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Entrepreneurship

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Entrepreneurship ­ MGT602
VU
Lesson 23
CREATING AND STARTING THE VENTURE (Continued....)
LEARNING OBJECTIVES
1.
To present examples and a step-by-step explanation of the business plan.
2.
To explain how to write a business plan
3.
To explain the procedure and list of document included in business plan
4.
To discuss the contents of each document and how to prepare them
WRITING THE BUSINESS PLAN
Description of the Venture
The description of the venture should be detailed in this section. This should begin with the mission
statement or company mission, which describes the nature of the business and what the entrepreneur
hopes to accomplish. The new venture should be described in detail, including the product, location,
personnel, background of entrepreneur, and history of the venture. The emphasis placed on location is a
function of the type of business. Maps that locate customers, competitors, and alternative locations can be
helpful. If the building or site decision involves legal issues, the entrepreneur should hire a lawyer.
Production Plan or Operations Plan
If a new venture is a manufacturing operation, a production plan is necessary. This plan should describe the
complete manufacturing process, including whether or not the process is to be subcontracted. If the
manufacturing is carried out by the entrepreneur, the plan should describe the physical plant layout and
machinery and equipment needed.
If the venture is not manufacturing, this section would be titled operational plan. The entrepreneur would
need to describe the chronological steps in completing a business transaction.
Marketing Plan
The marketing plan describes how the products will be distributed, priced, and promoted. Potential
investors regard the marketing plan as critical to the venture's success.
Organizational Plan
The organizational plan section should describe the venture's form of ownership. If the venture is a
corporation, this should include the number of shares authorized, share options, and names and addresses
of the directors and officers. It is helpful to provide an organization chart indicating the line of authority.
This chart shows the investor who controls the organization and how members interact.
Assessment of Risk
It is important that the entrepreneur make an assessment of risk in the following manner: The entrepreneur
should indicate the potential risks to the new venture. Next should be a discussion of what might happen if
these risks become reality. Finally the entrepreneur should discuss the strategy to prevent, minimize, or
respond to these risks. The entrepreneur should also provide alternative strategies should these risk factors
occur.
Financial Plan
The financial plan determines the investment needed for the new venture and indicates whether the
business plan is economically feasible. The entrepreneur should summarize the forecasted sales and
expenses for the first three years. Cash flow figure for three years are needed, with the first year's
projections provided monthly. The projected balance sheet shows the financial condition of the business at
a specific time.
Appendix
The appendix contains any backup material not included in the text of the document.
51
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Entrepreneurship ­ MGT602
VU
Other possible documents
Letters from customers, distributors, or subcontractors
Secondary or primary research data
Leases and contracts
Price lists from suppliers and competitors
52
Table of Contents:
  1. THE NATURE AND IMPORTANCE OF ENTREPRENEURSHIP:DEFINITION OF ENTREPRENEUR
  2. THE NATURE AND IMPORTANCE OF ENTREPRENEURSHIP:Possibility of New Venture Formation
  3. ENTREPRENEURIAL PROCESS/START UPS:GOVERNMENT AS AN INNOVATOR
  4. THE ENTREPRENEURIAL AND ENTREPRENEURIAL MIND:ENTREPRENEURIAL PROCESS
  5. THE ENTREPRENEURIAL AND ENTREPRENEURIAL MIND (continued…)
  6. THE ENTREPRENEURIAL AND ENTREPRENEURIAL MIND (continued…):CLIMATE FOR ENTREPRENEURSHIP
  7. THE ENTREPRENEURIAL AND ENTREPRENEURIAL MIND (continued…):PROBLEMS AND SUCCESSFUL EFFORTS
  8. THE INDIVIDUAL ENTREPRENEUR:ENTREPRENEURIAL BACKGROUND AND CHARACTERISTICS
  9. THE INDIVIDUAL ENTREPRENEUR (continued…):Personal Values, Work History, MOTIVATION
  10. THE INDIVIDUAL ENTREPRENEUR (continued…):ROLE MODELS AND SUPPORT SYSTEMS
  11. INTERNATIONAL ENTREPRENEURIAL OPPORTUNITIES:INTERNATIONAL ENTREPRENEURIAL OPPORTUNITIES, Minority interests
  12. INTERNATIONAL ENTREPRENEURIAL OPPORTUNITIES (continued…):DIRECT FOREIGN INVESTMENT
  13. INTERNATIONAL ENTREPRENEURIAL OPPORTUNITIES (continued…):BARRIERS TO INTERNATIONAL TRADE
  14. INTERNATIONAL ENTREPRENEURIAL OPPORTUNITIES (continued…):ENTREPRENEURIAL PARTNERING
  15. INTERNATIONAL ENTREPRENEURIAL OPPORTUNITIES (continued…):SOURCES OF NEW IDEAS
  16. CREATIVITY AND THE BUSINESS IDEA:METHODS OF GENERATING NEW IDEAS, CREATIVE PROBLEM SOLVING
  17. CREATIVITY AND THE BUSINESS IDEA:PRODUCT PLANNING AND DEVELOPMENT PROCESS
  18. LEGAL ISSUES FOR THE ENTREPRENEUR:NEED FOR A LAWYER, PATENTS
  19. LEGAL ISSUES FOR THE ENTREPRENEUR:TRADEMARKS, LICENSING
  20. LEGAL ISSUES FOR THE ENTREPRENEURS:PRODUCT SAFETY AND LIABILITY, INSURANCE
  21. CREATING AND STARTING THE VENTURE:WHAT IS THE BUSINESS PLAN, PRESENTING THE PLAN
  22. CREATING AND STARTING THE VENTURE (Continued….):WRITING THE BUSINESS PLAN
  23. CREATING AND STARTING THE VENTURE (Continued….):
  24. CREATING AND STARTING THE VENTURE (Continued….):WHY SOME BUSINESS PLANS FAIL, MARKETING PLAN
  25. THE MARKETING PLAN:MARKET RESEARCH FOR THE NEW VENTURE
  26. THE MARKETING MIX:STEPS IN PREPARING THE MARKETING PLAN
  27. THE ORGANIZATIONAL PLAN:DEVELOPING THE MANAGEMENT TEAM, LEGAL FORMS OF BUSINESS
  28. THE ORGANIZATIONAL PLAN (Continued….)
  29. THE ORGANIZATIONAL PLAN (Continued….):THE LIMITED LIABILITY COMPANY
  30. THE FINANCIAL PLAN:OPERATING AND CAPITAL BUDGETS
  31. THE FINANCIAL PLAN (Continued….):PRO FORMA INCOME STATEMENTS, PRO FORMA CASH FLOW
  32. PRO FORMA SOURCES AND USES OF FUNDS:PERSONAL FUNDS, FAMILY AND FRIENDS
  33. PRO FORMA SOURCES AND USES OF FUNDS:COMMERCIAL BANKS
  34. BANK LENDING DECISIONS:SMALL BUSINESS ADMINISTRATION LOANS
  35. SOURCES OF CAPITAL:GOVERNMENT GRANTS
  36. SOURCES OF CAPITAL:PRIVATE PLACEMENT, BOOTSTRAP FINANCING
  37. CAPITAL SOURCES IN PAKISTAN:PROVINCIAL LEVEL INSTITUTIONS, FINANCIAL INSTITUTIONS
  38. PREPARING FOR THE NEW VENTURE LAUNCH: EARLY MANAGEMENT DECISIONS (Continued….)
  39. PREPARING FOR THE NEW VENTURE LAUNCH: EARLY MANAGEMENT DECISIONS (Continued….)
  40. PREPARING FOR THE NEW VENTURE LAUNCH: EARLY MANAGEMENT DECISIONS (Continued….)
  41. PREPARING FOR THE NEW VENTURE LAUNCH: EARLY MANAGEMENT DECISIONS (Continued….)
  42. PREPARING FOR THE NEW VENTURE LAUNCH: EARLY MANAGEMENT DECISIONS (Continued….)
  43. NEW VENTURE EXPANSION STRATEGIES AND ISSUES:JOINT VENTURES, ACQUISITIONS
  44. NEW VENTURE EXPANSION STRATEGIES AND ISSUES (Continued….):DETERMINING THE PRICE FOR AN ACQUISITION
  45. ENTREPRENEURSHIP & PAKISTAN:GENDER DEVELOPMENT STATUS WOMAN AS AN ENTREPRENEUR IN PAKISTAN