Importance of a Business Plan - Essay Example

A business plan can help in identifying the underlying assets or liabilities of the business and also would bring into light the chances of future business success or loss. It can also provide Micky McDonald with a financial analysis of the business of the future. A comparative analysis can also be made between owning and dumping the business. Therefore, in a true sense, Micky McDonald can take the decision on facts and figures rather than deciding whimsically (Saint Vincent College, “Importance of a Business Plan”).

A business plan generally consists of the executive summary of the related ideas, the methodologies, the finances, and various other aspects. In relation to the topic, it is very important to prepare a business plan in a very cautious manner. As the firm has been running in losses, it is quite significant to analyze the reasons for the failure of the business. The business plan should be in line with the failures of the firm in the previous period and its chances in the future.

The business plan should be based on the learning of the early failures of the business. SWOT analysis and development of the value chain are very important in the business plan as they would act as a barometer for success if the plan is accepted. Major emphasis should also be given to the distribution as it is one of the major focuses of a marketing firm. It should also make clear the objectives and the values of the firm. The dimensions to the business plans are infinite but the major focus should be on turning the sick business into a profit-making one (Hadzima, “The Business Plan”).

It is very important to have a business plan irrespective of the nature of the business being dynamic or static. In the present day scenario, each and every business is operating in a dynamic environment. The business plan actually gives the business the much-needed direction. The demand for the apparel used while snowboarding would be fluctuating but the sports will remain the same and so will be the apparel.

Again, the business plan provides the company with long-term support. A business plan not only discusses the operating situations but also focuses on the goals of the company. The demand for a particular product depends upon a lot of factors. For snowboarding, one of the basic factors is that of the season. Therefore, the company should plan its business plan with the factors in mind. It means that it is good to have a dynamic business plan than not having one at all (Abrams, R. & Kleiner, E., The successful business plan: secrets & strategies).