PARTNERSHIP BUSINESS PLAN
Preface
Most successful partnerships require solid personal relationships based on trust. Relationships take time and are difficult to reduce to objective criteria. We know these tools are transactional in nature. They will never be able to replace the need for real relationships that form partnerships: a firm handshake and a clear look in the eye.
What they can do is help people to bridge their intentions to action and connect their performance to effective results. The tools will not replace building, but simply facilitate it. They will be a means to tee up opportunities.
We would really appreciate your feedback on these tools. Please call us with your suggestions at 214-435-0753.
Mountain Movers International
PARTNERSHIP BUSINESS PLAN
You are enthusiastic about an idea for a new ministry venture, or you want to expand a great one that you already started. You think that it has excellent market prospects and fits well with your skills, experience, personal values, and aspirations.
What is your entry strategy, and your tangible vision for growth? What are the significant risks and problems in launching or growing the venture? What is your marketing plan? What are its future financing and cash flow requirements? What are your expected results and return on investment?
Can you articulate answers to these questions, show evidence for your conclusions, and put them in writing?
A business plan is a written document that articulates the social problem to be solved, what the opportunity conditions are, why the opportunity exists, the entry and growth strategy required to seize it, and why you and your team have got what it takes to execute the plan. It is the blueprint you will need to actually launch and build your ministry.
If you plan to seek outside venture capital, a business plan is a must. It is more than a financing device. It is invaluable in identifying prospective partners, defining roles, and gaining their commitment.
The MMI business plan is designed to be completed by the ministry’s executive director, one or two board members, perhaps a financial partner, and the lead national whenever possible, with the help of a trained facilitator. It will require several days of research to complete. When completed, it will range from 15 to 25 pages in length.
Executive Summary
The principle focus of the executive summary is to articulate the social problem to be solved, the opportunity conditions, why they exist, who will execute the opportunity and why they are capable of doing so, and how the ministry will gain entry and rapid market penetration.
The executive summary should be prepared last; however, it will be the first thing about you and your ministry venture a prospective investor will read. It should be an appealing, convincing, and succinct document. It must be compelling.
On two pages or less, summarize the highlights from each of the following sections.
The Problem: Summarize the unacceptable condition in the community that needs a solution.
The Solution: Summarize your ministry’s mission and goals and the programs and services your ministry will provide to address the problem.
The Opportunity: Summarize the opportunity, why it is compelling, and your entry strategy: how you plan to gain rapid market acceptance.
The Results Expected: Summarize the changes in people’s lives that you expect as a result of this initiative.
The Management: Summarize the relevant experience and significant accomplishments of the leaders of this venture, and define the roles of all partners.
The Economics: Summarize the financial requirements of the venture, timetable for financial viability, and plans for long-term sustainability.
The Problem
A problem is a condition in the community that is unacceptable and needs a solution. A problem statement characterizes this condition in the form of documented determination of the nature and extent of the problem within the targeted community.
A problem statement provides the necessary context for the proposed venture. It establishes a foundation for assessing the potential impact of a social venture. It answers the question: “Why?”
On two pages or less, address the following questions in a compelling narrative. Utilize charts or graphs where necessary.
What social problem are you trying to solve?
What is the specific problem that you are trying to solve?
What is the specific nature and extent of this problem?
ڤ What is the specific need people are experiencing?
ڤ What aspect of this need will your program be addressing?
ڤ Or, what aspect has your program been addressing?
Who is affected by this problem and where do they live?
ڤ What group of people is experiencing the need?
ڤ Describe this target population and its common traits (age, ethnicity,
gender, etc.)
ڤ What is the geographical location of the target population?
What information exists that identifies this is a problem?
ڤ What information indicates that this condition is experienced by the target
population?
ڤ Summarize demographic data, news reports, research and any studies
that supports your conclusions.
How robust and durable is this problem?
ڤ What evidence exists that this problem is strong, vigorous, and likely to
continue?
ڤ What factors are contributing to its growth?
The Solution
A solution is an answer to a problem. It addresses all of the components of a problem, taking advantage of available opportunities and diffusing difficult obstacles. It works. And produces measurable results that show that it works.
An effective social venture is one that delivers the right solution to a well-defined social problem in an efficient manner. This type of venture provides a social investor with the greatest return on his or her investment.
On four pages or less, address the following questions in a compelling narrative. Utilize charts or graphs where necessary.
What is the solution to the problem?
ڤ What social strategies will work in solving the problem?
What evidence exists that this solution works?
ڤ What information exists that confirms that this solution strategy works?
ڤ Summarize demographic data, news reports, research, expert testimony,
and any studies that support your conclusions.
Why does this solution work?
ڤ What are the underlying reasons why this solution produces positive
results in solving the problem?
What is the mission of your organization?
ڤ What is the mission of your organization?
ڤ How does it relate to the problem and solution?
What are the goals of your program?
ڤ What are the big ambitions of your program?
ڤ What long-range benefits do you want to provide to your community?
ڤ Define the proposed effect, the identified need, and target population for
each goal.
What programs or services do you propose that will address the problem?
ڤ What is the service?
ڤ Who will provide the service?
ڤ Where is the service delivered?
ڤ When is the service delivered?
ڤ How is the service delivered?
The Opportunity
An opportunity is defined as a “favorable juncture of circumstances.” In the context of planning for a new ministry venture, or expanding an existing one, an opportunity is defined by a convergence of market conditions to which a ministry is ideally positioned to respond.
An opportunity analysis addresses the issue of venture viability by examining market conditions, prospective customers, and potential competition. It helps a prospective investor answer the questions:
“Is now the right time?” and “Is this ministry positioned to respond?”
On three pages or less, address the following questions in a compelling narrative. Utilize charts or graphs where necessary.
Who are your primary and secondary customers?
ڤ Segment the market and define your target markets. Primary customers
are those whose lives will be changed through your work. Secondary
customers are those individuals and groups who must be satisfied in order
for the ministry to achieve results. They may include donors, churches,
volunteers, etc.
What do these customers value?
ڤ What does the customer value?
ڤ What are the wants, needs, and aspirations of each of these customer
groups?
ڤ What is your basis for these assumptions? (Cite any market research,
demographic data, or studies that support these claims.)
What is the size of the market?
ڤ How many potential customers are there in each segment of the market?
ڤ What is your basis for these numbers?
How will the market change in the future?
ڤ How will the characteristics, needs, wants, and aspirations of customers
likely change in the future?
ڤ What factors will drive these changes?
ڤ What growth, if any, is projected?
What is your market niche and rationale?
ڤ What needs, wants, and aspirations of your customers are you best
positioned to address?
ڤ Who else is providing similar services to these customers?
ڤ What services are they providing?
ڤ What differentiates your programs and services from theirs?
ڤ What makes your service unique and desirable?
What unique opportunities does your ministry have to address the
problem?
ڤ What unique opportunities for market leadership does your ministry have?
ڤ Does a gap in services currently exist?
ڤ Are you uniquely positioned to provide these services?
Results Expected
The results of a ministry are always measured outside of the organization in terms of changed lives and changed conditions. These changes can be measured in terms of people’s behavior, circumstances, health, hopes, competency, and capacity.
Expected results should reflect intended progress and achievement in both qualitative and quantitative terms. Qualitative measures address the depth and breadth of change within its particular context. Quantitative measures use definitive standards and tell an objective story. In both cases, expected results should be stated in concrete, realistic, measurable, and time-related terms.
On two pages or less, address the following questions in a compelling narrative. Utilize charts or graphs where necessary.
How do you currently define results? How successful are you?
ڤ What does your ministry currently appraise and judge?
ڤ How does it measure results?
ڤ What results are currently being achieved?
What are the outcome objectives of your program?
ڤ What results is your program trying to achieve in the next three years?
ڤ What, how much, and when is change expected?
ڤ What effect do you expect to produce on the clients?
ڤ Are these effects realistic? measurable? concrete? assignable?
How will you measure these expected outcomes?
ڤ What methods will be used to assess outcomes?
ڤ What information will be collected and analyzed?
ڤ What will it cost?
ڤ Will the information be viewed as credible, accurate, and useful to
someone?
What will the return on investment be for the marketplace partner?
ڤ What is the cost of producing the expected changes in a single customer’s
life? (Divide the total cost of the venture by the total number of clients
affected.)
The Strategic Approach
Strategy converts a ministry’s mission and objectives into performance. It is an action-oriented plan that provides a prospective investor with a solid understanding of “how” you intend to maximize your market opportunity and achieve your intended results.
A good ministry strategy includes sound marketing, program development, and operations plans. It includes performance related timelines and benchmarks. It is the basis for defining the conditions for an agreement with a marketplace partner.
On five pages or less, address the following questions in a compelling narrative. Utilize charts or graphs where necessary.
What is your marketing plan?
ڤ What is your plan for marketing your services to your primary and
secondary customers?
ڤ What customers will you target for initial intensive selling efforts?
ڤ What features of the program will be emphasized to generate sales?
ڤ How will your services be priced?
ڤ What methods will you use to sell and distribute your services?
What is your program development (or expansion) plan?
ڤ What is your plan for innovating and improving existing programs and
services?
ڤ What programs or services should be abandoned?
ڤ What is the development status of any other new programs?
ڤ How successful have these programs been in the past?
What is your operations plan?
ڤ In what geographic locations will you operate the proposed venture?
ڤ What facilities are involved?
ڤ What improvements will need to be made?
ڤ How will you deliver your new or expanded program?
What is your overall schedule to launch a new initiative or expand one to the next stage?
ڤ What is the timing and interrelationship of the major events necessary to
launch the venture and realize its objectives? This should include all of the
deadlines or milestones critical to the venture’s success including tasks from the marketing, program development, and operations plan.
The Management
The management team is the key to turning a good idea into a successful ministry. Investors look for a committed management team with a proper balance of passion, vision, technical and managerial skills, and experience in doing what is proposed.
It is people, not programs, who make ideas come to life. The success of a ministry venture is dependent on the quality of its leaders and supporting staff and volunteers.
On three pages or less, address the following questions in a compelling narrative.
Who are the key managers of the proposed initiative? What are their various roles?
ڤ What are the names, positions, and exact duties of each key manager?
Include members of the Board of Directors and executive management
team.
What previous successes do they have in this area? What skills and knowledge do they bring?
ڤ Provide a summary of the each key manager’s career highlights.
Include accomplishments that demonstrate his or her ability to perform the
assigned role.
ڤ How long has the management team worked together?
ڤ What successes have they achieved together?
What other staff or volunteers are involved? What are their various roles and responsibilities?
ڤ Include a table that lists staff by title, minimum qualifications, and brief job
descriptions. Also include an organizational chart that diagrams your
program’s staffing structure and star the number of paid and non-paid full-
time staff equivalents (FTE’s) assigned. Include volunteers if they perform a direct service to the program.
What additional expertise is desired for your new or expanded venture?
ڤ What additional expertise, in the form of knowledge or skills, is also
necessary for the venture to succeed?
ڤ Why is this expertise essential for the success of the venture?
What role will the marketplace partner play in providing this expertise?
ڤ What strategic role in the ministry would a marketplace partner play?
ڤ What time and talent would be required for this role?
ڤ What specific responsibilities will the marketplace partner accept that meets his or her expectations and yours (as expressed in the Partnership Agreement).
The Economics
The financial plan is basic to the evaluation of an investment opportunity and should represent the ministry leader’s best estimates of future operations – your best judgment of the results that you believe is realistic and attainable. The purpose of the plan is to indicate the venture’s economic potential and timetable for financial viability.
On three pages or less, address the following questions in a compelling narrative. Attach Pro Forma Income Statements, Pro Forma Balance Sheets, and Cash Flow Projections for the first three years. In the case of an existing ministry seeking expansion capital, income statements and balance sheets for the current and prior two years should be provided in addition to these estimates.
What is your current annual budget? What are your current sources and uses of financial capital?
ڤ What is your current agency budget? Provide a brief summary including
total revenue and expenses for the last three years. Provide this
information in a table form.
ڤ What are the sources of your financial capital?
What is the total cost of this specific initiative? What will the funds be used for?
ڤ How much money will it take to fund the proposed venture until it breaks
even and becomes self-sustaining? Include all costs including initial (or
on-going) program development and capital expenditures.
ڤ What will these funds be used for?
How much has currently been raised? What are the sources of this capital?
ڤ How much of the venture budget has been raised?
ڤ From whom?
ڤ What restrictions have been placed on the use of these funds?
What stake do these donors have in the project?
ڤ What financial investment is the marketplace partner making?
ڤ Specifically, how will the funds be used from the marketplace partner?
How much is still needed? What is your plan for raising the additional capital?
ڤ How much money still needs to be raised?
ڤ What will it be used for?
ڤ What is your plan for raising this additional capital?
What is your financial plan for sustaining the venture long-term?
ڤ What long-term revenue streams will be developed to support the
venture?
ڤ What is your basis for these projections?
ڤ When will the venture break-even?
The Critical Risks
The development of any ministry venture has risks and problems, and the ministry invariably contains some implicit assumptions about them. The discovery of any unstated negative factors by potential investors can undermine the credibility of the venture. Identifying and discussing these risks demonstrates your skills as a manager and heightens the credibility of the proposed venture.
On two pages or less, address the following questions in a compelling narrative.
What changes in the ministry or marketplace may block or retard progress?
ڤ What trends, conditions, or attitudes within the ministry or in the
marketplace could block or retard progress?
ڤ How will you counteract these changes?
What projected revenue streams may be weak?
ڤ What sources of revenue may be soft and why?
ڤ What will you do to counteract a sluggish response from donors?
What projected expenses may be underestimated?
ڤ What projected expenses may be underestimated and why?
ڤ What will you do to control costs and stay within budget?
What delays may effect our expected results?
ڤ What delays in staffing, program development, or marketing may effect
the delivery of services and our expected results?
ڤ What will you do to avoid these delays and stay on schedule?