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TECHNOLOGY-BASED BUSINESS IDEA


BLUEPRINT
FORMAT & CONTENTS


COVER

TABLE OF CONTENTS

THE BODY OF BUSINESS BLUEPRINT

1. EXECUTIVE SUMMARY

2. PRODUCT/SERVICE DESCRIPTION

3. TECHNOLOGY DESCRIPTION

4. MARKET ANALYSIS AND STRATEGIES

5. MANAGEMENT TEAM

6. FINANCIAL ESTIMATES

7. PROJECT MILESTONES

8. CONCLUSIONS

9. APPENDICES



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BLUEPRINT OUTLINE


Note:
Before you begin writing within this section make sure that you have done some research.
Blueprint research helps you make informed decisions and create a successful direction for
your blueprint.
Gather information sources
Record relevant information
Analyze the information you have gathered and note the associated opportunities and
risks
If you are going to submit the blueprint to investors, research what types of investment
opportunities are available to you, why you need investment (banks, government,
private equity investors, etc.)


1. EXECUTIVE SUMMARY

The executive summary is usually short and concise. The summary articulates
what the opportunity conditions are and why they exist, who will execute the
opportunity and why they are capable of doing so, how the company will gain entry
and market penetration; it answers the questions: for what reason does this
venture exist and for whom?

Essentially, the executive summary needs to reflect the criteria presented in the
Business Opportunity Analysis Exercises. This is your chance to clearly articulate
how your business is durable and timely, and how it will create or add value to the
end user. This summary is usually prepared after the other sections of the blueprint
are completed.


1.1. Brief description of the business and product concepts






1.2. The target market and projections






1.3. The competitive advantages






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1.4. The profitability





1.5. The management team






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2. PRODUCT OR SERVICE DESCRIPTION


2.1. Describe in some detail the product or service to be produced/sold.







2.2. Discuss the application of the product or service and describe the primary end use
as well any significant secondary applications.










2.3. Emphasise any unique features of the product or service and how these will create
or add significant value; also, highlight any differences between what is currently
on the market and what you will offer that will account for your market penetration.










2.4. Define the present state of development of the product or service and how much
time and money will be required to fully develop, test, and introduce the product or
service. Provide a summary of the functional specifications and photographs, if
available, of the product.











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2.5. Describe any patents or other proprietary features of the product or service.











2.6. Discuss any opportunities for the expansion of the product line or the development
of related product or service.












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3. TECHNOLOGY DESCRIPTION

Areas to be covered are the key components related to the product/service or
technology, the intellectual property involved, specialized knowledge, experience
and skills involved and regulations that may govern the use of the technology to
deliver the product/service. It should also cover research & development (which
outlines your plans for the future), and future technology trends that you and the
market can foresee.

















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4. MARKET RESEARCH AND ANALYSIS

Information in this section needs to support the assertion that the venture can
capture a substantial market in growing industry and stand up to competition.
Because of the importance of market analysis and the critical dependence of other
parts of the blueprint on this information, you are advised to prepare this section
first.

4.1. Customers

a. Discuss who the customers for the product or service are or will be. Potential
customers need to be classified by relatively homogeneous groups having
common, identifiable characteristics (e.g., by major market segment).













b. Show who and where the major purchasers for the product or service are in the
market segment. Include national regions and foreign countries, as appropriate.










c. Indicate whether customers are easily reached and receptive, how customers buy
(wholesale, through manufacturers representative, etc.).












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4.2. Market Size and Trends

a. Show for three years the size of the current total market and the share you will
have, by market segment, and/or region, and/or country for the product or service
you will offer, in units, ringgit, and potential profitability.










b. Describe also the potential annual growth for at least three years of total market for
your product or service for each major customer group, region or country, as
appropriate.










c. Discuss the major factors affecting the market growth (e.g. industry trends, socio-
economic trends, government policy, and population shifts).




















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4.3. Competition and Competitive Edges

a. Make a realistic assessment of the strengths and weaknesses of competitors.

Competitors Strengths Weaknesses










b. Compare competing and substitute products or services on the basis of market
share, quality, price, performance, delivery, timing, service warranties, and other
pertinent features.











c. Compare the fundamental value that is added or created by your product or
service, in terms of economic benefits to the customer and to your competitors.








d. Discuss the current advantages and disadvantages of these products or services
and say why they are not meeting customers needs.









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4.4. Estimated Market Share and Sales

a. Based on your assessment of the advantages of your product or service, the
market size and trends, customers, competitors and their products, estimate the
share of the market and the sales in units and ringgit that you will acquire in each
of the next three years. Remember to show assumptions used.

Product/service Market Share and Sales

Year


Market share (%)



Total sales in units
Total sales in RM




4.5. Marketing Strategy

a. Overall marketing strategy. Describe the specific marketing philosophy and
strategy of the company, given the value chain and channel of distribution in the
target market. Include, for example, a discussion of the types of customer groups
that you are targeting for initial intensive selling effort those that you are targeting
for later selling efforts.










b. Pricing. Discuss the pricing strategy, including the prices to be charged for your
product and service, and compare your pricing policy with those of your major
competitors.










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c. Sales tactics. Describe the method (e.g., own sales force, sales representatives,
direct mail, or distributors) that will be used to make sales and distribute the
product or service.









d. Service and warranty policy. If your company will offer product that will require
service, warranties, or training, indicate the importance of these to customers
purchasing decisions and discuss your method of handling service problems; also,
highlight the kind and term of any warranties to be offered, whether service will be
handled by company service people, agencies, dealers and distributors, or return
to the factory.









e. Advertising and promotion. Describe the approaches the company will use to bring
its product or service to the attention of prospective buyers.









f. Distribution. Describe the methods and channels of distribution you will employ.












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5. MANAGEMENT TEAM

This section includes a description of the function that will need to be filled, a
description of the key management personnel and their primary duties, an outline
of the organisational structure for the venture, a description of the board of
directors, a description of the ownership position of any other investors, and so
forth. You need to present indications of commitment, such as the willingness of
team members to initially accept modest salaries, and of the existence of the
proper balance of technical, managerial, and business skills and experience in
doing what is proposed.

5.1. Organisation

a. Present the key management roles in the company and the individuals who will fill
each position.

Key Management Roles Name








b. If it is not possible to fill each executive role with a full-time person without adding
excessive overhead, indicate how these functions will be performed (e.g., using
part-time specialists or consultants to perform some functions), who will perform
them, and when they will be replaced by a full-time staff members.










5.2. Key Management Personnel

a. For each key person, describe in detail career highlights, particularly relevant
know-how, skills, and track record of accomplishments that demonstrate his/her
ability to perform the assigned role.


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Names & Positions Career Highlights
































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b. Describe the exact duties and responsibilities of each of the key members of the
management team.


Names & Positions Duties & Responsibilities



















































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5.3. Management Compensation and Ownership

a. State the salary to be paid, the share ownership planned, and the amount of equity
investment (if any) of each key member of the management team.

Names & Positions Monthly salary
Share of
ownership
Amount of
Equity Invested

















5.4. Supporting professional advisors and services

a. Indicate the supporting services that will be required.









a. Indicate the names and affiliations of the legal, accounting, advertising, consulting,
and banking advisors selected for your venture and the services each will provide.

Name of Professional Advisors Services Provided










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6. FINANCIAL PLAN

Sound financial management is one of the best ways for the business venture to
remain profitable and solvent. In this section think through some of the general
issues you will have to address in your formal business plan.

To effectively manage your venture finances, plan a sound, realistic budget by
determining the actual amount of money needed to start your venture (start-up
costs) and the amount needed to keep it open (working capital or operating costs).

6.1 Start-up Cost

Estimate the costs incurred in conjuction with one-time activities that the venture
undertakes when it opens a new facility, introduces a new product or service,
conducts business in a new territory or with a new class of customer or beneficiary,
initiates a new process in an existing facility or commences some new operation
after considerable research and discussion.



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6.2 Working Capital

Working capital represents the amount of initial expenditure required to finance the
daily operation until the business gets its first sale. The amount of working capital
is therefore dependent upon the period until the firm can generate enough sales to
cover its short-term expenditure.









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6.3 Start-up Capital and Financing

Total start-up capital incorporates both start-up cost and working capital needed to
start a project. The most common source of finance for new venture is the
entrepreneurs own equity contribution. The equity contribution can be in the form
of cash or assets. The next most common source of finance is term loan. This is a
form of long term financing offered by most commercial banks. The term loan can
be used to finance fixed assets as well as working capital requirements. The
interest rate and the loan period depend on the current interest rate and the
amount of loan required respectively.


6.4 Cash Flow Statement

A cash flow pro-forma statement refers to the projected statement of cash inflow
and outflow throughout the planned period. Under normal circumstances, the pro
forma cash flow statement is prepared between three to five consecutive years.
However, longer periods are sometimes needed depending upon the projects
undertaken. The pro forma cash flow statement must be able to show the following
information:
Cash inflows the projected amount of cash flowing into the company.
Cash outflows the projected amount of cash flowing out of the company.
Cash deficit or surplus the difference between cash inflows and cash
outflows.
Cash position the beginning and ending cash balances for a particular period.


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6.5 Income Statement

The next step in developing a financial plan is to prepare the pro forma income
statement which shows the expected profit or loss for the planned period, usually
for three to five consecutive years. Generally, the pro forma income statement
consists of the following elements:
Cost of good manufactured (production cost)
Gross profit
Net profit

Cost of goods manufactured (also known as production costs) refers to the total
production cost involved in producing the finished goods. It includes all costs such
as direct materials, direct labour, manufacturing overheads and the differential
value between the beginning and ending balances of the work-in-progress (if any).
Gross profit is the gross margin realised after deducting the cost of goods sold
from sales. It represents the amount of profit before deducting other operating
expenditure. Net profit (or net loss) is defined as the difference between gross
profit and operating expenses for the planned period.


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6.6 Balance Sheet

While the pro forma income statement shows the financial performance of the
company for the planned period, the pro forma balance sheet shows the financial
position of the company at a specific point in time in terms of assets owned and
how those assets are financed. The pro forma balance sheet is prepared for a
period between three to five years.




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7. PROJECT MILESTONES

This section includes a month-by-month schedule that shows the deadlines or
milestones of activities critical to the ventures success. Examples of activities that
are critical to the success of the venture are: Incorporation of the venture,
completion of design and development, completion of prototypes, obtaining of
sales representatives, signing of distributors and dealers, ordering of materials in
production quantities, starting of production or operations, receipt of first orders,
delivery of first sales.


Activities Deadlines











8. CONCLUSIONS








9. APPENDICES

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