The production plan, or the Vector of success of any enterprise
The meaning of the activity of any productionenterprises - with minimal costs to create a valuable product for the consumer, which would be successful in the market. It is impossible to realize this goal without forecasting and planning the future.
It is no accident that a specialsection, which describes in detail the upcoming technological and innovation processes, the company's tradition of quality control, the potential and real workload of equipment, compliance with environmental standards. This section is called the "Production Plan". It is from its richness and validity that the achievement of all other goals, including financial ones, depends.
What is a production plan? How is it compiled? First of all, this is a document for investors, which should convince them that the business idea is feasible and commercially attractive. To achieve convincing without economic calculations and mathematical calculations is impossible, therefore in the technological section there is always a large number of formulas. The aggregate capacity and planned output volume, equipment productivity, break-even point, labor efficiency index and other indicators should be calculated. The business plan for production should have the right combination of general formulations and specific information, as well as high readability and credibility. It is important that the investor, even without deep technological knowledge, could understand whether the project should be supported or not. For greater clarity, diagrams and graphs are constructed that show the dynamics of the indicators by months. In the following economic and financial sections, these data will be applied to the calculation of the most important indicators - profit, profitability, payback period, net income.
As a matter of fact, the production plan is the basis of allother sections. The information contained in it, its logical correspondence to economic calculations and calculations plays a decisive role in the decision to finance the project. It is good, if the investor will find answers to the questions in the document about the dynamics of production, whether it will be necessary to open new plants, expand the fleet of equipment, whether there are conditions for the normal supply of raw materials and the sale of finished products, and whether waste utilization will be applied. If the production plan is developed not for investors but for internal use, then another approach to its preparation is applied.
When an internal plan is drawn up at the enterpriseproduction control, then the results of market research, the state of the equipment, the supply of personnel, available reserves are taken into account. The more factors will be taken into account in the process of preparing the program, the more likely will be the production of quality products that meet the expectations of customers and commercial success.