The document that gives the project a detailed justification, as well as the opportunity to evaluate the comprehensively adopted decisions and planned activities as highly effective and allowing us to answer positively the question of whether the project is worth the investment, is a production plan. The business plan should reflect almost all the actions that will be needed when setting up production.
Functions
First, you need to show that the service or product will surely find the consumer, calculate the capacity of the sales market and draw up a long-term plan for its development. Secondly, you need to accurately assess the costs that will be necessary in the manufacture and marketing of products or the provision of services or work in the market. Thirdly, it is necessary to determine the profitability of production in the future, showing all its effectiveness for the investor (enterprise), for the state, regional and local budgets. And in this entrepreneur will help the production plan. The business plan also contains its main functions.
1. It should be a tool through which the entrepreneur assesses the actual results of a certain period of activity.
2. The production plan is also used in the development of the concept of promising business. The business plan has all the tools to attract investment.
3. The strategy of the enterprise is also implemented with its help.
Content
In the planning process, the most important stage is the production plan. The business plan should have everything necessary for planning within the company, and to justify subsidizing the company from external sources, that is, money is received for a specific project - these are bank loans, budgetary allocations, and the participation of other enterprises for the implementation of the project.
That is why it is necessary to reflect absolutely all aspects of commercial and industrial activities and the financial results of the enterprise. The structure of this document is subject to unification according to the norms that any production plan provides. The business plan (an example will be given below) should contain certain sections. For clarity, we take a standard sample.
Summary
The first section is an overview. This is a summary. It is the most important, since it briefly reflects the essence of this project. Almost all success depends on the content of the first section, on what exactly is the production plan in the business plan. An example of the refusal to cooperate after meeting with the resume of an entrepreneur can be given far from one. The first section should arouse interest in the company among potential investors.
The following items must be displayed in the resume. First of all, the goal of this project and a brief description of the company. Then, the most attractive moments and positive aspects of the business idea that is proposed are also summarized (here you need to choose the facts from all the other sections, the business plan of the production enterprise is always compiled as follows). Next, indicate the volume of attracted credit resources and investments with the main financial indicators that can characterize the effectiveness of this project. Be sure to indicate the expected terms of the return of borrowed funds. List the dates and numbers of certificates and patents received. It is recommended to complete the resume with facts that confirm the economic and legal guarantees and the reliability of the future enterprise.
Description of the enterprise
The second section is devoted to a detailed description of the planned enterprise. This is not yet a production section of the business plan, but many points from there have been transferred in a condensed form here - they seem to anticipate the gradual disclosure of the attractiveness of this object.
1. Profile: services, or trade, or production, the nature of the company and its main activities.
2. Business and stage of its development.
3. The main goals of creating an enterprise, all its organizational and legal norms.
4. Offers with which the company will reach its customers.
5. If the company already exists, then you need to provide all the basic economic and technical indicators for the past 5 years.
6. Today's geographical boundaries of activity and perspective.
7. Detailed coverage of competitiveness indicators: all services, products of similar enterprises for specific periods and markets.
8. Explain how this company differs from all others in this profile.
Description of Activities
In the third section, the business plan of production activities contains a detailed physical description of the services or products with the possibilities of their use. It is necessary to indicate all the most attractive aspects of the products and services that will be offered, to indicate the degree of their novelty.
It is very important to indicate the degree of readiness of the offered services or products to enter the markets (here information from those consumers or experts who have familiarized themselves with the products and can give written favorable feedback about them will be very appropriate).
Marketing strategy
In the fourth section, the production plan of the business project should contain a detailed analysis of the market, it is also necessary to outline your own marketing strategy. The purpose of this analysis is to clarify how the future business intends to influence the existing market, how it will respond to the situation that is developing there, so that the sale of goods or services is ensured. This is primarily the determination of capacity and demand, analysis of competition and many other factors of influence. As a result of market research, forecasts for sales volumes should be given. Everything that is relevant here is related to sales promotion, pricing, product promotion, that is, the entire marketing strategy, including advertising.
The marketing strategy includes many components. This is the result of market segmentation and new technologies, the pricing strategy for goods and services of the enterprise and price forecasts, market coverage, assortment development, resource strategy, the right choice of ways and methods of product distribution, sales promotion, advertising strategy and development prospects of this enterprise.
Production plan
In a business project, the production plan is its most substantial part. The development of a production plan (business plan) begins with a general approach to the organization of production: it is necessary to indicate what materials and raw materials are needed, where their sources are and what are the conditions of supply. Further: describe the technological processes of the entire production with the necessary equipment and designation of its capacity, list the labor resources and all requirements in this regard (administrative, engineering, technical, production personnel), indicating not only working conditions, but also the structure and composition of units, including training and anticipated changes as the company develops.
To update the products, a plan should also be drawn up with a description of scientific approaches, principles, systems, methods, technologies, justification of investment projects from the technical and economic side, indicators of competitiveness, resource intensity and quality of products of competitors and this enterprise. There must be a R&D plan (research and development).
In addition, the business plan for production should include a section on product sales. Be sure to address the following issues:
1. Calculations of the production capacity of all divisions of the enterprise.
2. Operational calendar plans for the sale of products.
3. A detailed analysis of the use of production capacity.
The production section of the business plan should include sections relating to the technical level of the enterprise and its improvement, the organizational level in production, the development of the team in the social plan, a list of environmental protection measures is mandatory. And finally - investment projects for the development of production. This is accompanied by work schedules with a list of the main stages of the implementation of the submitted project, funding needs for implementation (phased), reflection of the planned time frame for work at each stage.
A section on production support is included in the production plan for business planning, with an analysis of the efficiency of resource use and calculation of needs for their types. In terms of material and technical support of the enterprise, information management and regulatory and methodological support of activities, there should also be relevant sections.
Organization and Management
The seventh section of the business plan includes a description or listing with a brief description of all the main participants in the planned enterprise. This is the entrepreneur himself and his partners, investors, the board of directors and employees holding key positions. A scheme of the organization of the company with all internal relations and division of responsibility should be presented, the procedure for the selection and training of employees, as well as their remuneration, should be indicated.
The implementation of the business plan provides for such important points as the development, coordination and approval of programs for the implementation of strategic plans. Accounting and control over the implementation of plans should be organized, as well as motivation for the plan to be implemented clearly on time, without losing the required quality and without increasing costs. The process of implementing a business plan must be regulated if there are changes in the internal or external environment of the new production.
Finance
The eighth section of the business plan, consistent with the materials that were presented in all its other parts, with generalizations and the provision of the cost expression of each section, is financial, and therefore it should include a forecast of sales volumes, a balance of income and expenses in monetary terms, the financial budget of the entire enterprise and the forecast balance.
In addition, the financial section should include the operating budget of the company, its insurance, risk management, forecast for operations with securities, the main indicators of the project on its effectiveness, and these are the payback periods, and net present value , and internal rates of return , and profitability.
The risks
The ninth section is devoted to assessing the risks most likely for a given project, and, possibly, a more accurate forecast of what these risks can result in if force majeure is realized.
Here answers should be given to minimize risks and possible losses due to them. Usually in a business plan they are divided into two parts: the first describes organizational measures to prevent any risks, and the second sets out a self-insurance or external insurance program.
Second option
There are examples of a business plan with a more expanded eighth and additional ninth and tenth sections. Regarding the financial plan, we can say that it is simply somewhat expanded. It reflects monthly, quarterly and for each year the change in the dollar against the ruble, gives a list and tax rates, outlines ruble inflation. Details are provided on the formation of capital through loans, shares or equity, as well as the procedure for paying these loans and interest on them.
There are three main documents in the financial section: profit and loss statement (operating activities of the enterprise for each period), a plan for the movement of finances and a balance sheet on the financial condition of the enterprise at the moment. Attached are: prospective loan repayment schedules with interest payment, information indicating the initial premises and changes in working capital and tax payments. Additionally, calculations of solvency, liquidity and projected project effectiveness indicators are usually applied.