Cyber Ethiopia

Businesses should explore new ways and strategies on how to come out of depressing business situations to successfully achieve business activities, Zewde Biratu said at panel discussion organized by the Addis Ababa Chamber of Commerce (AACC). Zewde Biratu, General Manager of Zewde and Associates Plc, said that at a time when the business climate is gloomy and the relationship between banks and the business community is lukewarm, considering about a good business plan and its elements as well as examining its relevance is good for effective business activities. Explaining about the benefits of having a good business plan, Zewde said that to arrive at a successful achievement of business activities, the business community should first look at the challenges of the competitive environment, the entry barriers

and the rivalry situation in the surroundings than to stick to the bank loans. Zewde furthermore stated that as business requires a capital outlay, it also requires a longer period to recover it and there is always risk involved in the life of the business. But risks are not minimized by bank loans, he added, “ultimately, it is not the bank that would take the risk but the entrepreneur is taking all the risks. It is to minimize risks that we need to prepare business plan.” A good business plan, according to Zewde, helps managers and entrepreneurs to understand the current position of their business in the market and in relation to competitors, set realistic business objectives, prepare for dealing with unexpected threats and take corrective actions when the achievement of objective is threatened. It will also help outsiders, especially bankers and investors to asses management’s ability to diagnose the present situation, map future objectives and define a strategy for achieving both. Planning does not guarantee the success of a business, however, according to Zewde, but it helps the management to anticipate risks and prepare to deal with them. The planner should also consider the cost of overcoming internal and external constraints when projecting future scenarios. Some of external constraints to be considered during planning are laws and regulations while the internal constraint is mainly lack of qualified staff to carry out business. “Some constraints are absolute. There is nothing, for example, a company can do during the planning period to remove them. Many, perhaps most, of the external constraints will fall in this category. But even some internal constraints may be difficult to overcome in the near future,” Zewde said. Recognizing where and when opportunities and threats arise, setting objectives, resource requirements, risk analysis and evaluation methods and implementing the plan, among others, were issues discussed by Zewde at the panel. The theme for his presentation was ‘Business Plan: Its Elements and Relevance to Your Business.’