Business Plans Flashcards

All 5 cards in this deck

What is a business plan?

A document setting out the business idea and how the business will be run, marketed and financed.

Name four sections normally found in a business plan.

Any four of: the business idea; aims and objectives; target market (market research); forecast revenue, costs and profit; cash-flow forecast; sources of finance; location; marketing mix.

How does a business plan help a business obtain finance?

It shows lenders and investors the research, forecasts and sources of finance, giving evidence the business can repay them.

How does a business plan help to minimise risk?

It forces the owner to research the market and forecast revenue, costs and cash flow, so problems are spotted before money is spent.

True or false? Writing a business plan guarantees that a start-up will succeed.

False. It reduces risk, but forecasts may be wrong and the plan must be reviewed and updated as conditions change.