BUSINESS MODEL

AND RESOURCE MAPPING

STRATEGY

LEARNING OBJECTIVES

After comprehensive study of this chapter, you will be able to:

 Business model canvas: concept, business model canvas versus lean canvas
 Business Plan: concept and benefits of the business plan, elements of a business plan, different types of
plan. Preparation of the sample business plan by using business model canvas
 Techniques for effective resource visualization; Strategies for Resource Mapping
 Resources Mapping in Nepal.
166 Entrepreneurship & Business Resource Mapping

Business Model Canvas

Concept of Business Model Canvas

The general meaning of canvas is a picture or painting describing the facts or situation. It
is the framework to interlink or connect the various elements providing the life to the
project. Business Model Canvas is, thus, a strategic management concept and startup
template for developing new or documenting existing business models. It is a visual chart
with elements describing a firm’s or product's value proposition, infrastructure, customers,
and finances. It assists firms in aligning their activities by illustrating potential trade-
offs.It acts as the building blocks for the startup and operational activities of any new
activities as well as the business under operation. It provides general guidelines for
business firm about to create value through utility creation.
Each business need to have visual form of activities of any venture to have resources
utilization at the optimal level. It describes various elements like product’s value
proposition, infrastructure, capital, and customers. Business model canvas is prepared with
integrating various activities to be performed to attain the business goals. Business model
canvas is the justification regarding how an organization creates, delivers, and captures
value.

Elements of The Business Model Canvas

Acompletedescriptionofacompany'sbusinessmodelcanbebroken downinto nineelements:

1. Basic information
At the first, the company or firm’s name and the person or department preparing the
canvas is mentioned as the basic information.
2. Key partners
Key partners are the person, group or the firms investing upon the business,
network of suppliers and partners that make the business success. These are the
persons who make the business model success. Thus, in this section, the key partners
are stated. Partners can be persons, company and or strategic alliances. Integration,
commitment and coordination of the key partners help to optimize the operations for
effectiveness and efficiency with reducing risks of business model.
3. Key activities
Key activities are the major tasks or activities which are to be performed to achieve
the goals of the business enterprise. Such activitiesof the business create the value or
add the value so that the business can attain the goals. Depending upon the nature of
the business organization, they need to perform different activities. For instance, a
restaurant need to perform different functions from a travel agency. Likewise, a
manufacturing company performs different activities than a hotel.
 Business Model and Resource Mapping Strategy  Chapter 6 167
4. Value proposition
Value proposition is the description of service or product offering the business to
maximize the value of business and to satisfy the target customers so that the
business goals can be attained. Value propositions are the ways how the business can
solve the customer’s needs to satisfy them. The company's value proposition is what
distinguishes it from its competitors. Creativity, innovation accessibility,
convenience, brand value, special design, customized products, etc. increase the value
of the business. Value proposition is the secret of business success. Value proposition
can be in terms of quality, quantity or in both forms.
 Quantitative: Price, quantity, volume and efficiency.
 Qualitative: Overall customer experience and outcome.
5. Customer segments
Customers are the group of people, society or the entire nation to whom the business
wish to serve. It consist specific group of people that the company aims to serve.
Every business need to identify the customer group, their segment, special and
segmented needs of customers, purchasing power of the customers, and their buying
behavior. Business identifies the following special customer segments.
 Mass market: Mass market is the total possible market having no specific
segmentation. For instance, supplier of raw material have low segmented
customers. Under mass market, wide view of potential clients or customers are
identified.
 Niche market: Niche market is the small and specialized group of customers
having special and specific needs. For instance, Rolax watch, RAV 4 car,
Fertility Treatment Center, etc. have small, and specific group of customers
with specialized needs and interest.
 Segmented market: A traditional classification of the market in terms of
gender, age, geography, income level, etc. is most common to prepare business
model canvas.
 Multiple market: A business may serve thecustomer multiple segments having
different needs and characteristics with a single product or multiple products.
 Multi-sided market: Some business may have customer groups depending to
each other. For instance, Credit Card Company provides service to credit card
holders as well as merchants who accept credit cards.
6. Channels
Channels are the media or means how can the business reaches to the customers.
Business uses the channel to communicate with the customer segment and delivers
products and services to them. Effective channels assist to distribute the company's
value proposition in terms of time efficiency, cost-effectiveness and in best quality
assurance.
168 Entrepreneurship & Business Resource Mapping

7. Customer relationships
Customer relationships is the basic element for the success of any business.
Customer relationships in the business model canvas represents the methods to be
used to maintain relationships with customers. Every business should define the
customer relationship to follow to the entire operation of the organization. In many
context, customer relationships represent the organizational culture and approach to
maintain relationship with customers. Based on nature of the organization,
organizationfollow any one or combination of following types of relationships.
 Personal assistance: Personal assistance in a form of customer relationship
in which employees of the organization pay close relation with customers in
course of action. Under this approach, organization follows employee-customer
interaction to solve the problems of customers or deliver goods and services in
need of customers.
 Dedicated personal assistance: Under dedicated personal relationship,
particular employee is dedicated to pay due concern even the customers may
not demand specific service. It is based on the notion that customers get
satisfied if they get the dedicated service. Specially, in service sector business
and sales of capital goods with installation require dedicated personal
assistance to satisfy and attract customers.
 Self-Service: Self-service mode of customer relationship is the indirect
relationship in which customers are expected to render and get the service to
be provided by the business organization. Customers are expected to serve
themselves with the tools and other facilities provided by the organization.
 Automated services: Automated service is the more dedicated self-service
with the ability to identify individual customers and their references. Internet
based business offer the product based on customers. For instance, YouTube
offers the songs and videos to the viewer based on their previous views.
Amazon, Alibaba, Daraz, etc. offer the product based on customer’s
identification.
 Community creation: By creating customer community, they can share and
discuss the common problems. Such communitiesprovide framework for direct
interactions among different clients and the company. Such relationship
facilitates mutual sharing of information, skills and knowledge to solve
particular problems but there could be risk of manipulation and exaggeration
of facts.
 Co-creation: Co-creation is a customer relations in which managers and the
customers set collaborative innovation: ideas are shared and improved
together.
 Business Model and Resource Mapping Strategy  Chapter 6 169
8. Key resources
Resources which are used to produce and offer the customers for main business
course and the axillary business activities are the key resources. To make any
business model successful, human resources, capital resources, physical resources,
information and intellectual are most essential. Capital is the backbone of any
enterprise without which no business activity can be considered. Physical resources,
information and intellectual are the competitive resources. Human resources use all
other resources, create new business idea and deliver the product to customers. All
these resources are vital as they create value for the customer.
9. Cost structure
Total expenditures including regular expenses and overheads are called the cost. Major
headings which incur the cost to the business processing formulate the cost structure.
Costs structure in another words are the sources of expenses during production and
delivery of any product to the customers. Cost structure reduce the profit of the
business. There can be different types of costs within cost structure as follows.
 Fixed costs: Costs which do not get changed on the basis of production units
and incur irresponsible of production process and units are the fixed costs.
Rent, insurance, property taxes, interest expenses, utility expenses, regular
salary, etc. are the common fixed costs.
 Variable costs: These costs vary depending on the quantity of production of
goods or services are called variable costs. Variable cost vary based on
production volume. Material costs, wages, etc. are the variable costs.
 Economies of scale: Economies of scale is the cost advantage of any business
model because of large volume of production. With increasing volume of
production, cost of production gets down up to the optimal capacity. There can
be internal economies of scale and external economies of scale.
 Economies of scope: Economies of scope is the cost advantage because of
variety of products not the volume. Business model which produces different
products or by-products create the economies of scope. For example, sugar mills
also produce liquors as byproducts which increases the profits.
10. Revenue streams
Revenue streams are the sources of income and mechanisms for revenue collection in
the business. There are several streams to generate a revenue as follows :
 Sales: By selling the products, business can generate the revenue. Retail stores
are the sales centers as revenue streams.
 Usage fees: Business model can generate revenue from the use of a particular
service. Any other business organizations pay fees for using the warehouse of
others.
 Subscription fees: Subscription fee is the charge paid by other business
organizations for the use of brand name, logo, distribution channel or any access to
the market.
170 Entrepreneurship & Business Resource Mapping

 Leasing or Renting: Leasing or renting the property also generates the

revenue. Business can lease or rent the land, building, vehicles, etc. to other
business organizations with exclusive right to an asset for a particular period of
time.
 Licensing: Revenue can also be generated from charging for the use of a
protected intellectual property like brand, product image, etc.
 Brokerage fees: Business organizations can also charge fees as source of
revenue for any counselling or other intermediate service provided to other
business organizations. For example, business organization may charge
management consultation fee for management contract, brokerage fee for
selling the property, process consultation fee for production process.
 Advertising: Business organizations can also charge rent to other business
organizations by providing space for advertising.
A sample model of the business model canvas for a Highway Motel is presented below :
The Business Company Name Prepared For
Model Canvas Highway Motel Highway Motel

Key Partners Key Activities Value Propositions Customer Customer Segments

š Parents š Preparing š Providing Relationship š Long route public
š Petrol pump breakfast breakfast & Personal service drivers
š Grocery store š Preparing Launch Launch š Local drivers
š Car wash š Providing š Long route private
š Motorcycle wash refreshment drivers
š Waving people š Providing š Local visitors
vehicle wash &
maintenances
š Supporting
young
Key Resources entrepreneurs Channels
š Kitchen & š Social media
Utensils š Front Ads
š Launch area š Personal
š Furniture relationship
š Lawn space š FM Ads
š Employees
š Washing center
š Cleaning utensils
Cost Structure Revenue Streams
š Infrastructure, š Breakfast
š Machine & Utensils š Launch
š Standing space š Vehicle wash & maintenance
š Washing Center š Advertisement space
š Ingredients
š Staff salary, allowances
 Business Model and Resource Mapping Strategy  Chapter 6 171

Lean Model Canvas

Lean Canvas is a template helping early starter in their entrepreneurship careerfor quick
formulation of possible business models, product launches, marketing campaigns and way
to communicate stakeholders for Lead Flow Method work. It is the extended version of
Business Model Canvas by Ash MauryaLean Canvas uses the same nine blocks concept
except they’ve been modified slightly to suit the needs, purpose, and requirements of a Lean
Startup. The Lean Canvas is the perfect one-page format for brainstorming possible
business models, the blocks guide entrepreneurs through logical steps starting with
customer problems right through to unfair advantage similar to competitive advantage.
The Lean Model Canvas includes aspects for startup to deal with uncertainty and risk. He
added the elements Problem and Solution as well as Key Metrics and Unfair advantage. A
blank canvas is presented below:
The Lean Canvas Designed for: Designed by: Date:
Problem Solution Unique Value Prop. Unfair Advantage Customer
Key Matric Channels Segments
Cost Structure Revenue Streams

Following components are major components Lean Canvas.

1. Problem: Each business sets particular customer segment which consists of a set of
problems to solve by business. So, in this box, entrepreneur try listing the maximum
three high priority problems of the customer segment. These problems need to satisfy
the customers. After identifying the major problems, business can ensure the product
quality.
2. Customer segments: Customer segment is the entire group of the customers that the
proposed business wish to satisfy. Only after identifying the customer segment, product
nature and quality can be designed. Different segment of the customers may have
different needs and expectation. The problem and customer segments are intrinsically
connected as without a customer segment their problems cannot be identified.
3. Unique value proposition: A value proposition is a promise of value to be delivered
to the customer segment. Unique value proposition are the reason why the business
enterprise is different from others. Customers prefer the unique value product at the
low cost. Thus, the unique value proposition is the secret for any business success.
4. Solution: Competency of the business manager is to identify the best and unique
solution of the problem. For finding solutions, entrepreneur should be learner, and
try to think out of the box. It is often said that the solution is not in the office, it’s out
there in the streets. This means that to find the solution of the problem, entrepreneur
should got the customers, talk to them and get the feedback regarding the solution.
For effective, flexible and updated solution, a continual Build-Measure-Learn cycle
should be followed.
5. Channels: Channels are ways to reach the customer segment. Early starter should
focus on learning how effectively and efficiently can the product send to customer
172 Entrepreneurship & Business Resource Mapping

segment. Different alternative channels should be developed, for the purpose and
analyze them to find the most significant one. Channels can be email, social
networking, ads, blogs, articles, trade shows, radio & TV, webinars etc.
6. Revenue streams: Revenue is the most important factor for existence and growth of
any business organization. Source of revenue to the business enterprise is the cost
factor for the customers. Thus, it must be balanced that the pricing should neither to
exploit to customer nor it shrinks the profit size of any organization. Revenue streams
channelize the source of profits. Therefore, in this segment of the Lean Canvas, all
possible sources for revenue should be listed. Pricing strategies are listed for setting
appropriate price of the product so that it will set best level of the financial position.
7. Cost structure: It is obvious that each business enterprise incurs several costs for
inception, operation and delivery of the goods and services. There could be direct or
indirect costs applicable for the enterprise. So, in this box, entrepreneur should list all
the operational costs for taking business to market.
8. Key metrics: Every business either small or large, whatever may be the nature of
business have some key metrics to monitor performance and improve it. In this box,
all the ways or metrics should be stated.
9. Unfair advantage: Unfair advantage is special ability of the enterprise which are
different than other enterprises. Enterprise beat the market competition by using
such advantages as these advantages cannot easily be copied easily. The only real
competitive advantage is that which cannot be copied and cannot be bought.These
unfair advantages can be insider information, team cohesiveness, approaches to
information, getting expert endorsements, strong customer loyalty, etc.
Sample of a Lean Canvas
The Lean Canvas Designed for: Designed by: Date:
Maitri Consultancy
Group
Problem Solution Unique Value Unfair Advantage Customer
 Support cases  One stop Proposition  Strong consultant Segments
are hard to solution  Web based team  Small business
remember  One place service  One spot organization
 Support cases recording  Help desk solution  Other
are hard to customer software consultancies
share & problem  Coaching with  Government
delegate  Elimination of consultation agencies
 Complicated & delays and  High customer
slow software slow value
Key Metrics Channels
Special  Social media
š customer value  Organization’s
points each website
day  Customer blogs
 Add-on for
existing product
Cost Structure Revenue Streams
Hosting cost + Operating cost  Counselling fees
 Package charge
 Regular membership charges
 Business Model and Resource Mapping Strategy  Chapter 6 173

Business Model Canvas Verses Lean Canvas

As mentioned earlier lean canvas is the extended version of the business model canvas.
These two canvas have some specific differences as listed below :

Basis of Business Model Canvas (BMC) Lean Canvas (LC)

Differences
Target BMC targets both new and existing LC targets only to the startup businesses.
businesses.
BMC focuses on customers, investors, LC focuses on entrepreneurs purely.
Primary Focus entrepreneurs, consultants, and advisors.
Emphasis BMCemphases on customer segments, LCemphasis on problems as there is no
channels and customer relationships tested product with starter.
Value Focus BMC focuses on value proposition in LC focuses onunfair advantage rest on
quantitative and qualitative terms. and its effective utilization.
BMC pays more interest on infrastructure and LC begins with problem, a proposed
Approach sources of financing to attain revenue solution to attain revenue streams.
streams.
BMC fosters honest understanding and LC highlights on simple problem-solution
Application creativity through discussion and constructive approach in step-by-step manner.
analysis.
BMC provides a composite model of a LC is simpler but less composite which
Simplicity business which can be used for testing and more focuses on being a simple business
search in lean startup. models.

Business Plan

Business plan is a formal written statementregarding business goals, approaches to achieve

those goals, and the time frame within which these goals can be achieved.It is a road map
for directions to a business to perform business activities in accurately keeping the business
up-to-date. It describes the nature of the business, background information, financial
projections, and the strategies to be implemented to achieve predetermined goals.
Business plan describes opportunities to the business venture, product or service offering to
the customers, business environmental context, strategies to attain the business goals,
resources essential at the different time frame, expected financial returns from the
business and expected business life. Business plan basically deals with three questions as
where are we now? where do we want to be? and how are we going to get there? Business
plan helpsentrepreneurs toidentify the business potential, identify the potential roadblocks,
setting the strategy to unblock the roadblocks, and evaluate the viability of idea or growth
plans before get started.
174 Entrepreneurship & Business Resource Mapping

Benefits of Business Plan

Entrepreneurs write business plan to set the business goal, and action plan to attain the
business goals. There are several compelling reasons for writing a business plan as
discussedbelow:
 Planning : Writing business plan is an invaluable exercise as it helps to justify
the ideas of entrepreneur or business managers in course to fulfil the goals of
the organization. It helps to plan various resources like finance, human,
location, technology, and information. Business plan helps entrepreneur to
understand the scope of business and availability and uses of the resources.
 Evaluating ideas: Entrepreneur may have multiple ideas in mind. All the
ideas may be related to the business but all the ideas could not be benefiting to
business. Business plan help the entrepreneur to focus on appropriate ideas so
that resources can be properly utilized.
 Collaboration: Business plan provides clear vision to the business regarding
what to achieve, when to achieve and how to achieve. It also facilitates
regarding what should be the strategies to achieve the goals. Business plan
helps to develop approach of business. For this, business plan helps to develop
collaboration with other organization in terms of partnership or consultancy
service. Thus, business plan helps to set the collaboration to get success.
 Sound decisions: Business plan helps an entrepreneurto define and focus on
business ideas and business strategies. It not only helps to concentrate on
financial matters, but also on management issues, human resource planning,
technology and creating value for your customer.
 Stakeholder communication: A business plan is a communication tool to the
stakeholder like lenders, suppliers and other regulatory bodies. Business plan
is the source to develop business confidence regarding the business,
entrepreneur and entire management team.
 Environmental adaptation: Business plan helps to adapt in the changing
business environment. Economic change, political-legal change, socio-culture
change, technological and global change influences the business activities and
opportunities. Effective and flexible business plan helps to estimate future
trends in environment and helps to develop new strategies to cope with change.
 Creating new business: Business plan helps to establish right steps in
starting a new business, including what need to do, what resources will be
required, and what are expected to happen.
 Efficiency: Business plan provides guidelines for business activities,
strategies and action plans, resources identification and allocation, methods
and techniques which helps to improve the efficiency of the business venture.
Reduced wastages and improving efficiency can be the competitive advantage
of the business organization.
 Business Model and Resource Mapping Strategy  Chapter 6 175

Elements of Business Plan

Though the business plan may have different elements but it should cover the basic
information and analysis as basic elements. It provides the road map to the entrepreneur
regarding environmental situation, business goals and action plan to attain these goals,
resources availability and allocation, etc. A good business plan should cover the following
major elements.
1. Executive summary: A One-page executive summary is written as a first and most
important part of the business plan. Executive summary should include mission
statement, basics about the company foundation, a description of major products or
services, highlights of growth so far, and a summary of how the management of
business want growth. In simple words, executive summary is written to provide
high-level out look of the business with summarizing every activity, plan, policy and
the goals to achieve.
Executive summary is the major component in business plan as it provide major
details at condensed form so that readers get details at minimum time. So, it must be
written with deep concern. It is better to write the executive summary after
completing the other components. Here is a specimen of the executive summary of
Coffee House, Inc. with value addition in the business plan.
Market research indicates that an increasing number of consumers in our city are
interested in the experience of coffee. However, there isn’t a viable place for them to
meet and learn locally. Instead, they only have access to fast coffee. Coffee House, Inc.,
provides a place for people to enjoy fresh-ground beans and truly enjoy their cup.
Coffee House, Inc., provides a hub for a subculture of coffee, offering customers a place
to purchase their own coffee-grinding supplies in addition to enjoying the modern
atmosphere of a coffee house.
The founders of Coffee House, Inc., are coffee aficionados with experience in the coffee
industry and connections to sustainable growing operations. With the experience and
expertise of the Coffee House team, a missing niche in town can be fulfilled.
2. Business description: Business description is report or explanation of the business
and the organization. This segment includes out look at when the business was
formed and mission statement of the business. Business description includes the
story of the organization and allow others to connect to the organization. It helps
readers understanding what and why of the business. To make the description more
effective, writer should describe what the business does, how that satisfies a need in
the marketplace, the specific types of customers to serve, and any competitive
advantages that have made or will make the business successful. Additionally,
business description also deals with the questions like what is the business model?
What are customer base, revenue sources and products? are there any special
business relationships that offer an advantage to the business? Where is the business
176 Entrepreneurship & Business Resource Mapping

located? Who are the prime actors in the business? What is the ownership structure?
What are the major market opportunities? What is the projected growth?
3. Market analysis: Market is the source of revenue as basis of business success.
Market provides the opportunities as well as challenge to the business organization.
Open market policy and the maximum number of competitors increase the
competition level and hence the challenge. At the same time, market growth rate
increases the opportunities. In this section, thus, need to discuss the market situation
and the potential growth rate as well as probable challenges to face during the course
of business. Market analysis is an exercise for identifying where the business will be
fit in the market i.e. what are the superior strengths for competition. This is the
analysis of market where the business organization identifies and provides details
about target market (size, historical and forecasted growth rates, demographics,
needs, purchasing trends, etc.), and determine what share of that market a business
can capture.
While making the market analysis, different trends in the market are analyzed along
with the socio-economic and cultural change. Here is market analysis of above
mentioned Coffee House, Inc. as follows –
There is a wide trend toward slow food and the idea of experiencing life. On top of
that, there are no local coffee houses that offers fresh-ground beans or high-end
accessories for do-it-yourselfers. Coffee House can create an ideal customer identity.
The ideal customer is a millennial or younger member of Gen X. He or she is a
professional and interested in experiencing life and enjoying pleasures. The ideal
customer probably isn’t wealthy, but is middle class, and has enough disposable
income to have a hobby like coffee. Coffee House appeals to professionals who work
(and maybe live) in a downtown area. They meet their friends for a good cup of coffee,
but also want the ability to make good coffee at home.
4. Organization management and operation: This segment of business plan gives
details of team superstars behind the business. Specialty of each member,
responsibility-authority relationship, leadership style, etc. followed in the
organization should be clearly indicated. This section proves the team members have
special qualities to handle the business. By the profile of management team, banks
and financial institutions get confidence to provide adequate capital to the business.
It is suggested to provide total number of employees along with their profile and
expertise. Basic operation mode and the levels of business operations from basic
production process to ultimate delivery of the goods and services to customers. Here
is a description of organization management and operation of Coffee House, Inc. is
presented below :
The founders of Coffee House, Inc. have experience in making and understanding
coffee and the business. One of them has an MBA, and can leverage the executive
ability. Both have worked in marketing departments in the past, and have social
 Business Model and Resource Mapping Strategy  Chapter 6 177
media experience, so they can highlight their expertise. The founders emphasize their
connections in the world of coffee, particularly growers that use sustainable practices.
They can get good prices for bulk beans that they can brand with their own label.
5. Sales strategies: Strategies are the action plans to attain the business goals. Sales
strategies, thus are the list of action plans regarding how the business organization
raises sales volume and sales revenue from the business. In this section, the
strategies how the organization reaches to the customer segment, what will be the
pricing strategy, product quality assurance, after sales strategies, etc. are included
with priority. In this section, the promotional strategies now the organization is using
and to be adapted in future are also covered in this section. Nowadays, the use of
social media efforts and use of press releases and other appearances to help raise
brand awareness and encourage people to buy or sign up for products or services are
importantly analyzed. Coffee House, Inc. has set the following sales strategy.
Coffee House, Inc. needs to make sure to utilize word of mouth and geolocation
strategies for their marketing. Social media is a good start, including making
Facebook Live videos of them demonstrating products and how to grind beans. They
can encourage customers to check in when visiting, as well as offer special coupons
and promotions that activate when they come to the house to encourage sales.
6. Capital requirements: Business plan importantly should estimate the capital
requirement to startup, grow up, diversification and other purpose like salary
expenses, rent and lease expenses etc. It is more important to estimate the cost with
more realistic approach so that there would not be any deviation of estimated actual
capital requirement. For this, more realistic information regarding the market
inflation, cost of goods and services, cost of technologies, etc. In general, three states
of economy, i.e.,favorable, fair and worst are estimated and capital requirement for
each conditions are estimated. Timeline and volume should be tied up while
estimating capital requirement. For the Coffee House, Inc. the capital requirement
plan is estimated as below :
It can cost between NRs. 2000,000 and NRs. 3500,000 to open a coffee house, and
profit margins can be between 7 and 25 percent, depending on costs. Some of the
things Coffee House, Inc., would include in its timeline are getting premises, food
handlers’ permits and the proper licenses, arrange for regular supply and get the right
insurance.
7. Financial projections: At the last segment of the business plan, financial
projections are made to summarize successes up to this point. Forward-looking
projections should be based on information about revenue growth and market trends.
178 Entrepreneurship & Business Resource Mapping

Projections should be made based on realistic information regarding marketing

movements, sales strategies, level of competition. Coffee House, Inc. projects the
financial position as follows :
Within the first three years, Coffee House, Inc. gets break-even point. On the fourth
year, Coffee House will earn NRs. 0.5 million while from the five year Coffee House
can see revenues of as much as NRs. 1 million a year.

8. Critical Risks: Risks are the potential hazards, perils, or threats to the business
developed external environment. So, in the business plan, it is necessary to estimate
the potential risk and the sources. Risk of political-legal change, economic change,
socio-cultural shifts, technological change and the change in competitive
environments create the potential risks to the business. Risk can create the worst
situation for shut down the business enterprise as well. So, it is essential to make an
assessment of critical risks to the business enterprises. For risk assessment,
enterprise should first indicate the sources of potential risks to the enterprise. Major
critical risks for a venture could result from a competitor's reaction; weaknesses in
the marketing, production, or management team; and advancement in technology,
changes in consumer behavior, etc. After identifying the sources of risk, it is essential
to discuss the potential causes or situations that might happen to the business. While
discussing the probable causes, what worst and what best situation can happen
should be estimated. Finally, entrepreneurs should discuss for the strategy that need
to be employed to cope with the risk.

For Coffee House, Inc. has made the critical risk assessment as :As the capital
investment for small scale new business is not big deal, so many new entrants can
start up the coffee business. Likewise, other large coffee makers can provide the coffee
at the cheaper rate because of volume production. There is risk of substitute products
as well.

9. Summary and Conclusions: This is the final section which summarizes the major
situations highlighted. This section should be short and include are major
requirements, strategic moves to take, reasons for business troubles and success,
means to use the resources the firm's overall strategic resources, strategic direction,
the firm's sales and profit projections, its capital requirements, sources of risk and
potential degree of risk, etc.

10. Scheduling and Milestones: This is the section which provides key dates and
actions essential to take actions on each strategic directions. It is also called Gant
Chart. A specimen of scheduling is given below:
 Business Model and Resource Mapping Strategy  Chapter 6 179

Schedule for activities for a project of ABC enterprises

Months
Tasks
1 2 3 4 5 6 7 8

Project report formulation

Sanction of bank loan

Land purchase and building construction;

utility connections

Machinery installation

Trial production

Commercialization

11. Appendices: In this section, essential documents, charts, tables, etc. are presented
which are used while preparing the main document.

Qualities of Good Business Plan

Business plan gives clear picture regarding the current situation of the business enterprise
or the project under the enterprise. Based on business plan, enterprise formulates the
action plans to execute to attain business goals. Enterprise sets direction to cope with
challenges created by means changing environmental factors. So, the business plan must be
effective.
Many people used to say that lack of money is the major reason for poor performance or
failure of the business enterprise. However, financial backing is not only one main
determinant of success of any business. In fact, most businesses fail because of poor
business plan. Below are few features of good business plan.
 Perseverance: Startup enterprise requires drive and energy to overcome
these problems. Most people will fail at some time. Successful business people
are not deflated by failure but become even more determined to succeed in the
future. Perseverance literally is the determination. Thus, the business plan
should commit the determination what actions should be taken to overcome the
probable challenges.
 Proactive: Obstacles may be overcome by a pro-active approach. Successful
entrepreneurs anticipate problems and solve them practically. Thus, a good
business plan should provide business approaches, actions and direction in the
different possible environmental situation. Business plan should be guideline
to be prepared for any anticipated business situation.
 Detailed: A business plan should provide detail information and analysis of
the environmental situation. All the descriptions should be writtenalong with
180 Entrepreneurship & Business Resource Mapping

the supporting documents and assumptions of the analysis. It must be based on

research, for example, there should be detailed investigation of competitors,
legal compliances, chances of new entrants, etc. Doing Business could be good
document for getting support for making the analysis, if one cannot invest in
market research.
 Realistic: The business plan should be based on real ground. No information,
fact or assumptions should be exaggerated. It should not be over ambitious so
that there will be problem in implementation.
 Formal: Business plan should be written in in formal format covering all
necessary elements. Language should be formal, simple and lucid so that every
manager can easily understand it. It should refuge all possible flaws.
 Specific:Every business plan ought to include tasks, deadlines, dates,
forecasts, budgets, and metrics. It should be measurable. The business plan
should direct the actions. So, it must be actionable, should provide direction for
tracking the action. For this, business plan should be specific. A vague plan
cannot provide specific direction.
 Clearly defined responsibilities: In the business plan, actions are clearly
identified and direction are set specific. Effective implementation of the
business plan, responsibility should be clearly defined and allocated to the
persons. Clearly defined responsibilities can be easily implemented.
 Communicable: Business plan must be communicable to all the stakeholders.
It must be simple to understand, easy to implement and logically tracking.
Business plan should provide measurement techniques of the results expected.
 Commitment: Business plan should have strong commitment to attain the
predetermined goals. All the actions, strategies, responsibilities, resource
allocation, etc. should be committed to attain the enterprise’s goals.
Do’s and Don’ts of Writing a Business Plan
1. Do show that you understand market demand.
2. Do use sensible numbers.
3. Do stick to a clear storyline.
4. Do make it clear why your business is special.
5. Do tackle the risks head-on.
6. Don’t ignore the fact that your competitors will respond.
7. Don’t forget who you are writing for.
8. Don’t underestimate the resources you will need.
9. Don’t dismiss the competition.
10. Don’t think your backer was born yesterday.
 Business Model and Resource Mapping Strategy  Chapter 6 181

Types of Business Plan

To be an enterprise a successful, it requires to have effective business plan. A good business

plan helps to formulate strategic plans to attain the organizational goals. Suitably verified
and a validated business plan entrepreneurs to manage resources and develop action plans
to accomplishing commercial goal. Business plan describes how to illustrate action plans.
Based on nature of organization, purpose of preparing business plan, there could be
different types of business plans, some of them are discussed below:
 Start-Up business plans: Start-up business plan is prepared to the business
enterprise which is going to start first time. It is prepared with detail steps to
start new enterprise including resource requirement, use of resource
allocation and utilization, supply chain and marketing plan. Start-up business
plan includes different sections describing the enterprise, ownership structure,
the product or service to be produced and supplied, market evaluations, capital
requirement and sources of capital, projected profit, estimated risk, and
management team.
 Strategic business plans: A strategic business plan is prepared to provide
a high-level view of a company’s goals and action plans to achieve them.
Though the structure of a strategic plan differs from company to company,
most include five elements: business vision, mission statement, definition of
critical success factors, strategies for achieving objectives and an
implementation schedule. For instance, a market strategic business plan is
prepared with vital marketable strategic components like business vision,
statement of purpose, meaning of varying achievement variables, methods for
attaining an execution plan.
 Internal business plans: Internal business plans is prepared to facilitate
specific target group like human resource management, production department,
marketing department, etc. This document describes the company’s current state,
including operational costs and profitability, then calculates if and how the
business will repay any capital needed for the project. Internal plans are
prepared regarding purchasing procurement like raw material, recruitment and
selection of human resources, production process, marketing and supply chain
plan, technology hiring and utility cost, target demographics, market size and the
market’s positive effect on the company income.
 Feasibility business plans: Feasibility business plan is prepared to provide
the answers of two primary questions about a proposed business venture: i.
who will purchase the service or product i.e. customers, to whom the
enterprise wants to sell, ii. What will be the profit position of the
enterprise?
182 Entrepreneurship & Business Resource Mapping

 Growth business plans: Growth business plans is prepared to

communicate in-depth descriptions of proposed growth to the internal or
external stakeholders. This plan is prepared to estimate the growth and
development, estimated investment capital, Sources of investment capital,
management actions and approaches to reach to the goals.
 General business plan: The average or standard business plan include
aspects like company outline, product and service the company is producing
and selling, overview of target market, financial and marketing strategy of the
company, implementation of policies, analysis, financial forecasting and many
more. While preparing an immaculate financial plan, you need to concentrate
in accumulating reports concerning company’s projected sales, loss, profit, cash
flow and depending upon the anticipated use few other fields should also be
covered.

Sample Business Plan

Sample 1 : Blueprints Business Planning Pvt. Ltd.

Section 1: Executive Summary
1.1 Business idea and goals
The main goal is to establish a small, private (proprietary limited) company that
specialises in management consulting services for the small and medium-sized
enterprise (SME) sector in Sydney and other cities within the state of New South
Wales, Australia. The services to be provided will include preparation of business
plans, training in small business management skills, and books sales.
The owners plan to begin by employing one person full time (Jessie Jones, a major
shareholder) and gradually grow to the point where the business employs three or
four people within two or three years of inception. The business intends to generate
sales revenue of about A$ 100,000 and to make A$ 2000 profit by the end of its first
year of trading.
1.2 Marketing
Blueprints Business Planning Pvt. Ltd. will have two key markets: small business
managers (for whom it will prepare business plans, feasibility studies and associated
services) and SME support agencies (for whom it will provide contract services,
principally training in small business management skills). There are approximately
200,000 SMEs in the Sydney metropolitan area. Market research indicates that there
is currently unmet demand for the products we plan to offer. We will promote the
business using a variety of methods, including direct mail, telephone canvasing, a
Yellow Pages listing, networking, a websites and testimonials.
 Business Model and Resource Mapping Strategy  Chapter 6 183
1.3 Operations
The business will operate with one employee (Jessie Jones, managing director) at
start-up and be based from an office at her home. A minimal outlay of equipment and
expenses is envisaged at this stage, as most necessary equipment has already been
obtained.
1.4 Finance
The business will be self-funding. The directors will provide an initial capital
injection of A$ 10,000, and it is envisaged that the company will generate enough
funds from subsequent operations to allow it to operate on a ‘no borrowing’ policy
unless there is a major change in focus.
Section 2 : Background
2.1 Mission statement
Blueprints Business Planning Pvt. Ltd. exists to provide business planning services,
business education (training) programs and management advice to small and
medium-sized organizations.
The company intends to become known as one of the best business planners and
advisers in the Sydney marketplace. We want to be known as an organization that
emphasises honesty, accuracy and objectivity in the information we provide to clients;
that values confidentiality and sensitivity in all its relations with other parties; and
that gives tailor-made responses to individual client needs.
In this way, Blueprints Business Planning Pvt. Ltd. (BBP) seeks to promote the
interests of the following:
 Clients: By providing the above services, we can help our clients achieve
success in the marketplace and realize their own business goals.
 The wider community: Helping business become more successful ultimately
stimulates local economic development, job creation and wealth distribution.
 Our employees: A well-paid, motivated and well-educated staff is essential to
ongoing success. In return, employees should expect to receive secure
employment, to continually expand and improve their business skills, to be
encouraged to try new ideas and approaches and to work in comfortable,
encouraging environment.
 The owners of the company: Successful achievement of the company mission
should allow the company to operate profitably and to provide a fair return on
effort and investment by the owners on a long-term basis.
2.2. Company history
This is a new business that springs from the existing work of Jessie Jones as a
management consultant (operating as a sole trader) from August 2001 to June 2011.
During this time, Jessie provided training programs, mentoring services and a
limited amount of business planning to a range of clients.
184 Entrepreneurship & Business Resource Mapping

2.3 Business goals

The business’s goals for the short term (next 12 months) are to employ at least one
person full-time on a salary of approximately A$ 42,000 p.a. (gross), to meet all
operating expenses and to generate a net profit of at least A$2000 for future
investment. The long-term (next two or three years) goals are to establish a viable
consultancy service employing up to five people based in Sydney, delivering services in
business planning with its own purchased building.
A future exit strategy has been agreed to by the three foundation
shareholders/directors, should any of them wish to liquidate their interest in the
business at a later stage. The directors have agreed that, after the end of the third
year of trading, any shareholder will have the right to ask for the business to be
independently valued; the remaining directors will then have first option to buy out
the person’s interest. If they do not wish to exercise this right, the shareholder may
sell to an outside party.
Section 3 : Marketing
3.1 Marketing research
The following sources were used to prepare this business plan:
 Australian Bureau of Statistics
 NSW Small Business Advisory Network
 Personal interviews with several business enterprise centres in and around
Sydney
 Institute of Management Consultants, Australia.
 A brief survey of SMEs that already use outside consultants
 Other existing management consultancies
 A search of the relevant management literature
3.2 Market analysis
After a review of the industry, the following conclusions were drawn.
 Industry analysis: There is a definite demand for generic management
consulting services although the industry is still unregulated and ill-defined
(Brown 2008, p. 48). Most services provided are aimed at larger corporations
since, at the ‘bottom end’, micro-enterprises are too small to afford business
planning services. Accordingly, niche opportunities to provide these services
best exist among small to medium-sized (mid-range) business (Ziericki 2007). A
study of Australian SMEs recently showed that most need more training but
are unsure where to find this (Australian Bureau of Statistics 2009, p. 23-4).
This need is especially evident among the 200000 known SMEs in the Sydney
metropolitan region (Sydney Chamber of Commerce 2009).
 Business Model and Resource Mapping Strategy  Chapter 6 185
 Seasonality: It is estimated that business declines in December and January,
which represents the Christmas break and summer holiday period in Australia.
 Competitors: The business’s competitors are very similar to its potential
strategic allies. They include :
i) other management consultants (especially those who focus on SME
training)
ii) accountancy practices (which also act as advisers to many small firms.)
iii) publicly funded business support agencies (such as business enterprise
centers)
iv) commercial training providers.
 Potential strategic alliances: Potential exists to subcontract work from:
i) accountants (that is, those who don’t want to do business plans themselves
but who do want to offer it as a service to their clients)
ii) business enterprise centres (such as those who want training courses
provided or business plans assessed.)
iii) other management consultants (who may need someone to help if their
workload becomes too great.)
We intend to focus our efforts on finding a small number of strategic allies
(about six) with whom we can form long-term relationship.
 SWOT analysis: The information on the previous page was used to develop a
list of potential strengths, weaknesses, opportunities and threats.
Jessie's substantial SMEs advisory experience
Potential strengths
Links to NSW Small Business Advisory Network
One-person operation at present
Potential weaknesses Minimum track record in external consultancies
Little skill in preparing tenders
Growth in external training programs
Potential opportunities Growth of ongoing mentoring services
Good placement to qualify if sector becomes regulated
Competitors
Potential threats
Sensitivity of SMEs to economic downturns
3.3 Marketing plan
3.3.1 Products/services and target market
a. Business planning. Preparation of detailed business plans, covering all
parts of a firm’s activities.
Target markets:
š Small to medium-sized firms (10 to 100 employees).
š Sydney metropolitan area.
š Established companies (preferably two years or older).
186 Entrepreneurship & Business Resource Mapping

š Approximately 200000 such firms.

Customer buying motives:
š SMEs often need specialist expertise to help in running their firms.
š It is often too difficult to do themselves.
š Such advice is often needed for organizational survival or
repositioning.
b. Training. Short, intensive (one-or two-days) courses on
marketing, human resources, business planning, basic financial
management and record-keeping for SMEs
Target markets:
š New small business owners and existing owners keen to increase
their knowledge.
š Central Sydney metropolitan area.
š Sufficient business income (A$200000+) to be willing to pay for
services.
š An estimated 5000 new businesses that start trading each year.
Customer buying motives:
š Owner-managers of SMEs want short, focused courses that develop
their own knowledge base and competencies.
š Such course allow them to acquire useful skills in different aspects
of management.
š The increased knowledge helps them to grow their own business.
c. Small business development books. Sales of various book titles,
best done in conjunction with training courses (that is, sell books
at the end of a particular course).
Target market:
š Participants in training course, as discussed above.
š Central Sydney metropolitan areas.
š Sufficient business income (A$ 200000+) to be willing to pay
for services.
Customer buying motives:
š These books provide more information about materials
initially covered in our training courses.
3.3.2 Placement
Since this is a home-based business dealing directly with clients at their
premises, no particular distribution arrangements are envisaged as necessary.
3.3.3 Promotions and advertising
To start trading, the business already has a number of secure contracts in
place. As such, it is not necessary to actively promote the enterprise to the
general community. However, it would be useful to alert their potential clients
 Business Model and Resource Mapping Strategy  Chapter 6 187
to its existence, with a view to seeking work from them at a later stage. To this
end, the following promotional tools will be used by the business:
š Business cards and letterheads
š Direct mail followed up by telephone contacts
š Listing in the next edition of the Sydney Yellow Pages under ‘Management
Consultants’
š Promotional literature – a series of A4 sheets about the company covering
staff of the organization, services provided, the benefits of using the
company and a listing of previous clients
š Networking – links to other practicing professionals through membership
of the Institute of Management Consultants and other local business
bodies
š Testimonials – a file of positive testimonials from clients that can be used
as references for future marketing
š Internet – a website and more links to this to be built in overtime.
3.3.4 Pricing policy
Charge-out rates for tendered or casual consulting and training services will be
A$120 per hour, which is the current market rate (Jones 2010, p.1). The
standard price of preparing a basic 10 – page business plan will be A$2000; this
figure is comparable to prices charged by other private sector business planners
(both fees exclude GST). Any specific costs (such as travel and accommodation)
will be additional. These prices are set towards the higher end of those charged
within the commercial training sector, but well within the acceptable price
range for management consulting services. Terms of payment will be 10
working days (two calendar weeks) and accounts will be tendered on the day
that the services are provided.
3.4 Evaluation of marketing
The effectiveness of our marketing strategy will be assessed on a six-monthly basis by
analyzing sales data to see what draws the company’s work. For example, if most
work is coming from the distribution of promotional brochures, then this source of
promotion will be seen to be effective.
Section 4: Operations
4.1 Legal and licensing requirements
š Business name and legal structure. Blueprints Business Planning Pvt. Ltd
(Australian Business Number 99999999999) is a proprietary limited company.
The company structure has already been registered and established with three
shareholders i.e. Stephen Molloy (40% shareholding), Jessie Jones (40%
shareholding) and Andrew St. John (20% shareholding) who also serve as the
directors of the company.
188 Entrepreneurship & Business Resource Mapping

š Operating laws and licenses. After checking with the Small Business
Development Corporation’s Business License Centre, it appears that no specific
licenses are needed to operate this business, except for a home-based business
permit from the City of Sydney.
4.2 Legal
The managing director of the company will be:
Jessie Jones
135 Central Blvd, Sydney NSW 2000 Ph: (02) 99999999 Fax: (02)
Home address:
99999998
Date of birth: 14-Aug-70
Qualifications: Bachelor of Business (Distinction)

Experience : Management consultant and owner of Jones Consultancies, 2001-11

4.3 Organizational structure and staffing

Initially, the following tasks of the business will be done by the managing director:
 Consulting
 Training
 Servicing board of directors
 Marketing and public enquiries
 Bookkeeping and administration of the enterprise
Two casual trainers will be employed to help deliver the training programs, and to
help conduct research and write business plans for clients. Both will report directly to
the managing director.
The following is an intended final staffing structure as part of the business’s long-
term (two to three years) goals:
Managing director – business consultancy
This role will be filled by Jessie Jones.
 Duties: Provide business planning, mentoring and occasional training to
clients; undertake marketing of the business; provide administrative services
and strategic development of the firm
 Salary: Set at approximately A$42000 per annum in Year 1, rising to A$50000
by the end of the year 2.
Consultant – general business planning
 Duties. Conduct business planning and general management consultancy work
for clients; undertake office management
 Salary. A$ 45000 per annum.
 Business Model and Resource Mapping Strategy  Chapter 6 189
 Qualifications required.Aptitude for dealing with the public; small business
background; training qualifications (or willingness to obtain); proven ability to
deliver effective training sessions; formal educational qualifications preferred.
More detailed job descriptions, employment contracts and ongoing performance
appraisal mechanisms will be needed during the second year of operations, or
when the employment of full-time staff other than Jassie is necessary
(Anderson & James 2008, p.2). This information must be compiled and entered
into that year’s business plan. When the business does reach the stage of
employing more than one full-time person, it will also use a team-based
approach in dealing with specific projects, with different staff members leading
the rest of the team on particular assignment.
Training
A minimum of 20 hours professional development must be undertaken by each
employee each year, as such training is needed to keep abreast of general
developments in the field. One area where specific knowledge is needed is in
the preparation of tender submissions.
Professional association
The managing director will seek to join the Institute of Management
Consultants of Australia (IMCA).
4.4 Professional advisers
Accountant
Sunshine Street Accountants
4 Sunshine Street, Midland NSW 2050
Ph: (02) 799999999 Fax : (02) 2222 9999 Email: infor@sunshinestreet.com.au
Lawyer
Moot & Moot Partners
Ph: (02) 899999999 Fax: (02) 399999999 Email: reception@moot.net.au
Insurance broker
To be determined
Bank account
MegaBank Australia
5 St. Gregory Tce, Sydney NSW 2000
Manager: Janine Gregory
Ph: (02)22223333 Fax: 22223334
Email: Janine.Gregory@megabank.com.au
Bookkeeper
To be determined. This will not be sought unless the managing director can no longer
provide this service.
190 Entrepreneurship & Business Resource Mapping

4.5 Insurance and security issues

The following insurance will be required for the business:
 Professional indemnity
 Public liability
 Workers compensation
 Director’s liability (possibly).
It is estimated that the combined cost for these property and equipment include the
provision of a locked filing cabinet for client records. Online security for the website
will be needed, and electronic data will be backed up regularly and stored off-site.
4.6 Business premises
a. Location. The business will be based at Jessie’s home at 135 Central
Boulevard, Sydney NSW 2000. A separate room that can be used as a dedicated
office is available, with all required furniture and equipment. The property
concerned is owned by Jessie and her husband, so it has security of tenure
indefinitely. No rent is payable and no special equipment or fixtures are
required.
Training courses will be conducted at specialized venues that can be hired on a
daily basis.
b. Council and government rules. A home-based business license will have to
be obtained from the City of Sydney. No other license apply to the project.
Trainers and business planners do not need to be licensed.
c. Ability to access target market. Since most services will be provided on-site
at the customer’s premises, the office will easily allow the business to access its
target markets. The office is located close to most major roads and freeways.
Clients will be scattered throughout the metropolitan area, therefore, the firm
will need to travel to the client’s preferred locations.
4.7 Equipment required
The equipment required for the business will be :
 Answering machine
 Telephone line
 Mobile phone
 Computer, printer and scanner
 High-speed internet access
 Filing cabinet
 Table
 Ergonomic office chair.
 Business Model and Resource Mapping Strategy  Chapter 6 191
Quotes from suppliers indicate that the total cost of these items will be approximately
A$11500. All materials required for the proposed training programs (such as TV,
video and whiteboard) are provided by commercial training venues.
Likely future needs. If future growth necessitates the use of a fax/modem, the existing
home phone line will need to be replaced with a business phone line. Future
computing needs will probably include an upgraded system with wireless internet.
4.8 Production processes
An operations manual, updated every six months, will explain procedures and
processes within the office. It will also allow the company to apply for quality
assurance certification at a later stage, if it wishes to do so.
4.9 Critical risks/contingency plans
The critical risks facing this business and contingencies to deal with them are :
Liability – to be covered by professional indemnity insurance
Injury to the managing director – to be covered by workers compensation
Excessive workload – other directors may take on work, or it may be redirected to
other consultancies with whom a strategic alliance has been developed.
Section 5 : Financial projections
5.1 Basic assumptions and information
a. Calculation of income and expenses: Expenses have been calculated based
on market research and the manager’s own knowledge of costs. It is assumed
that all accounts revenue will be paid within the month issued (so there is no
delayed income on a monthly basis). No provision has been made for the impact
of inflation or increases in costs. Pricing and costs for the second year of
operations will be reviewed in next year’s business plan to take these factors
into account.
Depreciation of equipment items purchased in July 2011 is calculated using the
straight-line method at 10% per annum of total initial outlay. Book sales
assume a gross cost of goods of 60% (that is, a A$20 gross profit on sales price
of A$50). Only one year’s forecasts have been provided due to the difficulty of
forecasting over a longer time period.
b. Financing of the business: The directors will provide an initial capital
contribution to the business according to their shareholdings- Stephen Molloy
A$4000, Jessie Jones A$4000, Andrew St. John A$2000. Sales income for July
2011 is based on commitments or early orders from prospective clients, thus
providing initial cash flow and removing the need for short-term debt
financing. The overall financing strategy is to operate, wherever possible, with
a cash surplus in the bank account at all times. Bank loans will not be
192 Entrepreneurship & Business Resource Mapping

required. It necessary, the directors will reduce the wages paid to them during
times of cash flow difficulty.
The bank account required for the business is one that:
š Has mobile phone/internet banking access
š Pays interest on sums below A$5000
š Provide monthly bank statements (for reconciliation with accounts)
š Has credit card and electronic funds transfer facilities.
For security reasons, a minimum of two directors will be required to verify all
accounts.
c. Distribution of profits: Profits in Year 1 will be retained in the business. In
future years, annual net profit after tax will be divided in the following manner
: three-quarters will be paid up to the shareholders at the end of the financial
year in accordance with their shareholdings, and the remaining quarter will be
kept as retained earnings. The retained capital will be used for reinvestment in
the business, mainly to upgrade equipment and to meet unforeseen
contingencies. If the business is highly profitable, some of the retained capital
may eventually (in two or three year’s time) be used to help fund the purchase
of permanent business premises.
d. Goods and services tax: No GST figures are shown in any of the financial
documents; in other words all forecasts are net of tax.
e. Loans: The firm has no current loans or debts.
5.2 Analysis of financial forecasts
a. The owners have decided to use net profit margin as the main indicator of the
firm’s performance. Based on the projections made in this document, it is
estimated for Year 1 that this will be :
Net profit before tax $2320
Net profit margin % = Sales turnover = $103750 = 2.24%

This figure is relatively low and below industry norms, according to a recent
study by Jones (2010), but is not unusual for a business in its first year of
trading. We expect margins to increase substantially in Year 2 and Year 3.
In future years, as more data are gathered, it will also be possible to use other
rations to help analyze the financial performance of the firm.
b. Break-even point. Assuming that cost of goods sold is the only variable cost, the
contribution margin is equal to the projected gross profit margin (94%).
Projected fixed costs = $ 95280
Fixed costs $95280
Break-even point in dollars = Contribution margin = 0.94 = $ 101 362
 Business Model and Resource Mapping Strategy  Chapter 6 193

5.2.1 Sales mix forecast (All figures are in Australian dollars, A$)
Blueprints Business Planning Pvt. Ltd.
SALES MIX FORECAST
for the period July 2011 to June 2012
Jul. Aug. Sep. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May Jun. Total
Item: Business
planning
Number sold 2 2 3 3 4 0 1 3 4 5 5 5 37
Selling price 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 24000
Total sales
income 4000 4000 6000 6000 8000 0 2000 6000 8000 10000 10000 10000 74000
Cost of goods
sold per item 0 0 0 0 0 0 0 0 0 0 0 0 0
Total cost of
goods sold 0 0 0 0 0 0 0 0 0 0 0 0 0
Item: Training
Courses
Numbers sold
(hours
delivered) 15 15 15 20 20 10 15 20 25 25 25 20 225
Selling price 120 120 120 120 120 120 120 120 120 120 120 120 1440
Total sales
income 1800 1800 1800 2400 2400 1200 1800 2400 3000 3000 3000 2400 27000
Cost of goods
sold per item 20 20 20 20 20 20 20 20 20 20 20 20 240
Total cost of
goods sold 300 300 300 400 400 200 300 400 500 500 500 400 4500
Item:
Supplementary
books
Number sold 3 3 3 5 5 2 5 5 6 6 6 6 55
Selling price 50 50 50 50 50 50 50 50 50 50 50 50 600
Total sales
income 150 150 150 250 250 100 250 250 300 300 300 300 2750
Cost of goods
sold per item 30 30 30 30 30 30 30 30 30 30 30 30 360
Total cost of
goods sold 90 90 90 150 150 60 150 150 180 180 180 180 1650
Total sales
revenue 5950 5950 7950 8650 10650 1300 4050 8650 11300 13300 13300 12700 103750
Total cost of
goods sold 390 390 390 550 550 260 450 550 680 680 680 580 6150
194 Entrepreneurship & Business Resource Mapping

5.2.2 Cash Flow forecast (All figures are in Australian dollars, A$)
Blueprints Business Planning Pvt. Ltd.
CASH FLOW FORECASE
for the period July 2011 to June 2012
Jul. Aug. Sep. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May Jun. Total
Income
Sales revenue 5950 5950 7950 8650 10650 1300 4050 8650 11300 13300 13300 12700 103750
Capital 10000 10000
Sundry
Total Income 15950 5950 7950 8650 10650 1300 4050 8650 11300 13300 13300 12700 113750
Expenses
Cost of goods
sold 390 390 390 550 550 260 450 550 680 680 680 580 6150
Accounting/legal
services 1500 800 200 2500
Advertising 2000 100 100 100 180 100 100 100 100 100 100 100 3180
Bank Fees 15 15 15 15 15 15 15 15 15 15 15 15 180
Equipment
purchases 11500 11500
Equipment
leases 0
Insurance 2500 2500
Light & power 0
Loan repayment 0
Motor vehicle-
fuel 50 50 50 50 50 50 50 50 50 50 50 50 600
Motor vehicle-
other costs 0
Petty cash 25 25 25 25 25 25 25 25 25 25 25 25 300
Postage, printing
& Stationery 400 400
Rent 0
Repairs &
Maintenance 100 100 100 100 400
Staff causal
wage 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 24000
Staff
superannuation 6000 6000
Staff director's
wages 3400 3340 4700 3220 3340 3400 3220 3340 3400 3220 3340 3400 41320
Telephone 50 50 50 50 50 50 50 50 50 50 50 50 600
Other 100 50 50 50 50 50 50 50 50 50 50 50 650
Total expenses 24030 6020 8180 6160 6260 5950 6060 6380 6370 6290 6310 12270 100280
Cash - -
Surplus/(deficit) -8080 -70 -230 2490 4390 4650 2010 2270 4930 7010 6990 430 13470
 Business Model and Resource Mapping Strategy  Chapter 6 195

5.2.3 Projected Profit and Loss Statement (All figures are in Australian dollars, A$)

Blueprints Business Planning Pvt. Ltd.

Projected Profit and Loss Statement
for the period July 2011 to June 2012

Revenue

Sales revenue 103750

Less: Cost of goods sold 6150

Gross Profits 97600

Expenses

Accounting/legal services 2500

Advertising 3180

Bank Fees 180

Equipment purchases 11500

Equipment leases 0

Insurance 2500

Light & power 0

Loan repayment 0

Motor vehicle-fuel 600

Motor vehicle-other costs 0

Petty cash 300

Postage, printing & Stationery 400

Rent 0

Repairs & Maintenance 400

Staff wage 24000

Staff superannuation 6000

Staff director's wages 41320

Telephone 600

Other 650

Depreciation 1150

Total expenses 95280

Cash Surplus/(deficit) 2320

196 Entrepreneurship & Business Resource Mapping

5.2.5 Owner's personal assets and liabilities (All figures are in Australian dollars, A$)
Blueprints Business Planning Pvt. Ltd.
Owner's Personal Assets and Liabilities : Jessie Jones
for the period July 2011 to June 2012
Assets
Own house(Market value) 700000
Other real estate(Market value) 0
Motor vehicle(Insured value) 2500
Cash(on hand or in bank) 600
Superannuation 84000
Furniture & Personal effects(Insured value) 25000
Other (list if appropriate) 0
Total assets 840000
Liabilities
Outstanding mortgage (on home) 201500
Outstanding mortgage (on other real estate) 0
Personal loan 0
Credit cards 100
Current bills 0
Other debts 600
Total liabilities 202200
Personal worth (Total assets minus total liabilities) 637800

Section 6 : Implementation timetable, 2011-12

2011
Apply for home-based business license
Open business bank account
July Prepare letterheads, business cards
Send copy of business plan to accountant and lawyer (for their information)
Obtain all relevant insurance policies
Start direct mail campaign
August
Review contents of websites
Start compiling operations manual
September Visit accountant reprograms to date, recordkeeping
Enquire recomputing equipment required
October Enquire with Institute of Management Consultants (Australia) re:membership
November Prepare promotional brochure
December Print promotional brochure
2012
Staff/director's retreat to review progress to date
Review business plan
January
Review effectiveness of marketing plan and analyze source of sales of date
Review operations manual
February Attend Small Business Development Corporation course on managing business growth
March Implement benchmarking of advertising by outside adviser
April Update website
May Visit accountant re:end-of-financial-year returns
Write business plan for 2012-13
June
Review and write new marketing plan
 Business Model and Resource Mapping Strategy  Chapter 6 197
Sample 2: Business Model Canvas
Business Plan of an Old Age Care Center in Kathmandu
This canvas outlines a sustainable business model for an Old Age Care Center in
Kathmandu that offers culturally sensitive and community-oriented elderly care. The
emphasis is on providing a dignified, safe, and engaging environment for elderly residents,
while also maintaining close communication with their families and building trust within
the community.
1. Customer Segments
 Primary customers: Families with elderly members who need care or cannot
be looked after at home.
 Secondary customers: Senior citizens who may prefer to live in a community
setting rather than alone.
 Target market: Primarily middle-to-upper-income families in Kathmandu
and nearby areas who are looking for reliable and quality care services for
elderly family members.
2. Value Propositions
 High-quality care and comfort: Provide elderly care services with a focus on
compassionate, safe, and dignified living conditions.
 Medical and Nursing support: Offer round-the-clock healthcare services,
including access to qualified nurses and regular doctor visits.
 Community and companionship: Facilitate social activities, group
exercises, and outings to keep residents mentally and emotionally engaged.
 Cultural sensitivity: Offer culturally appropriate care that respects Nepali
customs, festivals, and traditions.
 Accessibility: Central location in Kathmandu with easy access for families to
visit and check on their loved ones regularly.
3. Channels
 Direct marketing: Reaching out to target families through hospitals, clinics,
and local community events.
 Digital marketing: Using social media, website, and local online directories to
raise awareness and provide virtual tours.
 Word of mouth &referrals: Partnering with healthcare providers and
previous clients to generate referrals.
 Community partnerships: Working with local community organizations,
religious institutions, and NGOs for outreach.
4. Customer Relationships
 Personalized care: Assign caregivers to specific residents to create a
personalized, trusted relationship.
 Family involvement: Keep families updated through weekly reports, regular
meetings, and occasional family events.
 Feedback mechanism: Collect and act on feedback from residents and their
families to continuously improve services.
198 Entrepreneurship & Business Resource Mapping

 Emotional support: Provide counseling and emotional support programs for

residents to ensure their mental well-being.
5. Revenue Streams
 Monthly service fees: Charge a recurring monthly fee for accommodations,
meals, basic care, and recreational activities.
 Healthcare services fees: Additional fees for medical check-ups, nursing
support, and specialized medical equipment.
 Event-based fees: Revenue from hosting family days, festivals, and special
events where families can join.
 Partnerships &donations: Income from partnerships with local health
providers or donations from well-wishers or charitable organizations.
6. Key Resources
 Staff: Skilled caregivers, nurses, administrative staff, activity coordinators,
and cleaning staff.
 Facilities: Comfortable and accessible rooms, dining areas, gardens, and
recreational spaces.
 Medical equipment: Basic healthcare equipment such as first aid kits,
wheelchairs, and emergency medical equipment.
 Supplies: Groceries, cleaning supplies, hygiene products, and recreational
materials.
 Technology: Software for managing resident records, monitoring health
updates, and coordinating with family members.
7. Key Activities
 Caregiving and health services: Daily care routines, including assistance
with personal hygiene, meals, and medications.
 Community and recreational activities: Social events, physical exercises,
cultural activities, and workshops.
 Health monitoring: Regular health checks, doctor visits, and monitoring of
resident health conditions.
 Family communication: Regular updates, meetings, and counseling services
for residents’ families.
 Facility maintenance: Ensuring the center is clean, safe, and comfortable for
residents.
8. Key Partnerships
 Healthcare providers: Partner with local hospitals, clinics, and pharmacies
for medical support and supplies.
 Community organizations: Collaborate with NGOs and local clubs for
community support and volunteer engagement.
 Training institutions: Partner with caregiving schools and training
institutions to hire well-trained caregivers.
 Suppliers: Reliable suppliers for food, hygiene products, and medical
equipment.
 Government and local authorities: Work closely with local authorities to
stay compliant with regulations and access any available support programs.
 Business Model and Resource Mapping Strategy  Chapter 6 199
9. Cost Structure
 Operational costs: Staff salaries, utilities, and administrative expenses.
 Medical supplies and equipment: Ongoing costs for healthcare supplies,
medicine, and medical equipment maintenance.
 Food and living supplies: Regular expenses for meals, bedding, clothing, and
hygiene products.
 Facility maintenance: Cleaning, repairs, and general maintenance of the
premises.
 Marketing and outreach: Costs for digital marketing, promotional materials,
and community outreach.
 Insurance and licensing: Compliance costs, including insurance and local
business permits.

Techniques for Effective Resource Visualization

Effective resource visualization techniques help make complex information accessible,
actionable, and easy to understand. These techniques facilitate quick decision-making,
resource optimization, and improved management by providing a clear view of how
resources are used and identifying opportunities to improve efficiency. Here are some
common techniques for visualizing resources effectively:
1. Resource Allocation Charts
 Resource Histograms: These bar charts show the number of resources used
over time for each activity. They’re excellent for spotting periods of resource
surplus or scarcity and for balancing workloads.
 Gantt charts: Widely used for project management, Gantt charts show tasks
over time and help visualize how resources are allocated across a timeline.
They are especially helpful for tracking progress and identifying resource
overload or gaps.
2. Heat Maps
A heat map is a graphical representation of data that uses color coding to show
different values. In resource management, heat maps can highlight underutilized,
optimally used, and overextended resources. This technique is useful for quickly
identifying resources that need reallocation.
3. Resource Dependency Diagrams
These diagrams show interdependencies between various resources and tasks,
helping identify potential bottlenecks. For example, Fishbone Diagram can help map
causes and effects related to resource constraints and provide clarity on where
adjustments might be necessary.
4. Workload Management Charts
 Burndown and Burnup Charts: These charts are frequently used in agile
project management to visualize resource usage over time. Burndown charts
show remaining resources needed to complete a project, while burnup charts
200 Entrepreneurship & Business Resource Mapping

show completed work and work remaining, giving insight into resource
consumption rates.
 Kanban Boards: Often used in agile methods, Kanban boards visualize tasks
across columns like ‘To Do,’‘In Progress,’ and ‘Done.’ They help track resource
allocation, identify bottlenecks, and balance work distribution.
5. Resource Dashboards
Dashboards provide real-time data on resource allocation, utilization, and availability
in one interface, making it easy to make informed decisions. Interactive elements,
like filters and drilldowns, allow users to explore specific resource data, such as team
workload, financial resources, or time-based allocations.
6. Bubble Charts
Bubble charts display resources as bubbles, with size representing a specific metric
(like cost or availability) and position indicating other factors (e.g., importance or
priority). This helps in understanding the relative size and significance of each
resource in comparison to others.
7. Flow Diagrams and Sankey Diagrams
 Flow Diagrams: These depict how resources flow across departments or
projects, providing insight into bottlenecks and inefficiencies in resource
distribution.
 Sankey Diagrams: Often used to visualize energy or cost flows, these
diagrams can show where resources (e.g., time, money) are allocated or wasted.
The width of each line represents the quantity, giving a visual summary of
resource movement and allocation.
8. Portfolio Maps
 Used in resource allocation for strategic decision-making, portfolio maps (such
as the Boston Consulting Group Matrix) categorize resources into quadrants
(e.g., “High Value, Low Cost” or “Low Value, High Cost”) based on specific
metrics. These helps prioritize resources for optimization.
9. Timeline-Based Visualizations
 Time Series Charts: Useful for tracking resource consumption over time and
spotting trends. They work well for visualizing financial resources, hours
worked, or equipment usage, helping in forecasting and resource planning.
 Calendar Views: Particularly useful for team scheduling, calendar views
make it easy to see resource availability on a daily, weekly, or monthly basis,
improving planning and allocation.
10. 3D or Layered Maps
 3D Maps: Effective when resources are location-based. These maps can show
resource distribution across regions or facilities, which is helpful for logistics,
fleet management, and geographically distributed teams.
 Layered Visualizations: Use layers to add dimensions like time, cost, or
priority to a map, enabling more comprehensive insights without overcrowding
the visualization.
 Business Model and Resource Mapping Strategy  Chapter 6 201

Strategies for Resource Mapping

Resource mapping is a process used to identify, assess, and visualize the resources
available within an organization, community, or project. Effective resource mapping allows
for better decision-making, enhanced resource allocation, and more efficient operations. By
connecting resource mapping to strategic objectives, we ensure that resources are invested
where they will have the greatest impact. These strategies create a comprehensive and
adaptable resource mapping process that enhances visibility, maximizes resource
utilization, and supports effective decision-making across the organization.
These strategies are widely used in sectors like project management, community planning,
healthcare, and education. Here are some of the most effective strategies for resource
mapping:
1. Asset inventory: One of the most common strategies of mapping resource is to
document all available resources, including tangible (physical assets, technology) and
intangible assets (skills, relationships). For this, we conduct a thorough inventory or
audit to catalog each resource, specifying its location, condition, and current
utilization. This strategy provides a foundational overview, allowing for a clear
understanding of existing resources and their availability. A company might create
an inventory of all hardware and software assets in use, underutilized, or outdated as
the asset inventory.
2. Categorization and prioritization: This strategy is set to categorize resources by
type (e.g., human, financial, technological) and prioritize them based on importance or
demand. For this, we need to break down resources into categories (such as human
resources, physical assets, information, financial assets) and rank them based on
urgency, impact, or relevance to current objectives. This strategy helps to focus on high
priority resources and prevents under-allocation to critical areas. Project team might
categorize team members by skill set and availability to allocate tasks effectively.
3. Gap and redundancy analysis: This strategy aims to identify missing (shortage or
gap) resources and redundancies (duplication) that could impact productivity and cost
efficiency. For this, we compare current resources with requirements (checklist of the
essential resources) to find shortages or overlaps. Gaps indicate areas needing
additional resources, while redundancies signal areas where resources can be
reallocated. Using this strategy, entrepreneurs prevent wasted resources, reduces
costs, and ensures critical functions are well-supported.In community health, a gap
analysis might reveal a lack of mental health services in specific areas, while
redundancies could exist in general care services.
4. Dependency mapping: Dependency mapping is done to identify interdependencies
among resources to optimize workflows and minimize bottlenecks. For the
dependency mapping, we map out how different resources are interconnected, noting
which resources rely on others for effective use. This allows for strategic planning
and helps prevent delays that can arise from dependencies. A construction project
may depend on certain tools, materials, and skilled labor. Mapping these
202 Entrepreneurship & Business Resource Mapping

dependencies can help anticipate potential delays if any of these resources are
unavailable.
5. Geographic Information System (GIS) mapping: GIS mapping strategy aims to
map resources spatially for organizations with geographically dispersed assets. We
use GIS tools to visually map resource locations, highlighting the distribution of
resources across regions. This strategy is useful for planning and logistics, helping
organizations allocate resources based on proximity, demand, or need. A disaster
relief organization like Nepal Police and Nepal Army may use GIS mapping to place
emergency supplies in strategic locations based on risk assessment.
6. Real-Time tracking and Dash boarding: This strategy is aimed to monitor
resource usage in real-time and make immediate adjustments as needed. For this, we
use software dashboards to display current resource availability, usage, and potential
bottlenecks. This strategy provides actionable data and allows quick reallocation of
resources to areas with sudden demand or scarcity. A hospital may use a real-time
dashboard to track bed availability, staff on duty, and inventory of critical supplies.
7. Stakeholder engagement and feedback: This strategy is suitable to gather
insights from stakeholders who directly interact with resources to improve accuracy
and efficiency. In this approach, we engage with employees, clients, community
members, and other stakeholders to identify resource needs and challenges. This
helps to get practical view of resource requirements, ensuring that resources align
with actual needs and are not wasted on low-value areas. An NGO working on
community development might engage local leaders to understand the community's
needs for better resource allocation.
8. SWOT analysis for resource allocation: SWOT analyzes internal strengths,
weaknesses, and external opportunities and threats related to resource availability
and usage. Conduct a SWOT analysis to assess how existing resources support or
hinder organizational goals and identify opportunities for optimizing resource usage.
This method provides a strategic framework for using resources effectively to build on
strengths, address weaknesses, exploit opportunities, and counter threats.A school
might use SWOT to assess its teaching resources, identifying a strength in well-
trained teachers but a weakness in the shortage of teaching aids.
9. Resource matching and allocation: This strategy is aimed to match resources
with specific needs and allocate them effectively based on demand. This helps to
identify resources available and requirements and allocate resources based on
relevance, skill alignment, and resource availability. This ensures that resources are
used optimally, and that skills or assets are assigned where they can be most
impactful. An IT company may match skilled employees to projects based on
technical requirements, ensuring that projects have the right expertise for successful
completion.
These strategies for resource mapping help organizations gain a clearer picture of
their assets, improve resource distribution, minimize waste, and enhance overall
effectiveness in meeting their goals. By combining these strategies, organizations can
build a comprehensive, flexible approach to resource management.
 Business Model and Resource Mapping Strategy  Chapter 6 203

RESOURCE MAPPING IN NEPAL

Resource mapping is a crucial tool for sustainable development, allowing countries like
Nepal to identify, document, and analyze their natural, human, and economic resources.
Nepal, a country rich in diverse ecosystems and cultural heritage, relies on effective
resource mapping to harness its potential for growth, economic stability, and social equity.
Key resources include water, forestry, minerals, tourism, human resources, and renewable
energy. By enhancing the resource mapping process, Nepal can foster a more data-driven
approach to resource utilization and management.
Nepal, located in the Himalayas, is rich in natural and human resources. Despite this,
development is often hindered by inadequate infrastructure, limited data access, and
geographic challenges. Resource mapping provides essential insights for policymakers,
development organizations, and investors, enabling strategic planning and resource
allocation. This report explores resource mapping across Nepal’s key resource sectors and
examines the benefits and obstacles to effective mapping.

Key Resources in Nepal and Mapping Status

i. Water resources: Nepal is home to abundant freshwater resources, including over
6,000 rivers and numerous lakes and glaciers. These resources offer potential for
hydropower generation, irrigation, drinking water, and biodiversity conservation.
Hydropower mapping has identified significant untapped potential, with projects like
Upper Tamakoshi showcasing success.
 Current mapping efforts: The Nepal Electricity Authority (NEA) and
various international agencies have conducted hydropower potential mapping.
However, detailed groundwater and irrigation mapping require more resources
and coordination among local and national stakeholders.
 Challenges: Lack of comprehensive data on seasonal water flow, impacts of
climate change, and inter-district water-sharing agreements complicate the
management of these resources.
ii. Forest and biodiversity resources: Nepal’s forest cover accounts for over 40% of
its land area, which is vital for biodiversity, timber, non-timber products, and carbon
appropriation. Resource mapping for forestry has helped in conservation efforts and
sustainable timber production.
 Current mapping efforts: The Ministry of Forests and Environment (MoFE)
and the Department of Forest Research and Survey use GIS and satellite data
to monitor forest cover and biodiversity hotspots.
 Challenges: Illegal logging, deforestation for agriculture, and encroachment
hinder conservation. Furthermore, limited resources and technological
constraints impact the accuracy and scope of forest mapping.
iii. Mineral resources: Nepal has deposits of minerals such as limestone, marble,
copper, and gemstones, which can boost its economy if efficiently mined. However,
mining remains underdeveloped due to limited exploration and infrastructure.
204 Entrepreneurship & Business Resource Mapping

 Current mapping efforts: The Department of Mines and Geology has

conducted preliminary surveys in select areas, and private mining companies
have made further assessments.
 Challenges: Lack of investment, modern equipment, and environmental
considerations, as well as conflict over land use, affect resource extraction.
iv. Human resources: Nepal has a young population with a high potential for
contributing to the economy through agriculture, services, and foreign employment.
Human resource mapping is essential to identify skills and educational needs across
the country.
 Current mapping efforts: The Nepal Labor Force Survey (NLFS) provides
periodic updates on labor demographics, while certain NGOs collect localized
data on skills and education levels.
 Challenges: High levels of youth migration for employment, lack of
comprehensive skills data, and regional disparities in education and skill
development pose challenges.
v. Renewable energy resources: In addition to hydropower, Nepal has potential in
solar and wind energy. Mapping these resources is essential for diversifying energy
sources and reducing dependency on imports.
š Current mapping efforts: Preliminary solar radiation and wind energy maps
have been developed by the Alternative Energy Promotion Center (AEPC) in
collaboration with international agencies.
š Challenges: Topographical constraints, high initial investment costs, and limited
access to updated technological data impact renewable energy mapping efforts.
Methods and Tools used in Resource Mapping
Nepal employs a range of traditional and modern techniques for resource mapping,
including:
 Geographic Information Systems (GIS): Widely used for mapping forests,
water resources, and land use. GIS provides spatial data and visual
representation, which is crucial for policymakers and local planners.
 Remote sensing: Satellite imagery and aerial surveys help map inaccessible
areas and monitor environmental changes, such as deforestation and river
erosion.
 Community-based mapping: Involves local communities in the mapping
process, especially in rural and indigenous areas. This approach ensures
accuracy in resource identification and supports community-driven
development.
 Field surveys and Ground-truthing: Physical site visits confirm remote-
sensed data accuracy and gather on-ground information that may not be
available through other methods.
 Business Model and Resource Mapping Strategy  Chapter 6 205

Challenges in Resource Mapping in Nepal

Several obstacles hinder the accuracy, efficiency, and usefulness of resource mapping in
Nepal:
 Geographic and environmental constraints: Nepal’s rugged terrain makes
certain areas difficult to access, limiting the scope of ground-based mapping
efforts.
 Data quality and integration: Resource data is often fragmented and
inconsistent across sectors, limiting a comprehensive view for integrated
planning.
 Financial and technical limitations: High costs and lack of advanced
mapping technology and expertise restrict resource mapping, especially in
rural and remote areas.
 Policy and coordination issues: Lack of collaboration between government
departments, NGOs, and the private sector results in redundant or incomplete
mapping efforts.

Applications and Implications of Resource Mapping

Resource mapping has several important applications in Nepal’s development, including:

 Economic development: Identifying resource-rich areas allows for better
allocation of investments and fosters local employment, supporting the
country’s economic growth.
 Environmental conservation: Forest and biodiversity mapping contributes
to conservation efforts by identifying critical habitats and ecosystems that need
protection.
 Infrastructure planning: Resource maps help in planning infrastructure
such as roads, power plants, and industrial zones, enabling balanced regional
development.
 Disaster risk reduction: Mapping of river systems, flood zones, and seismic
data aids in developing disaster resilience strategies, especially crucial in
earthquake-prone Nepal.
 Rural development: Mapping agricultural potential and local resources can
enhance rural livelihoods, supporting farming, livestock management, and
local industries.

BUSINESS RESOURCE MAPPING PRACTICES IN NEPAL

In Nepal, business resource mapping is increasingly recognized as a vital tool for
identifying and optimizing resources necessary for sustainable economic growth. Resource
mapping practices allow businesses to understand the distribution of key assets—such as
human resources, natural resources, infrastructure, and technology—supporting strategic
planning and informed decision-making. Although business resource mapping is still an
206 Entrepreneurship & Business Resource Mapping

emerging practice in Nepal, its growth signals promising benefits for productivity, economic
diversification, and competitiveness.
In the context of business, resource mapping involves identifying, categorizing, and
analyzing key assets that are essential to a company or industry’s success. For Nepal, a
country with rich natural resources and a young workforce, effective resource mapping
practices are essential for capitalizing on these assets, promoting economic stability, and
managing growth.

Key Resources Mapped in Nepal’s Business Sectors

Nepal’s diverse economic landscape necessitates business resource mapping in multiple

sectors, each with unique resource requirements and challenges.
i. Human resources: With a predominantly young and active population, human
resources are among the most valuable assets for businesses in Nepal. Companies in
various industries rely on mapping talent to ensure they can access skilled labor in
urban areas like Kathmandu, Pokhara, and Biratnagar.
 Mapping practices: Human resources mapping in Nepal involves assessing
the availability of skilled labor, workforce demographics, and training facilities.
Businesses often rely on data from government labor reports, educational
institutions, and private surveys.
 Challenges: High migration rates, brain drain, and skill gaps hinder effective
human resource mapping. Additionally, regional disparities limit businesses'
ability to access skilled labor across the country.
ii. Natural Resources: Nepal’s abundant natural resources, including forests, water,
and minerals, are critical for industries such as agriculture, forestry, hydropower,
and tourism. Effective mapping of these resources ensures sustainable utilization and
economic stability.
 Mapping practices: Natural resource mapping is carried out using
geographic information systems (GIS), satellite imagery, and field surveys. For
example, hydropower companies map water resources to identify sites for
potential projects.
 Challenges: Environmental constraints, lack of detailed local data, and
limited access to advanced mapping technologies are major obstacles.
Additionally, inadequate environmental regulations can result in
unsustainable practices.
iii. Physical infrastructure: Infrastructure resources, such as transportation
networks, energy facilities, and communication systems, are foundational to Nepal’s
business operations. Infrastructure mapping supports decisions regarding site
selection, logistics, and accessibility.
 Mapping practices: Businesses leverage GIS mapping and government data
to assess infrastructure distribution. For example, logistics companies map
roads and warehouses to optimize supply chain routes.
 Business Model and Resource Mapping Strategy  Chapter 6 207
 Challenges: Nepal’s rugged terrain and underdeveloped infrastructure create
logistical issues, making accurate infrastructure mapping challenging,
particularly in remote and mountainous regions.
iv. Technological resources: Technological resources, including telecommunications,
internet access, and IT infrastructure, play an increasingly important role in Nepal’s
business landscape. Access to technology enables businesses to modernize and
expand their operations.
 Mapping practices: Telecom companies, for example, map network coverage,
while IT firms assess the distribution of broadband access in various regions.
E-commerce platforms use digital tools to track digital infrastructure and
consumer internet access.
 Challenges: Inconsistent internet connectivity limited technological
infrastructure in rural areas, and a lack of tech-skilled workforce hinder
technological resource mapping and expansion.
v. Financial Resources: Access to financial resources, including banking services,
investment funds, and credit facilities, is essential for business growth and
innovation. Financial resource mapping enables businesses to identify funding
opportunities and assess credit access across regions.
 Mapping practices: Businesses often map financial resources by assessing
the availability of banks, microfinance institutions, and venture capital in
various regions. Data from the central bank and private sector financial reports
supports this mapping.
 Challenges: Limited banking infrastructure in rural areas, dependency on
remittances, and regulatory constraints affect financial accessibility and
mapping accuracy.

Tools and Techniques for Business Resource Mapping in Nepal

Various tools and techniques are used to map resources, offering businesses actionable
insights.
 Geographic Information Systems (GIS): Widely used for natural resource
and infrastructure mapping, GIS provides visual and spatial representations
that assist in planning and management.
 Remote sensing: Satellite imagery and aerial mapping are used, particularly
in sectors like hydropower, forestry, and agriculture, where understanding land
topography and environmental conditions is critical.
 Digital Analytics: For human resources and financial resources, digital data
and analytics platforms support mapping by aggregating data from multiple
sources, providing demographic insights, market trends, and consumer
behaviors.
 Field surveys and Ground assessments: Companies often conduct surveys
and site visits to gather firsthand data, especially in areas where digital tools
are limited.
208 Entrepreneurship & Business Resource Mapping

 Data from government and Industry reports: Data from government

agencies, such as the Central Bureau of Statistics and the Ministry of Industry,
Commerce, and Supplies, supports resource mapping, particularly for economic
and workforce data.

Challenges in Business Resource Mapping Practices

Despite its importance, resource mapping in Nepal faces a range of challenges that limit its
effectiveness and scope.
 Geographic and Topographical challenges: Nepal’s mountainous terrain
and remote rural areas limit access to resources and make accurate mapping
difficult, particularly in infrastructure and natural resource sectors.
 Data fragmentation and quality issues: Resource data is often fragmented
across various sources, which can lead to inconsistencies and limit
comprehensive analysis. Additionally, outdated data can reduce the accuracy of
resource mapping.
 Technological limitations: Limited access to advanced mapping
technologies, such as high-resolution satellite imagery and GIS software,
affects the detail and accuracy of resource maps.
 Financial constraints: The costs associated with conducting comprehensive
mapping, particularly for small and medium-sized businesses, can be prohibitive.
 Policy and coordination gaps: Lack of collaboration between government
agencies and private businesses results in duplication and incomplete mapping
efforts. Policies encouraging standardized mapping practices could enhance
coordination.

Applications and impact of Business Resource Mapping in Nepal

Resource mapping in Nepal offers numerous applications that contribute to the growth and
development of various industries. These applications demonstrate the value of resource
mapping in enhancing business competitiveness, efficiency, and adaptability.
 Site selection and expansion: Resource mapping allows businesses to
identify optimal locations for operations, leveraging data on infrastructure,
human resources, and market access.
 Supply chain optimization: Mapping infrastructure and natural resources
helps businesses plan logistics, select routes, and improve inventory
management, especially valuable in sectors like retail and manufacturing.
 Market entry and product localization: Understanding demographic and
geographic resource distribution enables companies to tailor products and
services to specific regions, maximizing customer satisfaction and market
reach.
 Risk mitigation and disaster planning: Mapping environmental resources
helps businesses prepare for risks such as floods, landslides, and earthquakes,
which are common in Nepal. This is crucial for long-term resilience planning.
 Business Model and Res
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1. Investment in tec chnology and train ning: Enha ancing acceess to ma apping
technologiees, such as GIS and reemote sensin
ng, and traiining staff tto use these
e tools
would impprove mappin ng accuracy.
2. Data stan ndardization and integ gration: Developing sta andardized d
data collectioon and
integration
n methods ca
an reduce incconsistenciess and improv
ve data shariing across se
ectors.
3. Collabora ation betw ween public c and private sectorss: Joint inittiatives invo
olving
governmen nt, businessses, and NG
GOs would expand
e resou
urces and ffoster betterr data
collection, sharing, and analysis.
4. Communiity engage ement and d local in nput: Enga
aging local communities in
mapping practices ca an improvee data accu uracy and promote reesource ma
apping
practices that
t align wiith local neeeds and cond
ditions.
5. Policy support
s annd incenttives: Policies encou uraging ressource map pping,
particularlly in rural and
a underd
developed arreas, could facilitate
f growth and attract
a
investmennts.

 Concept off Business ModelM Canvaas :Business Model Can nvas is a strattegic management
concept and d startup tempplate for deveeloping new or
o documenting existing bu usiness models. It is
a visual chaart with elem
ments describiing a firm’s or
o product's value
v proposittion, infrastru
ucture,
customers, and
a finances.
 Elements off Business Mo odel Canvas
š Basicc information š Keey partners
š Key activities
a š Vaalue proposition
š Custoomer segments š Chhannels
š Custoomer relationships š Keey resources
š Cost structure š Reevenue stream ms
 Lean Model Canvas :Leaan Canvas is a template helping early starter
s in their entrepreneeurship
career for quick formulattion of possible business moodels, producct launches, m marketing campaigns
and way to communicatee stakeholderss for Lead Flo ow Method wo ork. It is the eextended verssion of
Business Mo odel Canvas byy Ash Maurya.
 Major comp ponents Lean Canvas
C
š Probllem š Cuustomer segments
š Uniquue value propoosition š Soolution
210 Entrepreneurship & Business Resource Mapping

š Channels š Revenue streams

š Cost structure š Key metrics
š Unfair advantage
 Meaning of business plan :Business plan is a formal written statement regarding business goals,
approaches to achieve those goals, and the time frame within which these goals can be achieved.
It is a road map for directions to a business to perform business activities in accurately keeping
the business up-to-date. It describes the nature of the business, background information,
financial projections, and the strategies to be implemented to achieve predetermined goals.
 Benefits of writing business plan
š Planning š Evaluating ideas
š Collaboration š Sound decisions
š Stakeholder communication š Environmental adaptation
š Creating new business š Efficiency
 Elements of business plan
š Executive summary š Business description
š Market analysis š Organization management and operation
š Sales strategies š Capital requirements
š Financial projections š Critical Risks
š Summary and Conclusions š Scheduling and Milestones
š Appendices
 Qualities of Good Business Plan
š Perseverance š Proactive
š Detailed š Realistic
š Formal š Specific
š Clearly defined responsibilities š Communicable
š Commitment
 Types of Business Plan
š Start-Up business plans š Strategic business plans
š Internal business plans š Feasibility business plans
š Growth business plans š General business plan
 Techniques for visualizing resources
š Resource allocation charts: Resource Histograms, Gantt charts
š Heat maps
š Resource dependency diagrams
š Workload management charts: Burndown and Burnup Charts, Kanban Boards
š Resource dashboards
š Bubble charts
š Flow diagrams and Sankey diagrams: Flow Diagrams, Sankey Diagrams
š Portfolio maps
š Timeline-based visualizations: Time Series Charts, Calendar Views
š 3D or layered maps: 3D Maps, Layered Visualizations
 Strategies for Resource mapping
š Asset inventory
š Categorization and prioritization
š Gap and redundancy analysis
 Business Model and Resource Mapping Strategy  Chapter 6 211
š Dependency mapping
š Geographic Information System (GIS) mapping
š Real-Time tracking and Dashboarding
š Stakeholder engagement and feedback
š SWOT analysis for resource allocation
š Resource matching and allocation

Case Studies
Case Incident Analysis (CIA: 1.1)
Lovely Ice Cream Ltd. (LICL)was the first ice cream factory in Narayanghadh established in
2049 BS. As the city was fast growing being attraction of people from all the districts of
Nepal, Punya Sharma, started the business with capital of 20 Lakhs, forecasting good
business expansion over the growing cities of Nawalparasi, Parsa and many other. LICL
geared up its business as the normal expectation of Mr. Sharma and continued for ten years
till it was purchasing cone from India. Later, in 2063 BS, LICL decided to manufacture cone in
its own; purchased a cone-making machine from India for Rs. 25 Lakhs and started
manufacturing cone. Cone making, though machine is used, require enough hand skills, in a
good deal of physical labor in feeding the machine, and the work process involves heat
and fume. LICL started facing great deal of trouble in its cone-making department. The
department is isolated from the rest of the plant in an older, rather dilapidated building.
For years, management has pretty much let the cone makers have their own way, though,
on occasions, the men have gone on slow-downs, or strike over petty grievances. Their
supervisor, Mr. Gupta, from Gorakhpur, left the job complaining too less salary as compared
to his effort. Sanjeev Shrestha, one of the senior employee from local level started the job of
Mr. Gupta, but looked upon his job chiefly as that of protecting his men from management
pressure. Personally, Mr. Shrestha reports to the management in differently but whenever
representing the whole cone-making department, he always protested for employees
reporting good performance of whole department though it was low. Behaviorally he
showed contradicting personality. Productivity has tended to fall and the costs of
production of cone are considerably higher than in comparable departments in other
plants. Mr. Shrestha, led the employee resistivity in installing new machine and methods of
production, eventually, LICL management decided to shut down the department. Mr.
Sharma wish to retire from the business and handover the business to his daughter Ms.
Prajna, BBA from TU. Ms. Prajna, accepted the offer of her father but requested to settle the
issue of Mr. Shrestha and call back to Mr. Gupta.
Answer the following questions based on above case :
a. Trace the issues and problems of the case LICL.
b. What challenges do you identify in LICL, critically analyze from behavior dimension.
c. Compare and contrast the behavior of Mr. Shrestha and fear of Ms. Prajna.
d. What suggestions do you recommend to solve the prevailing problems of LICL and
maintain group cohesiveness for leading the business?
212 Entrepreneurship & Business Resource Mapping

Questions for Discussion

Brief Answer Questions
1. Define business model canvas.
2. Mention the major elements of business model canvas.
3. What is lean model canvas?
4. State the major elements of lean model canvas.
5. What is meant by business plan?
6. List out the benefits of writing plan.
7. Write down the elements of business plan.
8. Mention qualities of good business plan.
9. Differentiate between start-up plan and strategic business plan.
10. Give meaning of visualizing resources.
11. Mention the various techniques for visualizing resources.
12. What is resource dependency diagrams?
13. State different strategies for resource mapping.
Short Answer Questions
14. Explain the role of business model canvas in new venture start-up.
15. Describe in brief, different elements of business model canvas.
16. What is lean canvas model? How is it different from business model canvas?
17. Explain the various components of lean canvas.
18. What is business plan? Explain the benefits of preparing business plan.
19. Explain, in brief, the elements of business plan.
20. State and explain qualities of good business plan.
21. What different types of business plans are common? Explain them.
22. Describe the different techniques for visualizing resources.
23. What are the strategies for visualizing resources?
Long Answer Questions
24. Business should have a good business plan otherwise the investment gets wasted. Based
on the statement, explain the meaning of business plan and justify the importance of
business plan for success of any business.
25. With a specimen, explain the business model canvas.
26. Prepare a business model canvas for a restaurant café to be established in fast growing
city.
27. Provide a business plan for a small cheese factory to be established in nearby rural area of
the Bagmati province.
28. You are suggested to prepare a business plan in agriculture sector with initial investment
of NRs. 50 lakhs. With including all the elements, prepare a good business plan.
29. A company already established in food and beverage products for 15 years is seeking a
cold drinks production in Nepal. Prepare a business plan for a medium-sized cold drink
company under the given company.
30. What is lean model canvas? Differentiate it from business model canvas with specimen.
31. Describe the concept of visualizing resources with techniques and strategies.
