Many businesses either work without a business plan or have a plan with many inherent flaws. Our team of professionals shall closely analyze your business operations and prepare a business plan. Preparing a business plan would help in clarifying the company’s direction.
Market research & Feasibility Study
Market research is an important tool in the success of any business. Conducting market research in the early stages of development cycle can provide a reality check on the feasibility of business idea. Alternatively a business looking out for additional finance should also conduct a market research.
Market Research helps us to determine:
- The demand for product or service in consideration.
- The potential customers' needs and price expectations.
- The competitors to the business.
- The strengths and weaknesses of competitors.
- Ideal design for product or service most effectively, given the needs of your target market and the competitive environment.
Incase your investment is high or your product faces a high risk then conducting a feasibility study or a market research can greatly improve your chances of success.
The most lucrative term for any business is “profits”. In simple terms, profits, means the difference between the total revenue and the total costs. So the main goal of the business owner is to increase the revenue and at the same time keep a check on the costs. Our team shall conduct a detailed investigation of all the aspects of the company operations. The goal of this maximization effort is to achieve the highest profit margins that are possible in the existing circumstances. Further the team shall work on ways and means to maximize the revenues. The next step shall be analyzing the costs – fixed and variable. The fixed costs are those which cannot be eliminated and remain constant regardless of the volume of operations. Variable costs on the other hand are directly proportionate to the volume of operations. Our team shall work on strategies to manage the fixed costs to the best advantage and lower the variable costs.
- Critical Analysis of the internal control system.
- Views on adequacy of internal controls.
- Systematic and disciplined approach towards Risk Management.
- Effectiveness and efficiency of the reporting structure.
- Information about leakages in the accounting system and any other underlying weakness in the system.
Working Capital Optimization
Another important parameter to measure efficiency of a business is the working capital management. Working capital is the excess of short term assets over short term liabilities. We have observed with our experience in various industries that working capital does not get the amount of importance as cash. Business owners fail to realize that if working capital is adequate, it will take care of the cash flows, in turn making it easier for running the operations of the company. We feel that working capital is the most mismanaged area in any organization.
As stated earlier working capital consists of short term assets i.e Debtors and stock, and the short term liabilities i.e creditors. There are a number of techniques available for a business owner’s perusal. When we talk of stock, the business owner should ensure that he is not stacking excess inventory. Similarly he should neither be short of inventory which shall adversely affect his business operations. Depending upon the nature of business, the owner can follow “Just in Time” strategy for stock whereby instead of holding stock at the factory premises or godowns, it is ordered just in time i.e as and when required. Alternatively the owner can go in for the ABC analysis for inventory management. In the case of creditors, a longer credit period can be negotiated and the time taken for converting debtors to cash should be reduced.
Ensuring an adequate working capital is the need of the hour. If a business owner realizes that the working capital of his organization is not upto the mark or is not adequate enough to run the operations smoothly, he should initiate corrective steps to improvise on the same. We at Lakhani & Lakhani, provide structured solutions for the same. The techniques used by us vary from business to business and situation to situation.
MIS and Decision Support System
This is a process of transforming data into useful information for better decision making. Reports are structured to measure the performance of the business and compared with the original business plan. Any deviation is immediately reported so that appropriate steps can be taken by the management to rectify the same. We do an in depth analysis of your accounts to give you insights on profitability, cost and various trends in business.
We offer detailed MIS in area of
- Expenses and other balance sheet items
Some of the insights the management gets is that they spend 80% of the time in business which is giving them only 20% of the revenues & vice versa. Also they get information on product wise/ service profitability. They are also able to channelize their resources towards areas that are either contributing or would be contributing to exponential growth of the organizations. Our experience shows that these MIS reports help the management take correct decisions on their path to faster growth. Their decisions are more informed & less on gut feeling, which is generally the case when there is no MIS or an ineffective MIS.
We offer MIS reports on a monthly basis which provides as a report card on the past month & a road map for the month to follow.