Explain the importance of business planning to the survival and growth
A business plan should always for a business start up, the use of the
business plan should not stop there, and businesses should be planning
constantly in order to run their business effectively and efficiently.
Businesses have to think about how they are going to plan for survival
or growth, therefore they need to do business planning, to help the
business survive and to grow. Business planning means the stages the
business would need to build up the business. Business planning is a
written document which is used by various many types of people such as
financial advisors such as banks, etc, it shows that the business has
taken the time and discipline to think about where the business is and
where the business wants to go. This is called a Business Plan.
Business planning is essentially about taking a more in depth approach
to thinking strategically about the future of the business whilst
taking the businesses present situation into account, when planning
Businesses think about two basic goals, it would be the description of
the over view of the business idea and provide financial data, to show
that the business is making good money for future developments, this
record can be used in future to show financial institutions for
example: if the business needs money for a new project in order to
grow the business and goes to a bank for some finance, it means if the
business can show that the business is doing well then the business
will be eligible for this finance, it essentially allows the business
to asses the businesses current situation so that they can plan for
the future or make predictions as to what might happen, etc.
Many Businesses invest in the time and energy into business planning
for example by planning for a business it can save a lot of money.
Should plans go wrong, where if it were planned business would have a
back up plan to correct this situation, it automatically saves money
and time. The most common reason is to obtain financial support from
lenders to operate or expand the business for example in other cases
where a business might be experiencing trading difficulties, business
planning is a well process for any business undergoing significant
changes for example if company wants to develop new products, new
markets, or relocating into new premises therefore a plan need to be
drawn up to show and present how the business is going to achieve it
and how they are going to do it.
Within business planning, the business overlooks at various sections
and areas about the business, When planning the business begins with a
statement outlining the purpose and goals of the business and it goes
on to show how the business will realise these goals it will include a
detailed marketing strategy, when planning
Managers also calculate a break-even analysis, and profit and loss
projection and a cash flow...