EMS- Businnes Plan Flashcards
Important for (reason 3)
If you need to approach someone to invest in your business plan, or a bank for a loan, the business plan will be a very professional looking document that will give them all the information they need in order to make a decision.
SWOT analysis
Determines the strengths, weaknesses, opportunities and threats in the interns, and external environment.
Internal
We can control.
Strengths e.g reliable suppliers and a good location.
Weaknesses e.g lack of expertise
External
We have no control over.
Opportunities e.g weakness of competitors.
Threats e.g strength of competitors.
Product and Production Plan
The product’s use and unique features.
Fixed cost
Remains the same regardless of how many items one makes e.g rental cost per month is constant.
Variable Cost
Changes depending on the number of items made.
Cost per unit = (fixed cost + variable cost for one item) / number of items produced.
Start-up Costs
This includes all the costs that you would invite in order to start your business.
Costs
Raw materials, labour and overheads.
Overheads
Rent
Stationery
Telephone
Water and electricity
Profit Projection
Income statement - reflects profit or lose.
Profit = income less expenses
Selling Price
Must be higher than the cost per unit.
Add a % onto the cost per unit or add an amount to your cost per unit.
Break Even Point
When you make enough money to pay back expenses and can then make a profit.
Break even point =
Total fixed cost/ amount of money made from each sale.
Important for (reason 1)
It forces the owner to think through, and write down their plans and goals for each aspect of the business— from finances to labour issues.
