Business Planning Models for a New Era

• The Marketplace and Marketspace (the physical world and the internet world, how they react and effect your business.)
  
• The Product Designs in terms of usability both in terms of a functional physical products and/or services or interface designs.
  
• The Performance Matrix Analysis of your product and/or service. How it sits with the competition in terms of specs and functionality.
  
• The Competition in terms of a performance matrix of tactics and strategies.
  
• Your Resources and Infrastrucuture. Most startups are no where near using the resources that are available to them in their communities and now with the facilities of the Internet.
  
• Benchmark Performance Modeling of your technology. Many entrepreneurs do not realize that most investors just do not understand their offerings and technologies. What you need to do is do a performance model on your technology. You can performance model anything in the physical or virtual world. Start to performance model a pencil on your spreadsheet then move up to your fax machine, TV then your computer and you can begin to get an idea of the benefits of performance models. It starts with a feature functions matrix of your product and/service or offering. Then you do a Task Analysis of the technology. Then you compare your product and/or service offering with the "Taxonomy" in the field the recognized "classification of functionality" in that field. This gives the investors a place to understand and compare your products, technology and services. It also makes you look very professional in their eyes.
  
• The Market Analysis. If anything is changing these days it is the marketplace. We are moving from Marketplace into Marketspace. The early stage companies that are getting funding are bleeding out of boxes and computers to launch their business. They oo..ooze with knowlege of their niche and market. They are so confident when they walk into an account with their knowledge, skills and enthusiasm the customer is compelled to know more. These are the companies getting funded in the new economy. They are market savy companies and people not just engineering or product savy. The do not live in a box of closed doors they are out there. If your firm has not spent hundreds of hours on the net on market analysis, if your firm is just an engineering firm and not a market savy firm there is a good chance you are going to wake up one day without your customers. There is so much more to the technology field than just products. You need to emerge yourself in all the aspects of your nich to get a deep market and customer analysis of your business models.
  
• Information Mapping sessions should be held every quarter on the market with all the team to uncover the trends and movements in the market that are effecting your business models.

1. Describe the Stage of the company.

• Idea Research
• Seed Stage Prototype No Revenue
• Beta Customers Trial Sites
• Early Stage Shipping Product Some Revenue-
• Expansion Growth steady revenue
• Give a brief history of the company and how it got to its current stage

2. What is the technology and/or service?

(a) Platform Technology (b) Improvement (c) Hybrid
(d) or a Jump.

3. Business Concept.

The business concept and business model identifies the market potential within the industry and outlines the specific action plans for the coming year. Point by Point.

Description of the Industry This section will contain: Industry outlook and growth potential (industry trends, new products and developments. State your sources of information) Markets and customers (size of total market, new requirements and market trends) Competitive companies (market share, strengths and weaknesses, profitability) Industry and Economic trends (consumer trends, relevant economic indicators, technology indicators, Internet indicators etc.)

4. Description of Business Venture. This section will contain:

Product(s) or service (pictures, drawings, characteristics, quality) Product protection/exclusive rights (patents, copyrights, trade marks) Target market (typical customers identified by groups, present buying patterns and average purchase in dollars, wants and needs) Competitive advantage of the business and technology concept (your market niche, uniqueness, estimated market share)

Business location and size (location(s) relative to market, size of premises) Staff and equipment needed (overall requirement, capacity) Brief history (principals involved, development work done to date)

5. Business Goals. This section will contain:

One year (specific goals, R&D goals, design goals, financing plans, roll out plans if possible introducing new product strategies, etc.)

Over the longer term (return on investment, business net worth, sale of business, M&A etc)

6. Technology Overview in brief.

Describe how you will stay ahead of the competition - what patents or other forms of protection will you use to prevent other companies from copying the products?

7. Product Design Plans.

Specific descriptions of products. Critical design plans, drawings, flowcharts and specifications. Performance improvements and uniqueness. Patent Descriptions and Plans and Costs

Customer's Use of the Product. Describe how the customer will use the product and the benefit that they will obtain from it. It is important to understand the "whole product concept" that the customer requires - what products and services will the customer require to make effective use of the products? Where will these ancillary products be obtained? Describe the cost/benefit analysis that the customer will undertake that will cause him to conclude that they should purchase the product and/or service. What is the total cost of the "whole product" to the customer? What is the pay back period for the purchase? What post-delivery support will the customer expect?

8. Marketing Plan. This section will contain:

Sales strategy and Revenue Models (agents, sales objectives, target customers, sales tools, sales support etc) Distribution Channels overview (direct to public, wholesale, retail, Electronic Commerce) Pricing (costing, mark-ups, margins, break-even analysis) Promotion (media advertising, promotions, publicity-appropriate to reach target market). Support Services. How do you intend to reach the customer. Licensing Strategy etc.

Competition Matrix:

• By Product
• By Segment
• By Company

9. Sales Forecast. This section will contain:

Assumptions (one never has all the necessary information, so state all the assumptions made in developing the forecast) Monthly forecast for coming year (sales volume in units and dollars) Annual forecast for following 2-4 years (sales volume in dollars and units). The sales forecast is the starting point for your projected income statement and cash flow forecast. Sources of Revenue

Companies generally have several potential sources of revenue which have quite different costs associated with them. Identify the revenue expected to come from:

• Sales of the core product to new customers.
• Sales of ancillary products which may accompany the core product.
• Add on" sales - of product line extensions to the existing customer base.
• Re-occurring revenues such as service and support and what are they.
• Opportunities to sell other companies' products into your customer base.
• Other revenues such as royalties. Licensing Royalties.

10. Production Plan and Operations Overview. This section will contain:

Brief description of production design process (don't be too technical) Engineering and Product Design descriptions and cost estimates. Equipment and Software. Alliance Partners, Subcontractors and Suppliers. Personnel required (full-time, part-time, skill level, availability, training required) Cost of facilities, equipment and materials capital estimates (start-up or expansion capital required)

11. Corporate Structure. This section will contain:

Legal form (corporation) Share distribution (list of principal shareholders) List of contracts and agreements in force (management contract, shareholder or partnership agreement. Directors and officers (names and addresses and role in company) Background of key management personnel (brief resumes of active owners and key contractors and employees). Contract professionals/consultants (possible outside assistance in specialized or deficient areas). Organization chart (identify reporting relationships) Duties and responsibilities of key personnel (brief job descriptions--who is responsible for what?).

12. Risk Assessment This section will contain:

Competitors' reaction (will competitors try to squeeze you out?). What if . . . list of critical external factors (identify effects of new technology, new competition, supplier problems, shifts in demand, replacement problems, barriers to entry). Dealing with risks (contingency plan to handle the most significant risks, strategy goals) How will you maintain capital into the company in the early stages.

13. Action Plans. This section will contain:

Steps to accomplish this year's goals (flow chart by month or by quarter of specific actions to be taken and by whom, engineering, financing, alliances etc). Checkpoints for measuring results (identify significant dates, milestones and critical decision points). The implementation plan should identify the near term milestones that the company needs to achieve. These may relate to product development, engineering, sales, hiring or any other key aspect of the development of the company. These milestones should serve as guideposts to track the company's success in implementing its plan. The identification of key milestones also serves to highlight to the reader of the business plan the items you believe have the highest priority.

For each key milestone:

Describe the milestone briefly. Identify anything that must be completed to allow the milestone to be achieved. Estimate the date when the milestone will be reached. Use charts. You may wish to group the milestones by business function - marketing, production, research and development, key hires and finance.

14. Financial Plan

Where is the money and other required resources going to come from? Angels Investors, Government R&D, Venture Funds etc. Describe the financial plan and "Use of Funds". This outlines the level of present financing and identifies the financing sought and use of funds. This section should be kept concise with supporting material supplied only when requested. The Financial Plan contains pro-forma financial forecasts. In carrying out the action plan for the coming year, these operating forecasts are your guides to business survival and profitability. Before presenting the Business Plan to an investor, review and have the financial statements with your accountant. This familiarity will increase your credibility and at the same time provide you with a good understanding of what the financial statements reveal about the viability of the business.

15. ROI Return on Investment for Investors

• ROI Return on Investment description
• Exist Strategy
• M&A Mergers Acquisitions strategy
• If IPO describe costs and strategic plans

The costs include the writing of the prospectus by securities lawyers, audit and accounting fees, listing fees charged by the Exchange, printing costs, travel expenses, due diligence fees, assessment and valuation reports. The underwriters commission, usually the most expensive component, which is often between 6% to 10% of the total proceeds raised. As well as the costs, strategies and plans of maintaining and building the retail market need to be planned and described.

16. Financial Statements

Cash flow statement for at least 24 months is required for a startup.

17. References. This section will contain:

Name of present lending institution (branch, type of accounts) Lawyer's name (include address and phone number) Accountant's name (include address and phone number)

18. Appendix

Resumes, articles etc Copies of legal agreements (contracts, technology transfers agreements, benchtests and asessment reports) Appraisals, technical studies, financial statements for associated companies (where appropriate).

Business Plans and Information Mapping Services:

The State of Our Planet network of consultants can help your emerging business, association or society design a detailed logistical Business Plan at a reduced fee for new ecological and social venture projects. This is a real plan that is based on the realities of your project as it stands now and the realities of the marketplace and your technology. We start off with an Information Mapping session that is an emergance into your vision, technologies, partners, business and market models.

Designing a Culture:

After we complete your business plan with your team. We can also help you develop and design your organizational culture. It is the culture of the company or association that becomes magnetic to your partners. When your first employee comes on board that is the moment the culture begins. Various techniques and concerns should be covered, including design of the physical space, hiring practices, subcontractor and contractor policies, and things the entrepreneur can do to shape the culture as the organization grows. Its hard to find the people you need to build your knowledge based company or non profit society its harder to replace a good employee if he or she leaves because the culture is just not working.

For more information contact: Email:info@stateofourplanetforum.org