chapter 3 entrepreneurship

what are the three basic components of a business plan?

1. introduction 2. main body 3. appendix

organization made up of retired executives who volunteer their time to provide entrepreneurs with real- world advice and know-how

Service Corps of Retired Executives (SCORE)

an independent agency of the federal government created to help Americans start, build, and grow businesses

Small Business Administration (SBA)

what is a trade association?

organizations made up of professionals in a specific industry. they provide info, education, and networking opportunities to individuals in their industry

a financial statement based on projected revenues and expenses

pro forma financial statement

a brief explanation of why you are asking for a loan and what you plan to do with the money

statement of purose

common mistakes when creating a business plan

unrealistic financial projections, an undefined target market, poor research, ignored competition, inconsistencies in the business plan

would investors want to see your business plan?

yes

purposes of a business plan

• 1. A business plan explains the idea behind your business and spells out your product or service will be produced and sold • 2. A business plan sets specific objectives and describes how your business expects to achieve them • 3. A business plan describes the backgrounds and experience of the leadership

what does a business plan do?

• Describes what your business will produce, how you will produce it, and who will buy your product or service • Explains who will run your business and who will supply it with goods • States how your business will win over customers from competition and what your business will do to keep customers • Provides detailed financial information that shows how your business will succeed in earning a profit

importance of a business plan

• a business plan make you think about all aspects of your business o to think of phases of your business • business plan may help you secure financial support o more reason to get financial backing/ loan • a business plan helps you communicate your ideas to others o help communicate your ideas on paper as well as convince readers you can and will succeed • a business plan can serve as a tool for managing your business o help you make decisions

what is in the introduction?

• detailed description of the business and its goals • the ownership of the business and the legal structure • the skills and experience you bring to the business • the advantages you and your business have over your competitors

what are the 5 components of the main body?

1. introduction 2. marketing 3. financial management 4. operations 5. concluding statement

a written document that describes all the steps necessary for opening and operating a successful business

business plan

a letter that introduces and explains an accompanying document or set of documents

cover letter

elements of the introduction

cover letter, title page, table of contents

what is the detailed description?

describes how you came up with your idea and your short term, medium term, and long term goals

a short restatement of a report

executive summary

an entrepreneur's plan for extracting his or her money out of the business after it has become successful

harvest strategy

what is in the appendix?

letters, copies of license, resumes, lease agreements, other legal documents