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Chapter 6 The Business Plan

business plan
A document that presents the basic idea for the venture and includes descriptions of where you are now, where you want to go, and how you intend to get there.
comprehensive plan
A full business plan that provides an in-depth analysis of the critical factors that will determine a firm’s success or failure, along with all the underlying assumptions.
critical risks
A section of the business plan that identifies the potential risks that may be encountered by an investor.
executive summary
A section of the business plan that conveys a clear and concise overall picture of the proposed venture.
financial plan
A section of the business plan that projects the company’s financial position based on well-substantiated assumptions and explains how the figures have been determined.
management team
A section of the business plan that describes a new firm’s organizational structure and the backgrounds of its key players.
marketing plan
A section of the business plan that describes the user benefits of the product or service and the type of market that exists.
mini-plan
A short form of a business plan that presents only the most important issues and projections for the business.
offering
A section of the business plan that indicates to an investor how much money is needed and when, and how the money will be used.
operations and development plan
A section of the business plan that offers information on how a product will be produced or a service provided, including descriptions of the new firm’s facilities, labor, raw materials, and processing requirements.
pro forma statements
Projections of a company’s financial statements for up to five years, including balance sheets, income statements, and statements of cash flows, as well as cash budgets.
product/service plan
A section of the business plan that describes the product and/or service to be provided and explains its merits.
prospectus (offering memorandum)
A document that contains all the information necessary to satisfy federal and state requirements for warning potential investors about the possible risks of the investment.

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