As your business matures and your market share steadily increases, you will probably begin to encounter the growth limits of your original target market.
Assets represent the total resources of a company, which may shrink or increase depending on the results of operations. Assets are listed in liquidity order - ease of converting into cash.
Liabilities include what a company owes: All businesses divide assets and liabilities into two groups: Net worth is the owner's investment in the case of a proprietorship or partnership or capital stock original investment plus earned surplus earnings retained in the business in the case of a corporation.
These are items that can be converted to cash within one year or in the normal operating cycle of a business. Also included in this category are any assets held that can be readily turned into cash with little effort, such as government and marketable securities.
CASH refers to cash on hand or in banks, checking account balances, and other instruments such as checks or money orders. A rule of thumb is that cash position is generally strongest after the peak selling season.
Marketable securities are usually listed at cost or market price, whichever is lower. When marketable securities appear on a statement, it frequently indicates investment of excess cash. A retailer, such as a department store, may show its customer charge accounts billed and unpaid in this category.
In many businesses, accounts receivable are frequently the largest item on the balance sheet. A company's health often depends upon timely collection of receivables. Notes receivable may be used by a company to secure payments from past-due accounts, or for merchandise sold on installment terms.
Retailers and wholesalers will show goods that are sold "as is" with no further processing or supplies required in shipping. On the other hand, many manufacturers will show three different classes of inventory: As a company's sales volume increases, larger inventories are required; however, problems can arise in financing their purchase unless turnover number of times a year goods are bought and sold is kept in balance with sales.
A sales decline could be accompanied by a decrease in inventory in order to maintain a healthy condition.
Noncurrent assets are defined as assets that have a life exceeding a year. Examples include real estate, buildings, plant equipment, tools and machinery, furniture, fixtures, office or store equipment and transportation equipment. All of these would be used in producing products for a company's customers.
Land, equipment or buildings not used in the production of customer goods would be listed as other noncurrent assets or investments.“How to Expand Your Business Through New Market Development” Planning and implementing a growth strategy to develop new markets and expand your business before your current market flattens out will not only help your business survive tough times, it could also give you a considerable edge_.
Find the latest business news on Wall Street, jobs and the economy, the housing market, personal finance and money investments and much more on ABC News. “How to Expand Your Business Through New Market Development” Planning and implementing a growth strategy to develop new markets and expand your business before your current market flattens out will not only help your business survive tough times, it could also give you a considerable edge_ WHAT TO EXPECTYour business market.
Now that you understand why you need a business plan and you've spent some time doing your homework gathering the information you need to create one, it's time to roll up your sleeves and get. The purpose for segmenting a market is to allow your marketing/sales program to focus on the subset of prospects that are “most likely” to purchase your offering.
Intel's original plan, written on the back of a menu (view copy), is an excellent example of a hard statement. The company will engage in research, development, and manufacture and sales of integrated electronic structures to fulfill the needs of electronic systems manufacturers.