business planning

Question 1

what is a business plan?

Answer 1

The business plan is a document that sets out how the owners / managers of a business intend to achieve their objectives. Without such a plan, a business is likely to drift.

Question 2

what are the 7 sections of a business plan?

Answer 2

1. about the business
2. about the owners
   3.results of market research
   4.finance
   5.objectives
   6.target market
   7.competitors

Question 3

what are the 4 purposes of business planning?

Answer 3

1. provides a focus on the business idea - is it a good one?
2. it is essential to raise finance from outside providers, eg banks
3. provides a logical structure to thinking and be more organised
4. provides something which can be used to measure actual performance against

Question 4

advantages of a business plan:

Answer 4

allows the owners to review their ideas
allows to review its progress
reduces risk by providing a guide
help secure finance

Question 5

disadvantages of a business plan:

Answer 5

time consuming
could be too big of a jump
it’s a changing document - doing it over again
needs to be accurate
may be poor quality