Business Planning Process - Example

Business Plan Analysis Course Tutor Date 1. Introduction Business plan analysis according to Marzec (2014) is a desirable skill within the entrepreneurship and investment cadre. It not only allows for sound decision making but also gives a logical description of business milestones which are responsible for the success of any venture. One of the most important significances of business plan analysis is pointed as the fact to underline the importance of the business venture in terms of the intended purpose or returns and the risk that the lenders should expect to incur. While this among other business proficiencies are required for the economic relevance within the existing operational environments, this article identifies two of the most significant business plans for analysis in a bid to expand knowledge for application today and future. The two business plans meant for analysis are sourced innovatively through consultation with a local hosting website (Palo Alto Software, 2014) and the University of Puerto Rico portal (Cruz-Cruz, 2002). According to the summary of the business plan sourced from (Palo Alto Software, 2014), the nature of business intended to be undertaken regards establishment of a coffee house which seeks to capitalise on the ‘starbucks’ concept in order to flourish. In equal measures, the business plan literature sourced from the University of Puerto Rico portal entails a traditional business model whose main target is to provide vocational travel services to professionals aged between of 25 to 35 years. The resulting analysis thus seeks to develop a critical analysis of the two business plan and their respective models in order to establish their viability indices. The key points of consideration include; the main strong points, weak points, the suggested strategic improvements and the challenges that may be faced and how the same should be approached by the probable investors. Further, this article shall document the learning outcomes that shall have been achieved alongside the competencies. 2. Discussion 2.1 Brief Description The preparation of the business plan is a step that can make the best out of the sales acumen .There are promotional strategies that are applied in the entire process of strategic and short term planning. This is made up of public relations, shop front sale, Internet Web site, customer relations, press advertising, more others that make the Successful businesses have ambitious goals. There is need for the generation of the realist expectations, were by time and resources are well allocated to ensure that the accrued objectives have come to pass. When dealing with the business, the owner should have knowledge on the customer incentives, advertising and promotions, sales and marketing, and commission with the business strategic plan. Making the short term planning effective, the expert requires to ensure that the funds and timing be done appropriately. Investigative plans have demonstrated in the recent past that the strategic and short term planning is very important in many respects but in one respect, noble in the management process. The rising aptitude of the business is at the position of changing the market direction-towards less stagnant direction to growing. Short term planning emphasizes on the current quick operations of the organisation that are short range. This can be short period of time ranging from one year or even less. Strategic and the short term planning is very important as well as it helps the organisation in the focusing of the future success and the unnecessary failures. The strategic plans are eminent in the analysis of the future planning (Tactical Planning Vs. Strategic Planning, 2014). The strategic planning process requires full thinking and the implication means the workflow is a result. Short-term requirements in planning are given the priority .Competence is regarded more compared to any other facts, and strategy is to transform the organization. Therefore, a shorter-term strategic transitioning plan may be necessary if there is any need of transforming the organizations. When an organization has one major client that it is servicing, focus needs to be on delivering the best service possible to that client, while at the same time seeing if cross-selling of other products or services into the client can be realized. This show how the management system has been advanced (The Sergay Group, Ltd., 2014). 2.2 Key Strong Points In the two analysed business plans, that to say, the establishment of a coffee house and viability indices of the vocational travel services to professionals aged between of 25 to 35 years plan there are issues emanating that have controversy. According to, all businesses, whether start-up or growing, will be required to supply financial data. If you are an established business, you will be required to supply historical data related to your company’s performance. Most creditors require financial data for the past three years, including tax returns. Some other times, Financial Assumptions are considered , more so, individual people’s financial projections, will subject one to make some assumptions about specific issues like ; sales, expenses, operations. New businesses will be required to provide monthly projected income statements, balance sheets, and cash flow statements for at least two years. The business plan should not be predictable by the agents interrogating. In most of the incidents, the control methods that are applicable are equally urgent. Start-up expenses, Funds and Collateral, planning to take out a loan, Cash Flow, Income Statement and Balance Sheet, are especially used methods to ensure the sufficient coordinates supporting the business. When handling the matters concerning money, there is need for speculation .Room for expansion is the opportunity that should be granted. The employed people on the full term or short term work force basis are modest and profit earners. In the financial field of both the plans there is no strong holds that the organisation can cling to when there is less options. This is the stage where the purpose of the business is identified clearly; in additional to this, Return on shareholders capital by Year Three is projected to be close to 100 percent. This implies that the business plan is to communicate and extend the communication even outside the organisation. The control of the financial data is very precious and the involvement of the travel business. (Palo Alto Software, 2014 ) 2.3 Weakness of the business plans When Marzec (2014) does an analysis of the business plan, he is impressed with the accrued benefits to the entrepreneur and the investors .He goes a head to say that good business plan provide a thorough and logical breakdown of how a business makes money by delivering goods or services to customers and taking payment. However, this proposal has identified specific weaknesses that are up to breaking the million dollars that are to be saved instead! In most of the incidences the overall cases that have dominated the world of the business plan analysed. The pricing of the plan is as stannous and mainly the plans suffer these syndromes. The research and development of the management plan is technically a challenging facet as provides the optional growth condition. The financial planning for the case of the short term and long-term suitability is the complexity that the plans undergo. The accounting systems that are applied to the above business plans do not provide the either issues that are rotating around the income and the investment opportunity. Coffee house it self in the real sense has inherent risks as the business. This translates to the difficulty in the development of the innovative methods that are most current and can otherwise cause the business plan objectives to attain the optimum point. The risk assessment has been done in the two business plans and there are mitigation approaches that can be serviced to the challenges that are arising due to the environment and managerial systems. There also operating problems that are speculated, marketing problems as well find their way to the business thus weakening the format of the business plan. The unforeseen failures are not easily detected some other occasions .This may spoil the image of a very good business plan. In this arena potential weaknesses entail viewing and determining how the organizations can strategically influence or manage the variables at this level. 2.3 Improvements of the business plans. There are several other ways in which the business planners were to follow up especially, when creating a strategic plan of the business. An analysis of the external environment is very mandatory. The improvements of the business plans are necessary in predicting what impact this environment could have on the organization over the next few years. Technological advancement is required in the ensuring that the business plans have passed the test and the opportunities that are macro-environment, the market environment that includes competitors, customers, consumers, the incumbent industry landscape, suppliers and vendors are analyzed to determine how changes in it could impact the organization. Having it in mind that, the plan should be the driving force behind all the actions taken in the organization and the progress made, results achieved need to be constantly measured and communicated to the relevant levels. The major improvements are the ambitious goals that generate realistic expectations of the time and resources necessary to meet those goals. There increased knowledge of industry and customers treatment criterion. For the stagnation of the business plan to remain void, there is need for improvement of the mission and the vision statements .This communicates a lot about the unforeseen opportunities of the business and the success that is realistically capture. There is need for the improvements on how the company makes and provides its goods or services. The business plan should have the documentation on the services and the products that it derivers there materials. The reliability and the assets are described in the assumptions made. There should be composed flowchart that provides how the business swims on. The strategies on the payment of the customers either on monthly, use of credit cards, transaction costs anticipated has to be dealt. When the stage of operation is being, there is need for the improvement of the financial statement (Camillus, 1986). 2.5 Challenges faced and how they can be mitigated The business plan is very crucial document that should be developed for the survival of the business .The development of the business plan face a simple challenge of find time and resources that are required in the planning g process. This proposal evaluates the process in which the business owners take to have the clean plan put into the paper. The set of goals is as strenuous process but on the other perspective the attaining of the business plan goals is as expensive and difficulty .There is another challenge that erupted as the completion of the markets remains high and the situation may deteriorate. The development plans find it difficult to accommodate the virtue of attraction of the customers and retaining. More problems emerge in the online marketing and the research of the optimization that has a silent curve downwards. The top most challenges are introduce to the business plans. Financial controlling is a very sensitive sector that has provided the hard rock to the experts .The finances that are required in the development of the plan and the bearing that is in place, in additional to this the cost and the value of the business plans is a track humour. The balance of the income that is returned to the society and the saving in the absence of the government’s subsidiaries is also the target challenge of the business plans. There is also the realism challenge; this is the connection of the plan and the estimation of the actual data. The accounting system and the system controls that are vested in the organisations are widely covered this need expertise work to solve any solution. The morals of the business plan involves the business plan that is grounded on the tremendous growing business .The challenges that are faced in the business plan can be transformed to better solutions that are competent in the taming of the business flow (Cruz-Cruz, 2002). 3. Leaning Outcomes 3.1 Challenges faced during analysis While taking the whole process of analysing the business plan there is indeed enough time and resources that are spent in the process .There is some times boredom as some unnecessary steps of the business plan are included. The businesses plans are drawn from different backgrounds that to mean that; The two business plans meant for analysis are sourced innovatively through consultation with a local hosting website (Palo Alto Software, 2014) and the University of Puerto Rico portal (Cruz-Cruz, 2002). They also have different nature of the business .The other side tries to develop the glimpse of the establishing the coffee house , while the other main subject matter is to provide vocational travel services to professionals aged between of 25 to 35 years. The operating system has very limiting factors that emanate from the in consisted financial statement. The business plans analysis needs a keen understanding of the market, vision, mission statements, and the operational systems. There is in fact great challenge when it comes to determination of the daily operations of the business .This is difficult as the consumers can change their needs hence the business have no speculation of the analysed business plan. The historical back grounds that the business plans are developed on are not overt. There is a hidden a gender that is not coming in the executive summary of the business plans. The distribution channels of the business plans have not been out of short lift. The major part of the business plans that is more challenging is the detailed operational and the shallow financial control measures .There are lasting solution that can be applied to the above business plans to ensure that the good running of the business .The journey that is meant to overcome the challenges of the business plans is planning to plan the business plan before the initial plan itself. 3.2 Lessons learned There is needed to remain a Participatory party in strategic planning. This is due to its inaugural role that translates to the success of the business plan. The swot analysis is very crucial in the development of the correct business plan. For the business plan to be successful there is some components that are adhered to. There are short term strategies and the long term planning options that can be used if there is need to improve the management and the personnel of the business. Good plans can be developed, but what is more important is the analysis of the business finances, history, operations, competition and customers. While developing the business plan remain focused in persuasion of the readers but more importantly ensure that problems are highlighted and solutions attained. The planning process should provide the direction of the business and the methods through which the investor is able to recover the money spent once the investment is mature (Camillus, 1986). 3.3 Competencies achieved The process of analysing the business plans leaves one with the experience of developing the fundamental practises that are epitome to the business plan schedules. There is increased competence in working out the accurate business plan. The strategy formation and the short term planning of the business plan is an equally good plan that one evolves. Development of the business plan is a total commitment were by the executive summary, business description ,marketing plan, products and service description, operational plan, personal financial and the analysis . This is the right opportunity gain the prowess in the business plan. 4. Conclusion The proposal is fully developed on the analysed business plans that are hence provided .The real value of the business plan is to only driving to success, but also translates to organisational professionalism. Planning process therefore, helps an individual to develop critical thinking .This brings to typically the refinement of plans in relation to refining the plan. The proposal herein has described strategic and short-term planning processes and their importance in management, types of financial accounting and control methods, weakest component Improvements that should be done on the business plans, Challenges faced and how they were mitigated, and all the learning outcomes are summed up in the proposal. 5. References Camillus J.C. (1986) Strategic planning and management control: systems for survival and success .USA. Library of congress cataloguing – in publication data. Cruz-Cruz, J. A. (2002, March 10). Sample Business Plan. Retrieved August 16, 2014, from http://academic.uprm.edu/jacruz/admi3125/Sample_Business_Plan.doc Marzec, E. (2014, August 15). Business Plan Analysis. Retrieved from Demand Media: http://smallbusiness.chron.com/business-plan-analysis-1086.html Palo Alto Software. (2014, August 16). Coffeehouse Business Plan. Retrieved from Business Planning: http://www.bplans.com/coffeehouse_business_plan/executive_summary_fc.php Sergay Group (2011) strategic planning process. http://www.sergaygroup.com/Smart-Talk/Strategic-Planning-Process.html Management innovations tactical planning vs. Strategic planning Wednesday, Dec 10 2008,http://managementinnovations.wordpress.com/2008/12/10/tactical- Planning-vs.-strategic-planning Read More