Business Plan Preparation Introduction

1
Business Plan PreparationIntroduction

• Frank MoyesLeeds School of BusinessUniversity
  of ColoradoBoulder, Colorado

2
Tonights Agenda

• Choosing a good opportunity
• Discuss concepts
• Resume was due before class

3
Concept Team Selection Process

• Conduct Idea Exercise (download from website)
  (http//leeds-faculty.colorado.edu/moyes/html/reso
  urses/Idea20Exercise.pdf)
• Email resume to instructor before Sept 6 as Word
  attachment (must have your name Resume on file
  name)
• Discuss your concept in class Sept 6 (use Concept
  Summary as a framework for explaining your
  concept)

4
Concept Team Selection Process (continued)

• Email Concept Summary as a Word attachment to
  instructor by 100pm on Sept 8 (Friday) (must
  have your name Concept name in file name)
• Instructor to email all students which concepts
  with the greatest potential that have been
  selected on Sept 11 (Monday)
• Students whose idea are selected will form a
  teams of 4 on Sept 13 in class

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Next Week

• Framework for writing a business plan
• Read Writing a Successful Business Plan from my
  website
• Market research Gene Hayworth, Leeds School
  Librarian. Session in lab.
• Importance of validation
• Interviews and Call Reports

6
Good Opportunity
0

• Market is strong accessible
• Compelling need
• Sustainable competitive advantage
• Unique/different
• High margins
• Management

7
Market Demand Is Strong
0

• Favorable trends
• Growing market
• Size is big enough to be worth the effort
• Market share attainable
• Favorable window of opportunity

• Venture Capital Perspective
• 30 per year
• 100 million to 1 billion potential
• Minimum 20

8
Market Is Accessible

• Market Structure
• Fragmented
• No dominant player
• SOTs (slow, old or traditional)
• Response of competitors to new entrants is
  indifferent
• No proprietary barriers to entry
• Access to channels is possible
• Forgiving of mistakes

9
Compelling Need
0

• Solves a problem
• Unfulfilled niche
• Dissatisfaction with current products/services
• Poor quality or service
• Needs
• Physical Physiological
• Emotional Social
• Financial Intellectual

10
Competitive Advantage
0

• Understand the market
• Understand the competition
• Sustainable
• Innovation
• Differentiation
• Resources capabilities
• Really understand the market competition

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Strong Competitive Advantages

• Intellectual property
• Agreements with customers or suppliers
• Long term contracts

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Competitive Advantages That Are Often Questionable

• First to market
• Highest quality
• Best service
• Lowest cost or overhead
• Patent protection

13
Unique/Different
0

• You must differentiate your business its
  already being done by someone
• More than unique product/service design
• Marketing positioning
• Operations process or value chain
• Channels create a new channel
• Benefits

14
High Margins

• Mind-set of high low margin thinking
• Advantages of high gross profit margins
• Funding
• Cash flow
• Development marketing
• Can solve the screw-up problem

15
Management

• Meets your personal interests objectives
• Takes advantage of your experience
• Would your potential customers buy from you?
• You can put a management team together
• You are passionate and commit

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Concept Description

• Brief description
• Why is there an opportunity/need?
• What is the product/service? How will it be
  produced or delivered?
• Who is the target market?
• What are the unique benefits?
• Who is the competition? What advantages do you
  have over the competition?
• Profitability
• Revenue model
• Contribution margins