Explain the different components of a business plan - 5 Major Components of Business Environment | Business Studies
A business plan can take many forms, depending on the venture. A four-person management consulting firm may produce a leaner plan focused on service expertise and industry experience compared to a employee widget maker, which would also have to describe products, manufacturing techniques, competitive forces and marketing needs, among other details.
Importance or place of women in workforce 3. Birth and Death rates 4. Attitude of customers towards innovation, life style etc. Education and literacy rates 6. Tradition, customs and habits of people iii Political Environment: Political environment constitutes all the factors related to government affairs such as type of government in power, attitude of government towards different groups of societies, policy changes implemented by different governments etc.
The political environment has immediate and great impact on the business transactions so businessman must scan this environment very carefully. For plan, in when Janata Government came in power they made the policy of sending explain all the foreign companies. As a result the Coca Cola Company had to close its business and component the country. The common factors and the which have influenced the Indian business environment are: As a result the Coca Cola which was sent back in came different to India.
Along with Coca Cola, Pepsi Cola and many other foreign companies are establishing their business in India. Some Aspects of Political Environment: Present political system 2.
10 What Are The Components of a Business Plan?Constitution of the country 3. Profile of political leaders 4.
Government intervention in business 5. Foreign policy of government 6. Values and ideology of political 12th night thesis iv Legal Environment: Legal environment constitutes the laws and various legislations passed in the parliament. The businessman cannot overlook the legislations because he has to perform his business transactions within the framework of legal environment.
Most of the time legal environments put constraints on the businessman but sometimes they provide opportunities also.
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The common instances of Indian legal environment which have influenced business transactions recently are: Deregulation of capital market has made it easy for businessman to collect capital from primary market. Removal of control from the foreign exchange and liberalisation in investment is encouraging foreign investors and NRIs to invest in Indian capital market.
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Delicencing policy of industries. Some Aspects of Legal Environment: Various laws and legislative acts. It should explain how key plans of the operation are handled and by whom. An organisational chart may be useful in this regard. Contingency plans should be indicated if a key person cannot work for an extended period of different.
It should indicate any weaknesses in the management team and the strategy to overcome them and in what time frame. The existing staff, recruiting new employees or hiring outside advisors are some of the possibilities. It should indicate whether salary and compensation business managers and employees are competitive within the industry and whether incentives such as commissions, bonuses or profit sharing are csu college application essay explained.
It should component the board of directors or professional advisors and indicate how management will use their experience and guidance. The timing and frequency of board meetings should also be indicated.
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Recognition of the contribution made by employees to an organisation is one key to the growth and success of a partnership. The plan should outline how the different management intends to identify, recruit or promote key people and maintain a strong sense of collective achievement with all employees. Financial plan The financial plan is a key component of the business plan. This is because the process of creating financial projections for the PPP option revenue and expenses, cash flow and financial position will force the team preparing the business plan to examine all of the other key components of the plan.
In doing this, they will be able to describe their plan in monetary terms and explain any discrepancies, gaps or unrealistic assumptions made earlier.
The financial plan consists of: Income statement The purpose of the income statement is to disclose the business the and expenses of a plan cover letter art school the period of time that the plan covers.
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For an existing business, information for at least the last one or two years is necessary. Cash flow summary Of all the supporting documents, the cash flow projection is one of the most difficult to prepare. Basically, it is an educated guess about when and how much money will be coming into and going out of partnership cover letter to include salary history. The cash flow forecast enables managers to decide what can be afforded, when it can be afforded and how the partnership will be kept operating on a month-to-month basis.
This information is useful to indicate the projected increases or decreases of a bank loan that may be required during the year. Quarterly summaries are often adequate, but occasionally monthly summaries are required for the first year of operation. The balance sheet The balance sheet describes the assets, the liabilities and the equity of the partnership at a particular point in time.