Planning |
Planning has two
phases:
|
1. Strategic
2. Operational
|
Strategic Planning
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-
Determine business
objectives
-
Determine business
strategic position
-
Undertake SWOT
analysis
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Decide upon required
action
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Business Objectives
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Usually stated as:
|
Business Strategic
position
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There are four
considerations
1. Nature of
business. What are the products or
service offered? Which market does
the business service?
2. Competitive position of the
business. How does the business
compete in the market place?
3. Attitudes of the decision-makers.
How do the decision-makers react to
risk? Are they innovative or
conservative?
4. Image of the business. What
relationship does the business want
to have with customers, management,
staff, shareholders / owners,
suppliers, lenders and the community
at large.
|
SWOT Analysis
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S Strengths
W Weaknesses
O Opportunities
T Treats
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Operational Planning
|
-
Preparation of
marketing, production and personnel
plans
-
Financial plan
including annual budget and cash
flow statement
|
Marketing, Production
and Personnel Plan
|
-
Research
-
Setting Sales Targets
-
Developing Policies
|
The Budget and Cash
flow
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-
The information
contained in the marketing,
production and personnel plans
provides the basis for the budget
and cash flow.
-
The budget consists
of a budgeted profit and loss and
balance sheet.
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Profit and Loss Budget
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Sales
-
Stock movements
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Gross profit margins
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Fixed and variable
costs
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Profits
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Return on investment
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Budgeted Balance Sheet
|
-
Net worth of business
-
Assets
-
Working capital
-
Liabilities
|
The cash flow
statement
|
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|