Practice Flashcards
Two limitations of a business plan?
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All Flashcards in Topic 6.5
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6.5.120 cards
Two limitations of a business plan?
Based on predictions (uncertain), can become outdated quickly, time-consuming, may give false confidence, some succeed without one.
Predictions + outdated + time
Name four key elements of a business plan
Executive summary, business description, market analysis, marketing strategy, operations plan, HR plan, financial forecasts, sources of finance.
Summary, market, marketing, finances
What is a business plan?
A formal written document outlining goals, strategies and how the business will achieve them — a blueprint for success.
Written blueprint
Business plan = formal document with goals, strategies, ___
And financial forecasts — the blueprint for the business.
Finances
Name three reasons to write a business plan
Attract investors/finance, think through the idea, set goals/milestones, identify problems, guide decisions.
Investors, goals, problems, guide
Plans can give false confidence if ___
Based on optimistic assumptions — rosy projections aren't reality.
Optimistic assumptions
Purpose: attract investment, plan ahead, set ___, identify ___
Milestones; risks.
Milestones + risks
Executive summary = ___
Brief overview of the whole plan — the first thing investors read.
Brief overview
Limitations: based on predictions, outdated, ___
Time-consuming to create and may give false confidence.
Time-consuming
Banks and investors want to see a plan because ___
It shows the business is organised, has thought ahead, and is worth investing in.
Shows credibility
Market analysis includes ___
Target market, competitors, demand — understanding who you're selling to.
Target, competitors, demand
In fast-changing markets, plans become ___ quickly
Outdated — the market moves faster than the document.
Outdated
Financial forecasts include ___
Cash flow forecast, projected P&L, break-even analysis, start-up costs, sources of finance.
Cash flow, P&L, break-even
A business plan forces the entrepreneur to ___
Think through the idea carefully — testing assumptions before spending money.
Think it through
Essential for start-ups seeking ___
Finance — banks and investors require a credible plan.
Finance
Some entrepreneurs succeed without a plan because ___
They adapt quickly and rely on intuition — but this is riskier for most.
Intuition + adaptation
Quick: Key elements include executive summary, market analysis, ___
Marketing strategy and financial forecasts.
Marketing + finances
If asked to 'state two elements', pick from list and ___
Give a brief explanation of each — not just the name.
Name + explain
Creating a good plan is ___ but worth it for ___
Time-consuming; attracting finance and avoiding costly mistakes.
Time vs benefits
A business plan guides decision-making as ___
The business grows — providing a reference point for strategic choices.
Reference for growth
6.5.215 cards
What do investors care about most in a business plan?
The financial section — it shows whether the business can survive and grow.
Financials
Financial: cash flow, P&L, break-even, ___
Start-up costs and sources of finance.
Start-up + sources
Marketing strategy section answers: who is your ___?
Target market — who are you selling to?
Target market
Five financial elements in a business plan?
Cash flow forecast, projected P&L, break-even analysis, start-up costs, sources of finance.
CF, P&L, BE, start-up, sources
Marketing: target market, USP, marketing mix, ___
Competitive strategy — how you'll compete with existing businesses.
Competitive strategy
Marketing section includes: target market, marketing mix, ___, ___
Competitive strategy, USP — how you'll differentiate and compete.
Competition + USP
Operations: production method, location, ___, ___
Suppliers; equipment/technology.
Suppliers + equipment
Operations section answers: how will you ___ the product/service?
Produce or deliver — the practical 'how it works' details.
Produce/deliver
Cash flow forecast predicts ___
Cash coming in and going out each month — shows when the business might run short.
Monthly cash in/out
Financial forecasts are educated guesses — they won't be ___
Perfectly accurate, but they show you've done your homework.
Not perfect but prepared
Operations section includes: production method, ___, suppliers, ___
Location; equipment/technology needed.
Location + equipment
All sections must be ___ and evidence-based
Realistic — optimistic assumptions undermine credibility with investors.
Realistic
Sources of finance in the plan include ___
Loans, personal savings, investors, grants — how the business will be funded.
Loans, savings, investors, grants
Quick: Investors focus heavily on the ___
Financial forecasts — they want to see numbers.
Financial forecasts
What makes your product different = your ___
USP (Unique Selling Point) — essential for the marketing section.
USP
Topic 6.5 study notes
Full notes & explanations for Business plan
BM exam skills
Paper structures, command terms & tips
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