LECTURE
ESSENCE AND STRUCTURE OF BUSINESS
PLAN
1.The concept of business – plan
2.Contents (parts) of business plan
1.The concept of business – plan
In world practice, business plan is developed
based on the standard requirements: simplicity
and clarity of the plan; adequacy, reliability and
accuracy of information; validity and objectivity;
achievable goals; completeness; prospects;
optimal and flexibility, control.
Today, business plans, without losing its
traditional purpose, developed by virtually all
leading foreign companies on an ongoing
basis.
Business plan is called the document
containing the economic justification of
enterprise development, release of new
production or implementing other business
ideas.
Main objectives of business plan:
 determine the specific activities of the company, the
markets, and the place of business in these markets;
 formulate a long-term and short-term business
objectives, strategy and tactics;
 determine the composition and indicators of the
goods and the cost of their development and
implementation;
 determine whether the existing staff of the company
and the conditions of their work motivation;
 assess the financial position of the company and to
assess whether the existing financial and material
resources, the possibility of achieving the set goals;
 foresee the difficulties that may arise and prevent
the practical implementation of the business plan.
They are like the backbone of the entire
system in-house planning. Business plans are
developing plants and offices, manufacturing
units and affiliates. Business plans are
structural units are analyzed and summarized
in the business plans of companies.
The increasing role of the business plan in the
planning especially clearly manifested in the last
decade. It was connected to the following reasons:
1.The increase of the external economic
environment has required companies to its high
flexibility in the management, the ability to
continuously calculate a variety of options of
management decisions in the complex, taking into
account all factors.
2. The role of strategic marketing, the
ability to find and evaluate possible new,
promising areas of economic activity. But there
is little to find a promising opportunity in the
market, must also assess what it's worth. To do
this, and need a business plan.
3. Expanded autonomy of production units.
Under current conditions to see all the options of
economic development can only be at the lower
level, and to assess their attractiveness in terms of
the corporation as a whole, to analyze with regard to
the interests of owners of capital can be at the
highest level. Separation of business systems
integration solutions, if necessary on the part of the
investment policy and has made a business plan as a
popular tool for business planning.
Business plan - a plan of business development for
the period in which the subject stated, the main
objectives, strategies, and geographic areas of
economic activity, which sets pricing, capacity and
market structure, conditions of supply and
procurement, transportation, insurance and processing
of goods, factors influencing growth decline of income
and expenditure for the group of goods and services
that are the subject of enterprise activity.
Business plan always is probabilistic in nature,
suggests the possibility of different variants of conduct
of the enterprise. This is its fundamental difference
from the feasibility study, in which there is a fairly
tight linkage to a specific technology, there is a specific
project documentation, etc. Business plan - this plan
possible actions of the enterprise market.
2. Contents of business plan
Standard business plan has a certain structure,
the sequence of sections. The business plan includes
the following content blocks:
Resume - introduction of the subject of a business
plan, that is justification for appeal of a new business,
commercial or investment project proposals for the
destination of the business plan. From the beginning,
the business plan is justified, what resources are or
what help is needed a new business, and what impact
this business will be able to provide.
The marketing plan shows the results of market
research for new business, assesses the profile of the
consumer's strengths and weaknesses of competitors,
geography, and other market factors. It reflects the
results of marketing research, which lies at the heart of
the business plan.
The purpose of this section of the business plan to show that the market has a sufficient number of
consumers of the product, to prove that consumers
prefer this particular product or brand name
competitors, to show to what should be the main
emphasis in the strategy of advertising.
Operational plans - plans that create and develop
the production of goods and services that are the
subject of a business plan. It describes the mechanism
of startups, the sequence of steps to set up
production facilities, organization of distribution
channels, forms and advertising budget, supply chain,
composition and size of the necessary labor force, etc.
The financial section of the business plan must
include the three major documents (income and
expense plan, plan cash flow and balance of
payments), as well as preliminary observations - a kind
of commentary on the financial terms of business
(payment arrangements with suppliers and customers,
loan repayment period and interest on them, methods
for determining the cost of production, etc.).
One of the main instruments of the financial
section - it's income and expense plan It shows
financial feasibility of new business and being
prepared, using the sales forecast and the
corresponding production costs.
If the completed version of the business plan should begin
with a summary, the process of its development is completed
normally resume. The main thing here - the correct formulation
of the objectives of the business plan, quantitative and
qualitative, financial and nonfinancial, as well as their rationale
for using an appropriate market research, the results of which
could confirm the validity of the assessments made, the initial
financial results before conducting any financial calculations.
Business plans are the basis of in-house planning.
They are designed for departments, divisions,
subsidiaries, of specific projects to develop new
products or expansion of production and other
activities of the enterprise.
KEY TERMS
1. BUSINESS PLAN
2. RESUME (PART OF THE BUSINESS PLAN)
3. THE ORGANIZATIONAL PLAN
4. FINANCIAL PLAN
5. PLAN OF COMPETITION
6. DEVELOPING A BUSINESS PLAN
7. OPERATIONAL PLAN
8. MARKETING PLAN
9. CONTENTS OF BUSINESS PLAN