Business planning Flashcards
1
Q
Define a BUSINESS PLAN
A
A business plan is a document that describes how an entrepreneur proposes to set up a new business, including the nature of the product/service, objectives, functional activities, and financial forecasts.
2
Q
What are the components of a business plan?
A
- Executive summary - brief description of the business
- Business model and description
- Product and market positioning
- Managment team and key personnel
- Assessment of the market
- Marketing strategy
- Operations strategy
- Financial forecasts
- Key opportunities and threats
- Investment amount required
3
Q
What is the purpose of a business plan?
A
- To secure external sources of finance
- To ensure the business develops a healthy financial structure
- To help identify problems
- To set targets and check development
- To provide realistic expectations of what the business can achieve
4
Q
What are the benefits of a business plan?
A
- Tells potential investors how and why the business will succeed.
- Tells them how and why it can pay back loans or investment
- Provides detailed financial forecasts
5
Q
What are the drawbacks of a business plan?
A
They canot plan for everything and some businesses still fail even with an established, thought through business plan.
