Professional Documents
Culture Documents
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A business plan is a formal statement of a set of business goals, the reasons why they are
believed attainable, and the plan for reaching those goals. It may also contain background
information about the organization or team attempting to reach those goals.
The business goals may be defined for for-profit or for non-profit organizations. For-profit
business plans typically focus on financial goals, such as profit or creation of wealth. Non-
profit and government agency business plans tend to focus on organizational mission which
is the basis for their governmental status or their non-profit, tax-exempt status,
respectively²although non-profits may also
Business plans are decision-making tools. There is no fixed content for a business plan.
Rather the content and format of the business plan is determined by the goals and audience.
A business plan should contain whatever information is needed to decide whether or not to
pursue a goal.
Venture capitalists are primarily concerned about initial investment, feasibility, and exit
valuation. A business plan for a project requiring equity financing will need to explain why
current resources, upcoming growth opportunities, and sustainable competitive advantage
will lead to a high exit valuation.
Preparing a business plan draws on a wide range of knowledge from many different business
disciplines: finance, human resource management, intellectual property management,
supply chain management, operations management, and marketing, among others. It can be
helpful to view the business plan as a collection of sub-plans, one for each of the main
business disciplines.
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`oals are the driving force that pushes the business enterprise forward. Companies are
incorporated with the intention of attaining certain goals which it is to be achieved in the
long run. Annual business plans break up the long term objectives into smaller, attainable,
and measurable goals that are to be achieved in a shorter period. The short term objectives
may be set for a year or two and the method of reaching the target is well defined.
The goals are determined for the company as a whole, individuals and various groups. These
objectives are measurable so as to facilitate easy evaluation of the achievement of the set
limit. For creating an annual plan, the management is to decide on the goals that are to be
achieved. The annual plan for the previous year must be scrutinized to monitor the
effectiveness of the plan to the actual result. Failures must be evaluated and measures to
correct or overcome them must be taken in the corresponding plan.
The business entity¶s future is dependent on the internal and the external factors. The
external factors like government regulations, market trends, general economical policies and
competitive policies must be analyzed on an ongoing basis to reduce or eliminate unexpected
turbulences to the flow of the business. Market analysis helps to recognize the needs of the
people, their purchase pattern, the role of the competitive products in relation to satisfying
the customer needs and their pricing policies. Diagnosing the strengths and weakness of self
and the opposition using SWOT analysis helps to understand where one stands in the
present market scenario.
The annual business plan must be drafted taking into account the growing needs for talent
within the organization. Market analysis helps in the determination of the way things are to
shape in future. Market analysis including a study on future innovations in technology calls
for a change in the existing key skills. Man mower must be recruited at the right time to
avoid unnecessary delay in the flow of operations for lack of skill. A measurable objective
aids in the performance appraisal of the employees by monitoring the effectiveness of the
employees.
A good annual plan provides for contingencies in the form of market trends, government
regulations, employee turnover, legal issues, etc. They need to provide a back up of suppliers
to eradicate chances for the stoppage of work. Annual plans must provide the foundation for
long term investment plans like future expansion, mergers, product expansion, etc through a
demand-supply analysis. It also gives room for organizational structural changes taking into
account the future needs of the company. Annual plan lays the structural framework for
budgeting.
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By creating measurable and attainable objectives, the annual plan helps to analyze the
success of the plans by comparing it with the actual results, studies the cause¶s for deviations,
and take measures to prevent or eliminate them in future, thereby guaranteeing the success
of the business enterprise.
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NIK-SAN Engineering Company Private Limited a company promoted by Mr. Naresh Kumar
Choudhary & Mr. Suresh Kumar Choudhary. Nik-San Engineering Company Pvt. Ltd. is an
ISO 9001:2000 company, accredited by TUV Management Service `mbH, located in
Vadodara, `ujarat which is known as the HEART of transformer industry, having machinery
facilities to design, manufacture & test transformers. The company is one of the leading
manufacturers for all kind of Transformers in the Power Industry. They have an installed
facility to manufacture Oil filled Power & Distribution Transformers from 5KVA to 20MVA,
33KV class, Oil filled Instrument Transformers up to voltage range of 66 KV class, Low
Tension Current Transformers (LTCT) of all class and accuracy and wound cores. Our
transformers can also be customized to meet the requirement of individual, industrial,
commercial, co-generation and utilities. The company offers wide range of sales and services
to keep its customers TRANSFORMERS performing at maximum efficiency.
South America
Western Europe
Eastern Europe
Eastern Asia
Southeast Asia
Mid East
Africa
Oceania
The Company has heavy expansion plans in future in terms of raising its working capital
requirement, installing new machinery and a new shed for factory. The company has good
reputation in market so it raises funds each year via loans from Banks; Nik-san is a valuable
customer of Bank of Baroda. So whenever requirement of fund arises, it makes its annual
business plan and approaches the bank.
The expansion plan varies each year. It depends on the target sales set for each year.
The company determines it is estimated sales, with reference to its customer¶s requirements
and latest update of power sector.
Company has a very strong order book at 25.65 crore and is expected to rise in future.
With prospects of business rising, the company plans to operate in higher plans and generate
turnover, coupled with rise in cost of laminations, aluminium, copper and other material
components are expected to raise their working capital assistance substantially.
The growth of company has been phenomenal with the various initiative and reforms
introduced by `ovt of India under Electricity act 2003. The company believes that they can
cater the requirements of the industry to some extent if it provided help from the banks.
Hence it makes business plan for availing financial help from banks.
The documents that it prepares for annual business plan are as follows:
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These statements are necessary as per bank norms and decide upon the future of the road to
company¶s growth.
The annual business plan also serves another purpose for the company. Before starting of
each financial year the company holds a meeting of its managers and decides upon the yearly
objective and targets for the year. With these objectives set, it prepares the annual business
plan. ÷ serves as a benchmark for comparing the performance next year. It helps in finding if
there has been any deviation in the performance of the company. The company then keeps a
watch on those deviations and tries to reduce them.
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j The sales have been projected based on the orders that company has it on hand plus
past trend. The company has used #" % ! in its assumptions and
still the plan turns out profitable. The impact of recession has been kept in mind. So
the %("! has just been assumed to be 123 for coming years. And
company is very sure that the actual growth will be higher than projections.
j The raw material is assumed to be 3 3 ) " . Although the prices of raw
material are rising, the company aims at keeping this figure constant by bringing
about more efficiency in manufacturing process.
j Company intends to reduce it growth in labour cost from © 3699 -93 to 123
by 6919-11 by bringing in more production oriented efficiency and automation.
j % " % # "4. The rate of depreciation for building-
factory/office is at 193 *. And rate of depreciation for plant/machinery/
equipments and vehicle is at 6373* and for furniture and fixture is at 1©963
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j The company has made adjustments for various ratios, which is as per industry
standards.
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