Business Plans and Risk Flashcards

1️⃣ Familiarise yourself with the flashcards:

  • Look through all the flashcards to see what's on both sides.
  • Make sure you understand the information on each card. If something's unclear, click the link to the revision notes at the bottom of the page for more details.

2️⃣ Test yourself:

  • Look at the question or prompt on each card and try to remember the answer before flipping it over.
  • Check the answer and make a note of any cards you find challenging and need to go over more.

3️⃣ Consistently Review and Practice:

  • Use spaced repetition: spend more time on the cards you struggle with and go over them more often.
  • Regularly review all the flashcards to help you better understand and retain the information over time.

Note: We may include questions that have multiple correct answers. It's useful to remember specific examples to understand these concepts better.

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What is a business plan?

A written document that explains the business idea, aims, and how it will succeed.

Give two reasons why a start-up writes a business plan.

To reduce risk and to help get finance from a bank or investor.

Name three common parts of a business plan.

Aims and objectives, marketing plan, and financial forecasts.

What is a cash flow forecast?

A plan that shows money coming in and going out each month.

What is a sales forecast?

A prediction of future sales over a set time.

What is break-even analysis?

Working out the sales needed to cover all costs.

How does market research in a plan reduce risk?

It gives facts about customers and rivals, so decisions are based on evidence.

How can a business plan help secure finance?

It shows lenders how the firm will trade and repay the money.

What does risk mean in business?

The chance that something goes wrong, causing loss or failure.

Name two common risks for a new business.

Financial loss and business failure.

What is meant by lack of security for an entrepreneur?

Their personal belongings, like their home, could be taken if the business cannot repay a loan.

Why doesn't a business plan guarantee success?

It is based on estimates, and real events may be different.