Definition of Business Planning, Benefits and Types for Business
Definition of Business Planning or a business plan is a written statement that can describe your business, product or service in the future.
This business plan is usually made by business people in the initial business process. Or it can also be made when the business is running which aims to change the direction of the strategy.
The definition of business planning can also be defined as a document that summarizes the operational objectives and business finances.
This business plan usually contains a detailed plan and budget that shows how business objectives can be realized.
Usually, some companies make business plans covering three to five years.
Business planning is an important first step for business and also a map of success for anyone who is starting a business.
The writing of a business plan can also help entrepreneurs to analyze concept weaknesses, market misperceptions, and also other specific things that can cause business goals not to be achieved.
Benefits of business planning
The benefit of business planning is to provide as much information as possible to business owners or company leaders to achieve the goals.
The business plan can be divided into three main parts:
This section consists of business structure, products or services, and planning that makes your business a success.
This section describes and analyzes potential customers.
You must analyze who, where and also what makes your customers buy.
You also have to describe competitors and how to defeat them.
This section contains income and cash flow reports, balance sheets and other financial ratios.
This part of the business plan usually requires the help of an accountant or good spreadsheet software.
This business plan can help business owners find:
- The amount of funding needed to start a business
- Facilities or equipment needed to run a business
- Determine the exact location or place of business
- Determine the number of employees needed
- Understand the competition
- Knowing the company’s superiority over competitors so that they can use it.
With proper and accurate business planning and can inform all things that must be done.
So this can help business development.
Business planning component
What are the components included in the business plan?
Whatever the use, standard plan components include:
- Business plan summary
- Business description
- Product or service description
- Mission statement
- Market Analysis
- SWOT analysis (strengths, weaknesses, opportunities, strengths)
- Marketing plan
- Financial projections
- Cash flow analysis
Types of business plans
Business plans can be divided into four different types.
There are short plans or plans, work plans, presentation plans and electronic plans.
All types of work plans require different amounts of work and not always with different results.
This means that complicated plans do not guarantee success compared to simple plans.
A mini plan can consist of one to 10 pages and must be concerned about important things such as business concepts, cost requirements, marketing plans and financial statements.
This method is a good way to test the business concept with cepta and measure the interest of partners or investors.
The mini-plan can also function as the main foundation for developing long-term plans later.
A work plan is a tool used to run your business.
Therefore this plan must be long and detailed but lack presentation.
With a work plan, you can increase openness and higher informality.
A strict work plan aimed at internal space may eliminate some important components intended for someone outside the company.
You may not enter key executive resumes for example work plans.
If you want to make a business plan with low pressure on impressions and can draw attention to how it looks.
Then the presentation plan is very suitable to do. This plan is suitable for targeting investors, bankers or other parties outside the company.
Almost all the information in the present plan will be the same as the work plan even though it is arranged differently.
This presentation plan is usually not used as a reminder but is only used as an introduction.
Almost all business plans are made on a computer or the like and then printed or presented in hard copy.
But at this time it does not rule out that all business information can be sent electronically.
This electronic plan can be used for presentation to many people through the projector.
When you start a business, the first step you have to do is find the right business plan.
A business plan has goals such as making a profit or raising money.
The business plan of each business is not the same depending on your business and goals.
Sometimes you need a plan that is different from other business people.
The importance of a business plan for your business including this planning has a great influence on the overall course and development of your business.
Such is the definition of business planning (Business Plan), its purpose and type for business development.