102 Business plans

Question 1

Business plan

Answer 1

Makes clear a businesses objectives (1) and how the business intends to achieve them (1)
Can help secure finance and used to check against the progress of the business

Question 2

Executive summary

Answer 2

Overview of business aims/objectives and shows the proposal is viable. Sets out how business will be run

Question 3

Marketing plan

Answer 3

Market research carried out to establish size of the market, needs of customers and competition.
Includes the price, product, promotion and place (marketing mix)

Question 4

What are the 4 “P”s in the marketing mix?

Answer 4

Price, Product, Promotion and Place

Question 5

The Operations plan

Answer 5

Shows where business will be located, production methods and equipment needed. Plus information on costs of production and where supplies are bought from

Question 6

The Human Resources plan

Answer 6

Number of employees and skills, experience and qualifications required are outlined. Any management also identified.

Question 7

The Financial plan

Answer 7

Includes
Sales forecast indicating potential revenues
Cash flow forecast for first 12 months
Profit and loss balance forecast
Break even analysis

Question 8

What are the 4 functional areas of a business plan

Answer 8

The Marketing, Operations, Human resources and financial plan

Question 9

Potential benefits of a business plan

Answer 9

Clear set of instructions
Check progress against objectives
Shows potential investors

Question 10

Potential drawbacks of a business plan

Answer 10

Inaccuracy can lead to unachievable objectives
Fast changing markets mean it can be hard to fully predict
Time consuming
Doesn’t guarantee success