BUSINESS AND LIFE: Doing Business in Dominica: Part II

This week, before we begin our discussion on “Writing a Business Plan”, I want to express VF Inc.’s and my condolences to the family, friends and to all of us Dominicans on the tragic loss of Messrs. Kurt Hector and Norran Jno. Hope.  Our prayers are with Mr. Joslyn Prince for a speedy recovery.  I felt this loss so deeply, though I do not know any of the players.  I can only imagine their conversation on that early Friday morning, their excitement and the happiness of Norran on making his debut for Dominica.  I am amazed at Joslyn’s strength and courage to climb out of this ditch, and it must be God and his training that enabled him to get to the top.  Some persons have said he was used as an angel by God to avert a bigger disaster.  I concur.

I wish to offer a clarification on last week’s article.  A sole proprietor trading in his name does not have to register however a sole proprietor trading in a business name has to register that business name.  One can chose “Limited” or “Incorporation” when registering a company.

This week, we focus on writing a business plan.  A business plan is a formal statement of a set of business goals, the reasons they are believed to be attainable and the plan for reaching those goals (Wikipedia).  A business plan is an essential road map for business success (US Small Business Administration). The business plan is the blueprint for the business.  It provides information about the business, owners, the industry, the marketing strategy, financial needs and financial strategy.

There are many different styles in the preparation of a Business Plan, and the one outlined below is my preferred choice. A Business Plan is made up of the following components:

1. Introduction – This section serves in essence as an Executive Summary.  You provide brief information on the company, the types of business, the expected projections and sets out the structure of the business plan.

2. Mission, Vision and Core Values – In this section, you state the vision, mission and core values of the company.  The vision is the long-term goal of the company.  I often likened it to the question we were often asked as children: “What would you like to be when you grow up?”  In essence what would you like your business to be fifty, sixty, hundred years from now?  The mission is what has to be done to realise the vision of the company. The core values are the principles by which the business will be managed and led.

3. Corporate Structure, Ownership and Management – In this section, you state the form of business; sole proprietorship, partnership, public or private company and provide information on the sole proprietor, partners or directors, respectively.  You provide information on the key positions and the managers or employees who will occupy those positions.  It is important to provide comprehensive information on the owners and managers for this is the section that reveals the person or people behind the business, and when everything else is in order, this is maybe the most critical section which will determine whether a bank or other funding agency decides to provide the finance required.

4. The Business and Industry – Here you provide detailed information on the business:  What type of business is it?  How do you plan to differentiate the business from competitors?  How well do you expect the business will perform? Here you prepare projected financial statements for at least 3 years: Cash Flow, Income Statement and Balance Sheet. The statements are often placed as appendices.  You also provide information on the industry in which the business is located, the competitors and general economic review.

5. The Financing Requirement – Following your analysis in section 4, you identify, itemise and cost what you require to start the business and to operate for the first year.  This includes raw materials, costs of inventory, office equipment, office supplies, renovation costs of building, operating expenses for the first year, marketing and promotional expenses.  You should think deeply about what is needed, so you do not underestimate your costs.  You will also need to provide pro forma invoices to support the costs.  They are also usually placed as appendices.

6. Financing Strategy – After you have identified how much money is required to start the business, where is it coming from?  You will indicate the source: self, family, directors, bank.  Here you also indicate the lending assumptions embedded in the projected financial statements, example the interest rate, the duration of the loan.

7. The Marketing and Promotion Strategy – The strategies for promoting and marketing the business is provided here.  This section is important as it identifies the strategy to ensure the public knows about the business and to generate sales.

8. SWOT Analysis – Information on the Strengths, Weaknesses, Opportunities and Threats of the business, as well as information on your strengths and weaknesses and those of the other directors, managers and key employees, as appropriate.

9. CONCLUSION – The summary is provided here, however, you want to focus on the viability of the business.

10. Appendices – The following are some of the information to be placed in this section: Projected Cash Flow Statement, Projected Income Statement, Projected Balance Sheet, Pro Forma Invoices, Statistical Information.

Next week, we examine the challenges faced by the small business sector and strategies to overcome them.

Until we meet again, may God continue to keep us in the palm of His hands.

Valda Frederica Henry, VF Inc.’s CEO and Principal Trainer is a Chartered Financial Analyst (CFA), Certified Global Professional in Human Resources (GPHR), Certified Myers Briggs Type Indicator (MBTI) Practitioner, holds a PhD in Industrial Relations & Business, a Masters in Business Administration and a BSc Management Studies. VF Inc. is a Human Resource & Finance Consultancy firm with a Training and Recruitment arm, and the producer and host of a live TV program “The Cutting Edge of Business”.