Drafting the Business Plan

Everyone has great business ideas in their mind. However when we come to the stage of converting those ideas into a business venture, writing the business plan comes as the first and must the most difficult step to take. Despite its difficulty, the business plan is the basis to learn how to establish and run the business or to apply for funding. Therefore, we tried simplifying this task by presenting a series of questions that must be answered in any business plan whatever the size of the project or the activity. Please see the questions below

  • Q1. Who are the Promoters?

    If the Business Plan is being prepared to be submitted to an investor or a funding institute, then it is vital to mention details of the promoters with their contact information and addresses

  • Q2.What are the skills, competencies and expertise of the promoters?

    The skills and expertise of the promoter is significant and its relevance to the project activity will assist the promoter in successfully running the business and reduces the dependence on the employees or at least he will be capable to have control on the overall operations. Here you need to mention about the promoter intellectual capital and how it adds value to the project. What is the educational background and what past experiences that the promoter has that are related to the project activity?

  • Q3. Tell us about the project.

    The focus here is on the description of the main idea of your business and its uniqueness. In brief what is the idea of the business and what is the motive behind it. A clear understanding of the business with end to end explanation. Why do you plan to start this business and is there an added value that you will be offering to your clients?

  • Q4. What are the products or services the project is offering?

    This part includes detailed information of the list of your products/ services and it’s pricing. This is also where you highlight the benefits of your business. Now tell us in more details what are you offering your potential clients? Describe the specifications of the product or the service. Pricing of the products/services at? What gives your company’s product or service an edge in the market?

  • Q5.What is the target market?

    Briefly describe your key customers and how you intend to approach them. the clients might be defined by a geographical area, age group or income level. It could also be a combination of all as well as other factors. It’s important to clearly define who are you targeting to understand the size of the market and then determine how many products can you sell in a day, a week, a month or a year.

  • Q6.Who are your competitors?

    All businesses face competition either direct or indirect. Your competitor could be a new or old business offering a substitute or similar product/ services that makes your own idea redundant/alternative. Get to know who they are, especially those who have been in the market for a long time. Learn from their experience and the hurdles they face to maintain the business.

  • Q7. What is so unique about your product or service?

    What`s unique/different in your product or service? How is it better than what is offered by competitors? Could it be quality, speed of delivery or efficiency? What is it that will make your clients come back again and again?

  • Q8. What are the raw materials/resources that you need?

    Here you need to clearly define the raw materials/resources that you need, the quantity, where would you get it from and at what cost? Alternatively, if you do not need raw materials, you need to define the expertise that you need to offer.

  • Q9. How many staff do you have to hire and what are their expertise?

    It is very significant to plan your manpower requirement accurately. You need to find out the minimum possible number of staff the you need to hire to start operations. Are there specific skills that you are looking for? Can they be hired locally or would you need to find expatriates? How much will you pay them? What does the employment package include? You also need to calculate the recruitment cost accurately.

  • Q10. What licenses do you need to have?

    All businesses have to be registered at the Ministry of Commerce & Industry as well as Chamber of Commerce & Industry, some also require Municipality license, environmental license or civil defence authorization for fire and safety purposes. Whatever the type of business you are planning to establish, it is important to understand what licenses and approvals you need, where from to obtain them, how long does it take to obtain and how much it will cost.

  • Q11. What is the total cost of the project?

    You need to find out the total cost of the project you are planning to launch. Having a better idea of how much it will cost will avoid you getting stuck at the middle of setting up project. Cost of the project should include the following:
    -Infrastructure Cost: It is the cost of setting up the place of the project, examples include: renovation and decoration, painting, electrical work, etc.
    -Machinery cost: It includes the cost of the main machinery that will be used to provide the service/product
    -Other Tools and Equipment: It includes the cost of all other tools that are not directly used to provide the product/service but it is essential for smooth operations, e.g. : AC, Point of Sale system, CCTV cameras, etc.
    -Furnitures: Here you may list all furniture required
    -Pre-operating Expenses: You have to add all the expenditure you have to make before commencing the operations, e.g.: Government approvals, labor clearance, shop booking/advance rent, insurance, etc.
    Working Capital: You need to budget for the first 3-6 months operations, this includes cost of raw material, salaries, rent, etc.
    Contingencies: it is important to keep a budget for contingencies.

  • Q12. How much does your service/product cost?

    First, you must have a clear understanding of the production or service cost then you need to decide your margin of profit. The production or service cost will include the cost of the raw material, the cost of the direct staff/expertise, and any other direct expenses. . Also, You need to be aware of what competitors are charging for similar services or products . Remember, you can only charge more if your product/service has a unique features.

  • Q13. What is you sales expectations?

    Sales or Revenue expectation should be based on the combination of the capacity of the business and the demand in the market. How many products are you expecting to sell in a day, a month and a year? Or how many clients are you expecting to offer services to in a given time? What is the basis of your expectations/sales assumption? It has to be realistic based on proper market research.

  • Q14.What is your expected operational cost?

    Here you need to mention the expenses which are related to the operation of the business. Basically it’s the money that you spend to run your business. What is the expected cost for rent, salaries, electricity, utilities in general, marketing cost, administrative expenses and other charges. It can be broadly divided into ‘Fixed Cost’ & ‘Variable Cost’

  • Q15.What is the production/service providing process?

    Having a clear process and guidelines insures consistency and better quality to clients. You need to draw the steps it takes to produce or deliver the product/service. The process should highlight the items required at each step and the time it takes.

  • Q16. What is the expected cash flow?

    Now that you have your expenses listed out as well as your expected revenue, you can start developing your monthly and yearly cash flow statement. Include projected cash flows for five years or until stable growth rates are achieved. This is important to identify your “Breakeven Point” and the amount of investment that you need at a given point of time. You may download our free Cashflow template here:

  • Q17. What are your future plans?

    This refers to long term Goal. Everyone needs to plan ahead for the future of their businesses. Are you planning to have more branches? Or are you planning to increase your production or your customer base? Maybe you are planning to improve the quality of your operations or diversify your products/services?

  • Q18. What are the risks associated?

    All businesses will have risks, but it is wise to take calculated risk. Risks are not necessarily those related to natural disasters. Risks could be shortage of cash flow or in general changes in the economic, social and political environment, reputation risks, operational and competition risks. You need to identify these risks, and think and plan in advance that how will you to mitigate / overcome them?

  • Q19.Have you registered your IP [Intellectual Property]?

    Whether it is a product or process flow of a service, have you registered your Intellectual Property? Maybe this may not apply to all types of businesses but defiantly for manufactures and research-based businesses it is mandatory.

  • Q20. What is your timeframe?

    Here you need to explain the project implementation timeframe. What all you have accomplished? What is pending task and when do you plan to complete it. Having a timeframe is good to assess the progress and as a reference for all the steps required until successful commencement of operations.