Business plan Flashcards
The business plan
A statement that outlines the way in which a business will attempt to achieve its objectives- giving a clear idea of its operations and directions
Advice available to start up businesses
Business wales
commercial banks
the princess trust
british chambers of commerce
Core parts of the business plan- The introduction or overview/Executive
Statement
This provides an overview of the business’s
aims, objectives and strategy, and is evidence
that the proposal is viable. It sets out how the
business is going to be run.
Core parts of the business plan- The marketing plan
Important part of any business plan based on
both field and desk research. Market research
carried out needs, if possible, to establish the
size of the market, the needs of the customers
and the level of competition. When market
research findings have been examined then the
marketing plan can be prepared.
Core parts of the business plan- The operations plan
Core parts of the business plan- The human resources plan
The number of employees and the skills,
experience and qualifications they require will
be outlined. Any management team will also be
identified.
Core parts of the business plan- The finance plan
A variety of forecasting will be necessary:
* a sales forecast indicating potential revenues
* a cash flow forecast for the first 12 months
* a profit and loss and balance forecast for the
end of the first year
* a break-even analysis.
In addition, information on where the finance
for starting and running the business will come
from, indicating the available start-up capital as
well as any potential borrowing.
Benifits of having a business plan
sets out their objectives and strategy - outlines
the way in which they will attempt to achieve their
business objectives.
Outlines its marketing strategy – researches vital
information such as the size of the potential market,
the strength of the competition, etc.
Clear idea of direction and operation – Strategic
planning/setting objectives.
Helps to convince banks and lending institutions
of its ability to pay back loans – cash flow forecast
– without one, obtaining finance from banks, etc. is
less likely.
Highlights strengths and identifies possible
problems which can then be dealt with in advance.
Sets out what personnel/skills will be required to
run the business effectively.
Helps them think ideas through – giving a clear
idea of direction and operation. May help to identify
difficulties that may occur and allow the business to
deal with them before they become a problem.
Useful as a monitoring tool – e.g. compare actual
performance with forecasts in the business plan.
Disadvantages of a business plan
May succeed if the product or service proves so
popular that sales are very high, and profits are
made consistently.
May succeed without one if a small, easily managed
business e.g. window cleaner.
No business can be guaranteed success however
good the business plan.
External factors may make the business successful
even if business plan not drawn up – economic
upturn, change in the law/government policies.
Things to remember
Those businesses that have a clear plan are more likely
to be successful compared to those that do not.
