How to write the beginnings of a Business Plan


Generally, it helps to know about the business sector before starting writing a business plan.  However, I will start to discuss writing the beginning of a business plan without having not one ounce of knowledge of the business.  This process is more challenging.

A friend was interested in investing in a crematorium.  He knew nothing about the business, and his expertise focused on home repairs.  There was some experience he had which he could transfer to his establishment of a crematorium.  But not having any clue, he asked me to look into it.

First, look at the overall market by looking at what the business entails, both in terms of equipment and licensing.  The Internet is the best tool to research ever made. Within the County of Northern Virginia, the focus of the study, the crematorium business required some licensing on a county by county basis and EPA requirements.  The study focused on one county.

Second, what is needed.  The equipment can be purchased,costing a couple of hundred thousand of dollars.  All operated using methane gas.  Given that methane gas prices were going down, the margins should increase over time when one cremates a body.  Also, crematoriums charge by body weight — the greater the weight, the more gas is required.   Even with the obesity trend, the crematorium does not lose money.

We have identified that there is a market.  There are two certainties in life, death and taxes, and crematoriums fell into the former.

Third, identify the growth of the business by analyzing the macro-economic trends. Is it a growing market?  This final analysis found the wrinkle in this market sector.  A study in the local demographics unquestionably showed that the mortality rates  were dropping.  And given the competitive environment, there was an obvious concern that the business of a crematorium would be highly  profitable.  There was no hockey stick growth.

Was there another way to approach a fast growth in this business?   So, when faced with a business that is stagnant or facing flat line growth, one studies different angles. There is the a macabre musical, Sweeney Todd, The Demon Barber of Fleet Street, where one could produce profitable meat pies from artificially induced death.  Then one attempts to explore other approaches to create market growth.  The only solution I could consider is the creation of nationwide franchises in this industry, but already there were competitors following this same route.

My quick study of this industry revealed that the business had considerable hurdles.  There was no attractive business in this space right now, unless a better, cheaper technology develops.

This exercise, nonetheless, indicated the basic approaches of developing a business plan — first, identify the product or the industry; secondly, quantify that market; and thirdly, analyze the macro-trends.  It is said that a journey of a thousand miles begins with the first step.  These approaches show the first step to that journey to begin drafting the first few pages of a business plan.

 

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About Juan Ramón Zarco, SVVGP 胡安•雷蒙•扎尔科

Juan Ramon Zarco, 胡安•雷蒙•扎尔科, Silicon Valley Ventures Growth Partners llp, Hygieia Healthcare Technologies Company, AllRest Technologies LLC, Crimson Growth Partners LLP, jrzarco2001@yahoo.com, is an experienced as CxO, General Counsel and Secretary to public and private companies with global operations. Established track record of producing practical, revenue-focused solutions. As Counselor and Secretary, demonstrating vision, integrity, and sound business judgment, to CxOs. Managed complex, strategic transactions, M&A, contracts support, PE Financing, IPO, SEC compliance, Corporate/HR governance, IP licensing, Budgeting, Staff, outside counsel management, International market access strategies, Domestic & foreign government relations and advocacy. Creative in designing and implementing market access strategies. Practices law beyond conventional model with low-overhead and project-based fees. Effective at managing departments, formulating marketing strategies, balancing budgets, and implementing cost-saving measures. Extensive in-house and private practice experience, advising clients on commercial, corporate, international business, and technology law and policy. http://www.docstoc.com/video/89135472/make-your-business-an-international-presence; http://www.youtube.com/watch?v=fx5gijf3yoc For Sprint, he managed iDen international development in Southeast Asia, Middle East, and Africa, and contractual issues with Verizon. In Private Equity, he worked with Pegasus in vetting international investment deals and interim President for portfolio companies, such as Data Foundation, a data storage company, handling marketing, strategy, fund raising, and accounting. Before Pegasus, Mr. Zarco, as CLO and V.P. of Corporate Development, played a principal role in the structuring, international expansions for 2 telecom companies, U.S. Cable Group and Viatel, Inc. in financing and M&A deals exceeding $200 million. Mr. Zarco earned a J.D. from NYU Law School, M.B.A. from Cornell, and B.A. from Williams College; is fluent in Spanish, Portuguese, French, and German, with working knowledge of Russian, Arabic and Japanese.
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