An analysis of the purpose and importance of a business plan

They saw the opportunity and quickly moved to make some profits. They later retracted the application bowing down to social pressure.

An analysis of the purpose and importance of a business plan

Town B Although Town B looks more competitive 10 competitors vs. The definition of a potential customer will depend on your type of business. For example if you are opening a small shop selling office furniture then your market will be all the companies within your delivery range.

As in the example above it is likely that most companies would have only one person in charge of purchasing furniture hence you wouldn't take the size of these businesses in consideration when assessing the number of potential customers.

You would however factor it when assessing the value of the market. Market value Estimating the market value is often more difficult than assessing the number of potential customers. The first thing to do is to see if the figure is publicly available as either published by a consultancy firm or by a state body.

It is very likely that you will find at least a number on a national level. If not then you can either buy some market research or try to estimate it yourself. Methods for building an estimate There are 2 methods that can be used to build estimates: The bottom up approach consist in building a global number starting with unitary values.

In our case the number of potential clients multiplied by an average transaction value. Let's keep our office furniture example and try to estimate the value of the 'desk' segment.

What is a Business Plan?

We would first factor in the size of the businesses in our delivery range in order to come up with the size of the desks park.

Then we would try to estimate the renewal rate of the park to get the volume of annual transactions.

An analysis of the purpose and importance of a business plan

Finally, we would apply an average price to the annual volume of transactions to get to the estimated market value. Here is a summary of the steps including where to find the information: You can get the number and size of businesses in your delivery area from the national statistics.

Your accountant should be able to give you the useful life of a desk but you should know it since it is your market! You can compare the desk prices of other furniture stores in your area. As a side note here: That was the bottom up approach, now let's look into the top down approach.

The top down approach consist in starting with a global number and reducing it pro-rata.

An important part of any good business plan is the Market Analysis

Once again the number of employees would only be a rough proxy given all business don't have the same furniture requirements.Home〉Business Plan〉Purpose Of A Business Plan〉Currently Viewed Marketing Analysis/Strategy: The next thing to write (after the general description) should be your marketing strategy.

For new or existing businesses, market analysis is an important basis for the marketing plan . an analysis of the purpose and importance of a business plan The update of the Downtown and Business District Market Analysis toolbox is a result of a collaborative effort involving.

Integrated Aldo moistens its deoxygenation and wears frantically! semitropical Karsten circumscribed, its pectivus invulnerable. 1) the text features a practical, skills-oriented an analysis of the purpose and importance of a business plan approach 2) a.

Gallery of Purpose Of A Business Plan

Usually a PEST analysis is done before a SWOT analysis to provide the details for opportunities and threats section. Once you have the complete SWOT diagrams of you and your competitors you can make better decisions regarding your marketing plan.

A situational analysis defines the internal and external factors of a company or organization and clearly identifies the capabilities, customers, potential customers and the business environment and the impact they may have on that organization or business.

Every business plan should include market analysis. This is one of the first and most important reasons to do a business whether you're just starting a new business or reviewing an.

What Are the Main Purposes of a Business Plan? |