1.3 Flashcards
what is cash outlfow?
money leaving the business
what is cash inflow?
money going into the business(e.g from sales)
benefits of a business plan?
helps you predict problems,determines the success of the business
what does a business plan include?
company description,products and services,market analysis,marketing strategy,budget
whats market mapping?
using a graph to plot competitors and their products to try and spot a gap in the market
advantage of venture capital
access to substantial funds
advantage of personal savings
immediate access
disadvantage of venture capital
requires sharing profit with investors
disadvantage of personal savings
risk of personal financial loss
example of short term finance
trade credit,overdrafts
example of long term finance
venture capital,crowdfunding,bank loan
what are fixed costs
costs a business must pay no matter how many goods they make/sell e.g wages,rent
what are variable costs
raw materials
benefits of a bank loan
large amounts of amountd can be borrowed
disadvantages of a bank loan
interest must be paid regardless of business performance