1. SUGGESTED BUSINESS PLAN FORMAT
(Writing a Winning Business Plan)
1. INTRODUCTION
There are at least a hundred business plan formats. You may wish to use any one of them.
However, for our purpose, you are enjoined to follow the suggested (prescribed) business
format to test the understanding of various entrepreneurial and other business concepts
taught in the classroom.
The business plan is a story of how you intend to put up a business that will be
communicated to investors, business partners, lenders, regulators and employees. It is a
documentation of the plan, and a communication tool.
2. PARTS OF THE BUSINESS PLAN (from Trilogy of Enterprise)
I.The Business
A. Business Concept and Business Model
B. Business Goals : VMOKRAPI
(Vision, Mission, Objectives, key Result Areas, Performance Indicators [Metrics])
C. Business Offering and Justification
II.Executive Summary
III.Business Proponents : Type, Capabilities and Contribution
IV.Primary Target market and Main Value Proposition
V.Market Analysis, Potential Sales, Realistic Sales, Market Share, Estimate based on
External Analysis:
MAKRO Market – PESTEL
MICRO (industry) Market – Customer, Location, Competition
VI.The Product and Service Offering
(Concept, Design, Alpha Testing, Beta Testing, Evaluation)
VII.Enterprise Delivery System; Business Strategy and Competitiveness in relation to its
Objectives (Desired Results / Outcome)
VIII.Financial Forecast: ROI, ROE, Contingencies
1. PnL
2. Cash Flow
3. Balance Sheet
IX.Compliance with Regulators
X.Exit Strategy / Contingencies

2. FURTHER NOTES
I. Business Concept, Model, Goals, and Offering
1. Business Concept
It is the idea or abstraction of the product offering to a targeted customer group. It
must be brilliant, unique, differentiated and “compelling”. It should be a product of
a creative process – not a dry old concept. It must be innovative – NEW!
It can’t be a boring business, just like the others, a “me too” business, where
everyone can be into. It must be specific while at the same time, not more than 50
words.
X NO NO – We are going to be in the food business, restaurant business
YES! - A floating Japanese restaurant located in a middle of pond with Zen garden
- A bar in a tree house high above hills in Metro Manila or within a
swimming pool
- A restaurant or river boat cruise (as in Lontoc)
X We are in the footwear business
Sandugo Business Concept –“Sandugo crafts ruggedly handsome designed sandals
and slippers for adventurers, outdoorsman, construction worker who loves footwear
that breathe well and do not wear easily.”
VENTE –“Vente sells trinkets, toy, knuckle cracks and all sets of wearable accessories
to parents, teens, boys and girls in highly accessible mall location at one common
price, Twenty (Vente Pesos). Vente caters to impulsive buyers and gift given on a
budget.”
The business concept includes:
1. PTM (Primary Target Market)
2. Product / Product feature
3. Placement / Channels
4. Logic behind a product – why the product satisfies customers’ needs and vice
versa. Why the customers need the product.
The winning business concept, (which is compelling) is delivered with a punch! The
business concept briefly describes the essence of business in simple but powerful
way!
2. The Business Model
How the business intends to make money? It is a combination of various business
formula / elements on how the business will be run to make money. Does it possess
by factors for success in that business?

3. The business model has to be dynamic because of competition, costs, customer and
revenue pressures. (Please see Alex Osterwalder’s Business Model Canvass)
Basic Questions Answered under Business Model Portion
1. How will the business realize sale revenues and in what form?
2. What are the costs, how the costs will be met / managed to assure healthy
operating margins, net income. What will drive costs up and how can they be
reduced / managed?
3. What are the resources and processes needed to make the enterprise
competitive and differentiated?
4. How will the enterprise obtain the financing to:
1. Finance its growth
2. Stay competitive
Recently, seven out of ten businesses tweak their business models to stay
competitive and/or to compete in middle market. Previously, in the last 3 decades,
strategy is the buzzword.
Model – car model
Strategy – how car is built modified
Tactic – how the car is driven
The statement of business concept and model excites the reader to read more,
because its attractive and compelling!
3. The Business Offering – addressed to prospective investors.
1. The Test of Feasibility
2. Projected returns / participation by stake holder
The business offering should summarize proposed benefits to the stakeholders and
the business. Thus, “If we can obtain additional investments loan of P 2,000,000.00
to beef up the working capital, the business sale will increase by P 10,000,000.00
and [ x sale/asset turnover, resulting in additional GP of P2M (assuming 20%
GP/Sales ratio)] and P 500,000.00 additional net income or ROE of 25% (for #2).
Prior # 2, certain tests of feasibility / risks must be addressed:
1. Marketing Risks / Feasibility
2. Cash Flow Risks / Feasibility
3. Technical / Execution Risks feasibility (Manageable Execution)
# 1, 2 and 3 can be addressed by a compelling value proposition to assure the
correct / right amount of captive markets risk. Thus BEP must be established and

4. using conservative estimate as to whether break even can be achieved, given correct
estimate of sales obtained for projected demand and competitive activities.
For investors, this portion is the TERM sheet.
1. How big is the offering?
2. Size of offering for investor
3. Nature of debt, convertible debt, bonds, corporate PN, private placement,
preferred stocks, common stocks?
4. Returns – ROE, ROI, PN rate, conversion, effect of debt to equity conversion.
5. Terms, when to redeem
6. Pre-termination, if when allowed?
7. Security / Security Risks? How are they to be mitigated / addressed?
II. EXECUTIVE SUMMARY – Last to be written, 2 -3 pages and summarizes I, III, IV, V, VI and
VII
III. BUSINESS GOALS (VMOKRAPI)
Vision, Mission, Objectives, key Result Areas and Performance Indicators
1. VISION – It is a futuristic image of a business expressed in concrete terms over a time
frame.
No No:
To be the No. 1 ______________.
To be the No. 2 ______________.
To be the best _______________.
Better:
To sell P1B in Northern Luzon in 5 years’ time, (2x sales from its present level).

5. You must be able to chart / graph / picture map that vision. The Vision, as the business
concept is, MUST BE COMPELLING!
2. MISSION – The basic purpose for setting up the business. It tells how the business
conducts business; its values and philosophies and how it distinguishes itself from other
businesses. It details how it satisfies various stakeholders, profit, people and placement
and ever how it utilizes technology. It is the cornerstone for running the business.
3. OBJECTIVES – are desired outcome / results of business, inputs, process and marketing
setting up plants, purchasing equipment can’t be objectives. Objectives must answer the
SMART criteria:
SPECIFIC
MEASURABLE
ACHIEVABLE (Doable)
REALISTIC (manageable, Capable of being executed)
TIMEBOUND
Objectives are the subdivision, cascading down of Vision, Mission.
Four MINIMUM objectives of business (there can be more but for simplicity, the four are
more than enough).
1. CUSTOMER OUTCOME - As a business is defined as an entity that creates customers
and-on value for the customers, customer delight and satisfaction is at top of the list
of business objectives. Customer satisfaction delight comes first! Customer is
satisfied by Q, D, P in that order:
a. QUALITY
b. DELIVERY
c. PRICE
2. MARKET OUTCOME – customer satisfaction results in trial, repeat sales and more
sales. Market outcome is expressed in terms of sales, market share, % increase in
sales, etc.
3. FINANCIAL OUTCOME – More or less sales results in cash Flow, Gross Profit, Net
Income, Turn Over, ROI, ROE.
4. JOB GENERATION AND EMPLOYMENT – Continued operation results in more jobs
and employment that impacts society and reduces poverty. It may be just a
consequence of doing business or deliberately pursued.
The level and size of goals are determined by the opportunity screen:

6. “KAYA BA?” – does the proponent have enough resources and competence to
meet the objectives?
“KATUGMA BA?” – is the objective a perfect fit for the proponents motivation /
passion?
1. KEY RESULT AREAS
They are subdivision of performance metrics for various objectives. (How the
objectives vs. performance will be monitored and measured.
Thus:
For Customer Outcome:
Customer satisfaction level
Customer awareness of product
Customer / brand loyalty / recall
% of repeat sales
% of migration for the brand
Number of conversion from prospects to sale
In a hospital, they can be:
Number of patient vs. admission who get well
Number of patient who died; who were referred to the hospital
Number of repeat patients
What they like, don’t like in the hospital
For market outcome
Sales No. Of units / peso value
Sales / Region / Outlet
Sales / Products / SBU
Sales Growth
Sales / prospect
Sales / Sale personnel / PAX
For Financial Outcome
GP – ENIAT EBITDA
Net Income - EBIT
Liquidity : Quick Ratio, Current Ratio
Cash Flow
Leverage
ROI, ROE / ROA
2. PERFORMANCE INDICATORS
They are the numbers that are spread out for the past and projected into the future
at year. They are actual metrics number!

7. IV. BUSINESS PROPONENTS (ORGANIZATIONS)
Their competencies and cash contributions. It answers the question:
1. Who will execute the business concept?
2. Can they do it in a successful winning way?
It describes cash and competency contribution of proponents. There are at least
four groups involved in the organization of the new enterprise of people in the
organizations:
1. Financial backers / mobilizers
2. Technology / process holders
3. Top management team / Board / Senior managers
4. Executives (middle manager, their competencies and experience)
1. FINANCIAL BACKERS / MOBILIZER – Because a new enterprise eats up a lots of
cash at the start, the investors would want to know who else has deep pockets
to sustain but out the enterprise. If the reader is technology provider, he
would like to know if investors have lines of credit / back up while the
enterprise gestates.
2. TECHNOLOGY AND INTELLECTUAL CAPITAL PROVIDER – Is the technology
proven? Does it work? Can the new enterprise absorb the new technology?
(Does it have the manpower capacity to absorb high tech).
3. THE BOARD OF DIRECTORS, THE PARTNERS AND ENTREPRENEUR – Do they
have PIC?
a. PASSION – Gut and heart flame of entrepreneur
b. INTEGRITY – Do they have high moral character? Are they honest, do they keep
their word?
c. COMPETENCE – Do they have sufficient business education, training, expertise
to run the business?
Are they determined and will follow through the end? Do they have good
judgement, creative and critical thinking? Are they emotionally mature to
handle adversities.
4. THE MIDDLE MANAGER – Implementors. They should be capable and good
choices in implementing the business concept. For this purpose, the character
references and CV of the middle manager must be included.
The middle manager/ implementor, answers the manageable risk (execution)
of the business concept.

8. For micro and small enterprises, the 4 groups are bundled into the
entrepreneur. A higher degree of self mastery is needed for micro and small
enterprise entrepreneur.
The entrepreneur is the financier, the boss, the repairman, operator, delivery
boy, collector, the book keeper – “LAHAT AKO”.
The passion, the integrity and competence of the proponents must be
thoroughly discussed.
V. THE PRIMARY TARGET AND THE MAIN VALUE PROPOSITION
This section of BP addresses the marketing risk portion. The business should have enough
number of buying customer to absorb costs, and give enough returns for investors.
This should contain:
1. CUSTOMERS
a. Customer Profile – needs, wants vs. company products and service
b. Demographics – age, income, religion, occupation, residence, all other
manifestation.
c. Psychographics – motivation, preference, lifestyle, attitudes, (internal aspects of
PTM).
d. Technographic – degree of expertise of customer in use of product especially if
enterprise is involved in sale of high technology product / service.
2. SIZE AND LOCATION OF PTM
1. Secondary data / Are there enough PTM?
2. Where are they located?
3. Next resort is to resort to first hand research
a. Customer survey
b. Customer observation
c. FGD UAI
e.g. Traffic Food Cart
Thru GSM La Tondeña, SMB markets / promote in street dancing
Realtors leaflets in mall
Casinos pick up players in mall through free shuttle service
3. MAIN VALUE PROPOSITION
It is the “compelling reason” why a PTM buy the product or service. It has 4
components:

9. 1. Captive Market – community of buyers who desire / buy the products. Thus,
debts, credit card for women, loyalty card (SM Advantage, Batang National) or
Mercury’s Suki card are ways of capturing a market to buy again.
2. Affordability – the right price for the right quality. The price is competitive
versus competitive product. Because it is affordable the customer has no
choice except to buy the product.
3. Real Value for the Customer – the product is a perfect fit to customer wants
and needs. It could not ask for more. It is superb. The customer is satisfied
delighted. With all product benefits and customer service.
4. Uniqueness and Differentiation – the product is a stand out! Quality and
delivery are flawless! It is not a me too product service. It could be bankers
dozen (13 or 14 pieces). Fresh hot product, exquisite taste, heavenly ambiance.
It pampers the customers.

10. 1. To arrive with a market estimate, macro environment change must be quantified. Thus
simply stating RP population in 2011 will be 94 million is meaningless; (there are more
females than males in Metro Manila – also meaningless!).
2. Select / prioritize the MACRO opportunity that has direct more impact on the enterprise,
(as verified with existing business result). Thus for many hospitals, there are with greatest
input is not life style disease, and morbidity and mortality. But increasing payment for
Philhealth and HMO (many hospitals experience Philhealth payments do be at 60 – 70% of
total revenues. The one that has greatest impact are OB Gyne, and eye operations
admission is not high birth rate, or high incidence of cataract, but generous
reimbursement for Philhealth of CS and eye operation.
3. For the Industry
a. Identify the various industry segment. E.g. milk – infant formula, diebetics liquid
milk, powdered milk, ready to drink powder. (For electricity generation,
transmission, distribution). (For oil industry: exploration, drilling, refinery,
distribution, retail).
i. Sales / industry segment
ii. GP / industry and attractiveness
b. What is the historical supply and demand?
c. What is the forecast – will industry variable remain or change?
d. What is the impact of PESTEL on the industry?
4. For the market (specific industry segment)
a. What are the major factor affects supply and demand?
b. What are the common variables:
i. Common – number of people needing the product
ii. Variable – sex, age, preferences
5. MICROMARKET – the PTM
Concentrate on PTM where you are in. Compare factors for your enterprise.
YOU Major Major Major Competitor
Competitor 1 Competitor 2 3

11. 1. Competitive
Advantage
Product
Price
Promotion
Placement
Process
Location
2. Business Model
3. Strategies
4. Technologies
5. Weaknesses
The sales forecast can be derived from potential demand computing for actual demand,
subtract competition sales and project a conservative share of the micromarket within the
location.
VI. THE PRODUCT (POSITIONING)
1. What is the product / service
a. Feature attributes – real value to customers
uniqueness / differentiation (advantage vs. major competitor)
perfect fit to customer needs and wants
b. Price – affordability
c. Earth / People Friendly –safety / non toxic / non polluting
Recyclable
compliant with regulation
2. Testing
a. Alpha – in the plant / laboratory
b. Beta – in the market place
3. Motivation – compelling reason why customer should buy the product (summary of
MVP).
4. Manageable Execution
a. Available sales / distribution channel – ease of distribution and selling and costs
attribute to such.
b. Ease of promoting / selling the product.

12. i. Available media for ads
ii. Sales training / selling effort needed
5. What is the product positioning
VII. ENTERPRISE DELIVERY SYSTEM (SPATRES) - link with VMOKRAPI
a. Strategy
b. Program to achieve strategic objectives
c. Activities
d. Tasks
e. Resources needed to achieve
Strategy is the making the choice of possible options to meet strategic objectives:
satisfying customer wants and needs, achieving sale target (and beating
competitors) and reaching desired financial outcome covering.
a. Correct positioning
b. Differentiating for competitors and being unique.
c. Defining competitive advantage vs. major competitor
d. Defining the sustainability of enterprise.
It is using available resource to meet objective (nothing more nothing less).
EDS
INPUTS THROUGHPUTS OUTPUTS MATCHING OUTCOME/RESULTS
MEN PROCESS PRODUCT MARKETING OBJECTIVES
MACHINERY CONTROL SERVICES P'S OF CUSTOMER
MARKETING
MONEY SUPERVISION MARKET
METHODS TECHNOLOGY FINANCIAL

13. MANAGEMENT JOB GENERATION
EMPLOYEE WELFARE
(Defeat competitors delight
customers)
1. The EDS should highlight competitive advantage of the enterprise in the competitive
landscape (purple cow), or in a market served by competition (blue ocean). The
competitive advantage may come from inputs – cheaper better high tech materials,
better trained staff, technology used in processing, better products better
marketing.
2. Another way of looking at it will be to look at HR, Operations, Finance and Marketing
and how the unique, affordable, valuable product will meet customer needs and
wants, at an affordable price.
3. Everything results in high customer satisfaction, high sales, better profit, more highly
motivated staff and competitiveness of the enterprise.
4. EDS is the longest part of the Business Plan. It must be written in long form. It
proves, presents evidence how the enterprise can meet is desired outcomes.
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