Business Plans (Chapter 14) Flashcards
What is the purpose of a Business Plan?
A business plan is a planning tool that is used to identify where your business is now and in which direction you wish your business to grow. They are a blueprint to establish future direction and are used to attract investors or finance.
What are the 8 elements of a Business Plan?
- Executive Summary
- Vision Statement
- Mission Statement
- Business Profile
- Operations Strategy
- Marketing Plan
- Financial Plan
- Human Resource Management (HRM)
What is the definition of an Executive Summary?
An executive summary is a brief introduction and summary of your business plan. it should describe your business, the problem that it solves, your target market and financial highlights. A good executive summary grabs the reader’s attention and lets them know what it is you do and why they should read the rest of your business plan or proposal. It is not unusual for investors to make an initial decision based on reading an executive summary.
What is the definition of a Vision Statement?
A well-written vision statement declares where your organization wants to be in the future, framed in an aspirational, forward-thinking manner.
What is the definition of a Mission Statement?
A mission statement declares the purpose an organization serves to its audience. It often includes a general description of the organization, its function and its objectives.
What is the difference between a Vision and Mission Statement?
A mission statement describes what your company does and how you are different from other organizations in your competitive space and is TIMELESS, but the vision is time-bound and a bit more tangible.
What is the definition of a Business Profile?
A business profile functions as a document that introduces your business to your audience, whether that be customers, prospective customers, investors, new hires, or anyone else. A well-prepared company profile not only outlines who you are and what you sell, but also documents why you sell it, what your customers think of you, how you’re growing and more. It can be summarised as who, what, where, when, why and how.
What is the definition of an Operating Strategy?
An operations management strategy is a summary of how the business will undergo the production process. It lays out the who, what, when and how of your daily operations over the course of the next year. It is meant to define how physical resources will be allocated to achieve short-term goals that support your larger strategic objectives.
What is the definition of a Marketing Plan?
The marketing plan outlines all the activities that must be undergone in order to meet the requirements of product, price, promotion and place. A SWOT analysis should also be included which is a summary of the strengths, weaknesses, opportunities and threats to a business.
What is the definition of a Financial Plan?
This section of a business plan will demonstrate the viability of your business and then ultimately form the backbone of the business structure. This financial section includes the income statement, cash flow statement and balance sheet. For new businesses, the financial statements will be projections whereas for an existing business, it would contain several years of history as well as projections. In addition to statements, the financial plan should include the financial strategies of the business in how finances will be handled.
What is the definition of a Resource Strategy (HRM)?
Resource planning is about identifying the resources you need to operate your business and includes both physical resources and human resources. Physical resources include the assets the business requires. Human resource planning ensures adequate staffing meets your business’ operational goals by matching the right people with the right skills at the right time.
