Planning is a way of thinking about the future of a company. By planning, a business owner or entrepreneur is making a series of advanced decisions about where a firm needs to go, how to get there, and what actions to take during that time to reduce uncertainty and manage risk and the possibilities of change.
Planning is the process of setting goals and deciding how to achieve them.
A Business Plan is a way to document planning.
It is a written document that indicates the existence of a business opportunity and that establishes how the working group will work to take advantage of the identified opportunity.
The business plan offers a particular vision of the future of the company and deals with issues such as:
.How is the company going to be?
.In which markets will you compete?
.What products and services will you offer?
.How competitive will it be?
.What competitive advantages can be achieved?
.How big and profitable the firm can be.
The entrepreneur must adequately evaluate the sector where he is located and the context in which he is going to develop his business, and based on the assumptions he makes about his behavior, prepare an action plan.
The business plan that is developed will be totally conditioned by the assumptions on which it is built.
A complete business plan is generally quite extensive. In recent years, and especially in businesses based on certain technologies, products, or services (such as the Internet and high-tech companies), where the sector is characterized by being turbulent, highly unpredictable and rapidly changing a business plan is accepted. more reduced.
These reduced plans are sometimes enough for potential investors, and other times they only serve to analyze if there is any acceptance of the proposal, and then develop a complete business plan.
Creating a business plan is analyzing a development process, and its result is not immutable. What is done is to set the best path and the best way to reach an objective, but then there will be innumerable factors that can alter the planned courses.
Business plans are used primarily as a means to raise capital or to have a guide for the growth of the company.
For entrepreneurs who need to raise capital, in today’s competitive environment, a quality business plan is essential.
As a vehicle for raising capital, a business plan serves to convince the investor that the new venture has identified an opportunity, has the business and management talent to exploit it, and has a rational, coherent, and credible program for achieving revenue and profit. fixed at the scheduled times.
As one investor puts it: “I see the business plan as the way to evaluate the people who have written it.”
If the plan is accepted, it will become the most important measure of the abilities of those who must carry it out to define and analyze the opportunities and problems and to identify the most appropriate actions for each case.
The elements that usually characterize a good business plan are the differentiation of the product or service offered, the existence of entry barriers that prevent or hinder the entry of potential competitors, and the potential of the market.
A business plan will allow you to evaluate four critical factors for any venture:
4 Critical Factors For An Entrepreneurship
.The people (team): those who are in charge of the business must demonstrate how realistic they are about their expectations of success and the analysis of the problems to be faced. They must demonstrate how they will respond to adverse situations, and if they are willing to make extreme decisions. From reading the business plan, it should be clear what their motivations are for being in the business, and if they are really committed to it.
.The business: what is the product, what is the market, what are the possibilities for rapid growth, what is the competition? Analysis of expansion alternatives is important.
.The context: analyze it in its legal, economic, political, demographic, technological, and/or sociocultural aspects. Try to predict what factors may change that fall outside the control of the company.
.Risk: situations in which things do not occur according to the plan must be foreseen, the consequences evaluated, and the most appropriate response established.
The best business plans are a representation of the future in motion, offering a coherent story of what to expect. Through them, possibilities of action and reaction must be developed. It is essential that the plan concentrates on the dynamic aspects of the business.
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