Business Plan
You will need to produce a business plan for a new company and engineering-based product or service.
This plan will contain the following information, which is split into business development tasks and financial tasks. They are:-
Business Development Tasks
1. Product or service definition.
2. Identification and analysis of the market for the product.
3. Legal establishment and organisation of the business.
4. Business strategy.
5. Comment / reflection on team management and leadership.
Financial Tasks
6. Initial cost estimation of product (or service).
7. Estimated break even analysis.
8. Assessment of start-up costs and identification of funding sources.
9. Cash flow forecast for year 1.
More details of the requirements for each part of the brief follow.
1. Product or service definition.
- A description of your intended product or service, with an illustration for a product (n.b. full engineering drawings are not necessary), or a process flow diagram for a service.
- A discussion of your expected product / service lifecycle and plans for a future product portfolio.
- Plans for ongoing support of the product in use (if applicable).
2. Identification and analysis of the market for the product.
- Who is the intended customer for your product / service?
- What are your short, medium and long-term annual sales targets?
- In what market will you be competing? Who are your competitors?
3. Legal establishment and organisation of the business.
- What type of business are you?
- Names of executive directors and roles.
- Initial share capital (if applicable).
- Organisational structure of the business.
- Location and premises.
4. Business strategy.
- What business are you in?
- Short, medium and long-term business objectives.
- Mission statement.
- Analysis of strengths and weaknesses.
5. Comment / reflection on team management and leadership.
For this section, each member of the group will carry out a Belbin team roles assessment at the start of the assignment. You will then reflect on your Belbin team roles and your contribution to the group working.
6. Initial cost estimation of product (or service).
The initial cost to produce one product (or service), using one of the methods outlined in the module.
7. Estimated break even analysis.
The estimated quantity required to break even, and the price at which the product / service will be sold.
8. Assessment of start-up costs and identification of funding sources.
How much capital will you require to start up your business? How will you source this?
9. Cash flow forecast for year 1.
Expected cash flowing in and out of the business for year 1. How profitable is the business? What is the forecast time for reaching the required sales quantity and breaking even?