Chapter 8 Business Plans

Invention plan

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

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.

Internal understanding

The extent to which employees. investors, and family members involved in the business know the business's purpose and operations.

risks

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

Tagline

(also known as slogan) Memorable catchphrase that captures the ey idea of a business its service, product, or customers.

Research and development

(often abbreviated R&D) the part of a business that is focused on creating new products or services and pareparing new technologies, ideas, products, or services for the firm's market.

Elevator Pitch

A 30 second (100 words or less) action-oriented description of a business designed to see the idea of the business to another.

Business Plans

A document designed to detail the major characteristics of a firm- its product or service, its industry, its marker, 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

Executive summary

A one to two page (250-500 words) overview of the business, its business model, market expectations and immediate goals. It is typically put at the start of a business plan and is the most popular summary form for a business plan.

Cover letter

A one-page document on business stationary (also called a letterhead) that introduces the business plan and the business owner to the recipient and indicates why the recipient is being asked to read the plan.

Mission Statement

A paragraph that describes the firm's goals and competitive advantages.

Proprietary technology

A product or service or an aspect of one that is kept as a trade secret or is protected legally using patent, copyright, trademark, or service mark.

private placement memorandum

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

Vision Statement

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

Screening plan

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

Proof of concept Web site

An internet based type of business plan providing information or demonstration of a product or service designed to colicit information on customer level.

Operational Plan

Business plans designed to be used internally for manangement purposes.

Informational Plans

Give potential cutomers or suppliers information about the company and tis product or service.

Preselling

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

Key employee/partner plan

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

Test Marketing

Selling your product or service in a limited area, for a limited time.