social business planning
DESCRIPTION
Social business or social enterprise needs careful planning. This slide series was developed and presented for the Social Business Launch Pad seminars by William P. Kittredge, PhD. The Social Business Launch Pad is a joint education seminar series co-sponsored by the Yunus Center at AIT and the Thai Social Enterprise Office http://www.tseo.or.th/TRANSCRIPT
Business Planning for Social Business
Prepared & Presented by:
William P. Kittredge, PhD
Social Business Launch Social Business Launch PadPad
Why Have a Business Plan?
Value lies in the process of researching and thinking
about your business in a systematic way
The act and learning process of making a business
plan may make you a better entrepreneur
Allows you to avoid big mistakes by developing a
game plan
Why Have a Business Plan?
One survey study shows that companies who
completed business plans were almost twice as likely to effectively
expand their businesses or acquire capital
compared to those who didn’t.2
General Company Description
Products and Services
What factors will give your product or services
competitive advantage or disadvantage?
What are the pricing, fee, or leasing structures of your
products or services?
Marketing Plan
Marketing PlanMarket Research
Why? Make sure your business is on track
How? Public information & gathering your own data
Economics:
What is the total size of your market?
What are its growth potential and opportunities?
What barriers to entry do face?
ProductFor each product or service
What are the most important features and why?
What will the product do for the customer?
Marketing PlanCustomers:
Who are your target customers (businesses or consumers)?
What are their characteristics (demographics)?
CompetitionWhat products and companies will compete with you?
How will your Competitive Analysis look?
Marketing Plan
Marketing Plan• Niche
• How does your company fit into the world?
• Strategy• Promotion: How will you get the word out to
customers?• Promotional Budget: How much will it cost to get
the items needed for promotion?• Location: Is your location important to costumers?
Is it convenient?• Distribution Channels: How will you sell your
products/services?
Marketing Plan: Sales Forecast Spreadsheet
Attaches numbers to your plan
Based on historical sales, marketing strategies, market research, industry data
Two forecasts: “best guess” and “worst case”
Operational Plan
Management and Organization
• Who will manage the business on a day to day basis?
• What experience does that person bring to the business?
• What special and distinctive competencies?
• What is the plan if this person is lost in incapacitated?
Management and Organization
• Identify and list professional and advisory support– Board of directors
– Management advisory board
– Attorney
– Accountant
– Insurance agent
– Banker
– Consultant(s)
– Mentors and key advisors
Personal Financial Statement
Shows assets and liabilities held outside the business and personal net worth.
Startup Expenses and Capitalization
• Estimate expenses. Will you have sufficient capital?
• Your business may cost more than you anticipate• Add “padding” to the budget
• Add separate “contingencies” to account for the unexpected
• Explain your research, sources, amounts, and terms of proposed loans.
• Explain how much each investor contributes and what percent of ownership each will have.
Expenses and CapitalizationSpreadsheet
Budgeting
C:\Users\Wilson1\Dropbox\Splash SE\Business plan\Examples for Presentation\Startup Expenses and Capitalization\Daycare Solution.ods
Financial Plan• 12-month profit and loss projection What
it will take to make a profit and be successful?
• 3- year profit and loss projection Optional projection if company wants to forecast longer term
• Projected cash flow Plan how much you need before startup for preliminary expenses, operating expenses, and reserves
Financial PlanProfit and Loss Projections
Financial Plan• Opening day balance sheet what
assets the company holds, what its liabilities are
• Break-even analysis predicts sales volume at a given price required to recover total costs
Financial Plan
Financial Plan
Break-Even Point Q = Fixed Cost / (Unit Price - Variable Unit Cost)
Appendices• Include details, studies, graphs and charts in
your business plan, for example:• Brochures and advertising materials
• Industry and market research studies
• Blueprints and plans
• Maps and photos of location
• List of equipment owned and to be purchased
• Copies of leases and contracts
• Letters of support
• List of assets available for a loan
Refining the PlanFor Raising Capital
Bankers: Amount of loan, how the funds will be used, what will it accomplish, requested payment terms
Investors: Funds needed for short term and long term, how the funds will be used, estimated return on investment, exit strategy for investors, financial reporting
Refining the PlanFor Types of Business
Refining the PlanFor Types of Business
Refining the PlanFor Types of Business
Refining the PlanFor Types of Business
Executive Summary• Write this section last with 2 pages or fewer
• Explain the fundamentals of the business:• What is your product?
• Who are your customers?
• Who are the owners?
• What do you think the future holds?
• Enthusiastic, professional, complete, and concise.
Reporting Reporting ResultsResults
Monitoring & Impact Measurement : Social ROI
ROI refers to a single ratio - SROI is more like TBL reporting.
Value based, in part, perception and experience of stakeholders
Employs indicators of change
Where possible, uses monetary values for these indicators.
It is an emerging management discipline: a skill set for the measurement and communication of non-financial value.
Monitoring & Impact Measurement : Social ROI
Example: Water purification systems social business
Impacts: Educational FinancialPublic Health
Indicators:Attendance and Test Scores; also testimony of teachersDisplacement of prior costs, including health careImprovement in public health; measured as lower cost to
government and charity provided healthcare systems
Social ROI:Monetisation principle
Practical benefits of Monetary proxies :
it induces transparency since it precipitates the clarification of which values have been included and which have not been included;
it permits sensitivity analysis to show which assumptions are more important in that the result is more affected by changes in some assumptions than others;
it helps identify the critical sources of value and so streamlines performance management.
Social ROI:Monetisation principle
Practical benefits of Monetary proxies :
it induces transparency since it precipitates the clarification of which values have been included and which have not been included;
it permits sensitivity analysis to show which assumptions are more important in that the result is more affected by changes in some assumptions than others;
it helps identify the critical sources of value and so streamlines performance management.
Social ROI:Monetisation principle
Don't get crazy with the numbers
Some things cannot be quantified or monetised
How many kilos do you love your Mother?
How many meters do you love Thailand?
Who would be silly enough to ask this type of question?
Social Business Social Business Action Plan Action Plan
Action Plan
1. Clearly define your objective: it must be measurable and achievable.
2. Decide who is to be involved in your action-planning group.
If your objective is a small, personal goal, it may be only you.
However, if it is a company objective you may want to include people who will be involved in carrying out the action plan.
3. Hold a brainstorming session with the participants to establish all possible courses of action that must be taken in order to achieve the desired objective.
Action Plan4. Develop an action plan according to the template handed out in class or something that works for you that contains the same information.
5. Review the plan thoroughly to check that it is complete.
6. Implement your action plan.
7. Track the progress achieved and tick off completed tasks.BE HONEST
8. Review and amend the action plan on an on-going basis.
9. Communicate with all of the people involved throughout the process.
Action Plan
8. Review and amend the action plan on an on-going basis.BE RUTHLESS
9. Communicate with all of the people involved throughout the process.
Funding Social Funding Social Business Business
Social Business is Still Business
The addition, or substitution, of a 'social good' to, or for, 'profit'
• Changes the purposes (outcomes) of the activity
•Intention to create a 'social good' rather than 'profit' for investors
• Does not change the mechanics of enterprise
•Cannot survive if cannot pay the bills•Must still recruit, train, support and manage people•Must acquire financing
Social Business Financing
Crowd-sourcing very popular
Good source for finding potential capital funders:
Google: Charity Navigator
DAF Direct
Indiegogo
Kickstarter
StartSomeGood.com
Social Business Financing
Direct purchase support:
Google: Shopfunder
Ebay Store
Micro-loans:
Google: Kiva.org
donationpay.org
op
Social Business Financing
Local and National Business Groups – social business funding may be part of their CSR or could be
Banks doing CSR
International Corporations in Thailand, e.g. Toyota
Do Not Be Shy!!
Social Business Financing
Where to learn how:
Google: RocketHub Success School
AIT Yunus Center
StartSomeGood Crowdfunding 101
Final Thoughts Final Thoughts
Social Business Networking
Networking globally with social entrepreneurs:
Facebook:
Social Business and Economics https://www.facebook.com/SocialBusiness.org?fref=ts
Social Business Student Forum: https://www.facebook.com/SBSForum?fref=ts