A business plan involves a process in which a business organization puts together a given set of resources ( people , capital, materials etc) to achieve defined goals and objectives over a specific period of time. In addition to providing the direction necessary for success , a sound business plan should be flexible to take advantage of new opportunities or to allow adjustments when certain assumptions or conditions changed . This plan should be review and progress assessed ( once every 3 or 4 month ) . Ensure that implementation is consistent with overall goals and objectives lay out in the business plan. Developing a business plan is an important factor for success regardless of size , type or time of establishment of the business plan . Even though some export -import companies start a business plan after they have reached a certain stage. planning is needed at all stages in business development from inception to maturity. It is a road map to one's target destination . By allowing for a critical evaluation of different alternatives , a business plan forces entrepreneurs to set up a realistic goals , predict resource allocation and project the future earnings. such a practice assist in avoiding costly mistakes and enhance the decision making abilities of businesses. A written business plan is the basis on which other parties ( bankers , potential partners ) assess the overall business business concern. It is used for obtaining bank financing , seeking investment funs, obtaining large contracts to supply governments or companies or arranging alliances to conduct joint marketing and other activities . The structure of a typical business plan is as follows:
COMPONENTS OF A BUSINESS PLAN
(1) EXECUTIVE SUMMARY
The executive summary contains the company 's background , its market potentials, products/services, cost/sales, profit projection
(2) GENERAL DESCRIPTION OF INDUSTRY AND COMPANY
This components includes the general company description , the current status , and prospect for the industry , description of the products and services .
(3) THE TARGET MARKET
This component describes or present the target market , the market size , the market share and trends and the competition .
(4) THE MARKETING PLAN AND SALES STRATEGY
This includes the marketing strategy , the sales tactics and distribution , advertising and promotion .
(5) MANAGEMENT AND ORGANIZATION
This includes compensation and ownership , the organization and key management
(6) THE LONG TERM DEVELOPMENT PLAN
It includes basic strategy and potential risk
(7) FINANCIAL PLAN
The financial plan exhibits the cash flow projection for 3 years , the proforma income statement and balance sheet
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