Mr. & Mrs. Phillips, your family friends, have just retired from the public service and are planning to set up a mushroom farm. They hope to use their gratuity and a loan sourced from their bank as initial capital for the business. Their bank manager requested them to present a business plan for this purpose. They approach you for advice on how to prepare a business plan, as they cannot afford to hire a consultant.

You are required to:
Advise Mr. and Mrs. Phillips on the contents of a standard business plan. (Total 15 Marks)

A standard business plan typically includes the following key contents:

  1. Executive Summary: A concise overview of the business, including the business name, location, product offerings, and a brief description of the business goals.
  2. Business Description: Details about the business, including the industry background, structure (sole proprietorship, partnership, etc.), and the mission statement.
  3. Market Analysis: An examination of the target market, including market size, customer demographics, market trends, and an analysis of competitors.
  4. Organization and Management: Information about the business structure, ownership, and the management team, including their qualifications and roles within the company.
  5. Products and Services: A detailed description of the products or services offered, including the benefits, unique selling points, and the production process.
  6. Marketing and Sales Strategy: Outline of the marketing approach to attract and retain customers, including pricing, promotion, and distribution channels.
  7. Funding Request: If seeking funding, this section should detail the funding requirements, potential future funding requirements over the next five years, and the proposed use of funds.
  8. Financial Projections: A forecast of future financial performance, including income statements, cash flow statements, and balance sheets for the next three to five years.
  9. Appendix: Optional section for any additional information that supports the business plan, such as resumes, permits, legal documentation, or other relevant documents.
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