Business plans are many times the key to success when it comes to a new business. However, business plans are always subject to change due to threats to its success.
These “threats” do not come in the form of other people or the competition. Trends threaten the success of a new business and business plans need to be adapted to the changing trends in business and in the world.
The most critical trends that cause a change in business plans are cultural, economic, governmental, and technological.
These trends affect the world. Trends affect decisions, which can affect business. Sometimes the effect of trends is minimal, but many times the effect can be dramatic. In either case, business plans should reflect the changes necessary for a business to be successful no matter the trend.
Cultural Trends - As lifestyles change, social worries appear, and customers age, cultural trends impact a business and business plans. If a certain city becomes popular, people move there. As customers “age out,” new marketing must reach new customers. As items and activities popularize in the media, sales go up. When something is over-marketed or has “seen its day,” sales decline.
Economic Trends - These trends happen because the economy is affected in some way. Interest rates rising or falling, the rate of inflation, and the exchange rate of money affect businesses and their business plans. Economic trends are usually set by the actions of the government and affect the economy.
Governmental Trends - Regulation changes, tax changes, and new bills and laws bring about governmental trends. These trends happen because of government, politics, or the courts. A business must change business plans to reflect governmental trends as their finances may be at risk. In addition, not keeping up with governmental trends can put a business at legal risk as new laws are developed.
Technological Trends - Technology is changing every day. Not only in the computers and machines business owners use in the daily operation of their businesses, but in what a business may sell or manufacture. A company that manufactures VCRs today is at risk. VCRs are out dated, the customer base is shrinking, and the future of VCRs is bleak with the rise of DVD players. A business must stay on top of technology to be successful. Technological trends are an important part of business plans, not only for manufacturers but also for businesses who are the end users.
All of these trends dramatically affect business plans for both new and established businesses. A business must be aware of trends and ready to implement new business plans in reaction to trends that threaten success.
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