Business plans Part 3
When you write your business environment/description you will need to include relevant researched information on your desired industry and the market place. Here you will need to convey the nature of the industry and direction of the market place, include the opportunities of your business environment and threats. In your industry analyst describe how your industry operates. Talk in-depth about your customer. Break down the market into leader segments. Measure the size of your competitors, base your analyst on revenue, profits and market share. Your industry analyst has four key components. Relationship, structure, market and finances.
Work on linking your environmental analysis to all aspects of your planning and forecasting process, you need to conduct and compile your market research, be mindful of the latest developments affecting your market, industry and the economy, your business will be affected by multiple environments such a political, economical, social and technological, this is your PEST analysis. Every industry has a unique shape and structure. Use the PEST to analyze the environment in which your business operates.
The Marketing Environment and Competitor Analyst
Political Environment deals with trade’ government trade, traffic labor laws, environmental regulations, and policies etc. what ones will have long term affects on the economy and impact on your business either directly or indirectly. How stable is the political environment, remember the political influence regulating business and the power of consumer spending. Government regulations change and this can impact on the economy long term; assess its impact on your business.
Economic Environment deals with the forces at play within the economy that the business has little control over, things like interest, inflation, and exchange rates increase in Gross Domestic Product (GDP), the financial and stock markets, the job market, etc. will each impacts on your business from your ability to generate revenue to the cost of borrowing money or the salaries you will pay to employees.
Social Environment deals with the demographics of the environment that your business/company operates within. Demographics are the characteristics of a human population i.e. gender, race, age, income, disabilities, educational attainment, employment status, and religion. How will your business affect particular groups, what factors can in pact on operations and revenue.
Technological Environment refers to the technology that currently exists that the business has accessible to them such as servers, computers ect.
You will need to summarize the high points of your business this will be your SWOT analyst and covers your business strengths / opportunities and weaknesses / threats. Investor’s lenders and partners will want to know about the downside of your new venture.
Porter’s Five Forces Analysis
Porter’s Five Forces is a framework for industry analysis and business strategy development. Analyze the microenvironment of your business. Each of the forces can be given a value of a low, medium, strong, or very strong rating and together provide a strategic ‘picture’ of your business.
Research and fill in the following, use the heading below as a guide
1. The bargaining power of customers
2. The bargaining power of suppliers
3. The threat of new entrants
4. The threat of substitute products
5. Intensity of competitive rivalry
6. Relevant when obtaining resources
For the SWOT you need to create a Grid 3 Colum’s across and 2 Colum’s down, title top cross header to read Positive and Negative. On the 2 Colum’s down title header to read Internal and External. Segment your SWAT into four quarters. Add strengths and weaknesses to the internal Colum’s, as they are internal factors and opportunities and threats to in your external Colum’s as these are external factors that affect your business. Now you should have four lists one for each component.
Strengths of the organization that positively impact its ability to achieve business objectives, the here and now to build apron and maintain
Weaknesses are the attributes of the organization that negatively impact its ability to achieve business objectives that will need to be reduced and stopped.
Opportunities are the external conditions that potentially assist the business in achieving future objectives. Discuss and prioritize future strengths
Threats are external conditions that potentially threaten the success, in the present or future, of your business.
If you what to find out more or begin to create your own plan you can get help and advice from https://www.gov.uk/write-business-plan
The following link will give you a visual insight