Chapter 1- Planning Flashcards
What is a business plan
A plan of how the business will develop over a future period of time
What does a business plan do?
- Outlines strategy of the business
- Helps to clarify what is needed to achieve its goals
- Helps entrepreneurs to think through their options
- Identifies the best opportunities and how to make the most out of them
What does a business plan include?
- an executive summary
- an elevator pitch
- the business and its objectives (SMART)
- the business opportunity
- the owners background
- information on the market and market research
- premises and equipment
- costing and finance
- financial forecasts
What is the purpose and relevance of a business plan ?
Needed to support applications for funding both at the start up stage and in the future
What are the advantages of a business plan
- identify objectives
- provide a strategy for development
- provide and action plan for goals and key tasks
- highlights potential problems
- helps prove owner is realistic , responsible , serious and trustworthy
What is an elevator pitch?
Likely a minute talk introducing the business, its name, what it does, aims , what differentiates it from competitors.
Should be quick + concise
What is a business opportunity?
Necessary to explain what the business plans to sell as readers may not be familiar with its products
What does a financial forecast include ?
Sales forecast - how value of sales will change overtime
Cash flow forecast - how money will flow in and out the business
Profit and loss forecast - shows when business might move from making a loss to making a profit
Breakeven analysis - level of sales where total cost and total revenue are the same
What is SWOT analysis?
Strengths
Weaknesses
Opportunities
Threats
What is SMART?
Specific
Measurable
Achieveable
Relevant
Time-based
