1. Executive summary

Although mentioned and shown at the beginning of a business plan, it can only be completed after all other issues have been addressed.  Objective of the executive summary is to give the reader a short overview of the entire project and by doing so draw his or her attention to the details of the project. The aim of the executive summary is that it can be read and understood within a short period of time.

2. Company

2.1 Company profiles of INVESTOR containing the following

  • present or planned business of company
  • market, product and service areas covered
  • history of the company
  • legal status/form of the company
  • medium- and long-term targets of the company and the new project

2.2 Objectives of the joint venture

  • Long-term company targets (5-10 years)
  • Main factors for success (means what is important to achieve the targets)
  • Strategy to achieve the targets
  • Specialities, means what will be done differently compared with other competitors
  • Important milestones and sub-targets for the project
  • Time schedule in form of a bar chart with all important milestones and sub-targets
  • Future plans (what is next, when project targets are achieved)

3. Products and services

3.1 Advantages for the customers

Explanation and reasons why this products will be superior over other products. Which special advantages will the customers have in buying this product. Consider also eventual disadvantages.

  • Who are the customers?
  • What are the customers expectations in such products?
  • Which function does the product fulfil in this respect?
  • What else is required to meet the customers expectations?
  • Which other partners might be required to match the customers' benefit expectations?
  • Which competing products are already on the market?

3.2 Product development

  • Actual state of technology for such products
  • Innovation of the product
  • Future development plans for the product
  • Which products for which customers
  • Important milestones for future developments
  • Service and maintenance situation for the product
  • Guarantees for the product
  • Strengths and weaknesses of the new product in comparison with competing products
  • Resource demands for successive developments
  • View to future changes of turnover for the product including explanation of reasons why this development may
       be expected.

3.3 Manufacturing

Describe manufacturing process of product. Which machines and facilities with which capacities are required to meet the planned turnover targets. Inform about the expected investment budget for the manufacturing machines. Please answer the following questions:

  • Type of manufacturing process
  • Production capacity
  • Quantity and quality of machines, tools, control instruments and facilities required
  • Quantity of raw material, semi-finished and finished products required for the manufacturing of product
  • Availability of raw materials on your domestic market
  • Parts and services procured from third parties for the manufacturing of product
  • How can manufacturing capacities be increased on short notice if required?
  • Which efforts are required for such capacity increase (time, staff, equipment, cost)?
  • Measures for quality assurance and control
  • If stock is required how shall this be organised?
  • Quantity of staff required and cost structure?
  • Manufacturing costs of product under different production load conditions (e.g. under full capacity load, part capacity load e.g. 75 %, 50 % etc.)?

4. Industrial sectors and market

4.1 Analysis of industrial sectors and market

Overview to which industrial sector the company will belong with a view which major factors can have an influence on this sector in the future. Description of status-quo and - based on this - the expected trends. Describe by what the industrial sector can be influenced, e.g. by technological developments, legal or political changes, raw material availability and how these changes may affect the product.
The following questions need to be answered:

  • Dynamics of development for the respective industrial sector
  • Role of innovation and technological progress
  • Actual trend in this sector (upward, stagnating, downward)
  • Which economical developments have an effect on the respective industrial sector?
  • Influence of legislation and government administration on the respective industrial sector.
  • What influences the economical growth in the respective industrial sector?
  • How fares the competition? Which strategies do the competitors follow?
  • Possible obstacles which may arise when entering the market and ways to overcome them.
  • Profits which are usually achieved in this industrial sector

4.2 Market segments and target customers

Please answer the following questions:

  • How will the market be split up ( geographically, industrial sectors )?
  • Target groups
  • Examples of typical customers
  • Expected sales, turnover and profit for the first 5 years
  • Specific share of sales for the different market segments, now and in future
  • Expected market share, presently and in future
  • Expected profit for the different market segments, now and in future
  • Expected turnover potential of important customers, now and in future
  • How many customers are expected now and in future?
  • On which facts and assumptions are based your aforementioned statements?
  • Present reference customers
  • Influence in purchase decisions of customers
  • Role of sales department and customer service for such purchase decisions
  • The new company will depend to what extent on big customers?

4.3 Competition

Please answer the following questions:

  • Which important competitors offer similar, equivalent products?
  • Which new developments can be expected from these competitors?
  • Who of the competition might be able to use the same business idea?
  • Which market segments are served by the competition?
  • Which market share have got your competitors in the different market segments?
  • How successful and/or profitable are and will be your competitors?
  • What possible strategies may the competitors pursue now and in future?
  • What sales channels are used by the competitors?
  • Comparison of competitors strength and weakness with own company (consider product development, product quality, price, sales, marketing, location)
  • How strong will be own advantage over the competition?
  • Reaction of competitors on improvements of your products and your efficiency.
  • What possible answers do you have on competitor reaction?

5. Marketing

5.1 Market entrance

Descripe step-by-step market entrance and steps to win satisfied reference customers which can become important ”opinion makers”.

Please answer the following questions:

  • Which customer could be important reference customers and why?
  • Draft timetable for steps when new product/company enters market (advertising, symposiums, customer visits, exhibitions, brochures, samples etc.).

5.2 Sales concept

The sales concept determines advertising and sales promotion measures as well as sales channels including the respective cost. Describe the organisation of sales including the requirements to quantity, qualification and motivation of sales personnel. Consider also to what extend the products require technical explanation and which influence this will have on the sales success.
The following questions need to be answered:

  • Which sales price need to be achieved for the different products in different market segments?
  • What is the expected turnover for the different products in different market segments?
  • Description of typical process of product sales.
  • Which sales channels are to be used?
  • Consider possible ways of entering the market, e.g. quick with a low price or rather selective sale with a maximum profit?
  • How much sales staff with which qualification and with which sales tools are planned?
  • Which sales margins must be estimated for the different sales channels and products?
  • How will the share of sales and profits be for the different sale channels?
  • Which market share shall be achieved for which sales channel?

5.3 Sales promotion

How to draw attention of customers onto the new company and products. Select the different types of sales promotion tools such as e.g. phone acquisition, direct acquisition, advertisements, symposiums, press publications, exhibitions etc.

  • How to draw attention to your improved product quality and efficiency?
  • How much time and effort is to be spent to win a new customer?
  • Which sales promotion tools are to be used?
  • What importance is to be put on customer service and hotlines?
  • How difficult will it be to keep a customer long term and what are the costs?
  • What efforts are to be untertaken to keep customers on a long term basis?
  • What is the expected sales price for each different customer target group and sales channel?
  • Which form of payment conditions will be offered?

6. Management and Key Personnel

It is the people who make the success of a project. Therefore the following questions must be answered:

  • Education and professional career of management team as well as key staff in your company
  • Which experience do they have with respect to the new project
  • Who will be responsible for what in the improvement project
  • How shall the management team be paid (mode of payment, e.g. fixed salary, or fixed salary combined with profit share, turnover commission or only profit share)

7. Learning Paths

Knowledge is power, particularly for entrepreneurs and managers. A ”knowledge lead” ensures managerial freedom, particularly in case of hurry and the manager with a knowledge lead can act instead of react. Therefore it is of essential importance for a company management to maintain a knowledge lead and hence in this respect the following questions must be answered:

  • How to ensure, that the products are always as per actual state of the technique
  • How to learn in time about changes of customer requests
  • How to ensure the sufficient qualification of own staff
  • Plans for the education of staff and management
  • How can staff introduce improvement suggestions
  • How will communication inside the company and shareholders be ensured, so that important information will reach everybody for whom it might be of interest

8. Chances and Risks

Following questions to be answered:

  • What are the principle chances and risks for this project
  • How realistic are the different risk scenarios
  • How plans must be changed if risk occurs
  • Which alternative reactions are possible
  • What will happen if in case of risk no reaction takes place (optimistic, pessimistic)
  • To what extend can the affects of risks be limited and how can benefits in case of chances be used.
  • To what extend a wider capital basis could help in case of risks occurring
  • Pessimistic / optimistic plan for the next 5 years

9. 5-Year Plan

9.1 Staff Planning for 5 years

  • which staff will be required when for the different departments/functions of the company
  • What will be the salary side cost
  • What must be done to bind this staff to the company on the long run and hence to avoid staff fluctuation and what are the cost for this.

9.2 Plan for investments and depreciation

  • how much investment capital is required to achieve the first turnover
  • Short-term investment plan
  • Large investments expected in future

9.3 Plan Profit-Loss Estimation

Shall include:

  • Turnover
  • Change of stock
  • Activated self-production
  • Operative Performance
  • Other income
  • Operative Profit
  • Material cost
  • Staff cost
  • Depreciation from investments
  • Cost for interest
  • Other operative cost and expenses
  • Operative Cost
  • Operative Result
  • Neutral Income
  • Neutral Cost
  • Annual Loss / Profit
  • No. of employees
  • Statistical data
  • Turnover per month
  • Output per month
  • Output per capita
  • Cost per capita
  • Operational cash-flow
  • Turnover profitability

9.4 Cash-Flow Planning

  • Outlook short-, medium- and long term
  • For the 1st business year expected incoming and outgoing payments split up in months
  • For the 2nd and 3rd business year, same as above but quarter yearly
  • For the 4th and 5th business year, same as above but half yearly
  • Up from when a income excess can be expected

10. Finance requirements

  • Which financial resources are available to cover the required financial demand