Planning  for  your  business    

Prajakt  Raut  President  –  Angel  Investors  Consor2um  Execu2ve  Director  –  The  Hatch    Visit  the  Virtual  Learning  Center  for  startups  at  www.thehatch.in    www.facebook.com/TheHatchforStartups  

An  idea  is  not  a  business  

A  business  has  to  be  constructed  around  an  idea  

•  What  do  you  do  •  How  do  you  do  it  •  How  do  you  make  money    

A  business  plan  is  useless  product.  

But  it  is  a  priceless  process.  

Provides  a  structured  and  logical  framework  for  planning  your  business  

Plans  means  nothing.  Planning  is  everything.    

Should  address  the  following  ques>ons  

o  What  problem  or  opportunity    are  we  addressing?  

o  How  are  we  addressing  it?  

o  How  are  we  planning  to  do  it?  

o  Why  are  we  doing  it?  

 

The  market/Target  Audience  

Product  /  service  

Organiza>on  &  Opera>ons  planning  

Business  case  :  measure  against  YOUR  goal  

Create  wealth  

Serve  the  poor/reduce  unemployment/make  people  happy  

Do  what  I  enjoy  

Etc.,  etc.  

A  business  plan  has  internal  as  well  as  external  uses  

Internal uses •  Understanding business case

•  Planning your business

•  Provides parameters to evaluate and made adjustments

•  Monitoring progress

•  Ensures team alignment

•  Help recruit senior personnel

External uses •  Funding

•  Alliances

•  Board members / advisors

•  Partnerships

•  Mergers and acquisitions

What’s  the  process  of  working  on  a  business  plan?  

o  Start  with  a  ‘story’  -­‐  ‘See  the  film  in  your  mind’    

o  Work  out  rough  milestones  and  goals  

o  Think  deeply  of  how  you  will  implement  it  

o  Work  out  the  ‘structure’  of  an  excel  sheet  –  with  costs  and  revenues  

o  Start  working  in  the  excel  sheet  –  assump>ons  are  cri>cal  

o  Work  on  mul2ple  ‘scenarios’  

o  Finally,  ar2culate  it  into  the  ‘presenta2ons’  

It’s  a  liNle  bit  like  planning  a  journey  

Idea  

Implementa>on  

Can  solve  a  problem  

Improve  quality  of  life  

Improve  something  

Fulfill  a  need  

Cheaper  

Faster  

BeNer  

Fuller  

Nicer  

Nearer  

Examples  of  cheaper:  

Lower  price  0r  accessible    to  more  people  e.g  .EMI?  

Improve  something  

Product    

Service  

Value  

Business  model  

New  users  

New  uses  

Having  a  good  idea  is  not  the  same  as  having  a  business  plan.  

SeVng  up  a  chain  of  coffee  shops  is  more  than  just  making  great  coffee  

Building  a  coffee  chain  requires  the  following  competencies  •  Real  estate  procurement  

•  Facili2es  management  

•  Brand  iden2ty  

•  Marke2ng  

•  Sales  

•  Food  handling    

•  Supply  chain  /  procurement  

•  Processes  

•  Standardiza2on  

•  HR  –  hiring,  training,  reten2on  

•  Service  management  •  Legal,  finance,  audit  

•  Vendor  management  

•  MIS  

Etc.  etc.,  etc….  

Dynamics  of  an  e-­‐commerce  business  

Brand  Strategy  

Value  proposi2on  &  posi2oning  

Target  Audience  

Pricing  

Brand  Personality  

Product    

Procurement  

Produc2on/Packaging  

Supply  chain  

Vendor  management    

Capacity  u2liza2on  

Portal  

Technology  PlaYorm  

Look  &  Feel  –  user  experience  

Ordering  mechanisms  –  including  ‘order  on  phone’  

Payment  gateways  &  methods  

Logis>cs  

Delivery  &  fulfillment  mechanisms  

Warehousing  

Logis2cs  partners  

Order  Management  

Marke>ng  

Marke2ng  strategy  as  well  as  tac2cal  idea,  sales  strategy                      

Media  Plan  &  Budgets  

CRM  Strategies  &  Ideas  including  loyalty  programs,  referrals,  etc.    

Team  Roles  &  Responsibili2es  iden2fica2on  

HR  policies  

Team  hiring  &  reten2on  plan  

E-­‐commerce  

How  many  vendors  are  involved?  

Technology  &  portal  development  partners  

1.  E-­‐commerce  capable  

Technology  partners    

2.  Hos2ng  partner  3.  User  Interface  partner  4.  Payment  Gateway    

5.  Tes2ng  &  bug  fixing  experts  

Opera>ons  partners  

1.  Packaging  &  prin2ng  partners  2.  Logis2cs  partners  3.  Recruitment  consultants  

4.  CRM  partners/CRM  plaYorm  

vendors  

5.  Database  vendors  6.  Process  Training  Consultants  7.  Sod  Skill  Training  Consultants  8.  Outsourced  Call  Centre    

Marke>ng  &  Brand  Communica>on  partners  

1.  Brand  iden2ty  specialists  2.  Photographer  3.  Direct  Marke2ng  agency  

4.  Social  Media  Agency  

5.  Adver2sing  Agency  6. Media  Buying  agency  

19  Partners  /  Vendors  involved  in  the  implementa>on  process  

To  make  a  business  case  around  a  good  idea.  

 

 Objec>ve  of    today’s  session  

 

 Fall  in  love  with  a  PROBLEM.    Don’t  get  infatuated  with  a  solu>on.      [Allows  you  to  try  new  solu2ons  if  one  does  not  work]  

 

   To  have  one  great  idea,  have  many  of  them.      Thomas  Edison  

 

 Exercise  1  

Iden>fy  the  problem  or  need  that  you  want  to  own  

Present  it  as:    

1.   The  situa>on/environment  [e.g.  accommoda2on  choices  in  Gurgaon  are  either  too  expensive  or  too  basic  &  dirty]  

2.   The  problem  you  want  to  address  [e.g.  “We  want  to  address  the  problem  of  finding  smart,  cheerful  accommoda2on  at  reasonable  prices]  

 

 Exercise  2  

State  the  ideas  that  address  the  problem  that  you  chose  

Present  all  the  ideas  you  considered  and  explain  why  you  discarded  some.    

Implementa>on  planning  

The  most  cri>cal  component  of  the  plan  

Implementa>on  planning  –  things  to  consider  

•  Customer  segments  and  value  proposi2on  •  B2B,  B2C,  B2B2C  

•  Channels  to  reach  them  •  Marke2ng  strategy  •  Sales  strategy  •  Revenue  streams  •  Key  ac2vi2es  •  Key  partnerships  •  Key  resources  •  Cost  structures  

Crea>ng  an  overview  of  your  business  

•  What  is  the  pain  point  you  are  addressing  or  what  is  the  opportunity  you  are  targe2ng?  i.e.  the  need/value  proposi>on  

•  What  is  your  service/product/concept?  i.e.  what  do  you  do?  i.e.  Concept  

•  Whom  is  this  service  targeted  at?  i.e.  your  customers/consumers?    i.e.  The  Target  audience  

•  What  is  the  business  model?  I.e.  Who  will  pay  how  much  and  to  whom  

•  What  is  the  scale  of  aspira2on?  i.e.  how  large  do  you  see  yourself  as  in  a  3-­‐5  year  >me  period?  

Example of a business model Types  of  business  models  

•  Free  for  users  –  adver2sers  pay  •  SAAS  –  pay  only  for  service  /  rental    •  Pay  per  use  •  Pay  up  front  •  Annual  /  periodic  payments    •  Pay  in  installments  •  B2B2C  

     

Example  of  a  business  model    “We  have  a  B2B2C  model.  We  will  charge  parents  Rs.250  per  child  per  month.  This  will  be  collected  by  the  school  from  parents  who  subscribe  to  our  service  and  will  be  paid  to  us  at  the  beginning  of  every  quarter.      

Students  will  be  pre-­‐registered  but  subscrip2on  is  not  compulsory  and  parents  can  choose  to  opt  out.      School  will  keep  20%  of  total  revenues,  which  we  will  give  them  at  the  end  of  the  year  on  achieving  a  pre-­‐agreed  minimum  revenue  commitment.”  

Your goals

•  In  the  next  3  –  6  months  

•  In  the  next  12  –  18  months  or  24  months  

•  In  the  next  5  years    

•  Indicate  when  you  become  profitable  

Current achievements / status:

Competitive landscape

•  Who  will  you  compete  with?  [current  or  in  future]  

•  Why  would  someone  choose  you  over  them?  

•  Why  do  you  have  a  chance  to  be  a  dominant  player?  

Planning  for  your  business    

Prajakt  Raut  President  –  Angel  Investors  Consor2um  Execu2ve  Director  –  The  Hatch    Visit  the  Virtual  Learning  Center  for  startups  at  www.thehatch.in    www.facebook.com/TheHatchforStartups