A Business Plan What is a business plan? What is the role of a business plan? What are the types of business plans? © Karen Devine 2009

What is a business plan? A business plan will include details of: a) a) what the business wants to achieve (its goals). b) b) how the business will achieve its goals (its strategies).

What is the role of a business plan? A business plan has the role of: a) a) Clarifying whether the proposed business is viable. b) b) Organising a business c) c) Leading a business. d) d) Controlling a business e) e) Demonstrating what the nature of a business is to financial institutions. f) f) Demonstrating business viability to investors. g) g) Acting as a management tool. h) h) Allowing an owner to take time to think through decisions. i) i) Financially planning for the year ahead. j) j) Incorporating legal and financial advice from experts.

Types of Business Plans The start up plan or feasibility study. The strategic plan. The tactical plan. The operational plan.

The Start Up Plan A feasibility study occurs at the inception of a business idea. It details the original goals and objectives of a business. A feasibility study is used to determine whether the business idea can work.

The Start Up Plan A feasibility study provides details on: a) a) the business developer’s concept. b) b) the target market for the goods and services. c) c) an analysis of location. d) d) the proposed or projected financial needs.

The Strategic Plan Strategic plans involve developing a long term action plan, generally for a 5-10 year period. Strategic plans involve a degree of forecasting potential events in the external business environment. Eg: interest rate movements.

The Strategic Plan Strategic plans include making decisions on: a) a) changes to mission statements. b) b) changes to funding arrangements. c) c) changes to product development. d) d) marketing strategies. e) e) asset acquisition. f) f) training and development needs. g) g) changes to supply and suppliers.

The Strategic Plan Strategic planning is usually done by upper levels of management. An example of a strategic plan is an establishment plan. This is drafted if the feasibility study determines that the business idea could be successful.

The Tactical Plan Tactical plans involve dealing with the specifics identified in the strategic plan. Tactical plans are very short term and deal with the day to day business operations. Tactical plans are usually done by lower levels of management.

The Tactical Plan Tactical plans contain details of: a) suppliers b) clientele c) technology used d) markets e) Distribution networks.

The Operational Plan Middle management usually completes operational plans. Operational plans are usually more short term in nature. Operational plans examine the business’ objectives for the next year. Included in operational plans are statements about how to include strategies to implement the strategic and tactical plans.

The Operational Plan Operational plans include such issues as: a) a) changes to the production process. b) b) changes to output targets. c) c) changes to budgets. d) d) an examination of goals. e) e) strategies for implementing change.

Question Time? Using your research skills, locate a business plan on the internet. Classify which type of plan it is.