The business plan
The fixed outline of the document, from its summary to the financial forecasts: forecast income statement, break-even point, cash plan, and what makes a plan credible to a bank or an investor.
- 23 cards
- 6 topics
- Free
The outline, topic by topic
Each topic is weighted the way the exam weighs it.
- Concepts
- Questions
- Sort and link
- The numbers
- Scenarios
- Understand
A few cards from the deck
Business plan: what is it?
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A written document that presents a start-up project, its market, strategy and forecast figures, to convince a funder or guide its owner.
It follows a fixed outline: summary, founders, offer, market, commercial strategy, organisation, legal form, financial forecasts. The reader finds the information in the same place from one file to the next.
A business shows a positive profit but its bank account is empty. Which cause is the most plausible?
- Its customers pay in 90 days, its suppliers sooner
- The income statement forgets sales and counts only expenses
- It passed its break-even point too early in the year
- Cash only takes into account the business's fixed costs
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Its customers pay in 90 days, its suppliers sooner
Profit counts invoiced sales, cash counts sales collected. If customers pay late and spending goes out early, profit is positive and the bank balance negative.
Break-even point = … costs ÷ … rate.
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Break-even point = fixed costs ÷ contribution margin rate.
With 48,000 euros of fixed costs and a 30% margin rate, each euro of turnover brings 0.30 euro towards the fixed costs: 160,000 euros are needed.
Executive summary: what is it?
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One or two pages at the head of the plan, giving the essentials of the project: the offer, the market, the founders, the key figures and the funding need.
It is read first and often decides whether the rest will be read. It is written last, once the rest is settled.