Although discredited by some (see Mintzberg’s works about it), enterprise plans remain relevant in defining the offerer’s sales prices. As “Alice in Wonderland” author said, any path will do if you do not know where you want to get to..
An enterprise plan is a management tool that establishes an articulated set of guidelines containing the objectives (goals) pursued, the means (resources) used, and the actions (procedures) to be performed in an operational period.
For Snyder and Glueck, enterprise planning is “those activities which are concerned specifically with determining in advance what actions and human and physical resources are required to reach a goal that includes identifying alternatives, analyzing each one, and selecting the best ones.”
There are several types of enterprise plans. Here, we will touch on three of them: the startup business plan, the corporate budget, and the strategic business plan.
Startup business plan
The startup business plan is an expedient startups and small businesses use to attract investors and leverage their operations.
Briefer than other plans, it prioritizes demonstrating the business’s essential operations (core activities) and its economic and financial viability.
Due to the scarcity of its own historical data, it depends a lot on market data. Moreover, it usually covers only three to five years of activity and emphasizes qualitative aspects, not necessarily measurable, of the entrepreneurs and the business operations.
Corporate budget
The corporate budget, instead, is complex and detailed.
In some companies, it is divided into operational, financial, and investment plans and covers several fiscal years.
By its nature, it deals with quantitative aspects, and the larger and older the enterprise, the greater the weight of its internal historical data compared to market data.
Strategic business plan
The strategic business plan tends to be more complex and detailed than the startup business plan but less specific than the corporate budget.
Because it is strategic, whether annual or multi-annual, it prioritizes the issues determining its operational success (critical success factors), mainly related to market, profitability, and anticipated demands. However, unlike the budget, it addresses quantitative and qualitative aspects. And unlike the startup business plan, its qualitative targets must be measurable.
Furthermore, of these three planning options, the strategic business plan is usually the best suited to guiding sales prices.
C. L. Eckhard, author of Pricing in Agribusiness: setting and managing prices for better sales margins.
Claudio Luiz Eckhard is a former professor, business consultant, and author of the books “Ajustando o Rumo”[Adjusting the Business Course], “Gestão pela Margem”[Management by Margin], “A Empresa Saudável”[The Healthy Company], and “Pricing no Agribusiness”[Pricing in Agribusiness].
