How to prepare a professional business plan to make you stand out in the New Normal

“Without a clearly defined goal, success is impossible… Success is finding a need and then filling it. One cannot command success. You have to work hard to deserve it. So never give up to achieve your dream.” ~Mr. Leo De Leon, Allegro Beverage Corporation founder, and CEO

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Purpose is an ongoing pursuit of a goal

Without a clearly defined goal, success is impossible.
Success is finding a need and then filling it.
One cannot command success, you have to work hard to deserve it.
If there is a will, there is a way
Never, never, never give up to achieve your dream.

At the very first AFEX webinar, Allegro Beverage Corporation founder and CEO Mr. Leo De Leon shared his decades of expertise in the coffee industry by teaching us how to set up our very own profitable coffee shop in the midst of a global pandemic.

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Mr. De Leon helped aspiring entrepreneurs how to prepare a professional-level business plan to make any brand and business stand out in this age of the “New Normal”.

Know Your Business’ Purpose

Before creating a business plan, Mr. De Leon suggests entrepreneurial introspection to find out what is at the very heart of your business. By finding out the purpose of your endeavor, you will know how to begin the pursuit of your goals.

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Create a Business Identity

Another important part of preparing for a business plan – or any business, for that matter – is to come up with a unique and catchy business name and a memorable logo. Both are not just important but imperative components of any enterprise because it will define the identity of your business. Therefore, both the name and the logo must reflect the brand in a positive light.

Once both components are finalized, make sure to register your business with the Securities and Exchange Commission (SEC) and the Department of Trade & Industry (DTI).

After the concept of the business has been laid out through its purpose and identity, it’s time to share your ideas with prospective investors through a business plan. This means the future of your business hinges greatly on how well you can communicate your goals and strategies to encourage possible investors to give you their money and most importantly their trust, especially during a global pandemic and economic backlash.

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Mission & Vision Statements

According to Mr. De Leon, after a clear but concise description of the concept (your brand, your purpose, your driving force), a good business plan must have an appropriate mission and vision statements. He differentiates the two easily:

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A vision statement focuses on tomorrow and what an organization wants to ultimately become.

A mission statement focuses on today and what an organization does to achieve it.

As an industry leader, Mr. De Leon also gave examples of good mission and vision statements, like the following:

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Overview and Strategy

Now is the time to impress your panel with how much research you’ve poured into your business plan.

The overview of the entire business must include the following aspects:

Product Offerings – Menu items or list of services offered with rates
Store Location – Take note of the foot traffic in the prospective location
Merchandising and Marketing – Suppliers, Inventory, and Publicity
Architectural Design – A combination of aesthetics and efficiency
Management Team / Human Resources – Qualifications, experience, clear roles and expectations of staff
Store Details – Like food specifications and store operating hours

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Market Analysis

It is important to find your business’ niche in the market. Now that everyone is sheltering at home and ordering online, digital markets are prevalent. Every business owner opening a start-up in this kind of economic climate must determine industry trends to find out how to better position their products and services. This is where the SWOT Analysis comes in, a common tool used by managers to determine both the internal and external influences of business. SWOT stands for Strengths, Weaknesses, Opportunities, and Threats.

To find out your business’ SWOT, try answering the following questions:

STRENGTHS

What are you and your company good at?
What unique resources and skills do you possess?
What do others and your competitors see as your strengths?

WEAKNESSES

What can you and your company improve on?
Where do you have fewer resources than others? Limitations?
What do others and your competitors see as your weaknesses?

OPPORTUNITIES

What opportunities are open to you and your company?
What trends can you take advantage of, given the Covid-19 pandemic?
How can you and your company turn your strengths into opportunities?

THREATS

What threats could harm you? Internal and External.
What is your competition doing?
What threats do your weaknesses expose to you?

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Financial Projection

According to Mr. Jamile Merlan (Accounting & Finance Manager of Allegro Beverage Corporation and Group Finance Head of UCC Ueshima Coffee Philippines Inc.), a financial projection is “an estimate of the company’s profitability and financial condition. It is important because this will tell you if the business is feasible.” A business’ financial projection can be used to attract investors as well as a tool in applying for business loans.

During his part of the webinar, Mr. Merlan shared the characteristics of a good financial projection. It must be:

Realistic – Estimates must be supported by valid assumptions
Flexible – Do not stick to just one assumption; prepare contingency projections for various situations or conditions
Comparable – First, it must be comparable to the industry standard, then compare your projections with actual results
Cover multiple periods – do not just show projections for one month or one year; recommended to show at least three years’ worth of projections

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Year 1 - Monthly Projections

Year 2 - Quarterly Projections

Year 3 onwards - Annual Projections

Mr. Merlan also listed the components of a good financial projection:

Projected Income Statement – Must show sales and operating costs
Projected Capital Requirements – How much initial and working capital do you need?
Projected Cash Flows Statement – Must show the cash inflow, outflow, and running balance for both items
Projected Balance Sheet – Shows the assets, liabilities, and quality of the business; it is used to determine the financial condition of the business.
Break-even Point Analysis – The level of sales at which total revenues equal total expenses (no profit, no loss); monitored on a regular basis to check if the business is on the right track to hit its goals

Location, Location, Location

According to Mr. De Leon, he observed that before the pandemic hit, shopping malls were the top locations for businesses, where it could reach up to 500,000 to 750,000 shoppers in one day during peak season (like the holidays). But today – more than five months into the longest lockdown/quarantine in the world since COVID-19 hit – the number one business location are high-rise residential areas or condominium buildings. He listed down the top 10 locations aspiring entrepreneurs can consider when scouting for the best spot.

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Now that you know the best locations to establish your business, here are some tips in securing the ideal spot.

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When it comes to leasing a property, there are several considerations the new business owner must take into account carefully. Mr. De Leon suggests consulting a lawyer to study the lease contract to make sure the agreement is amenable for both the tenant and the landlord.

Below are some considerations when leasing:

Length of Lease
Rental Rates – Minimum rent, escalations, percentage of sales
Security Deposits and Advance Rents
Renewal Option
Hours of Operations – Including weekends and holidays
Menu Restrictions
Location – Access to entrance, escalators, movie house, ground floor, frontage, etc.
Cost of Leasehold Improvements
No Rent Payment During Construction Phase
Construction Restrictions
Electrical and Plumbing Requirements
Triple Net Charges – Maintenance, Insurance, Taxes
Marketing Programs and Costs
Discounts
Insurance Requirements
Audits
Exclusivity
Exhaust Systems
Garbage Collection
Delivery Access and Schedule
Construction and Expansion Plans
Fire Department and Health Department Codes