Specification of writing business plans Essay Example | Topics and Well Written Essays - 5750 words

Specification of writing business plans - Essay Example The paper tells that in the conditions of changeable economics, stability and success of every economic player can be insured only by effective planning of its economic performance. The planning program of business optimization is represented by business plan, which is working instrument used in every sphere of entrepreneurship. This document describes the process of firm’s functioning and shows essential methods that can help supervisors to attain own goals and tasks. Good structured business plan helps enterprise grow, conquer new position on the market, build perspective concepts of launching new goods and services, choose rational methods of their implementation and receive various ways of financing. According to Collins, â€Å"Business plans are like sell sheets on steroids. It details your current financial position and your path to revenue growth†. Creation of business plan is conventional and generally adopted way to define objectives of economic performance and outline initial routes for their achievements. This document can be carried out for start-up as much as for already existed entry on successive stage of its development. Business plan is an objective evaluation of own entrepreneurial performance and extremely important instrument of production according to market needs. Successful co-founder and co-owner of Roaring Lion Energy Drink that is worth millions of dollars, Sean Hackney, stated that writing business plan was absolutely worthwhile, because there were a lot of ideas that needed to be put on paper. (as cited in Henricks, 2008, p. 94). The main purpose of elaborating business plan is to predict economic and financial performance of the company for the nearest perspectives, taking into account needs of target consumers and abilities of getting required resources. Goals of business planning Traditionally business plan is considered to be an efficacious mode that helps to attract finance needed for project’s implementatio n. However, many specialists highlight other not less important tasks, which can be carried out with a help of business plan. They are the following: defining concrete directions of performance and target markets; formulating long-term and short-term goals, strategy and tactics of their attaining; choosing the most appropriate products and appraising production and costs of marketing; revealing correspondence of present staff and conditions of motivation with qualifying standards; outlining marketing measures aimed at marketing research, advertising, sale promotion, pricing; evaluating financial state of the company and availability of financial and maternal resources; predicting obstacles that may hinder practical implementation of the project. According to Smith (2004), planning process provides assistance in delegation of responsibilities, results in better co-ordination of resources and encourages constant forward thinking (p. 3). Elaboration of business plan is time-taking and rather laborious process, but implementation of this complex multi-functional document has several objectives. First of all, business plan encourages attraction of external capital. Financial calculations of mentioned document are able to explain what sum of start-up financial resources is required, how they are going to be returned to potential investors and creditors, what risks can take place and others. Secondly, on the beginning stage of project’s implementation business plan insures communication between entrepreneur and future suppliers, merchandisers and employees. Then it helps to avoid impediments before setting up own business. Also business plan is a reliable way to model system of