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A recession is the optimal time to reinvent competitive advantage because the pressure of a feeble economy will separate the strong businesses from the weak ones, with the weak falling out of the game entirely. Your business will be strong if you have a plan of action based upon a little industry research, an analysis of what you have and what you want, and continuous monitoring of the results of your plan. This kind of innovation is not only a necessity right now, but it is an opportunity to improve the quality and efficiency in the way you do business.

The expected revenues and expenses for at least a year should be projected in the cash flow section of the Financial Plan. It's better to make conservative predictions rather than be too optimistic when it comes to cash flows. As part of this section, a break_even analysis is essential. This is the "amount of units sold or sales dollars necessary to recover all expenses associated with generating these sales." (NxLevel for Entrepreneurs, 2005) The formula for calculating the break_even quantity is Total Fixed Costs/(Price _ Average Variable Costs).

The organizational section of the business plan also needs to include an explanation of your record keeping process, checks and balances, and control management systems. Anyone who reads your business plan should be able to understand the organizational procedures for running your business day_to_day, as well as in an emergency situation.

I mentioned that the 'writing of a business plan' as one of the pivotal steps involved in setting up a successful business. By now you should understand the need for writing a business plan. Writing a business plan, for a traditional brick and mortar business, will probably take a lot of time. It may take up to 100 hours or even more. For obvious reasons, a new business needs to carry out a lot of research before a business plan can even be developed.

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