Successful Business Planning Process for Entrepreneurs
A business plan is a written document prepared by entrepreneurs that help shape the layout of their business and describes all the relevant external and internal elements involved in starting a new venture. It is an integration of functional plans i-e Marketing, finance, manufacturing, and human resource plan.
It is also a blueprint of a step by step process to convert a business idea into a successful business venture. The business planning process helps to answer two questions.
1: Where are we?
2: where do we want to go?
The result of this process is called a business plan. A business plan serves as a guide for the management of the company on how to run it. Business plans describe the most critical tasks that must be completed and gives a specific time frame for the completion of the task. It helps companies allocate resources to accomplish goals.
Where Are We Now?
In the “where are we now” phase companies begin the planning process by taking a critical look at the business’ current situation. The management team evaluates the strengths and weaknesses of the company.
Objectives of the evaluation cold are revenue targets or simply ascertaining the company’s reputation for reliability in the market. The planning process provides an opportunity for improvement in all areas.
What’s the Competition Doing?
In business, keeping track of the competitors is an ongoing process but in the planning phase, this information is used to evaluate the strengths and weaknesses of the competitors. This analysis shows the company management how to position the company’s products or services to compete more effectively. Competition can be in different ways it may be that the best way for your company to contend with a competitor is by simply offering better customer service than lower prices.
What’s the Opportunity?
Success in business is providing products and services that meet the customers’ needs and expectations in a significantly better way than competitors. Before launching a product or entering a new market, management needs to determine a strong customer need to determine a problem and to launch a product or services accordingly.
Solving the customer’s problem must be a top priority. No company has unlimited resources, the decisions about which opportunities are best to exploit are critical to the company’s success.
How will we Attract and Keep Customers?
The marketing plans details which customer groups to target and how to convince them to make a purchase or acquire your services. The planning process must produce specific and minutely detailed tactics, not just vague generalities.
Instead of saying the company will employ Internet marketing, then the plan must be a detailed one about which categories of internet marketing will be emphasized, which website will be used, and the cost of advertising considered. And also include the reason why these strategies are likely to result in success.
How Will We Allocate Budget?
The planning process determines how all the assets of the company will be utilized to achieve the goals and objectives. Thorough planning allows financial resources to be used wisely and allows the human resources of the company to be as productive as possible.
Planning helps avoid problems like cash shortages, inability to deliver products on time/schedule, or inadequate staff levels.
What’s the Financial Forecast?
A financial forecast, sometimes referred to as the company budget is also produced during the planning process. Later the forecast numbers are compared to actual results during the year and discrepancies are analyzed to check if a change, of course, is required or has shifting expenses became necessary due to a changing economic environment.