Business Planning

Question 1

I understand the reasons why businesses create plans - I can name 2 reasons why they are beneficial

Answer 1

Provides a roadmap for business growth and development.

Helps secure financing by showing potential investors a clear strategy.

Question 2

I understand the main sections of a business plan - I can name 4 sections of the business plan

Answer 2

Executive Summary - Overview of the business and its objectives.

Market Analysis - Research on industry, market size, and competition.

Marketing Strategy - Plans for promoting and selling products/services.

Financial Projections - Revenue forecasts, budget, and cash flow statements.

Question 3

I can analyse the benefits and drawbacks of business planning

Answer 3

Benefits - Clarifies business goals, identifies potential challenges, and facilitates resource allocation.

Drawbacks - Time-consuming, may be based on assumptions that could change, and can be inflexible.

Question 4

I understand the difference between variable costs, fixed costs and total costs

Answer 4

Variable Costs - Costs that vary with production levels (e.g., raw materials).

Fixed Costs - Costs that remain constant regardless of production levels (e.g., rent).

Total Costs - Sum of variable and fixed costs.

Question 5

I can calculate variable costs and total costs

Answer 5

Variable Costs - Variable Cost per Unit x Quantity

Total Costs - Fixed Costs + Variable Costs

Question 6

I understand the concept of revenue, costs, profit and loss

Answer 6

Revenue - Price per Unit x Quantity Sold

Profit - Total Revenue - Total Costs

Loss - Occurs when total costs exceed total revenue.