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Business Plan Competition
Presented by:Mohamed Hossany Negm
Senior Technical Support Specialist and MarketingMaster’s Degree, Poultry Science
TEL:00201123223874
Faculty of Agriculture Zagazig University
Bill Gates
• Born 1955
• 15 years: first virus
• 18 years: Harvard Law School
• 21 years: started Microsoft
• 22 years: launched MS DOS
• 23 years: Sold 2 million copies of MS
DOS
• NOW: 45+ Billion USD
Why write a Business Plan
1. Because I have to…
– Needed for financing
– Strategic partnering
– Attract key people/investors
Why write a Business Plan
2. Because I Need to Understand My Business
– The Plan is the result of a planning process
– People Don’t Plan to Fail; They Fail to Plan
• Who are my customers?
• Why will they buy my product or service?
• What will they pay?
• How will I make and deliver/sell the service/product?
• What resources (people, money, technology) do I need?
• Can I make money / create value?
• Do I have the right team on board?
The Right Ingredients
• A TEAM with Relevant Experience
• Market Size
• Idea
• Technology
• Competitive Advantage
• Reasonable Projections
• Exit Strategy
Company
Structure
Financials
Operations
&
Production
Team
Idea
Market
Competitive
Edge
Marketing
Strategy
Business
Plan
Business Planning Steps
1. Idea generation, Vision, Mission, Objectives, Strategies
2. Market research and Analysis
3. Marketing strategy
4. Production planning
5. Management and Organization
6. Financial plan
7. Company formulation
1. The Idea
• Innovative product or service
• Visualize a market gap – you
can add value
• Imported idea
Give a man a fish and you feed
him for one day…
Teach him how to fish and you
feed him forever …
Chinese Wisdom
Business Plan Competition
• The Idea of the Business Plan Competition
• Learning: what is a Business Plan
• Writing: how to write a Business Plan
• Presenting: the Business Plan in the competition
• Implementation: Writing the Business Plan
Key Questions for Business Planning
1- Where is the NEED? Idea Generation
2- What are your:
Strengths, Weaknesses, Opportunities, Threats SWOT Analysis
3- Where do you want to go at the end? Vision
4- Whom do you live for? Mission
5- How to get to achieve your objectives? Strategy
4.1 How do you grow? Corporate Strategy
4.2 How do you compete? Business Strategy
4.3 How to implement? Functional Strategy
6- What do you need? Resources Needed
7- How do you measure performance? KPIs
8- How do you ensure sustainability? Corporatization
Business Planning Model
Performance
Actual
Results
Evaluation
&
Control
Programs
Budget
Procedures
Activities
needed
to
accomplish
a plan
Cost of the
programs
Sequences
of steps
needed to
do the job
Objectives
StrategiesWhat
results to
accomplish
when Plan to
achieve
mission &
objectivesBroad
guidelines
for
decision
making
Mission
Reasons
for
existence
Environmental
Scanning
Policies
Societal
Environment:
General Forces
Task
Environment
Industry Analysis
Internal
Structure:
Chain of
command
Culture:
Beliefs,
Expectations
Resources:
Assets, skills
Competencies
knowledge
External
Strategy Formulation Strategy Implementation
Feedback Learning
Business Plan Competition Criteria
1- Market Analysis
2- Strategy Formulation
3- Implementation
4- Financial Modeling
5- Measuring Performance
6- Corporatization: Sustainability
7- Social Responsibility
1- Market Analysis 1- Identifying the NEED of specific Targeted Group
2- External Analysis: Opportunities & Threats
- Country: Political, Economical, Socio-Cultural & Technological Forces (PEST)
- Industry: New Entrants, Competitors, Substitute, Buyers & Suppliers (Porter 5 Forces)
3- Internal Analysis: Strengths & Weakness - Company: Value-Chain Analysis
4- SWOT Analysis:
How you capitalize on them
How you avoid them
How maximize them
How minimize their effects
Strengths
Weaknesses
Opportunities
Threats
Internal
External
Country Analysis – PEST
Economic
Forces
•GDP
•Interest Rates
•Money Supply
•Inflation rate
•Unemployment Level
•Wages
•Price control
•Devaluation
•Reevaluation
•Energy costs and
availability
•Disposal income
Technological
Forces
•Government Spending
on R&D
•Industry Spending
on R&D
•Patent protection
•Telecom infrastructure
•Internet availability
•Availability of certain
Technology need to
improve productivity
Political-Legal
Forces
•Anti-trust regulations
•Tax laws
•Attitude toward
foreign companies
•Employment laws
•Stability of government
•Foreign trade laws
•Customs regulations
Socio-Cultural
Forces
•Life Style changes
•Population growth rate
•Age distribution
•Life expectancies
•Birth rate
•Mortality rate
•Religious orientation
Industry Analysis
Porter’s 5-Forces
Rivalry among
Competition
Bargaining Power
Of Suppliers
Entry Barriers
Bargaining Power
Of Buyers
Threat of
Substitute
Threat of new Entrants
Barriers to entry:
• Economies of scale
• Product differentiation
• Switching costs
• Capital requirement
• Access to distribution Channels
• Government Policy
Rivalry among Competition
Intense rivalry related to :
• Number of competitors (Monopoly, Monopolistic
Competition, Fragmented)
• Rate of industry growth
• Product or service characteristics
• Amount of fixed costs
• Capacity
• High exit barriers
Threat of Substitute
Threat of substitute :
• Availability of substitutes
• Switching costs
Bargaining Power of Buyers
Buyers Power :
• Buyer buys large portion of seller’s product
• Buyer can integrate backward
• Undifferentiated product
• Availability of sellers
• Buyer orientation (price oriented vs quality oriented )
• Switching costs
Bargaining Power of Suppliers
Suppliers Power :
• Number of suppliers and buyers (Petroleum)
• Suppliers product characteristics (unique or commodity)
• Switching costs
• Availability of substitutes
• Suppliers forward integration
• Amount purchased from supplier
Firm’s Resources
Resource: an asset, competency, skills, knowledge
controlled by the corporation
1. Value: does it provide competitive advantage?
2. Rareness: Do other competitors possess it?
3. Imitability: is it costly for others to imitate?
4. Organization: is the firm organized to exploit the resource?
Value Chain Analysis
Value Chain:
Set of value-added activities begins with basic raw material
sourcing and ending with handling the product to the consumer
Center of Gravity:
The part of the value chain where the company has its greatest
expertise and capabilities.
Firm Infrastructure(general management, accounting, finance, strategic planning)
Human Resource Management (recruiting, training, development)
Technology Development(R&D, product and process improvement)
Procurement (purchasing of raw material, machines and supplies)
Inbound
Logistics
(raw material
Handling and
Warehousing)
Operations
(machining,
Assembling,
Testing)
Outbound
Logistics
(warehousing,
distribution
Of finished
goods)
Marketing
And Sales
(Ads,
promotion
Pricing,
Channel )
Services
(insulation,
Repair,
Parts)
Company - Value Chain Analysis
Profit
Margin
Support
Activities
Primary Activities
How you capitalize on them
How you avoid them
How maximize them
How minimize their effects
Strengths
Weaknesses
Opportunities
Threats
Internal
External
SWOT Analysis
2- Strategy Formulation
1- Vision: what do you want to be?
2- Mission: what do you exist for?
3- Objectives: SMART Short - Medium and Long Term
4- Strategies:
- Corporate Strategy: How to grow?
- Business Strategy: How to compete?
- Functional Strategy: How to do it? Strategic Marketing Plan.
Strategic Management Model
Performance
Actual
Results
Evaluation
&
Control
Programs
Budget
Procedures
Activities
needed
to
accomplish
a plan
Cost of the
programs
Sequences
of steps
needed to
do the job
Objectives
StrategiesWhat
results to
accomplish
when Plan to
achieve
mission &
objectivesBroad
guidelines
for
decision
making
Mission
Reasons
for
existence
Environmental
Scanning
Policies
Societal
Environment:
General Forces
Task
Environment
Industry Analysis
Internal
Structure:
Chain of
command
Culture:
Beliefs,
Expectations
Resources:
Assets, skills
Competencies
knowledge
External
Strategy Formulation Strategy Implementation
Feedback Learning
Vision
1st Objective
2nd Objective
3rd Objective
4th Objective
Strategy
Where do you want to go at
the end?
What is the road
map and major mile
stones? How will
you reach
your
objectives?
Vision
Objectives
Mission:
Stakeholders
Family
Work
Friends
Religion
Country
Community
Who are your stakeholders and what is
your mission to each one of them?
Mission:
Stakeholders
Shareholders
Employees
Customers
Suppliers
Country
Community
Who are your stakeholders and what is
your mission to each one of them?
SMART Objectives
Specific
Measurable
Achievable
Relevant
Time-Bound
Hierarchy of Strategy
Functional
Strategy Functional Strategy
How To Do Implement?
Corporate Strategy
How To Grow ?
Business Strategy
How To Compete?
Corporate Strategy
Manufacturing
Feeding Industry
Primary
Manufacturing
Retail
Distribution
Raw Material
Customers
New Product New Region
Fo
rwa
rd In
tegra
tion
Ba
ckw
ard
Integ
ratio
n
Horizontal Integration
Ver
tica
l In
teg
rati
on
Horizontal Integration
Business Strategy Business Strategy:
Emphasizes improvement of the competitive position:
1- Competitive (Apple Computers)
2- Cooperative (British Airways)
Competitive AdvantageCost Leadership – Differentiation
Focused –integrated %
High
High
Low
Low
Relative Cost
Outstanding Success
Maintain Cost
advantageHope for
market growth
Maintain SpecialtyDegree
of
Differentiation
(Swiss) (Coca-Cola / Pepsi)
(China)(Egyptian FIAT 128)
Functional Strategy Functional Strategy:
How to achieve corporate and business unit strategy by maximizing resource productivity:
1- Marketing Plan
2- Production Plan
3- R&D Plan
4- HR Plan
5- Financial Plan
Your Marketing PlanWhat is Marketing: Satisfying Needs Profitably
• The Target Market
• The Strategic Marketing
• Segmentation
• Targeting
• Positioning
• The Marketing Mix
• Product
• Price
• Place (Push / Pull)
• Promotions
Business Planning Steps
1. Idea generation, Vision, Mission, Objectives, Strategies
2. Market research and Analysis
3. Marketing strategy
4. Production planning
5. Management and Organization
6. Financial plan
7. Company formulation
Segmentation
A process of subdividing the market into distinct subsets of
customers that behave in the same way or have similar need.
Bases for Segmenting Consumer Markets
These segmentation variables can be used singly or in combination
Geographic
Calls for dividing
the market into
different
geographical
units such as
states,
regions,counties
& neighborhood
• Region
• City or Metro size
• Density
• Climate
Demographic
• Age
• Family Size
• Family lifecycle
• Gender
• Income
• Education
• Occupation
• Religion
• Race
• Generation
• Social Class
• Nationality
Psychographic
• Lifestyle
• Personality
Behavioral
• Occasions
• Benefits (Unique
selling
proposition) Crest
• User status
• Usage Rate
• Loyalty Status: -
high-core loyals –
Split loyals –
Shifting loyals -
switchers
• Buyer-readiness
stage
• Attitude toward
product
Segmentation
Targeting
The act of evaluating and comparing the identified groups and
then selecting one or more of them as the prospects
Selecting the Market Segments
Targeting
M1 M2 M3
P1
P2
P3
Single segment
Concentration
The company
selects a single
segment, it
gains a strong
knowledge of
the segments
needs &
wants&
achieves a
string market
position in the
segment
M1 M2 M3
P1
P2
P3
Selective
Specialization
The company
selects a
number of
segments all fits
objectives &
resources.
& all promises
to be money
makers
M1 M2 M3
P1
P2
P3
Product
Specialization
The company
concentrates on
a certain
product that it
sells to several
segments.
It builds a
strong
reputation in the
specific product
area
M1 M2 M3
P1
P2
P3
Market
Specialization
The company
concentrates on
serving many
needs of a
particular
customer group.
It builds a
strong
reputation in
serving this
customer group
M1 M2 M3
P1
P2
P3
Full Market
Coverage
The company
serves all
customer groups
with all the
products they
might need.
Only very large
firms can
undertake a full
market coverage
strategy
Differentiation & Positioning
Differentiation & Positioning
Product
• Features Characteristics that supplement the product’s basic
function
• Performance QualityThe level at which the product’s primary characteristics
operates
• Conformance QualityDegree to which produced units are identical & meet
promised specs
(Perceived quality is more imp. than technical quality)
• DurabilityThe product operating lifecycle under natural & stressful
conditions
• ReliabilityThe measure of the probability that a product will not
malfunction or fail within a specified period of time
• StyleThe product’s looks & feel to the customer
• Design
• Reparability
Service
• Ordering Ease
• DeliverySpeed, accuracy &care attending
• InstallationWork done to make a product operates in its planned
location
• Customer trainingTraining customer employees
• Customer ConsultingData information & advising services
• Maintenance & repairHelping customers to have the product in a good
working order
• Miscellaneous Services
Tools for competitive Differentiation
McDonald’s
Mercedes
Cisco
Pizza Hut
Metro
McDonald’s
Tools for competitive Differentiation
Personnel
• Competence Required skill & knowledge
• CourtesyFriendly respectable & considerate
• CredibilityTrustworthy
• ReliabilityThe employees perform the service
consistently & accurately
• ResponsivenessRespond quickly to request &
problems
• CommunicationMake an effort to understand
customers & communicate clearly
Channel
• Coverage
• Expertise
• Performance
Image
• Identity Vs ImageIdentity is the ways that the company aims to
identify itself or position its product.
Image is how the public perceives the
company or its products
• SymbolsTriggers company or brand recognition
(Brand Logos)
• Written & audiovisual MediaConvey a storyline or mood or a performance
level
• AtmospherePhysical space in which the company
produces or delivers its products
• EventsThe company could build an identity through
the type of event it sponsors
Differentiation & Positioning
Marlboro
Apple
Malaysia
Morgan Stanley
Vodafone
Chipsy
New Product Development Process
“How to launch a new product ?”
Product
1- Idea Generation
5- Business Analysis
6- Product Development
7- Market Testing
8- Commercialization
2- Idea Screening
3- Concept Development & Testing
4- Marketing Strategy Development
New Product Development Process
“How to launch a new product ?”
GrowthDeclineMaturity
Emerging
Profits
Sales
Product Life Cycle
BCG Matrix
High
High
Low
Low
Relative Market Share
?Question Mark
DogCash Cow
StarMarket
Growth
Rate
Value-Delivery Process
Product
Design Procure Make Price Sell
Advertise
PromoteDistribute Service
Make the Product Sell the Product
Customer
Segmentat
ion
Market
Selection/
Focus
Targeting
Value
Positioning
Product
Developm
ent
Service
Developm
ent
Sourcing
Making
PricingDistributing
Serving
Sales
Force
Sales
PromotionAdvertising
Choose the Value Provide the Value Communicate the Value
(a) Traditional Physical Process Sequence
(b) Value Creation and Delivery Sequence
Strategic Marketing Tactical Marketing
Marketing Plan Process
Marketing Research
Segmenting Positioning Targeting
Defining Target Market
Needs, Wants, Demand
Product
Variety
Quality
Design
Features
Brand
Packaging
Size
Services
Warranty
Return
Price
Price List
Discounts
Allowances
Payments
Credit
Promotion
Promotions
Advertising
Sales Force
Public
relation
Direct
marketing
Place
Channels
Coverage
Assortment
Location
Inventory
Transport
Marketing Mix
4 Ps
Marketing Mix
4 Ps 4 Cs
• Product Customer Solution
• Price Customer Cost
• Place Convenience
• Promotion Communication
Business Planning Steps
1. Idea generation, Vision, Mission, Objectives, Strategies
2. Market research and Analysis
3. Marketing strategy
4. Production planning
5. Management and Organization
6. Financial plan
7. Company formulation
2. Market Analysis
• Market size
– How big is it NOW?
– Trends – how fast is it or will it grow?
• Market Players – Competitors
– Competitive Advantage
– Estimated market shares
– Existing/planned products in the marketplace
Market Analysis (cont’d)
• Market segmentation
– Demographical
• Age, gender, marital status, income…
– Geographical
– Life style
– Consumer buying behavior – decision makers
• Is this the RIGHT time for my product?
• Is there a gap that I can fill?
• Who are my TARGET customers?
• Why would they buy my product?
• How much would they pay?
• What are the special features in my product?
• What is my competitive advantage
• What are my 4 Ps: Product, Price, Place & Promotion
It is all about your EDGE
3. Marketing Strategy
Business Model
How Shall I reach my target customers?
• Direct Sales
• Mass Media - Advertising
• Retail
• The Web
• Telemarketing / Phone Sales
• Trade Shows and Conferences
• Channels, Distributors and Partners
Business Planning Steps
1. Idea generation , Vision, Mission, Objectives, Strategies
2. Market research and Analysis
3. Marketing strategy
4. Production planning
5. Management and Organization
6. Financial plan
7. Company formulation
4. Production plan
• Technology
• Equipment
• Raw Material Sourcing
• Operation Plan and Capacity
Business Planning Steps
1. Idea generation , Vision, Mission, Objectives, Strategies
2. Market research and Analysis
3. Marketing strategy
4. Production planning
5. Management and Organization
6. Financial plan
7. Company formulation
5. Management Plans
• Getting the RIGHT Team
on board
• Training
• Delegation
• Empowerment
3- Implementation
1- Action Plan: Programs needed to achieve the targeted objectives
2- Procedures: Sequences of the programs
3- Budgets for such programs
4- Tools & resources needed
4- Financial Modeling
1- Projected Income Statement
2- Projected Cash Flow Statement
3- Projected Capital Expenditure
4- Projected Investments Required
5- Measuring Performance (KPIs)
1- Measuring Profitability
2- Measuring Feasibility: Return on Investments
3- Measuring Market Penetration
4- Measuring Satisfaction
Structure –control - benchmark
6- Corporatization: Sustainability
1- Legal Structure
2- Organization Structure
3- Logo & Slogan
4- Team
7- Social Responsibility
1- What target market will be your project benefit (non-financially)
2- What specific programs or action will your project perform to benefit such segment
3- How do you measure the effect?
4- How do you ensure sustainability?
Business Planning Steps
1. Idea generation , Vision, Mission, Objectives, Strategies
2. Market research and Analysis
3. Marketing strategy
4. Production planning
5. Management and Organization
6. Financial plan
7. Company formulation
6. Financial Plans
• Income Statement Projections – Revenues Assumptions
– Costs/Expenses Assumptions
– Depreciation Assumptions
– Interest Expenses Assumptions
– Taxes
• Cash Flow Projections– Initial investment
– Working Capital (Payables vs Receivables)
– Capital Expenditure (Capex)
– Debt Assumptions
Income StatementObjective: provides information about the firm’s operating activities over a
specific period of time.
Revenue: 100 100%
- Cost of Goods Sold (COGS): 60 60%
Gross Profit (Profit Margin) 40 40%
Operating Expenses:
General & Administration 8 8%
Sales & Marketing 12 12%
- Total Operating Expenses 20 20%
Earning Before Interest, Tax, Depreciation & Amortization (EBITDA)20 20%
- Depreciation & Amortization 5 5%
Earning Before Interest and Tax (EBIT) 15 15%
- Interest Expenses 5 5%
Net Income Before Tax 10 10%
-Taxes 2 2%
Net Income 8 8%
Financial Plans (cont’d)
• Financial Measures– ROI
– Break-even
– NPV
– IRR
• Providing needed Capital– Equity
– Debt
Business Planning Steps
1. Idea generation
2. Market research and Analysis
3. Marketing strategy
4. Production planning
5. Management and Organization
6. Financial plan
7. Company formulation
7. The Company
• Name – logo - slogan
• Legal structure
• Location
Mission – Values - Objectives
Elements of the
Business Plan
1. Executive Summary2. The opportunity, the company and
product/service3. Market research/analysis4. Economics of the business5. Marketing strategy and plan6. Design and development plan7. Manufacturing and operations plan8. Management team9. Action Plan: Schedule, risks, problems10. Financial plan
Thank You
&
God Bless You
Mohamed Hossany Negm
Senior Technical Support Specialist and
Marketing
Master’s Degree, Poultry Science
TEL:00201123223874
Faculty of Agriculture Zagazig University