How to Write a Business Plan for a Micro Enterprise Program

"Marketing is the process of planning and executing conception, pricing, promotion, and distribution of goods, ideas, and services to create exchanges that satisfy individual and organizational goals." American Marketing Association

Take Away

Copying a program that has proven successful elsewhere does not guarantee that it will also be successful in a different community. Understanding cultural differences, values, purchasing patterns and consumer preferences is necessary to successful implementation. A marketing analysis could be an effective means to verify program viability in a local context.

Considering social and micro credit services from a marketing perspective can increase their success. A marketing analysis provides organizations the opportunity to recognize the value of what it has to offer. It can serve to develop a strategy that increases access to services (market-share) and improves sustainability through impact and product diversity. As well, it could reduce operating costs on a per client basis and create a service delivery model that is customer service oriented. In addition new products can be developed to follow the life cycle of the target market to improve community and household well-being. For example, extending micro credit to simulate payday loans to provide an affordable alternative credit source.

Cautions

A marketing analysis requires entrepreneurial thinking. Marketing lingo and analysis may cause conflict with staff members, who are involved because of their heart, not a target market. As well staff may feel that their work is charity and should not be charged for as they are serving low-income clients. The coffee shop faced a revolt from employment services teachers who refused to let their students pay for coffee. The organization ceased to operate the coffee bar. Now clients go next door to Seven Eleven to purchase their coffee.

Be prepared to ask for advertising funds. The budget prepared for the Start-up Center included over $10,000 for advertising in print and public transportation media, such as inside the bus. The advertising budget was an item questioned by both staff and donors. Your advertising plan needs to be clear and you must be able to defend it.

The creative for the advertising must appeal to your customer and sell your product. Don’t include your mission statement or program definitions, etc. Sell, sell, sell the advertising copy for the Start Up Center said, “Be your own boss!” Start your own business and provided contact info, period. Involve your customers in proofing the creative. It will give the proposal more weight when it comes to organizational approval.

Learning to see both donors and clients as a market could enable nonprofits to improve the products and services they offer. In reality marketing is about learning what is the best way to serve the costumer. A marketing strategy can assist organizations determine the most efficient and effective means to achieve both their social and economic goals.

Click here to read full article, containing survey data and additional information.

If you would like additional materials, such as business plans and curriculum examples, please contact Carlos Gasca at communityatwork@comcast.net.

Free Software! Planwriter is micro credit business plan writing software. The software uses real micro credit business plan examples. You can reproduce it for the benefit of the community. For-profit reproduction requires permission. The program is designed to run in almost any MS Windows PC (sorry no Mac version). Planwriter was produced by Carlos Gasca and Ken Fast. Click here to download Planwriter (2 MB)

cisalefhaiti - Sep 14, 2005 10:50 am (#1 Total: 11)

Good Morning Dr. PRABIR DUTTA,

 

The Coordination of the National Crossroads of Support to the Development of the autonomy and the Leadership of Women (CISALEF) you presents her compliments and informs you that she interested to have ampler information on the Program of Microphone Credit because we would like to integrate the shutter Microphone Credit in our Network of Women but unfortunately one didn't have the luck to make the first again. 

 

The National Crossroads of Support to the Development of the autonomy and the Leadership of Women (CISALEF) is not only a space of exchanges, information and sensitization of women on various stakes of which the human rights, the lasting development and health, but also and especially of formation to the TWITCH and the integration of these in their economic, social and political activities while developing their capacities of advocacy in favor of a just and equitable world. 

 

Her actions are oriented in favor of the national communities of women and Young of which they contribute to create in every country. They articulate globally around the civic education, the democratic education and of the backing of capacities of woman autonomy by the slant of a set of activities: 

 

" Education civique/démocratique 

- Support to the creation of the the national community of women 

- Formation of persons responsible of the national communities of women 

- Support of the national communities of women in what milked to their integration in various international networks of women 

- Organization of colloques/Journées of promotion of the woman 

- Formation of women to the TWITCH and the use efficient of these in the promotion of the democracy  

- Promotion of international forums of women (Women's National Storming) 

- Civic and political education of women (administrative writing, public communication, human rights, equality of sexes, democracy, solidarity, leadership...). 

 

" Development of capacities of woman autonomy 

- Promotion of culture entrepreneuriale at women (feminine entrepreneuriat) 

- National forum of the feminine entrepreneuriat   

 

Institutional " development of the milieu/Réseaux 

- Actions of allègement of the domestic tasks of the farming women 

- Support to the creation and the development of structures féminines/coalitions and networks 

 

 

GUERDA BENJAMIN 

Coordinating of CISALEF - HAITI (National Network of Women in Farming Environment of Haiti) 

President of the OFAT - Haiti (Women) 

Resp. of the Public Relations of CISALEF - HAITI (National Network of Youngsters) 

Tél: (509) 401-7513 

 

Cgasca - Sep 14, 2005 11:24 am (#2 Total: 11)
Social Entreprenuer


Welcome! Thank you for your interest and the opportunity to discuss micro enterprise development. The experience I bring to discussion is based on my personal experience as an entrepreneur, and teaching and consulting on micro enterprise. As well I benefited from my graduate studies at Southern New Hampshire University CED program, which I highly recommend.

I hope our discussion can assist those of us who are starting or running micro enterprise programs. The planning process I used to develop the program described here starts with marketing, then operations and finally financials. Marketing consists of four parts, product, place, price, and promotions. Product or Service is the solution you are offering to your customers. To start the discussion let’s talk about the solution micro enterprise offers from a customer perspective. Personally, I believe micro enterprise offers individuals the opportunity to control their own productivity, what is your perspective? Who are your customers?

Cgasca - Sep 15, 2005 10:05 am (#3 Total: 11)
Social Entreprenuer


Understand your clients well, that is what our customers taught us. Each Tuesday and Thursday night our entrepreneurs would show up for class. Their goal was to complete a business plan in 13 weeks. Once the business plan was completed they could then apply for a micro loan. At least that was our assumption.

The business plans were to be reviewed by the credit committee made up of business volunteers. 13 weeks went by and only one of our 15 customers completed a business plan. Our clients rarely missed class. We assumed that good attendance could translate to business plan completion. However, that was not the case.

For our clients attending class had two purposes. One, to learn how to run their own business, two, to nurture their hope that some day they could be their own boss. Nurturing this hope consisted of learning and sharing their experiences with each other. In other words they were building up the courage and expertise to start their own business.

Our clients taught us that becoming your own boss is a step-by-step process. Students could have a business idea and dream about it. Once they showed up in class it was their first step to becoming committed to their dream. Our job was to nurture this commitment.

We then realized that each student could be at different level of commitment to running his or her own business. This led us to diversify our products, which established three levels of products, explorer, freelancer and entrepreneur. This approach enabled our clients to recognize their own achievement and match their learning needs to their level of commitment and resources.

Anna Raksany - Sep 15, 2005 2:53 pm (#4 Total: 11)

Hi Carlos- thanks for hosting this week’s forum. On the topic of marketing, I’d be interested in hearing your thoughts on defining and articulating as a marketable ‘product’ the services of the nonprofit sector that we don’t traditionally include in the framework of marketing and promotion. Many users of this website are dedicated to products and services that are no doubt of social value, but that are more difficult to conceive of as having actual ‘market value.’ How do we make the transition from understanding our work as a product/service that achieves mission-related goals, to a product/service that is of both social and market value?

Cgasca - Sep 16, 2005 9:51 am (#5 Total: 11)
Social Entreprenuer


Anna, the division between social and market value is rather artificial. For example, Plymouth Housing Group (PHG) a nonprofit that provides permanent affordable housing won the downtown champions award. The Seattle Downtown Business Association (DSA) gives the award. The convention center was one of the competitors for the award. It could be said that a convention center provides more market value than a homelessness organization.

As nonprofits we typically speak about the needs of our clients and the benefits we provide them. Instead PHG chose to identify the market value they provide to businesses in Seattle’s downtown. They identified their market to be all the major hotels, condo buildings and businesses offices in downtown. Their product value was improving the quality of life of downtown by providing safe, affordable and permanent housing to homeless individuals.

If businesses had any doubt about PHG’s market value all they had to do is walk down their streets to witness the difference or speak to hotel concierges. As the marketing manager of Pacific Place said “Tiffany & Co. and PHG would seem to be miles apart on any scale. However, they are important equals in terms of their contributions to creating a healthy, vibrant and diverse downtown”.

As social entrepreneurs we may be more motivated by our sense of mission than "market value". However, our success as social entrepreneurs depends on how clear we are in articulating the value we provide to our markets, both donors and those we serve.

I look forward to your response and I hope I addressed your question.

Cgasca - Sep 16, 2005 10:48 am (#6 Total: 11)
Social Entreprenuer


SE Field Notes postings will be followed by a list of resources.

Learning about marketing http://en.wikipedia.org/wiki/Marketing

http://www.marketingpower.com/content24639.php

Consumer Behavior http://www.consumerpsychologist.com/#Strategy

Attachments:

Payday Advance Customer Profile.pdf (375 KB)

Cgasca - Sep 17, 2005 2:14 pm (#7 Total: 11)
Social Entreprenuer


This power point presentation clearly illustrates a marketing analysis process. It was written by Professor John A. Hengeveld. The terms used and the point of view are from a for profit perspective. You can substitute some names by identifying the similarities to nonprofit activities. For instance market research = community outreach or needs assessment. If you want to further explore the terms used link to http://en.wikipedia.org/wiki/Marketing

Attachments:

Marketing basics.ppt (179 KB)

Cgasca - Sep 19, 2005 9:07 am (#8 Total: 11)
Social Entreprenuer


The following business-planning model was developed by the Calgary Center for Nonprofit Management. The emphasis of this planning model is on nonprofit sustainability. The graphic provides an outline of a nonprofit business plan using this planning approach. The key word Market is included in business plan components. If you wanted to included a market analysis to the plan it could be inserted after mission, values and history.

Combining the Sustainability Business Planning Model with a Market Analysis could generate the following business plan outline:

1. Business Plan Title Page; 2. Table of Contents; 3. Executive Summary (Why, Who, What, Where, When); 4. Market Analysis; - The five c’s; customers, company; competitors, collaborators; context; - Market segments; target market selection; product or service positioning; - Marketing mix; product or service, target market or place; price and promotions; - Customer acquisition and customer retention strategy, sustaining value; 5. Operations (human resources), equipment, legal, governance & facilities descriptions; 6. Finance (source and uses of funds);

Researching the sources of funding early is just as critical as researching the needs of the population you seek to serve. If you are intending to operate a nonprofit venture then it is important to remember that you are serving two markets; the donors that will fund you and the people you plan to serve. If you are starting a for-profit social enterprise you will also have two markets; investors/or credit and the market you plan to serve.

The attached file is in a picture format. You may need to print the document to view all of its contents.

Attachments:

Sustainability-Model.gif (1169 KB)

Cgasca - Sep 19, 2005 11:25 am (#9 Total: 11)
Social Entreprenuer


A market analysis can assist social entrepreneurs and social investors to improve the effectiveness of their initiatives and investments. A market analysis assists social entrepreneurs to: 1. To deliver a product or service to people that need it when they need it; 2. To establish a truthful argument based on facts that moves beyond ideology, politics or affinities; 3. To focus on local or regional use of resources to improve effectiveness and achieve high returns on investment; 4. To develop culturally sensitive and appropriate products or services;

For social investors a marketing analysis can ensure that: 1. That a sound argument for delivery of product or services is established on the basis of real needs; 2. That local or regional funding sources can complement their commitment to the venture; 3. That sustainability and longevity have been incorporated in the planning process, including; a logic for sources and uses of funds; 4. That the proposed product or service in fact can operate and succeed in a cultural context;

Planwriter offers social entrepreneurs an outline and examples of business plans. The reference materials attached can be used to complement the software in order to develop your own business plan. If you have any questions, comments or suggestions please feel free to email me at communityatwork@comcast.net

gemuh - Dec 10, 2005 12:37 pm (#10 Total: 11)
Tinshu Genesis Gemuh


I find this discussion rather interesting. I am Executive DIrector of Helps International, a non-profit NGO here in Cameroon Africa.

We are just now picking up the challenge to set up a micro-finance structure (Rural Banks) to beter serve the rural poor masses of Cameroon.

Our idea is not only surpervising the money they receive for the projects but moreso, supervising the projects for which they receive money. This has often been greatly neglected by the former MFI

I will be grateful to hear of any ideas. I just downloaded Planwriter by Carlos and Ken. Thank you for making this available.

Tinshu

force3 - Dec 15, 2005 7:30 am (#11 Total: 11)
force3 ( forum for Creative entrepreneurship)

Dear Cgasca will it be possible for you to act as a mentor on IT Enabled Micro enterpise development. Await your confirmation to send you details of the proposal.