Posted: July 9th, 2014

conducting analysis and creating a business plan, inflation becomes

conducting analysis and creating a business plan, inflation becomes important when dealing with the financial analysis

Paper instructions:
Please prepare a half page response for each part:

Part 1

When conducting analysis and creating a business plan, inflation becomes important when dealing with the financial analysis. An accurate financial analysis cannot be conducted during times of inflation. The reason for this is that it is impossible to plan for the future. During inflation, it is hard to predict if there will be a demand for the product/service that the company will provide based on the current economic state of the economy. Manufacturing and producing products/services are done at a risk because in order to cover the overhead cost of the company, higher prices will have to be placed on products and services and there is no real guarantee that consumers will actually pay the higher prices. Inflation causes uncertainty about interest rates, future prices and exchange rates (Geralamo, n.d.).

When pursing new market opportunities, some of the options that are considered are a new industry or demographic; offer different products or services or new geographical location. These same options that are used for pursuing a new market opportunity are also used when deciding on a career path. The same way that companies will often times look into entering a new industry or demographic, people often times change the industry that they have experience working, in order to gain new skills and for a fresh outlook. The same can be said for entering a new geographical location. Moving from one location in order to pursue your career goal in the next location if also a trend that is very common amongst people that are interested in a career change. I can personally attest to this has this is the strategy that I used when I started pursuing my current career. First I choose a different industry than the one I was previously employed in, and then I started looking for jobs in another state because I wanted a fresh start and a change of scenery.

Just the same way that when pursuing new market opportunities a plan has to be in place, it is the same thing for career advancement. Knowing your values, vision and needs takes times to develop and even more time to determine which direction best suits your vision. Measurable, realistic goals will need to be set in order to achieve success. This includes creating a plan with milestones and setting achievable measures in order to attain the career goals and path desired (Caprino, 2013).

Part 2

Inflation influences in a business plan revealing a condition where the demand for goods and services go beyond their supply in the economy. Its reasons could be caused by the reserved part and the government expenses more than their profits, or by losses in production. Price rises could also be caused by growths in expenses of manufacture, inflation origins many alterations in the economy. When costs increase these customers cannot purchase as much as they could before. This disappoints reserves due to the point that the cash is value more currently than in the upcoming. This anticipation decreases economic development because the economy needs a firm level of savings to funding investments which improves economic development. Also, inflation varieties it harder for companies to strategy for the upcoming; how to choose how much to produce, since commerce cannot forecast the demand for their merchandise at the upper expenses they will have to charge in direction to cover their expenses. Consequently prices need to be upraised and this inflames customers who blame manufacturers for raising rates. Then commerce tries to keep from rising prices. This can cause businesses to produce goods that vend for a reduced amount of in real terms than they charge to produce; which can guide to a bankruptcy in the long run (Caruso, 2011).

To consider options to pursue a new market opportunities it is important a possibly satisfactory condition in which a industry can take advantage of on a varying development or an growing demand for a merchandise by a demographic group that has yet to be accepted by its competitors. For a market opportunity to happen, a business must be capable to recognize who its prospective consumers are, the precise necessities that need to be met, the extent of the market, and its volume to capture market share. Even though people at the start see opportunities, they are naturally established in companies. Identifying a business opportunity remarks a chance to present advanced products or services to a market. In following a career, opportunities can be recognized as based on the supply and demand market in the specific field, in which case the supply of technology is identified and market demand is unidentified, or they can be accepted because dissimilar market members have inadequate contact to information about the market situations (consumers, markets, and methods to serve markets), in which situation the demand in the market is recognized to some, but the supply has to be established (Renko, 2012).

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