1.2 Business Planning Flashcards
What is a business plan?
A simple plan which sets out details on the product or service being sold, where the finance is to come from to start the business, how the product or service is to be marketed, and the market research to show there is a need for what is being sold.
How does a business plan reduce risk?
The plan identifies competitors and how you can gain advantage over them.
Finance has been carefully thought through.
Market research has been carried out to see if there is a demand for the product or service.
How does a business plan help a business to succeed?
A business plan requires an entrepreneur to carefully think through every aspect of the business. The greater the care and thought that goes into this process, the greater chance of success.
Remember a business plan does not guarantee success.
What are the key contents of a business plan?
The business idea. The owners/managers. Market research findings. Finance (where the money will come from). Objectives. The target market. Competitors.
What is the role of a business plan?
To identify markets.
To help raise finance.
To identify resources needed.
To help achieve aims and objectives.
Why is a business plan important?
Without a plan a business may not identify the correct market, or the staff or resources it needs to succeed.
When is a business plan produced?
When a business is first starting, introducing a new product or expanding.
Why would a bank want to see a business plan?
If a business is looking to borrow money, the plan will show the bank that they have thought everything through. It will shows they have planned their finances and whether they are likely to be able to afford to make loan repayments.
What resources would a business need to consider in their business plan?
Equipment. Finance. People/skills. Premises. Machinery.
How can a business measure success?
Profits made.
Surviving.
Providing a good service to customers.
