Importance of micro companies
Microenterprises are the most important companies for every state economy. They employ a large number of people and they offer many opportunities for them. But, because of their small capacity they can be very weak and vulnerable.
Purpose of making Business plans and Budgets (1/4)
To avoid risks surrounding microenterprises which represent a threat to their success and progress, they should use modern business tools in their daily work. One of the most important business tools, to combat threats, is a business plan. Having a Business plan and budgeting are an integral part of every contemporary business.
Purpose of making Business plans and Budgets (2/4)
With every business plan and even one showing the worst, you will be a step in front, because you can better see the planned activities and goals, and you will have a better overview of what is to come in the period ahead.
Purpose of making Business plans and Budgets (3/4)
In the period for which the business plan applies, you will have measures that will allow you to see at any moment how much you have achieved from the outset, where you need to squeeze more out, where you need to dedicate more, and where you have the best results.
Purpose of making Business plans and Budgets (4/4)
In the preparation of every business plan, it is obligatory to make an analysis of the market from which a precise picture of the needs of consumers, demand and supply of competition will be obtained, as well as opportunities for cooperation with related companies.
What the business plan includes (1/3)
Every business plan should be composed of a narrative and a financial part.
What the business plan includes (2/3)
The narrative part should be composed of the following:
• Description of the situation in business and company
• Description of the products and services
• Market analyses
• Marketing plan
• Production plan
• Financial plan
What the business plan includes (3/3)
The financial part of the business plan includes a financial plan and a calculation of all the parameters of the business. Those parameters should be presented broken down by the various activities in one table – the budget.
Period covered by the business plan (1/7)
The business plan is made for an exact period of operation of the microenterprise. This means that all data should be provided for the period which is covered by that business plan.
Period covered by the business plan (2/7)
Short period- up to one year:
When the period is shorter, data should be more detailed and more precise.
Period covered by the business plan (3/7)
from one year up to 3 years
Period covered by the business plan (4/7)
Long period – from 3 years up to 5 or more:
For longer periods data will be more relative and they are mostly based on predictions.
Period covered by the business plan (5/7)
Most of the business plans for microenterprises are made for one year (short period), three years (medium period) and five years (long period).
Period covered by the business plan (6/7)
The business plans for different periods should be constructed using the same rules for every year. All above mentioned points should be included in every year of the business plan.
Period covered by the business plan (7/7)
In the financial part of business plan a cash flow for every single year for the planning period should be made. This will give the managers leading a map for financial transactions in the coming period.