SlideShare a Scribd company logo
Creating a Winning E-Business
Second Edition
Creating an E-Business Plan
Chapter 3
Creating a Winning E-Business Second Edition, Chapter 3 2
Learning Objectives
 Organize a business plan
 Prepare an executive summary
 Write a mission statement
 Prepare a marketplace analysis
 Create operational, financial, and management
plans
Creating a Winning E-Business Second Edition, Chapter 3 3
Learning Objectives
(continued)
 Understand legal forms of businesses
 Describe e-business partnerships
Creating a Winning E-Business Second Edition, Chapter 3 4
Business Plan Organization
 Business plan
– Formal business planning document
• Identifies the business and its mission
• Names the key management team members
• Describes the products or services to be offered
• Provides a marketplace analysis
• Identifies customers and competitors
• Determines resources for profitable operations
• Sets a timetable for profitability
Creating a Winning E-Business Second Edition, Chapter 3 5
Business Plan Organization
(continued)
 Government and for-profit sources for business
planning information and templates
– SCORE
– SBA
– BizPlanIt
– Bplans.com
– E-Future Centre
Creating a Winning E-Business Second Edition, Chapter 3 6
Business Plan Organization
(continued)
Creating a Winning E-Business Second Edition, Chapter 3 7
Business Plan Organization
(continued)
Creating a Winning E-Business Second Edition, Chapter 3 8
Business Plan Organization
(continued)
 Business plan components
– Cover sheet and title page
– Table of contents
– Executive summary
– Business description
– Vision/mission statement
Creating a Winning E-Business Second Edition, Chapter 3 9
Business Plan Organization
(continued)
 Business plan components (continued)
– Information on products/services
– Industry, customer, competitor analyses
– Operational, financial, and managerial plans
– Identification of critical risks
– Exit strategy
Creating a Winning E-Business Second Edition, Chapter 3 10
Business Plan Organization
(continued)
 Cover sheet
– Title of document and preparer’s name
– Plan copy number
– “Confidential” notation
 Title page
– Cover sheet information and
• Contact numbers
• Key team members’ names
• Name of person receiving the plan
Creating a Winning E-Business Second Edition, Chapter 3 11
Business Plan Organization
(continued)
Creating a Winning E-Business Second Edition, Chapter 3 12
Business Plan Organization
(continued)
Creating a Winning E-Business Second Edition, Chapter 3 13
Business Plan Organization
(continued)
 Table of contents
– Lists all the major sections and subsections of the
plan
– Prepared after rest of plan is complete
– Carefully checked for omissions and page
number errors
Creating a Winning E-Business Second Edition, Chapter 3 14
Business Plan Organization
(continued)
Creating a Winning E-Business Second Edition, Chapter 3 15
Business Plan Organization
(continued)
 Executive summary
– A condensed version of the complete plan
– Used by interested parties to quickly assess the
business idea and weed out plans
– Keep it short (one to three pages)
– Use clear and concise language and action
words
– Create last after plan details are developed
Creating a Winning E-Business Second Edition, Chapter 3 16
Business Plan Organization
(continued)
Creating a Winning E-Business Second Edition, Chapter 3 17
Business Plan Organization
(continued)
 Vision statement
– A formal statement of a business’s hopes and
desires
– Written to guide and inspire employees
 Mission statement
– A formal statement that explains a business’s
reason for existing
Creating a Winning E-Business Second Edition, Chapter 3 18
Business Plan Organization
(continued)
 Business description
– Summary of business’s background
– Information about legal form of business
– Business’s history to date
– Key personnel
– Future goals
Creating a Winning E-Business Second Edition, Chapter 3 19
Business Plan Organization
(continued)
Creating a Winning E-Business Second Edition, Chapter 3 20
Business Plan Organization
(continued)
 Products or services section
– Description of products or services offered
– Anticipated sales for each product or service
– Describes benefits of product or service to
customers
Creating a Winning E-Business Second Edition, Chapter 3 21
Business Plan Organization
(continued)
Creating a Winning E-Business Second Edition, Chapter 3 22
Business Plan Organization
(continued)
 Marketplace analysis
– Information about the specific industry of which
business is a part
– Description of targeted customers
– Description of major competitors
– Overview of marketing and sales strategies
Creating a Winning E-Business Second Edition, Chapter 3 23
Business Plan Organization
(continued)
Creating a Winning E-Business Second Edition, Chapter 3 24
Business Plan Organization
(continued)
 Operational plan
– Describes a business’s physical location and
equipment
– Notes the manufacturing or service actions
needed to get products/services to market
– Summarizes Web site operations
Creating a Winning E-Business Second Edition, Chapter 3 25
Business Plan Organization
(continued)
Creating a Winning E-Business Second Edition, Chapter 3 26
Business Plan Organization
(continued)
 Financial plan
– Explains how your e-business idea, goals, and
strategies translate into profits
– Provides standard financial statements for
income, expense, and cash flow data
• Pro forma balance sheet
• Projected income statement
• Planned cash flow statement
– May include “deal plan,” break-even analysis,
ratio analysis
Creating a Winning E-Business Second Edition, Chapter 3 27
Business Plan Organization
(continued)
Creating a Winning E-Business Second Edition, Chapter 3 28
Business Plan Organization
(continued)
Creating a Winning E-Business Second Edition, Chapter 3 29
Business Plan Organization
(continued)
Creating a Winning E-Business Second Edition, Chapter 3 30
Business Plan Organization
(continued)
Creating a Winning E-Business Second Edition, Chapter 3 31
Business Plan Organization
(continued)
Creating a Winning E-Business Second Edition, Chapter 3 32
Business Plan Organization
(continued)
 Management plan
– Organizational structure of business
– Information on
• Key members of management team
• Outside advisors
• Mentors
• Consultants
Creating a Winning E-Business Second Edition, Chapter 3 33
Business Plan Organization
(continued)
Creating a Winning E-Business Second Edition, Chapter 3 34
Business Plan Organization
(continued)
Creating a Winning E-Business Second Edition, Chapter 3 35
Business Plan Organization
(continued)
 Appendices
– Resumes
– Pictures of products
– Explanation of services
– Legal documents
– Other supporting documentation
Creating a Winning E-Business Second Edition, Chapter 3 36
Legal Forms of Organization
 Sole proprietorship
– Business started by an individual
– Owner and business are one in the same for tax
and legal liability issues
Creating a Winning E-Business Second Edition, Chapter 3 37
Legal Forms of Organization
(continued)
 Partnership
– Legal business entity with two or more co-owners
– Follows a partnership agreement
– General partnership: Tax and legal liabilities flow
through to individual partners
– Limited partnership
• General partner manages and assumes unlimited
liability
• Limited partners have liability for amount of their
capital contribution and their accepted debt
Creating a Winning E-Business Second Edition, Chapter 3 38
Legal Forms of Organization
(continued)
 Corporation
– Separate legal and taxable entity from its owners
– “C” corporation owners are it shareholders
– Liability is limited to investment in business
– Profits are taxed twice: once for the corporation
and again when distributed to owners as stock
dividends
Creating a Winning E-Business Second Edition, Chapter 3 39
Legal Forms of Organization
(continued)
 Corporation (continued)
– “S” corporation gives owners partnership status
and corporate liability protection
 Limited liability company (LLC)
– Tax status of sole proprietorship or partnership
– Liability status of a corporation
Creating a Winning E-Business Second Edition, Chapter 3 40
E-Business Partnerships
 Strong positive relationships with strategic
partners are critical
– Partnerships that help build market awareness
• Public relations firms
• Marketing consultants
– Partnerships that assist in operations
• Suppliers
• Distributors
• Web hosting companies
Creating a Winning E-Business Second Edition, Chapter 3 41
Chapter Summary
 A business plan is used to
– Check feasibility of business
– Seek funding
– Guide operations
 A business plan includes
– Cover sheet and title page
– Table of contents and executive summary
– Marketplace analyses
– Operational, financial, and marketing plans
Creating a Winning E-Business Second Edition, Chapter 3 42
Chapter Summary
(continued)
 Business plan appendices can include
– Resumes
– Pictures of products and information on services
– Legal documents
– Other supporting details for the overall plan
Creating a Winning E-Business Second Edition, Chapter 3 43
Chapter Summary
(continued)
 Business description should include legal form of
business
 Business plan should note key strategic
partnerships

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E-Business

  • 1. Creating a Winning E-Business Second Edition Creating an E-Business Plan Chapter 3
  • 2. Creating a Winning E-Business Second Edition, Chapter 3 2 Learning Objectives  Organize a business plan  Prepare an executive summary  Write a mission statement  Prepare a marketplace analysis  Create operational, financial, and management plans
  • 3. Creating a Winning E-Business Second Edition, Chapter 3 3 Learning Objectives (continued)  Understand legal forms of businesses  Describe e-business partnerships
  • 4. Creating a Winning E-Business Second Edition, Chapter 3 4 Business Plan Organization  Business plan – Formal business planning document • Identifies the business and its mission • Names the key management team members • Describes the products or services to be offered • Provides a marketplace analysis • Identifies customers and competitors • Determines resources for profitable operations • Sets a timetable for profitability
  • 5. Creating a Winning E-Business Second Edition, Chapter 3 5 Business Plan Organization (continued)  Government and for-profit sources for business planning information and templates – SCORE – SBA – BizPlanIt – Bplans.com – E-Future Centre
  • 6. Creating a Winning E-Business Second Edition, Chapter 3 6 Business Plan Organization (continued)
  • 7. Creating a Winning E-Business Second Edition, Chapter 3 7 Business Plan Organization (continued)
  • 8. Creating a Winning E-Business Second Edition, Chapter 3 8 Business Plan Organization (continued)  Business plan components – Cover sheet and title page – Table of contents – Executive summary – Business description – Vision/mission statement
  • 9. Creating a Winning E-Business Second Edition, Chapter 3 9 Business Plan Organization (continued)  Business plan components (continued) – Information on products/services – Industry, customer, competitor analyses – Operational, financial, and managerial plans – Identification of critical risks – Exit strategy
  • 10. Creating a Winning E-Business Second Edition, Chapter 3 10 Business Plan Organization (continued)  Cover sheet – Title of document and preparer’s name – Plan copy number – “Confidential” notation  Title page – Cover sheet information and • Contact numbers • Key team members’ names • Name of person receiving the plan
  • 11. Creating a Winning E-Business Second Edition, Chapter 3 11 Business Plan Organization (continued)
  • 12. Creating a Winning E-Business Second Edition, Chapter 3 12 Business Plan Organization (continued)
  • 13. Creating a Winning E-Business Second Edition, Chapter 3 13 Business Plan Organization (continued)  Table of contents – Lists all the major sections and subsections of the plan – Prepared after rest of plan is complete – Carefully checked for omissions and page number errors
  • 14. Creating a Winning E-Business Second Edition, Chapter 3 14 Business Plan Organization (continued)
  • 15. Creating a Winning E-Business Second Edition, Chapter 3 15 Business Plan Organization (continued)  Executive summary – A condensed version of the complete plan – Used by interested parties to quickly assess the business idea and weed out plans – Keep it short (one to three pages) – Use clear and concise language and action words – Create last after plan details are developed
  • 16. Creating a Winning E-Business Second Edition, Chapter 3 16 Business Plan Organization (continued)
  • 17. Creating a Winning E-Business Second Edition, Chapter 3 17 Business Plan Organization (continued)  Vision statement – A formal statement of a business’s hopes and desires – Written to guide and inspire employees  Mission statement – A formal statement that explains a business’s reason for existing
  • 18. Creating a Winning E-Business Second Edition, Chapter 3 18 Business Plan Organization (continued)  Business description – Summary of business’s background – Information about legal form of business – Business’s history to date – Key personnel – Future goals
  • 19. Creating a Winning E-Business Second Edition, Chapter 3 19 Business Plan Organization (continued)
  • 20. Creating a Winning E-Business Second Edition, Chapter 3 20 Business Plan Organization (continued)  Products or services section – Description of products or services offered – Anticipated sales for each product or service – Describes benefits of product or service to customers
  • 21. Creating a Winning E-Business Second Edition, Chapter 3 21 Business Plan Organization (continued)
  • 22. Creating a Winning E-Business Second Edition, Chapter 3 22 Business Plan Organization (continued)  Marketplace analysis – Information about the specific industry of which business is a part – Description of targeted customers – Description of major competitors – Overview of marketing and sales strategies
  • 23. Creating a Winning E-Business Second Edition, Chapter 3 23 Business Plan Organization (continued)
  • 24. Creating a Winning E-Business Second Edition, Chapter 3 24 Business Plan Organization (continued)  Operational plan – Describes a business’s physical location and equipment – Notes the manufacturing or service actions needed to get products/services to market – Summarizes Web site operations
  • 25. Creating a Winning E-Business Second Edition, Chapter 3 25 Business Plan Organization (continued)
  • 26. Creating a Winning E-Business Second Edition, Chapter 3 26 Business Plan Organization (continued)  Financial plan – Explains how your e-business idea, goals, and strategies translate into profits – Provides standard financial statements for income, expense, and cash flow data • Pro forma balance sheet • Projected income statement • Planned cash flow statement – May include “deal plan,” break-even analysis, ratio analysis
  • 27. Creating a Winning E-Business Second Edition, Chapter 3 27 Business Plan Organization (continued)
  • 28. Creating a Winning E-Business Second Edition, Chapter 3 28 Business Plan Organization (continued)
  • 29. Creating a Winning E-Business Second Edition, Chapter 3 29 Business Plan Organization (continued)
  • 30. Creating a Winning E-Business Second Edition, Chapter 3 30 Business Plan Organization (continued)
  • 31. Creating a Winning E-Business Second Edition, Chapter 3 31 Business Plan Organization (continued)
  • 32. Creating a Winning E-Business Second Edition, Chapter 3 32 Business Plan Organization (continued)  Management plan – Organizational structure of business – Information on • Key members of management team • Outside advisors • Mentors • Consultants
  • 33. Creating a Winning E-Business Second Edition, Chapter 3 33 Business Plan Organization (continued)
  • 34. Creating a Winning E-Business Second Edition, Chapter 3 34 Business Plan Organization (continued)
  • 35. Creating a Winning E-Business Second Edition, Chapter 3 35 Business Plan Organization (continued)  Appendices – Resumes – Pictures of products – Explanation of services – Legal documents – Other supporting documentation
  • 36. Creating a Winning E-Business Second Edition, Chapter 3 36 Legal Forms of Organization  Sole proprietorship – Business started by an individual – Owner and business are one in the same for tax and legal liability issues
  • 37. Creating a Winning E-Business Second Edition, Chapter 3 37 Legal Forms of Organization (continued)  Partnership – Legal business entity with two or more co-owners – Follows a partnership agreement – General partnership: Tax and legal liabilities flow through to individual partners – Limited partnership • General partner manages and assumes unlimited liability • Limited partners have liability for amount of their capital contribution and their accepted debt
  • 38. Creating a Winning E-Business Second Edition, Chapter 3 38 Legal Forms of Organization (continued)  Corporation – Separate legal and taxable entity from its owners – “C” corporation owners are it shareholders – Liability is limited to investment in business – Profits are taxed twice: once for the corporation and again when distributed to owners as stock dividends
  • 39. Creating a Winning E-Business Second Edition, Chapter 3 39 Legal Forms of Organization (continued)  Corporation (continued) – “S” corporation gives owners partnership status and corporate liability protection  Limited liability company (LLC) – Tax status of sole proprietorship or partnership – Liability status of a corporation
  • 40. Creating a Winning E-Business Second Edition, Chapter 3 40 E-Business Partnerships  Strong positive relationships with strategic partners are critical – Partnerships that help build market awareness • Public relations firms • Marketing consultants – Partnerships that assist in operations • Suppliers • Distributors • Web hosting companies
  • 41. Creating a Winning E-Business Second Edition, Chapter 3 41 Chapter Summary  A business plan is used to – Check feasibility of business – Seek funding – Guide operations  A business plan includes – Cover sheet and title page – Table of contents and executive summary – Marketplace analyses – Operational, financial, and marketing plans
  • 42. Creating a Winning E-Business Second Edition, Chapter 3 42 Chapter Summary (continued)  Business plan appendices can include – Resumes – Pictures of products and information on services – Legal documents – Other supporting details for the overall plan
  • 43. Creating a Winning E-Business Second Edition, Chapter 3 43 Chapter Summary (continued)  Business description should include legal form of business  Business plan should note key strategic partnerships