Page 109 - DMGT310_ENTREPRENEURSHIP_AND_SMALL_BUSINESS_MANAGEMENT

Entrepreneurship and Small Business Management

Notes Business plans help companies identify their goals and objectives and provide them with
tactics and strategies to reach those goals.

They are not historical documents; rather, they embody a set of management decisions
about necessary steps for the business to reach its objectives and perform in accordance
with its capabilities.

Business plans have several major uses. These include internal planning and forecasting,
obtaining funding for ongoing operations or expansion, planned divestiture and spin-
offs, and restructuring or reorganizing. While business plans have elements common to
all uses, most business plans are tailored according to their specific use and intended
audience.
Business plan is an outline of a business giving details of the finance, assets, staff, products
or services and markets. It guides the entrepreneur, identifies possible problems and is
also used in funding applications.
The business plan sets out how the owner of a business intends to realize its objectives.
Steps in a business plan include: Idea Generation, Environmental Scanning, Feasibility
Analysis, Functional Plan (Marketing plan, financial plan, organizational plan and
operational plan), Project Report Preparation, Evaluation, Control and Review.
Planning is essential in all organizations and company plans should be documented in the
form of a project report. This unit presents a comprehensive discussion and outline of a
typical business plan. All the key elements in a business plan are discussed in this unit.
Banks and other lenders use business plans to evaluate a company’s ability to handle more
debt and, in some cases, equity financing. The business plan documents the company’s
cash flow requirements and provides a detailed description of its assets, capitalization,
and projected financial performance.
An entrepreneur is a highly creative person who gets an innovative idea about a product
or service that could be brought into the market.

The objective of a successful environmental scanning should be to maximize the
information and hence the entrepreneur should collect information from as many sources
as possible and then analyze them to understand whether the given information would be
supportive/obstructive to the business venture.

Environmental appraisal is carried out to assess the external and internal environment of
the geographical area/areas where, entrepreneur intends to set up his business enterprise,
whereas feasibility study is carried out to assess the feasibility of the project itself in a
particular environment in greater detail.

7.5 Keywords

Blueprint: A blueprint is a reproduction of a technical drawing, documenting the architecture or
an engineering design, using a contact print process on light-sensitive sheets.
Business Plan: It is a roadmap for the organization, showing the destination it seeks, the path it
will follow to get there, and the supplies and wherewithal required to complete the journey.
Demographic Appraisal: It assesses the overall population pattern of a given geographical
region.

Feasibility Analysis: It is done to find whether the proposed project (considering the above
environmental appraisal) would be feasible or not.

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