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The aim of the below report is to outline the development and progression of the Business Plan for B&T Inc, Tanzania's first Business and Technology magazine. It will summarize my contribution to this project as well as the key areas of idea initiation, teamwork, presentation experience, alternative scenarios and learning gained as well as other areas covered in the development of the business plan.
Overview of B & T Inc
B&T Inc aspires to provide a business and technology magazine which is produced in Tanzania for Tanzanian professionals, students and investors alike. This is a necessity in the growing economy of this country where 600,000-700,000 new professionals enter the fields of business and technology every year. As there is no locally produced magazine covering areas of business B&T magazine will be the first of its kind and likely to establish a stronghold in the market before the threat of future competitors is faced. A team of experienced directors together with a world class designer is expected to lead the company in this direction.
Initially 100 shares will be offered at a value of Tsh 1 million per share.
Payback is projected to occur in the 9th month of the 3rd year as the net profit for the 2nd year is expected to increase by 76% due to reduced costs. With the expected profit of 14 million to be earned in the 1st year, the profit of the 2nd year is expected to increase by 76% due to reduced cost.
The net profit growth in the 3rd year decrease to 46% because of the new assets expected to be bought.
Investors may choose to exit the business by selling their equity either to existing partners or to a new employee who is eligible for partnership.
Teamwork - All 3 team members contributed to make this project successful
Idea Initiation - After several discussions the group decided on a Business and technology magazine under the guidance of Mrs Priti Punatar
Presentation Experience - A learning experience about time management, public presentation and the importance of thoroughly understanding the business venture an individual wants to undertake.
Alternative Scenario - Consideration of both best and worst case scenarios allows B&T to prudently predict steady growth rate.
Team work is the most important part in any working or academic culture. Most successful businesses always have a core of faithful hardworking team members that pull together to create an amazing empire. The most important attribute in any team member should be dedication and the aim for perfection and the most important of all, the ability to take orders and accept delegation where necessary. A famous man once said, 'Rome was not built in a day'. This is true, it took a large number of men to make it possible and the results were, phenomenal.
Each individual brings to the table a very unique set of skills, as was the same within our team. It is important to understand and learn to work in a team environment which will help sharpen teamwork skills when entering a workforce. We have found that involvement of social interactions while completing different tasks is one of the best ways of learning. Conflicts and clashes of ideas in a team are a common problem and it helps if everyone is aware of this being a possibility and prepared to deal with the situation in a mature and academic manner. Our team had faced a similar situation during the initiation period of our plan, the merging of three very highly opinionated individuals was like a combustion but we overcame this by using said before methods of social interaction.
Initially, our team consisted of four team members; Joyce Issowe, Krupa Patadia, Priyanka Divecha and myself. At our first group meeting, each of us were assigned tasks to complete and present at the next meeting. The delegation was as follows; Joyce was to create a financial plan, Krupa the industrial analysis report, Priya the marketing plan, and my task was to come up with an operational plan.
Joyce Issowe had not being keeping well and was unable to complete the financial plan, seeing this, Priyanka having already completed the marketing plan decided to create the financial plan as we were running short of time. After completing my own tasks, we realized we still needed to consider risk factors and such, so Krupa took over the role of risk analysis and I took over Krupa's tasks. Everyone else including myself completed all their assigned tasks with no further problems.
The name B&T Inc. had been chosen from the phrase "Business and Technology" which we believed was a professional name to be allocated to a business magazine that targets all the business players in Tanzania. The executive summary, the business and appendices were completed with hard work from all the three team members equally. All In all, every remaining team member picked up the slack, all meetings were attended in time and all our planned goals were reached.
Process of Idea Initiation
Initially our group had a number of business concepts to go with. Joyce had suggested a dairy farm, Krupa suggested a school for performance arts, Priyanka suggested an engineering consultancy and my own suggestion was a real estate firm. To get a better idea of what we were doing, we met with different people to discuss ideas for a potential business. Somewhere along our quest, we stumbled upon the idea of a telecom system to advertise for real estate, a directory of sorts.
After further discussion within our group, and under the supervision of Mrs. Punatar, we decided to work on a business and technology magazine that would aim to build an interactive vessel within the business arts and simultaneously provide a channel of information needed by the new entrants.
During this process of Idea Initiation, we learnt a valuable life lesson that all the team members had a different manner of approaching this business plan for which many conflicts of interest were displayed.
B&T intends to create a communicative vessel among the vast range of business tycoons and provide brilliant business news feeds that have been ignored by other leading magazines.
The process of crafting the slides to be presented, and ensuring the presentation would cover all essential areas whilst summarizing the entire business concept, was a challenging one that taught me about time management, extraction of essential information from available data and the involvement of visuals to convey essential points.
Through the course of heated discussion and debate our team prepared a set of slides that all members were satisfied with at the end. Although each member of the team had their own ideas as we started, the merging of all these together allowed us to come up with a synergized and impressive slideshow.
All three members of the group presented the plan in parts with me introducing the business, the problem we aimed to solve and our business model. Krupa then took over and covered management team, industry analysis and competition leaving Priyanka to finish the financial overview including; share offering, payback, profitability, break even analysis and current status and projected use of funds ending with exit strategy for investors.
Crucial lessons were learnt during this presentation about capturing and retaining the interest and attention of our potential investors, maintaining the set time limit as well as the importance of confidence and a deep understanding of the business venture.
The success of any business is dependent on external as well as internal conditions. Internal factors are easier to control and predict relative to the external factors. With regards to external conditions, there is always some degree of uncertainty. In order to be prudent all figures taken within the business plan have reflected the worst case scenario.
In order to achieve this and to reflect altnernative scenarios that may arise due to unpredictable factors the revenue included in the business plan is less than that actually expected by investors. Due to the unpredictability of Macro-environmental factors the number of subscriptions have been kept at minimum and the advertising revenue included is less than what the firm will target to achieve.
Another relevant point concerns the break even analysis. To keep alternative scenarios in mind, both best and worst case of total revenue have been considered whilst the figure taken for cost has been kept at maximum in line with the accounting principle of prudence. This allows investors to be comfortable to know that the minimum success will be as presented in the business plan with an additional potential for greater growth.
Business partnerships have also been taken into account in order reflect alternate means to achieve a target. This can be seen as in the outsourcing of printing to keep costs low as well as the establishment of a network of free lance contributors.
Figures for costs and budget in the analysis of the financial statemements have also been calculated after the consideration of the alternative growth scenarios and B%T therefore is expected to have steady growth as a worst case scenario where the best case reflects a quicker point of break even and higher profitability.
Four areas of risk were covered in the business plan including management, marketing, operational and financial risk factors.
Research has indicated that due to poor media and marketing services the magazine may be in circulation only within a small group of people and awareness at the beginning may be lessened to to the above noted fact. B&T marketing department will be responsible to ensure that awareness is increased even if it requires door to door marketing.
Management and operating risks are internal factors that B&T directors will monitor in order to ensure success of the venture.
With regards to financial risk it is interesting to point out that cash outflow may be more than cash inflow during certain periods and care will have to taken by the financial director to ensure that company affairs carry on smoothly.
Turning now to the question of break even analysis, the calculated point may not be entirely accurate as the worst case scenario figures have been used in this calculation and in actual fact B & T might break even earlier than this point.
Learning and Usefulness of the Business Plan
The experience of coming up with a business plan opened up my eyes on the many aspects that are necessary to be considered whilst starting up a business. Extensive research is required together with knowledge of the industry. I have realized that an entrepreneur must have a clear vision on how exactly his company will work and perform.
The business man/woman also must be aware exactly where the need for his product/service lies and how to fulfill this need. He/she must be aware of the environment in which the business will compete, what challenges may be faced and how to resolve these. Knowledge of the financial aspect is a key area which the entrepreneur must be well versed with as well.
All the points noted above are those covered in the business plan and illustrate the importance of this document to a business. The business plan provides a guideline for any business and all areas covered within it are linked with some aspect of the business that is of importance to stake holders.
Having considered the learning gained about the business itself, it is worth pointing out that there has also been great personal learning in the areas of:
1. Listening more
2. Giving importance to others' ideas
3. Respecting time and maintaining discipline and punctuality
4. Working within time constraints and meeting deadlines
Receiving feedback from my group members has allowed me to overcome many of my previous weaknesses and I have come out as a stronger, better and more understanding individual.