The production activity can involve important capital investments in facilities and equipment that can require high payments. It could be an important risk for a small or startup company because it could make the company less attractive for potential investors. 

Investments needs (and, therefore, financial need) can be reduced by subcontracting the production to third companies and renting concrete equipments. This solution may be compatible with the need of reaching a suitable and safe production level in order to maintain stocks. Whoever supports the activity from different aspects (allies, suppliers, partners...) would like to examine that we have a satisfactory commitment between the restraint of financial needs and an approach too offshored, that could give production problems and suffocate deliveries once company would be settled. All costs related to production may be included in the business plan forecasts in five years, with the aim of making cash flow forecasts, balances and exploitation accounts (determining the breakeven point).

Planning may also talk about how to oversee and control production and which stocks index of raw materials and finished products are kept. The calculation may collect the material needs, costs and sources of supply and their conditions. Duties and responsibilities of key personnel in the production direction may be specified. And finally, the availability of a labour force adequately may be pointed out as well as a compilation of industrial relations.  

Control list  

Are you producing the product or subcontracting the work? Are you renting the premises and equipment or did you buy them (and why)? Which are exactly the equipment needs and the cost of the investment? What is the forecast for production costs (breakdown concepts)? Is it produced by stock or order? Who are the suppliers? Which delivery periods for orders have we? Who will be the responsible to solve the problems related to tests and quality control? Have duties or responsibilities of the key management personnel been specified?