Ch2 Business Plan Flashcards
Three sections of a feasible analysis
- Product and or service feasibility
- Market in industry feasibility
- Financial feasibility
Two criteria to determine product or service feasibility
- product or service is possible at a profit
2. will customer demand will be sufficient
Five industry forces that impact market and industry feasibility
- Existing competitive rivalry
- Barriers to entry
- Threat of substitutes
- Supplier power
- Buyers power
Six barriers to entry into competitive market or Industry
- Capital requirements
- Cost of advantages
- economies of scale
- Access to distribution channels
- product differentiation
- Government policy
What is the concept of threat of substitutes
The level of threat posed by alternative products and services to industry consumer matters.
What is the concept of supplier power and how can it impact industry or Market feasibility
The less bargaining power and control the suppliers of raw material components and labor have over competitors the more attractive the industry
What is the concept buyer power and how does it impact market industry feasibility
The larger and more diverse the customer base the less depending competitors in the industry will be on particular customers
Analyzing the financial feasibility of a business idea involves Assessing its viability and then
Addressing capital requirements revenues cost in earnings should suffice
The nine core blocks of a business model canvas
- Customer segments
- Value proposition
- Channels
- Customer relationships
- Revenue streams
- Key resources
- Key activities
- Key partnerships
- Call structure
The four main elements contained in a business plan are
- The story of what the business is and will be
- all cost and a marketing plan
- Description of how the business will be financed
- An estimate of projected earnings
Two reasons you need a business plan
To attract of the investors and see if business is viable
Danger in using standard software packages to create your plan
Creating a cookie-cutter plan and falling into the trap of using the data in financial projections of sample plans
Length and purpose of execution summary
Written last in limited to one or two pages he should answer the who what when why and how questions for the business
Mission statement
Devise the purpose in management philosophy of the business
Feasibility analysis
A study to assist in making the go/ no go decision based on a close examination of product/ service, market, industry, and financial data
Business model
Accompanies plant to generate revenue and make a profit from operations
Business plan
A document that truly explain the business idea and how it will be carried out
Marketing plan
A statement of the marketing goals and objectives for a business and the intended strategies and tactics to attain them
Marketing mix
The combination of the four factors –product ,price ,place, and promotion –that communicates a marketing vision
Advertising
Paid promotion through media outlets
Public relations
Community activities that are designed to enhance and organizations image
Publicity
Free promotion
Direct marketing
Includes telemarketing ,direct-mail ,in person, selling ,and other personalized promotional efforts
Break even point
When the volume of sales exactly covers the fixed cost
Contents of the management section of the business plan
Management team will bios
organization chart
job descriptions
If your business will be involved in research and development the description of the physical location
Three forms of financial statements included in the business plan
- Cash flow projections
- balance sheet projections income statements for
- three years
