Writing Business Proposals, Business Plan and Case Reports

8/3/2019 Writing Business Proposals, Business Plan and Case Reports

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Writing Proposals

UnsolicitedSolicited

Internal External



PROPOSALS

Letters of Intent

Usually short ,concise, brief, and clear.

Read the instructions of the funding

agency, sometimes they specify theformat and sections needed.



Concept Paper/Letter of Intent

Project Introduction (Do some homeworkabout agency)

State the problem that needs to beaddressed

Project Description (Objectives,Approach, new methods and benefits)

Time and Support Needed (If Budget isnot requested don’t include)

Contact Information



Your authorization is needed for the initiation of thesummer analyst program. I must emphasize theimmediate and long-term benefits that will result fromthis new addition to human resources. It is a fast fixfor our overworked employees during the summer,and it extends a successful hiring pattem for years tocome. Please inform me of your decision within twoweeks so that we can prepare for the university on-campus recruiting season beginning in January. As

you have played an instrumental role in building theHR department, your thoughts are greatlyappreciated. I would enjoy meeting with you todiscuss the proposal.



Main Elements of a Proposal

The following are major elements to be included ina proposal:

Title Page

Abstract (Executive Summary) Statement of Need

Project Description (Objectives, Methodology,Staffing, Administration and Evaluation)

Budget & Budget Justification Biographical Data and References

Appendices



1. Title Page

It Contains:

Project Title

Project Team Institution Name

Submission Deadline, or the Date of

Preparation



2. Abstract/ Executive Summary

This section is a summary of the whole proposaland the most important section. It should serveas a description of the whole proposal –

It must stand alone – even if separated fromproposal It must be understood by both expertsin your field and by generalists.

It might be the only section read by all

members of grants committee who are not theprimary reviewers but nevertheless their scoreis taken into consideration



3. Statement of Need

This section represents the reason behind yourproposal and should specify the problem to besolved and the need to solve it or research it.

Has to be persuasive: Include the facts andevidence, statistics that support the need for theproject.

Include an explanation of the project's

significance and how compatible it is with yourorganization’s programs.

Give the reader hope.



4. Project Description

This section should have 5 subsections

ObjectivesMethods

Staffing

Project Administration Evaluation



5. Budget

The budget must be calculated withreasonable accuracy.

As you start preparing the budget, goback

through the proposal narrative and make a

list of all personnel and non-personnel

itemsrelated to operation of the project.

The budget must be divided into directand

indirect costs.



Preparing the Work Plan

Statement of the problem

Statement of the purpose and scope

Discussion of tasks to be accomplished

Description of final products or outcomes

Review of schedules and requirements

Plans for following up

Working outline



6. Biographical Data andReferences

Biographical data must be submittedwith proposals to show the background,areas of interest, research qualifications,capabilities, and publications of theperson submitting the proposal andthose who will be working on the project.

A current list of references to relevant

literature in the field.



7. Appendices

This section includes documents andinformation which support the proposal

such as: - Illustrations,

- Figures and graphs,

- Letters of support, - Certifications.



Common Errors Made

The proposal is too ambitious.

There are no clearly defined priorities and timetable.

There are no results of pilot studies or other preliminarydata.

The Budget is unrealistic.

The application is fragmented and disjointed

Carelessness – “I don’t have to go into detail, trust me

and look at my track record” Cannot rely on your reputation, it does not work.

The proposal tends to be too cautious and does notventure into new, unexplored areas



Business Plan elements

Cover Sheet

Executive Summary

Table of Contents Statement of Purpose

Company History

Business Description Products and Services



Market Analysis

Customers

Competition Marketing Strategy

Management

Operations Financial Plan

Appendices



Cover Sheet Identity information

The words “Business Plan”

Your name and business name

Company logo

Address

Telephone number

Fax Number

Email Address

Web Address (URL)

Submission date

Looks vs. content



Executive Summary

Most important part of the plan

30-second test

Concise explanation Venture objectives

Market prospects

Financial forecasts

Sources and uses

WRITTEN LAST



Table of Contents

Include page numbers

List of headings

Major Subsections



Statement of Purpose The business plan’s objectives: financing or operatingguide Financing

How much money is needed? What will the money be used for?

How will the funds benefit the business? Why does this loan or investment make business sense? How will the funds be repaid?

Operating guide Who will use it?

Will it layout strategy plans? How will it be updated?

Becoming self-sufficient



Sample: Statement of

PurposeThis business plan is written to secure financing in the amount of

$24,000, which will cover the following costs:

• $10,000 in equipment• $14,000 in operating capital

The loan will supplement the owner’s equity investment of $20,000,and will be repaid beginning the month after disbursementaccording to lender terms. Funds will play a crucial role insustaining the business as the client base grows, and will allowthe business to become self-sufficient by the beginning of yeartwo.



Company History

Mission Statement Basic product description

Names of principals and brief background on each

Legalities: business type

Company location

Number of employees Customer highlights

Your niche and unique qualities

Strategic alliances

Awards and merits Company milestones (business formation, opening date, hiring

employees, revenue levels/ growth)

1-3 year plan – future milestones to reach (sales goals, hiringemployees)



Business Description

Mission statement

Legalities: business type

Basic product or service description

New, takeover, expansion, franchise

General strategy plan List of planned milestones (business formation,

opening date, hiring employees, reaching certain

revenue goals) Planned strategic alliances

Work already done

Experience in the business



Products and Services

Detailed description of products orservices

Indicate stage of development: in-process, prototypes, samples

Patents or trademarks, legal contracts,licensing agreements, regulations,

certifications

“The Brochure Section”



Market Analysis

Industry analysis

Customers: individual, business

CompetitionMarketing Strategy

Cite Sources!



Market Analysis: IndustryAnalysis

Market background

Industry-wide information, trends

Local industry information, trendsMarket capture and expectations

Social, economic, legal, technological

issues



Market Analysis: Customers

Customer definition, consistency

Individual customer demographics

Location, age, gender, occupation Ethnic group, lifestyle, education, income

Business customer demographics

Sector, location, structure

Sales level, distribution classification,number of employees



Competition

Rule of Three for Competitive Study

Why your company is superior

Trends in competitive companies

Similar and dissimilar

SWOT (strengths, weaknesses, opportunities,threats)

Lessons learned

Advertising Eye on the future

Competitive grid and explanation



Competitive GridCompetitor Shahnaz Hussain Body Care BEST CUTS

Offerings Men’s/women's cut/styles/color perms

Men’s cuts only Men’s/ women’s cut/style/ color/ perms

Service Prices Starts at $38 Starts at $50 Starts at $30

Retail Prices 100% markup 100% markup 75% markup

Location High traffic, highly visible Moderate traffic, highlyvisible

High traffic,not visible

Expertise 20+years, up-to-date trends 15+ years, younghairstylists

13+ years, up-to-datetrends

Service Set hours, little scheduleflexibility

Manager never there Custom hours to suitclients needs

Turnover Low High Sole stylist

Capacity 11 active chairs 8 active chairs 1 active chair

Client Base Over 4000 ? Over 300



Marketing Strategy

Obtaining a profitable share of the entiremarketplace

Product: sellable aspects, brand image Pricing: cost-plus or economic value

Placement

Promotion



Management

Job descriptions of the decision makers

“I do everything!”

Compensation, benefitsContribution and background as

leverage to perform

Advisory board



Production/ Operations

Logistics plant location, facilities needed, space

requirements, capital equipment needed,

labor requirements If applicable: purchasing policy, quality

control program, inventory control system,production cost breakdown, subcontracts

Environmental and other issues Further research and development

What is done vs. what is TO BE done



Maximum sway at top caused by metal dilation: 18 cm (7 inches).

Pressure on foundation: 4.1 to 4.5 kg per square centimeter

15,000 iron pieces (excluding rivets).

2.5 million rivets.

40 tons of paint.

1671 steps to the top.

Maximum sway at top caused by wind: 12 cm (4.75 inches).

Maximum sway at top caused by metal dilation: 18 cm (7 inches).

Weight of elevator systems: 946,000 kg (1042.8 tons).

Total weight: 8.56 million kg (9441 tons).

Weight of foundations: 277,602 kg (306 tons).

Size of base area: 10,281.96 square meters (2.54 acres).

Cost of construction: 7.8 million francs ($1.5 million).



http://sbdcnet.utsa.edu/





Financial Plan

THE PRIMARY EVALUATING TOOL

Support all information

Make conservative projections Start-up Budget: amount needed to open

Operating Budget: ongoing expensesonce open

Sources and Uses Sheet



Methods of Financing

Personal funds

Family/ friend loans and gifts

Angel investor

Venture capital

Grants

Personal loan

Business loan



What is an Guaranteed Loan?

Loan obtained from a financial institution,guaranteed by the

Loans of various sizes



What are the Requirements?

An excellent personal and businesscredit record

Adequate collateralCash investment: generally 20-30% of

total project

Experience in the business you arestarting

A solid business plan



Financial Plan: Startup

Budget Personnel (costs prior to opening)

Occupancy (lease, rent, or mortgage)

Legal/ Professional Fees

Equipment Supplies

Salary/ Wages

Utilities

Payroll Expenses

Internet Licenses/ Permits

Insurance

Advertising/ Promotions



Financial Plan: Operating

Budget Personnel Lease/ Rent/ Mortgage Loan Payments Legal Fees

Accounting Supplies Salaries/ Wages Dues/ Subscriptions/

Fees

Repairs/ Maintenance

Insurance Advertising/ Promotions Depreciation Payroll Expenses

Internet Payroll Taxes Travel/ Entertainment Miscellaneous 3-6 Months of Operating

Capital



Financial Plan: Sources and Uses

Sources of funds

Details of requested financing

Amount Use

Terms



SOURCES & USES OF FUNDS

SOURCES OF FUNDS

INVESTMENT CAPITAL

Cash on Hand

Investment by FounderInvestment by Others

Incentives and Grants

DEBT CAPITAL

Bank Business Loan

Bank Personal Loan

SBA Guaranteed Loan

Other Loans

TOTAL

APPLICATION OF FUNDS

Rent & Security Deposits

Equipment/ Fixtures

Leasehold Improvements

Initial Inventory

Working Capital

Insurance

Professional Fees

Advertising

Signage

Contingency Reserve

TOTAL



CASH FLOW PROJECTION Year One

Month 1 2 3 4 5 6 7 8 9 10 11 12 Total

Cash In-Flows

Sales

Other Income

Total In-Flows

Cash Out-Flows

Cost of Goods Sold

Rent/ Mortgage

Owner's Salary

Other Salaries

Advertising/ Promotion

Utilities

Loan Payments (current)

Loan Payments (previous)

Telephone

Office Expense

Dues/ Subscriptions

Accounting

Insurance

Professional Fees

Internet

Repairs/ Maintenance

Licenses/ Permits

Travel/ Entertainment

Legal FeesBank Charges

Miscellaneous

Total Out-Flows

Beginning Cash Balance

Ending Cash Balance



Pro-Forma Income Statement

Year 1 2 3

Sales

Less: Cost of Goods Sold

Gross Profit

Operating Expenses

Rent/ Mortgage

Owner's Salary

Other Salaries

Payroll Taxes

Advertising & Promotion

Telephone

Office ExpenseDues and Subscriptions

Accounting

Insurance

Professional Fees

Internet

Repairs & Maintenance

Licenses & Permits

Travel & Entertainment

Legal Fees

Bank Charges

Miscellaneous

Depreciation

Amortization

Interest

Total Operating Expenses

Net Profit Before Taxes

Pro Forma Balance Sheet



Pro-Forma Balance Sheet(Opening Day of Business)

CURRENT ASSETS

Cash

Accounts Receivable

Inventories

Prepaid Expenses

Other Current Assets

TOTAL CURRENT ASSETS

FIXED ASSETS

Land

Leasehold Improvements

Equipment

Vehicles

Other Fixed Assets

Subtotal Fixed Assets

Less: Accumulated Depreciation

TOTAL FIXED ASSETS

TOTAL ASSETS

CURRENT LIABILITIES

Accounts Payable

Short-Term Debt

Accrued Expenses

Other Current Liabilities

TOTAL CURRENT LIABILITIES

LONG-TERM DEBT

OWNER'S EQUITY

Paid-In Capital

Retained Earnings

TOTAL OWNER'S EQUITY

TOTAL LIABILITIES & OWNER'S EQUITY



Appendices

Supplemental materials Resumes of management team

Past three years of tax returns

Current bank statements

Copies of existing loans or notes Interim income statement and balance sheet

Personal financial statement

Copies of legal documents

Copies of potential contracts

Letters of reference

TOTAL PACKAGE FOR A LOAN APPLICATION

Documents

Writing Business Proposals, Business Plan and Case Reports