cost vendor cost)?
• How much will it cost you to bring new customers?
• Compare with revenue you get from customer
• Why is Internet a key part of the solution?

5
Business Plan

• Other
• What is the target customer population?
• Data that show size and characteristics of this
  market segment
• Need
• Show need exists
• Survey of existing products/services
• Answering the need
• Convince me that your business can answer the
  need
• Examples of other E-Commerce along similar lines
• Why is Internet a key part of the solution?

6
Business Plan

• Marketing Plan
• Refine all elements in Business Description
• Goal
• Focus on a specific niche become expert in one
  are
• Dont try to do too much
• Summarize the Marketing Plan with Opportunity
  Framing charts
• What aspect of business is shown in demo?

7
Marketing Plan (contd)

• Customers
• More specific and detailed than previous section
• Business Description defines market segment where
  the idea will work
• You may target only one sub-segment of this
  population, e.g. segment for which
• you have expertise
• you can get resources at low cost
• you have a channel to advertise

8
Marketing Plan (contd)

• Competition
• Survey of businesses that provide similar
  product/service
• Find all major businesses that offer same
  product/service
• If none, find all major businesses that offer
  closest relative
• Identify whats missing in each of the major
  groups of competition
• Why they arent serving the need

9
Marketing Plan (contd)

• Pricing
• Physical
• Data that shows what similar products/services
  cost
• Digital
• What do you charge for?
• What do you give free?
• Why will customers be willing to pay for the part
  thats not free?
• How much will they pay for it? (Your price model)

10
Marketing Plan (contd)

• Summarize the Marketing Plan with Opportunity
  Framing charts
• Similar to Schwab Opportunity Framing shown in
  class
• Choose which charts are relevant
• May be used to summarize Customers, Competition,
  Pricing

11
Marketing Plan (contd)

• Advertising
• This doesnt just mean placing ads
• It means how will customers find out about your
  service/product
• Where will you place ads? (locations that are
  visited often by your customer population)
• Will you give samples away free on the internet?
• Why will customers want to pay for more?
• Advertising outside the Internet
• Partner businesses that can refer customers to
  you
• Deals you make with partners to encourage
  referals
• What will your ads emphasize? What is your
  message?

12
Executive Summary

• Short
• 1 2 pages
• Start with brief (1-2 paragraphs) description of
  opportunity
• Emphasize web aspect
• Summarizes all previous sections
• Write exec summary last

13
Bibliography

• All items with asterisk () require
  documentation, referenced in Bibliography
• Main resource is Internet
• Reference Includes (some may not apply)
• URL
• Name of news agency or periodical
• Issue Id (e.g. vol. / no.)
• Date
• Author
• References should be recent (check last updated)