Business Planning

Creating and Implementing Business Plans

The core of your business plan is your vision for the future. From this vision, you will be able to set objectives for various parts of the business and these objectives will need to be well communicated to all involved to ensure a coherent approach to the tasks in hand. Your business objectives are statements about what you want individual parts of the business to achieve. You may, for instance, have a series of objectives about the financial side of the business, or about its products and services, or about your marketing. The objectives you set create a ‘strategy’ for the business.

Marketing Planning

From the analysis carried out, you will no doubt have set some objectives about marketing. ‘Marketing’ is a very broad area of the business – indeed there are likely to be marketing implications associated with almost all your objectives.

Your marketing plan will include detail about:

  • your products and /or services
  • the place in which you sell them and the way that you distribute them
  • the price you charge for them
  • the promotion you undertake

These are commonly described as the ‘4Ps’ of marketing.

The plan will show your intention of how you will undertake the full range of marketing activities. It will be based on the data you collected about your competitors, your market places and other areas discussed earlier. It will also reflect the potential you have identified through analysis for:

  • adding or amending products and/or services to your range
  • finding new customers or better satisfying the needs of existing customers.
  • finding new markets
  • taking advantage of changes in business environment, especially changes in existing market places
  • combating threats posed by competitors and taking advantage of their weaknesses

Finance Planning

A financial plan is often seen as the basis for many other parts of the business plan. This particular plan, designed to meet the financial objectives you have set, is important in that it pulls together the one common denominator of all other plans – and that is cash. The financial plan for the business will have at its heart standard features:

The financial plan you set should be tailored to meet your individual business needs. To do so, it will refer to your particular business circumstances and may also include one or all of a range of other financial tools, such as:

  • business funding structure
  • working capital analysis
  • sales forecast
  • returns achieved on sales
  • break-even analysis
  • contribution from production
  • stock analysis

Looking into these different forms of analysis will quickly show you that they individually serve differing business requirements. You will need to decide which are most relevant to your business situation and from which you will gain most advantage.

People Planning

Having the right people with the right skills is vital to every business. A successful business will recognise that, to be competitive in the 21st Century, it must be proactive in training and developing its employees and it must have in place a strategy for achieving this.

The plan needs to concentrate on the objectives which arise from the business vision. It could cover a wide range of business issues including the identification and satisfaction of training and development needs to meet business and individual requirements. People planning can be crucial in achieving longer term objectives by equipping employees with the right skills – and it is on those skills that the business will be competitive in its market places. The plan will also cover broad statements on recruitment, employment, induction, training and a range of other related business functions.

The Employment Department’s ‘Investors in People’ initiative centres around the proven fact that concentration on ‘people’ issues can bring significant business benefits. Your local Training and Enterprise Council in England or Wales, or your Local Enterprise Company in Scotland, will be able to offer help and guidance on this matter.

Product Planning

Throughout this guide, ‘product’ is taken to mean your product or – if you are a service provider – your service. Which ever your areas of activity, today’s changing business environment and trends in customer buying patterns have to be closely monitored. The business needs to be able to react quickly and effectively when changes occur. In addition, you will want to influence future trends throughout your own marketing effort – but you need to carefully plan future product and service developments to coincide with likely changes. The life cycle of a product or of a service can be estimated and the various stages it goes through will determine its contribution to the business.

The effect of this is that your plans for improving or extending products and/or services is closely linked to your marketing and financial plans.

Quality of your products and services is an important area within your plan. Closely linked to your pricing strategy, the question of product development affects the whole of the business – and everyone in it.

You set your quality standards to satisfy the needs and desires of your customers. Many industries have acknowledged quality levels and the concept of ‘benchmarking’ is an innovative way to create partnerships from which all parties benefit through exchange of information.

Supply Planning

The relationships you develop with your suppliers and your customers are also important influencing factors to be addressed when looking at your product plan. Associated with the issue of quality, these relationships are crucial to future business success.

Many companies are participating in local or regional groups promoting supply chain and materials management – details are available from Government Regional Offices. For more information – 020 7215 1478 or fax 020 7215 1306. Among other material available on the subject, the Supply Chain Management Group in Glasgow (tel: 0141 330 5696) produces a comprehensive pack to help businesses build competitive advantage with important suppliers through improved relationships.

However you choose to approach this and other areas, careful and thoughtful planning is a prerequisite – especially if you are going to learn from and take advantage of the best practice which exists.

Business Planning Guide © Crown Copyright 2011

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