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Business Purpose and Structure

A number of decisions will need to be made whilst preparing a business plan:

Aims and Objectives

Whether the business is new or developing, aims and objectives will need to be considered. New business goals and objectives are likely to involve establishing itself in the market, surviving, building a reputation and raising awareness. Established business objectives may include growth, diversification or building in some way on what they have already developed.

Product/service

A business will need to decide on its products and services. The product or service mix is vital to ensure it meets customer needs.

Types of ownership and reasons for change

There are many types of ownership that can be considered. Many businesses start as sole traders or partnerships as these are easy structures to set-up. Often, as the company develops and grows, alternative structures will bring benefits such as limited liability and the ability to raise more capital through selling shares.

You can review the different types of business ownership by following the link:

Private Businesses

up to

Public Limited Companies

Business Structure – flat, matrix, hierarchical

The structure of a small business tends to be flat. There is no need for a specific structure when only a small number of people work in a business. But as the business grows, decisions will need to be made about how the business will be organised in order to work in the most effective way possible.

Click on the link to remind yourself of the different organisational structures:

The Organisation of a Business

Business location – local, national, international

The location of a business may depend on its target market and its product or service. For example, a hairdressing business has to be close to its market but a business that offers an online service can be located anywhere in the world as long as there is an internet connection.

Evaluating, justifying and combining business ideas

Businesses do not tend to make ad-hoc decisions. They actively research and evaluate information as well as justify why one choice of action is better than another. Information often needs to be brought together from a number of different sources and from a number of different people or teams before a final decision is reached.