Influences in establishing an SME (business planning)

Question 1

what is the planning process

Answer 1

• Planning is the preparation of a predetermined course of action for a business.
• it refers to the process of setting objectives and deciding on the methods to achieve them
• The business plan needs to analyse the whole business by examining all parts of the operation
• As a result, each part of the business can function effectively and achieve its goals

Question 2

what is a business plan

Answer 2

a written statement of the business’s goals and the steps to be taken to achieve them.

It is a summary and an evaluation of a business idea in written form
Each plan will be unique, containing information and strategies that apply to one particular business

Question 3

Executive summary (common elements of a business plan)

Answer 3

A brief overview of the plan

Question 4

Goals

Answer 4

What the business hopes to achieve

Question 5

Strategies

Answer 5

An overview as to how the business will attempt to achieve the goals

Question 6

Business description and outlook

Answer 6

An overview of the industry, in which the business will operate, including a situational (SWOT) analysis

Question 7

Management and ownership

Answer 7

The type and nature of organisational structure

Question 8

Operational plans

Answer 8

Details the production process and the people required now and in the future

Question 9

Marketing plans

Answer 9

The product, price, promotion and distribution details

Question 10

Financial plans

Answer 10

A description on the business’s financial needs and methods for evaluating its performance

Question 11

Human resource plans

Answer 11

Details both the present and future staff requirements

Question 12

benefits of a business plan

Answer 12

The planning process acts as a link or bridge between the business owner’s ideas and the actual operation of the business.

1) Helps test the viability of the business

2) Assists the business to be proactive rather than reactive

3) Assists in maintaining the business operation, especially focusing attention on the goals and objectives

4) Indicates the owner’s ability and level of commitment

5) Forces the small business owner to justify their plans and actions

6) Identifies the business’s strengths and weaknesses

Question 13

sources of planning ideas

Answer 13

Having access to up-to-date, relevant and accurate information will allow the business owner to prepare a much superior business plan.

The business owner must account for economic, political, social, technological, geographic and legal factors during the planning stage.

Specialists all provide knowledge to assist a business in its planning (accountants, finance brokers, consultants, bank managers and solicitors).

Question 14

SWOT

Answer 14

Strengths
Weaknesses
Oppotunities
Threats

Question 15

Strengths

Answer 15

refers to the internal aspects of the business.

Are identified to analyse the advantages associated with the business’s current position
Enquires into what the business does well and what advantages it has over its competitors.

E.g. well-trained staff or good customer knowledge.

Question 16

Weaknesses

Answer 16

Weaknesses – refers to the internal aspects of a business.

Are identified to analyse the limitations and disadvantages associated with your current position

Enquires into what the business is not good at, the limitations that a business has, and the advantages that competitors have.

E.g. limited access to technology.

Question 17

opportunities

Answer 17

refers to external opportunities that may affect the business.

Opportunities are identified to analyse potential future actions and their associated benefits

refer to future plans, rather than to where the business is currently.

E.g. new Govt legislation

Question 18

threats

Answer 18

refers to external factors that may pose a threat

Identifies future risks

Example: New competitors who copy ideas

Question 19

What is a vision/mission statement

Answer 19

• states what the business aspires to become in the future
• sometimes called mission statements
• The main purpose of the vision statement is to guide and direct the business owners, managers and employees
• It creates the culture within the business and acts as a benchmark
• Avision statementisa long-term, idealistic state of the FUTURE
• A company’smission statementishow the company chooses to pursue its vision.