Entrepreneurship Chapter 8

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The market: competition and competitive advantage

Major competitors Competing product or service: market share, price, competitive advantages and disadvantages What makes product or service unique

mission statement

a paragraph that describes the firm's goals and competitive advantages

Private Placement Memorandum

a specialized legal form of business plan crafted by lawyers for the purpose of soliciting formal investments

preselling

involves introducing your product to potential customers and taking orders for later delivery

test marketing

selling your product or service in a limited area, for a limited time

path to the business plan

1) vision 2) mission 3) elevator pitch 4) executive summary 5) business plan

the elevator pitch

A 30-second action-oriented description of a business designed to sell the idea of the business to another

invention plan

A business plan that provides information to potential licensees. Invention plans focus on the details of an invention, including intellectual property rights.

Vision Statement

A very simple 5-10 word sentence or tagline that expresses the fundamental idea or goal of the firm.

informational plans

Give potential customers or suppliers information about the company and its product or service.

the organization: related service providers

Identify your bank and banker, attorney and legal firm, accountant or bookkeeper, other consultants Major relationships established with well-known suppliers or customers Board of directors / board of advisors

tagline

Memorable catchphrase that captures the key idea of a business, its service, product, or customer. also known as a slogan

Executive Summary

One- or two-page overview of the business, its business model, market, expectations, and immediate goals

The market: marketing strategy

Overall strategy your firm pursues in the market Sales plan that shows specific ways you apply strategy to secure sales from your customers Longer-term competitive plan that shows how you protect your firm from efforts of the competition to unseat you

the organization: key personnel

Sell the most important single element in the business plan - you! Who are your key personnel? Talk about accomplishments rather than just experience Do not limit yourself to business

external legitimacy

The extent to which a small business is taken for granted, accepted, or treated as viable by organizations or people outside the small business or the owner's family.

pitch deck

The name of a slideshow presentation that summarizes a business or more often a business plan.

The Market: Market and target customer

Total population of people or firms you plan to sell to Target customer section: focuses attention on who would buy Demographics' relation to the product, how often they buy, and past experience

business plan

a document designed to detail the major characteristics of a firm - its product or service, its industry, its market, its manner of operating (production, marketing, management), and its financial outcomes with an emphasis on the firm's present and future

new entrant business

a firm whose product or service is established elsewhere, but is new to this market

pioneering business

a firm whose product or service is new to the industry or is itself creating a new industry

cover letter

a one page document on business stationary that introduces the business plan and the business owner to the recipient and indicates why the recipient is being asked to read the plan

proof-of-concept web site

an internet-based type of business plan providing information or demonstration of a product or service designed to solicit information on customer interest

data room

an online repository for the documentation that back ups and details the specifics of your business and business plan contents of the data room are very similar to those of the three-ring binder personal edition of the plan held and used by the founder

operational plan

business plans designed to be used internally for management purposes

title page

company name contact information date this version of the plan was completed proprietary statement to protect your ideas

the appendixes

copies of signed contracts, letters of intent or commitment, or contingency contracts results of marketing studies or pilot sales efforts industry reports price lists for products or services floor plans of the location, if it is central to the business advertising copy, such as ads, logos, catalog pages, brochures, sales letters, or press releases customer or spokesperson testimonials

The Company: Product/service and industry

describe firm's product or service explain how the customer uses the product propriety technology industry descriptions

internal understanding

extent to which employees, investors, and family members in the business know the business's purposes and operations

screening plan

gives the basic overview of the firm and a detailed look at the financials also called a mini-plan

the organization: legal and organization structures

legal form of the business where it is formally registered and located licenses or certifications along with the firm's intellectual property protections, like patents, trademarks and trade secrets

table of contents

lists major section headings sections underneath major sections put page numbers on every page of the business plan

key employee/partner plan

provides information on the company, product/service, market, and critical risks to prospective business or marketing partners or to prospective key employees

pitch

the name given to the formal presentation of a slideshow summarizing your business plan given before judges or potential investors or partners

research and development

the part of a business that is focused on creating new products or services and preparing new technologies, ideas, products, or services for the firm's market

risks

the parts of a business or business plan that expose the firm to any kind of loss - profits, sales, reputation, assets, customers, and so on

due diligence

the process of investigating a business to determine its value


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