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Explain the importance of business planning to the survival and growth of organisations.

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Introduction

Task Seven Explain the importance of business planning to the survival and growth of organisations. A business plan should always for a business start up, the use of the business plan should not stop there, and businesses should be planning constantly in order to run their business effectively and efficiently. Businesses have to think about how they are going to plan for survival or growth, therefore they need to do business planning, to help the business survive and to grow. Business planning means the stages the business would need to build up the business. Business planning is a written document which is used by various many types of people such as financial advisors such as banks, etc, it shows that the business has taken the time and discipline to think about where the business is and where the business wants to go. This is called a Business Plan. Business planning is essentially about taking a more in depth approach to thinking strategically about the future of the business whilst taking ...read more.

Middle

Within business planning, the business overlooks at various sections and areas about the business, When planning the business begins with a statement outlining the purpose and goals of the business and it goes on to show how the business will realise these goals it will include a detailed marketing strategy, when planning Managers also calculate a break-even analysis, and profit and loss projection and a cash flow analysis designed to show if the business has enough money or has developed as expected. Other areas include analysing the business and its operating environment, defining its competitive advantage, positioning the business in its market, and setting appropriate financial, personnel and operational plans which help the business significantly to grow and survive as these aspects are critical in today's business world. There are many specific reasons for business planning: > Deciding objectives > Asses market demand > Plan resource requirements > Assess finance requirements > Analyse likely future changes > Summarise likelihood of success > Set targets > Guide day to day activates > ...read more.

Conclusion

In summery business planning helps significantly and contributes massively to help the business to survive and grow as it helps the business to: > Focus businesses attention on longer-term business goals and direction > Identify any areas on internal strengths and weaknesses > Identify possible threats and constraints on the business > Identify, assess business opportunities > It helps the business to compete in the market place (through an analysis of what the business competition lacks) > Anticipating potential problems so the business can solve them before they become disasters. A businesses survival can therefore be threatened by anything that might reduce its income. If sales revenue falls, because of competition or a move by consumers away from a brand, profit will also fall. This is why planning helps as it helps to aid in keeping there eye on their market, it also helps to review strengths and weaknesses opportunities and threats for the organisation in order to grow and survive. BTEC National Diploma In Business Studies Unit 1: Introduction To Business Razaul Islam Page Number:1 ...read more.

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