User talk:Profinharki92595

A business which wants to attract foreign investments should present a business plan. But a business plan is the exact carbon copy of a trip card. The introduction is very important - but, once interest have been expressed by the foreign investor, an additional, more serious, more onerous and more tedious process commences: Due Diligence.

"Due Diligence" is a appropriate expression (borrowed from the securities industry). It means, essentially, to be sure that all the important points regarding the organization can be found and have been independently verified. In certain areas, it's very similar to a review. All the documents of the firm are reviewed and assembled, the management is interviewed and a staff of economic experts, solicitors and accountants descends on the firm to investigate it.

First Rule:

The organization should employ ONE due diligence planner. That individual interfaces with all outside homework teams. He collects all the supplies required and runs all the activities which will make up the due diligence process.

The firm should have ONE VOICE. Only 1 person represents the company, responses issues, makes presentations and serves as a coordinator when the DD groups want to interview people connected to the organization.

Second Rule:

Brief your workers. Give the big picture to them. If the buyer comes in exactly why is the company raising resources, who're the investors, how will the future of the firm (and their personal future) look. Both management and employees should understand that it is a top priority. They must be advised never to sit. They have to know the DD coordinator and the company's spokesman in the DD approach.

The DD is a process that will be more organized than the preparation of a Business Plan. It is restricted both over time and in subjects: Legal, Financial, Technical, Marketing, Controls.

The Marketing Plan

Must include the following elements:

a.. A quick history of the business enterprise (showing its course performance and progress).

b.. Details about the political, legal (permits) and competitive environment.

c.. A vision of the business in the future.

d.. their and products and services uses.

e.. Comparison of the firm's products and services to those of the opponents.

f.. Warranties, guarantees and after-sales service.

g.. Development of new services or products.

h.. An over-all breakdown of the market and market segmentation.

i.. Is the market increasing or falling (the trend: past and future).

j.. What customer needs do the merchandise / services meet.

k.. and why which areas segments do we concentrate.

l.. What factors are very important in the customer's decision to buy (or not to buy).

m.. A listing of the strong competitors and a quick description of every.

n.. The strengths and weaknesses of the competitors in accordance with the firm.

o.. Lacking information regarding the markets, the clients and the rivals.

p.. In the pipeline researching the market.

q.. A sales forecast by product group.

r.. The pricing method (how is pricing decided).

s.. Promotion of the sales of the merchandise (including a description of the sales force, sales-related incentives, sales targets jt foxx, education of the sales personnel, special deals, dealerships, telemarketing and sales service). Add a chart of the purchasing process from the moment that the customer is approached by the sales team until the product is bought by him.

t.. Marketing and advertising campaigns (including cost estimates) - broken by media and by industry.

u.. Distribution of the merchandise.

v.. A flow chart describing the delivery of orders, invoicing, delivery.

w.. Customer after-sales support (hotline, help, maintenance, issues, updates, etc.).

x.. Customer loyalty (example: churn rate and how can it be checked and controlled).

Legal Details

a.. Complete name of the organization.

b.. Ownership of the company.

c.. Judge registration documents.

d.. Copies of all standards of the Board of the General Assembly and Directors of Shareholders.

e.. Signatory rights guaranteed by the right decisions.

f.. The rent (statute) of the firm and other incorporation documents.

g.. Copies of licences granted to the organization.

h.. A legal opinion concerning the above licences.

i.. A list of lawsuit that were filed against the firm and that the firm filed against third parties (litigation) plus a list of conflicts which are likely to reach the courts.

j.. Appropriate views regarding the possible results of disputes and all the lawsuits including their potential influence on the firm.

Financial Research

Last 36 months income statements of the firm or of components of the firm, if the firm could be the results of a merger. The claims need to include:

a.. Stability Sheets;

b.. Money Statements;

c.. Cashflow statements;

d.. Review studies (preferably done based on the International Accounting Standards, or, if the company is looking to raise money in america, in accordance with FASB );

e.. Income Projections and the assumptions underlying them.

Controls

a.. Accounting methods used;

b.. Techniques to cost services and products and services;

c.. Fee conditions, collections of aging and debts of receivables;

d.. Introduction of international accounting standards;

e.. Tabs on sales;

f.. Monitoring of instructions and shipments;

g.. Keeping of records, declaring, archives;

h.. Charge accounting system;

i.. Budgeting and budget monitoring and controls;

j.. Inner audits (frequency and techniques );

k.. Outer audits (frequency and procedures );

l.. The banks that the company is working with: record, recommendations, balances.

Technological Program

a.. Description of production processes (electronics, pc software, communications, other );

b.. Importance of know-how, technological transfer and licensing required;

c.. Manufacturers of equipment, pc software, services (including offers );

d.. Manpower (skilled and unskilled );

e.. Structure (energy, water, etc. );

f.. Transport and communications (example: satellites, lines, receivers, transmitters );

g.. Organic materials: places, cost and quality;

h.. Relations with suppliers and help industries;

i.. Importance limitations or licensing (where applicable );

j.. Internet sites, technological specification;

k.. Environmental problems and how they are addressed;

l.. Rents, particular arrangements;

m.. Integration of new businesses into active ones (practices, etc.).

A successful due diligence could be the key to an eventual investment. This is a process much important and more serious than the preparation of the Company Plan.