1.6 - business planning Flashcards
1
Q
problems of business planning - 3
A
- uncertainty occurs when there is a lack of information
- lack of experience
- change : if the plans are not regularly updated or reviewed its of little value
2
Q
why are business plans created? - 3
A
- to help set up a new business
- to raise finance
- to set objectives
3
Q
how to reduce the risk in business planning - 4
A
- research market in detail
- get guidance from experts
- plan for different situations
- regularly review and update the business plan
4
Q
the main sections of business - 5
A
- backgrounds on founders and investors
- analysis of the market
- business objectives
- price of production and predicted sales
- financial position
5
Q
financial section
A
a prediction of profits will be made for a specific period, usually a year
6
Q
revenue calculation
A
number of units/productions sold x selling price
7
Q
business plan
A
a document saying what a business does and what it wants to achieve in the future
8
Q
revenue
A
the income that a firm receives from selling its goods or services , also called ‘turnover’
9
Q
fixed costs
A
costs that do not change when a business changes its output
9
Q
variable costs
A
costs that vary directly with the businesses level of output
10
Q
total costs
A
variable plus fixed costs
