1.4.4 Business plans

Question 1

What are the 7 element of a business plan?

Answer 1

The business idea,the business aims and objectives,target market,revenue forecast,projected costs and profit,cash flow forecast,sources of finance,location,marketing mix

Question 2

What is the purpose of creating a business plan?

Answer 2

Provides direction,supports decision making,helps establish the viability of the business,to arrange a bank loan,to seek investment,to help the business be successful

Question 3

“Discuss the impact on an entrepreneur of not creating a business plan”(6 marks)

Answer 3

One impact is that an entrepreneur can not set out its aims and objectives.This means that a business would not have have certain standards that would allow the business to thrive/meet there aims and objectives.As a result,a business would find it hard to make any profit/revenue without any business plan.This may lead to the business going bankrupt.As a result, this would lead to the business being insolvent.Ultimately,this would lead to business failure