LESSON 3: BUSINESS MODEL AND REVENUE

Question 1

• This describes how the business will generate revenue and support financial projections.
• This will greatly help in describing the importance of the business in gaining profit and sales.
• This describes the means and methods a firm employs to earn revenue projected in its plans.

Answer 1

Business Model

Question 2

This is to outline each persona’s demographics, common challenges and the solutions your company will offer.

Answer 2

Identify the Specific Audience

Question 3

This is to understand the activities required to make business model work.

Answer 3

Establish Business Process

Question 4

This is to document essential business resources to ensure the business model is adequately prepared to sustain the needs of the business.

Answer 4

Record Key Business Resources

Question 5

This is to build strong standing out among the competitors.

Answer 5

Develop a Strong Value Proposition

Question 6

This is to determine the key partners that can contribute to the business’s ability to serve customers.

Answer 6

Determine Key Business Partners

Question 7

This is to create strategy that builds interest in your business, generate leads and designed close to sales.

Answer 7

Create a Demand Generation Strategy

Question 8

Is calculating or predicting usually as a result of study and analysis of available pertinent data.

Answer 8

Forecasting

Question 9

The Benefits of Forecasting

Answer 9

1. Improved cashflow planning
2. Informed management decision-
   making support in raising finance
3. Time-saving and error reduction
4. Enhanced performance monitoring

Question 10

Businesses choose between two basic methods when they want to predict what can possibly happen in the future, namely, qualitative and quantitative methods.

Answer 10

Forecasting Methods

Question 11

Otherwise known as the judgmental method, ____________ forecasting offers subjective results, as it is comprised of personal judgments by experts or forecasters. Forecasts are often biased because they are based on the expert’s knowledge, intuition, and experience, and rarely on data, making the process non-mathematical.

One example is when a person forecasts the outcome of a finals game in the NBA, which, of course, is based more on personal motivation and interest. The weakness of such a method is that it can be inaccurate.

Answer 11

Qualitative Method

Question 12

The _____________ method of forecasting is a mathematical process, making it consistent and objective. It steers away from basing the results on opinion and intuition, instead utilizing large amounts of data and figures that are interpreted.

Answer 12

Quantitative Method

Question 13

Is the total income produced by a given source, a property expected to yield large annual revenue, the gross income returned by an investment.

Answer 13

Revenue

Question 14

Is a stage in the process of growing; it it’s a result of growth, a producing especially by growing. It is anticipated progressive growth especially in capital value and income

Answer 14

Growth

Question 15

_____________________ are useful both for start-ups and existing businesses. Here is how to prepare:

1. The preparation for projected sales is the first thing to be done in making revenue forecasts of the business operation.
2. After the projected sales is determined, the business operation can forecast the revenues using the formula:

_____________________

Answer 15

• Revenue Forecasts
• Revenue Forecast = Projected Sales – Total Projected Sales

Question 16

Is an important part of any business plan because it can help strategize how much and how quickly you intend on growing your company. That said, it is also the most difficult to estimate. This is counter to things like costs and funding, which are far more under your own control.

Answer 16

Revenue Forecasting