From January to September of the current year, the Small and Medium Business Development Agency (KOBİA) developed 220 business plans, which were presented to entrepreneurs and individuals seeking to start a business. These business plans aim to establishing new businesses or to expand the existing entrepreneurial activities in production and service sectors in Baku as well as the regions of the country. The majority of the business plans cover the Baku economic region. Ganja-Dashkasan, Gazakh-Tovuz, Quba-Khachmaz, Sheki-Zagatala, Karabakh, and other economic regions are set to follow suit. Out of the business plans, 73 have been developed for women entrepreneurs. In total, KOBİA has supported the development of 1,555 business plans for entrepreneurs up to date. What is a business plan then and why is it necessary?
Elmaddin Hajiyev, the head of the Business Services Department at KOBİA addressed the aforementioned questions. According to E. Hajiyev, one of the requirements of modern business is planning the idea, which entails the development of a business plan. If your goal is to create a strong, competitive, and profitable business, then a business plan is essential.
“ The professionally developed business plan is important not only for attracting investment, but also for the sustainable and steady development of the enterprise.”The business plan ensures a thorough analysis of the business idea to be implemented, examines the potential issues that may arise during the realization process, and identifies solutions to those issues. "Indeed, a carefully thought-out business plan creates the foundation for achieving positive results in the implementation of a new idea," explained E. Hajiyev. “The field of entrepreneurship is multifaceted. ”However, regardless of the type of the product company produces and sells or the sector in which it operates, a business plan is an integral part of the path to success. Experience shows that inadequate planning in producing a new idea leads to unexpected problems. Starting business without a business plan is like setting sail on an ocean without a compass and setting foot into unchartered waters without a map. According to E. Hajiyev, there is no sector of the economy in developed countries where entrepreneurial activity is launched in the absence of the developed business plan. In recent years, there has been an increased emphasis on developing business plans amid launching a business in Azerbaijan as well. “In a nutshell, a business plan is a document that provides brief, precise, and clear description of the intended business, outlining the conditions and paths for achieving thereof.” A business plan consists of two parts: the idea of the work to be done and the organization of the implementation of that idea.
Advantages of Business Plan
Our interviewee emphasized that develoiping business plan encourages a realistic approach to work, facilitates a thorough assessment of business opportunities, and creates an environment for finding effective strategic decisions. This document also allows for establishing the amount of financial resources required for the implementation of the idea and forecasting the expected revenues: “A business plan helps to gain the trust of investors and lending organizations by demonstrating that the idea has great potential for success and that it can be executed effectively, particularly by the project initiator. Additionally, a business plan fosters quick and creative operations through incorporating all aspects of business management, ensures the execution of tasks that can be quantitatively assessed, and consequently facilitates effective oversight of the business while allowing for the timely identification and elimination of challenging and undesirable aspects of operations.
Steps for developing Business Plan
E. Hajiyev stated that the most commonly encountered generalized structure of the business plan in practice is as follows:
Company Analysis: What products or services do you offer, or what are you going to offer in the future?
Sector Analysis: How large is your market or markets, and in what ways it changes? "What trends are influencing the market, and do they contribute to your future success?
Competitive Analysis: Who are your competitors, and what are the strengths and weaknesses of each competitor? In which sectors will you have a competitive advantage, and how will you achieve that advantage?
Customer Analysis: Who are your target customers? What are their needs?
Marketing Plan: How will you reach your target customers? What marketing channels will you use? How are you going to assess your products and services?
Management Team: Who is currently on your team, and for which key positions do you need to hire?
Operational Plan: What is your action plan? What measures do you need to take to reach your desired position by the end of the year? What actions are you going to take to achieve your goals by the end of five years?
Financial Plan: How much external funds do you need to establish your company? What sectors will these funds be invested in? What are your projected revenues and profits for the next year and the next five years? What assets need to be acquired?
This structure may vary depending on the nature of the business, its needs, and other circumstances.
Therefore, entrepreneurs and those seeking to start business will be able to formulate specific business objectives by addressing issues in these eight sections of the business plan.
Free of charge support for Devolopment of Business Plan
In addition, it was noted that KOBİA provides support for the development of business plans free of charge. This activity is carried out by the SMB Development Centers (SMBDCs) operating in Baku and the regions of the country. Specifically, the SMB Development Centers (SMBDCs) offer training sessions and consultancy services to entrepreneurs and individuals seeking to start a business seeking to develop their business plans. Additionally, specialists from SMB Development Centers (SMBDCs) provide support for developing business plans. Entrepreneurs and individuals seeking to start a business can contact KOBİA directly for assistance with developing their business plans at info@smb.gov.az or through the provided link. https://smb.gov.az/az/contact-form/aze-citizen
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