If you are planning to launch a new business or trying to expand an existing business, it is important to have a proper business plan in place. In another article on the business guidance series, we already discussed building a proper business plan step by step. In this article, we will try to be more specific about how to avoid any possible losses through proper business planning.
While planning for business, you have to be unbiased, and it is quite possible that you may drop a business plan after careful planning by identifying it as not viable. Any weakness of a business plan may usually surface during its financial analysis or operations planning. This is the area where the business expert may find problems that are not necessarily obvious at the first point.
Business planning essentials by Kavan Choksi
Financial analysis during business planning may often show how a new product or service pricing may affect the profit or any other production of the existing products. Operations planning may also project some production costs which may go above the actual estimates. Kavan Choksi comments that saying no to a project after careful planning is also a business planning success. With this, you may know what to do as well as what not to do. Avoiding such mistakes during business planning will help prevent wasting your time and money.
Integrating a project plan into a business plan
After you have gone through carefully developing and scrutinizing each part of your business plan and find it viable, you can go ahead with executing it. This means integrating your project plan into your actual business plan. For this, one needs to identify the extension plan, and you also need to address the budget and forecasts for this. Determine which projects you have to prioritize. This phase of planning will have an impact on your cash flow and profitability.
Keep the stakeholders’ interests in mind
You need to prioritize the interests of the stakeholders while you are setting up a business or planning to expand an existing business. You have to plan and maintain a fair return on an asset that is acceptable to all of them on the board of directors. Your current audience’s interests and marketing messages may also have to be prioritized. You need to consider whether your marketing for business expansion may dilute the marketing of your existing brand. It may be so easy to do over-promotion and give the wrong message to the existing customer base while planning an expansion. You have to determine how you are approaching your existing markets to ensure that you do not overwhelm the customers with your new launches.
From conception to the execution of the business plans, you need to diligently plan. This plan, however, may not ideally occur in a straight line from the part of the idea to execution. You may need to compromise and readjusts many parts in between. As Kavan Choksi comments, you also need to understand that all business ideas are not really good, and some may have to be dropped towards the end of the planning process.