BUS302 Identification of Entrepreneurial Business Plan Strategies: Assessment 1 Answer
Assessment 1 BUS302
Case Study: Pioneer Consulting
The project report consists of a comparative analysis of two business plans for identifying the entrepreneurial business plan strategies that enable a company to be successful. For the purpose of comparison, a business plan has been chosen and contrasted with a standardised business plan of Blueprints Business Planning Pty Ltd. The selected business plan is the one followed by Pioneer Consulting for providing services to their customers. The various segments of a business strategy have been thoroughly discussed and evaluated to understand the major opportunities and issues that might help in future success or might hinder the growth and development of the company. Both the positive and negative points have been identified in the chosen plan, and the areas of improvement have been pointed out for future development of the company pursuing the business plan. Summative study analysis of these business plans has allowed the researcher to identify the most optimised plan for entrepreneurial business plan strategies.
Identification of Entrepreneurial Business Plan Strategies
Business Goal and Success Factors
The company goal in Pioneer Consulting business plan focuses on working closely with the clients while also fulfilling the set goals. The ideas of the customers are evaluated in a strategic, creative and cost-effective manner for committing full support for the customers. The company boasts its ability to minimise the learning curve and expenses of the clients through their technical expertise. The company and client are regarded as working in a single business team for an overall success achievement (Bplans, 2019). The company also ensures the timely launch of its clients' marketing plans while also generating innovative ideas for the client to produce high quality and cost-effective product.
The standardised business plan of Blueprints Business Planning Pty Ltd. includes the goal of establishing an SME that specialises in management consultancy services for customers in Australia. The business goals include management skills, preparing business plans and training the clients for managing sales for the company. The success factors in the business plan include starting with a small number of employees and gradually increasing them over the years (Shaper et al. 2014). The estimation of the business plans promises great revenue generation and high-profit margins within the first year of implementing the business plan.
As it can be evident from the above comparison, both the plans, include working closely with the customers and the main goal is to provide services to the customers and clients that would help the business grow and develop in the future. Each of these plans has their unique success factors that would help the companies reach their business goals within a specific time period. It is the approach towards meeting the business goals that make the companies following the plan, successful and improve further in the future.
The chosen business plan of Pioneer Consulting consists of marketing strategies that focus on a specific area of the business market. The target clients of the business plans include small start-up companies and existing small business firms for providing their services. The marketing segmentation of the business plan has been strategically planned out for targeting these specific client profiles as it is expert in providing consulting services to smaller and emerging business companies rather already existing successful large corporations. The first target of the business plan, the small start-up companies does not have the ability to afford marketing consultancy services or expert knowledge to develop their own marketing strategies (Allen, 2012).
Figure 1: Market segment of Pioneer Consulting
Source: (Bplans, 2019)
Such companies only focus on getting a product and service to a customer without any proper means or knowledge on how to do it. With the number of start-ups growing high with each year, this business plan is ideal for helping out these small start-ups with their expertise invaluable marketing strategies and promotional ideas. The second type of clients are the existing small business firms who have reached a level of success in their business field but are unable to expand more due to lack of knowledge on marketing and resource usage. These types of companies have achieved success solely based on the quality of their products and not from using strategic business plans (Hatten, 2012). This makes another ideal target client for this plan that can provide valuable strategies regarding market planning and utilisation of resources.
The Blueprints Business Planning Pty Ltd. business plan follows a more robust and detailed market planning strategies for targeting their customers, and various marketing factors are considered before targeting their customers with the necessary services. These major factors of consideration include industry analysis, seasonality, competitors and potential strategic alliances. The industry analysis consists of an evaluation of the demand for generic management consultancy services in the present market. This industry analysis has shown that large corporations are most likely to hire consultancy services for their marketing strategies as microenterprises are too small to afford such consultancy services. However, smaller companies need consultancy services and training more than their bigger peers but lack the knowledge from where to get them and implement it properly in their business operations. Such industry analysis is supported by the studies of Australian SMEs in recent years. The seasonality considerations are necessary as studies have shown that business declines during December and January due to Christmas and summer holidays in Australia. Targeting customers during this time would likely result in a decline of offers from clients and resource wastage of the company. The business competitors are considered as it is necessary to understand other consultancy firms that provide similar services for SMEs and big corporations as well. This also includes accountancy practices, public funded business support agencies and commercial training providers that can act as rivals in providing consultancy services. The potential allies are very similar to the competitors as the business plan suggests for subcontracting work from other accountants, business enterprise centres and management consultants (Audretsch et al. 2016). With the help of a small number of strategic allies, the company can make a long-term relationship with them and collaboratively provide services to the small and large business companies in the region.
It is evident from the above-mentioned comparison that the standardised business plan is much more detailed oriented and considers more factors in the business market before providing their services to clients. The chosen market plan does not offer any such detailed plan that might help it to gain success in the future.
Operations and Services
The services provided by the Pioneer Consulting business plan consists of a number of factors based on the demands of the clients. These services include development and preparation of strategic marketing plans and programs for small and medium business firms. It also consists of identification plans and programs for identifying the target market for the company. The design of public relations and advertising strategies are also included in the chosen business plan. The analysis of the industry trend is one of the services of the chosen business plan. And the final service is the execution and implementation of the marketing plans and programs in the company of its clients. The business operations included in the chosen business plan mainly consists of three factors. They are a competitive edge, sales strategy and sales forecast for the company's clients. The competitive edge for the business plan is gained by targeting the customers that the large corporations do not actively pursue (Audretsch et al. 2015). This makes it an operational monopoly in the market with little or no competition in the market. The broad range of services provided by the company also acts as a competitive advantage for the company. The sales strategy in the chosen business plan is based on person to person contact for new and emerging businesses which would help to compile a list of customers for the company and act as a promotional activity for the company’s services. The business plan operations also include the sales forecast for the clients for up to three years which would help the clients make future estimations and future planning in advance becomes easier (Amato et al. 2016).
The standardised business plan of Blueprints Business Planning Pty Ltd. provides a list of services for their target market, and the business operations include the choice of target market procedure and other factors for promoting the services to the clients. The major services provided by the standardised business plan consists of three major services each targeted on a specific customer segment. They are business planning, training and small business development books. The business planning services include preparation of detailed business plans that includes all aspects of the activities performed by the company. These services are specifically targeted for small and medium-sized companies as they are the ones that require such elaborate business plans to expand their business in the future. The training services of the chosen business plan include short yet intensive courses on marketing, human resources, business planning, financial management and record keeping. The target market for this service is also small and emerging businesses as they lack the theoretical knowledge on the subject. The business development books services include the delivery of books and recommendation of other book titles. This service is offered in addition to the training services as theoretical knowledge can be easily gained from reliable sources rather than by simple demonstration. The target market for this service the participants of the training services for the company. The business operations included in the chosen business plan include various activities like legal and licensing requirements, management details, organizational structure and staffing options, necessity of professional advisers, insurance and security issues, business premises, equipment required, production processes, information and communication technologies and critical risks and contingency plans (Chell et al. 2016). These ten specific business operations help to provide an overall strategy of running the business properly and also helps in the growth and development of the company in the future.
It is quite evident that although the services provided in the chosen business plan is quite substantial and adequate for market planning, however, the business operations are not up to the mark when compared to the standardised plan which is much more robust and complete encompassing all the aspects of business activities.
The financial business plan in Pioneer Consulting consists of four major aspects which include break-even analysis, profit and loss, cash flow and balance sheet. The break-even analysis is presented in a tabular form that includes monthly revenue break-even for the company, assumptions by the company, average per cent variable cost and the estimated monthly fixed cost. The projected profit and loss table in the chosen business plan includes sales figures consisting of direct cost of sales and other production expenses (Hatten, 2012). It also takes into consideration the sales figures like gross margin, gross margin percentage and various expenses like payroll, sales and marketing, depreciation, cell phone costs, utilities, insurance, rent payroll taxes and other expenses. It also includes the total operating expenses of the company like profit before interest and taxes, interest expenses, EBITDA, taxes incurred and a net profit of the company. The cash flow and balance sheet of the company help to understand the financial progress of the company over the years and necessary measures can be taken based on the cash flow and balance sheet results and company progress.
Figure 2: Profit & loss statement of Pioneer Consulting
Source: (Bplans, 2019)
The financial planning for the standardised business plan, however, considers some basic information. It includes calculation of income and expenses, financing of the business, distribution of profits, goods and service tax and loans. The financial forecasts are done through calculation of the break-even point, application of market and earning based valuation of the company, cash flow forecast, sales mix forecast and projected profit and loss statement (Linton and Solomon, 2017).
It is quite evident from the comparison that the financial planning in the standardised business plan is much more elaborative and detail oriented. The chosen business plan fails to cater to all these extra aspects, and thus, financial planning is not very conclusive in this case. Special attention is necessary for this section for improving the financial sustainability of business and increase future revenue profit for the company.
Both the chosen business plan of Pioneer Consulting and standardised business plan of Blueprints Business Planning Pty Ltd. has been carefully analysed and evaluated based on each of their merits. Such comparison is necessary for understanding the key factors that help the business grow and expand and helps to achieve success in the future. The areas where the chosen business plans fail to meet the required demands are considered as issues that need to be addressed and rectified as these factors are not good for business operations and might lead to the decline of business in the future. The key positive factors and issues of the chosen plan have been identified in this section of the report, and mitigation methods are recommended for improvement of business plan in the future.
Focusing on smaller targets
The first factor considered is the business goal and success factors in each of these business plans. The basic goals in each of the cases are quite similar that includes working closely with the customers and catering to their demands. The success factors are also quite similar and provide an opportunity for businesses to become successful. However, the chosen business plan does not target large corporations and only focus on small and medium business enterprises. The standardised plan focuses on all market segments as a small business sometimes fail to afford consultancy services due to lack of financial resources or lack of knowledge on why consultancy services are necessary business growth. This is why the chosen business plan should include large companies along with small and medium firms for expanding their customer reach.
Making an effective marketing plan
The second factor considered is the marketing plan for both the business plans. It indicates that the standard plan is much more robust and detailed oriented when compared to the chosen plan. The chosen plan needs to implement factors like industry analysis, seasonality, competitors and potential strategic alliances in their marketing plan as they provide a better understanding of the market demands and trends (Holmes et al. 2016).
The marketing segmentation of Blueprints Business Planning Pty Ltd should be been strategically planned out for targeting these specific client profiles as it is expert in providing consulting services to smaller and emerging business companies rather already existing successful large corporations.
The Blueprints Business Planning Pty Ltd should make an effective marketing strategy that focus on a specific area of the business market. The target clients of the business plans should include small start-up companies and existing small business firms for providing their services.
The company could implement digital marketing for prompting its services for attracting the target market. Adopting such measures in their marketing plan will help to determine and develop better business strategies and ensure the future success of the company.
Making a standard plan
The operations and services segment of the business plan has also been compared and analysed for understanding the key issues in this area. It is quite clear from the comparison that both the plans provide similar services for their companies. The chosen business plan is far more elaborate and provides extra services for their customers than the standard version. However, the business operations do not meet the quality of the standard plan and require to pursue the business operations of the standard plan for achieving success in the future. The ten key factors of business operations mentioned in the standard plan must be considered and implemented by the chosen plan for ensuring success in the future.
Economic sustainability plan
The final segment is the financial planning of the business plans, and it is evident from the comparison that the standard plan considers factors like calculation of income and expenses, future financing of the business, distribution of profits in the company and good and service taxes. These aspects must be considered and implemented in the chosen business plan as it guarantees stable future sustainability for the business and also tracks the progress of the company over time.
The project report on comparing a chosen business plan with a standardised business plan has allowed to understand the major areas where the company must focus on ensuring future success. Companies without proper knowledge of future planning fail to meet the demands and future aspects of the business and lead to a disaster in the future. By making necessary changes identified in the report, a company can ensure its future success and maintain a competitive edge over other companies as well.