TECHNO - Quiz Chap6

Question 1

a written narrative, typically 25 to 35
pages long, that describes what a new business plans to accomplish.

Answer 1

Business Plan

Question 2

the business plan is a ________________ document used both inside and outside the firm.

Answer 2

Dual-purpose

Question 3

How does the business plan help the firm’s employees?

Answer 3

to operate in sync and move forward in a consistent and purposeful manner.

Question 4

For Investors and other external stakeholders, A firm’s business plan must ________________-

Answer 4

make the case that the firm is a good use of an investor’s funds or the attention of others

Question 5

T or F

To make the best impression a business plan should follow an unconventional structure, such as the outline for the business plan shown in the chapter.

Answer 5

F; conventional

Question 6

T or F

Entrepreneurs are encouraged to demonstrate creativity by departing from the basic structure of the conventional business plan

Answer 6

F

Question 7

There are many software packages available that employ an interactive ____________ approach to assist in the writing of a business plan.

Answer 7

menu-driven

Question 8

• Some of these programs are very helpful. However, entrepreneurs should avoid a _________ plan that looks as though it came from a ________ source.

Answer 8

boilerplate; canned

Question 9

a business plan needs to project a
sense of ____________ and _____________about the possibilities that
surround a new venture.

Answer 9

anticipation; excitement

Question 10

The content of the business plan must be long enough to _____________ yet short enough to __________________

Answer 10

provide sufficient information; maintain reader interest

Question 11

For most plans, ____________ pages is sufficient.

Answer 11

25 to 35

Question 12

Types of Business Plans: SFO

Answer 12

Summary Business Plan
Full Business Plan
Operation Business Plan

Question 13

A business plan which only has 10-15 pages

Answer 13

Summary Business Plan

Question 14

This business plan works best for new ventures in the early stages of development; “test the waters”

Answer 14

Summary Business Plan

Question 15

This business plan works best for new ventures who need funding; serves as BLUEPRINT for the company’s operation

Answer 15

Full Business Plan

Question 16

How many pages are in a Full Business Plan

Answer 16

25 to 35

Question 17

A business plan which is meant for an internal audience and works best as a tool for CREATING A BLUEPRINT for a new venture’s operations

Answer 17

Operational Business Plan

Question 18

A business plan with 40-100 pages

Answer 18

Operational Business Plan

Question 19

T or F

The plan does not change while written.

Answer 19

F; It’s important to recognize that the plan will usually change while written.

Question 20

T or F

New insights invariably emerge when an entrepreneur or a team of entrepreneurs immerse themselves in writing the plan and start getting feedback from others.

Answer 20

T

Question 21

T or F

Most business plans do not include all the elements introduced in the sample plan

Answer 21

T

Question 22

T or F

Each entrepreneur must decide which elements to include in his or her plan.

Answer 22

T

Question 23

Enumerate the outline of a business plan:

EICMTMDOMOF

Answer 23

Section 1: Executive Summary
Section2 : Industry Analysis
Section 3: Company Description
Section 4: Market Analysis
Section 5: The Economics of the Business
Section 6: Marketing Plan
Section 7: Design and Development Plan
Section 8: Operations Plan
Section 9: Management Team and Company Structure
Section 10: Overall Schedule
Section 11: Financial Projections

Question 24

a short overview of the entire business plan. It provides a busy reader with everything that needs to be known about the new venture’s distinctive nature.

Answer 24

Executive Summary

Question 25

An executive summary shouldn’t exceed ____________________

Answer 25

two single-spaced pages.

Question 26

T or F the executive summary appears at the beginning of the business plan so it should be written first

Answer 26

F; Last

Question 27

When will an investor ask for a copy of a firm's entire business plan?

Answer 27

if the executive summary is sufficiently convincing.

Question 28

It is the most important section of a business plan

Answer 28

Executive Summary

Question 29

The industry analysis section begins by describing the industry will enter in terms of: a. attractiveness, size, growth rate b. growth rate, target market, demand c. size, growth rate, and sales projections

Answer 29

C.

Question 30

Items to include in the Industry Analysis section: IINKIL

Answer 30

* Industry size, growth rate, and sales projections. * Industry structure. * Nature of participants. * Key success factors. * Industry trends. * Long-term prospects.

Question 31

T or F Before a business selects a target market it should have a good grasp of its industry—including where its promising areas are and where its points of vulnerability are.

Answer 31

T

Question 32

T or F The industry that a company participates in does not define the playing field that a firm will participate in.

Answer 32

F; Largely defines

Question 33

This section begins with a general description of the company.

Answer 33

Company Description

Question 34

Items to include in Company Description: CCMPCLK

Answer 34

* Company description. * Company history. * Mission statement. * Products and services. * Current status. * Legal status and ownership. * Key partnerships (if any).

Question 35

This section demonstrates to your reader that you know how to translate an idea into a business.

Answer 35

Company Description

Question 36

It breaks the industry into segments and zeros in on the specific segment (or target market) to which the firm will try to appeal.

Answer 36

Market Analysis

Question 37

Items to include in this section: Market Analysis MBC

Answer 37

* Market segmentation and target market selection. * Buyer behavior. * Competitor analysis.

Question 38

T or F Most start-ups do not service their entire industry. Instead, they focus on servicing a specific (target) market within the industry.

Answer 38

T

Question 39

This section addresses the basic logic of how profits are earned in the business and how many units of a business’s profits must be sold for the business to “break even” and then start earning a profit.

Answer 39

The Economics of the Business

Question 40

Items to include in this section: The Economics of the Business RFOSB

Answer 40

* Revenue drivers and profit margins. * Fixed and variable costs. * Operating leverage and its implications. * Start-up costs. * Break-even chart and calculations.

Question 41

Two companies in the same industry may make profits in different ways. One may be a ______________, while the other may be a ____________________

Answer 41

high-margin, low- volume business; low-margin, high-volume business.

Question 42

focuses on how the business will market and sell its product or service.

Answer 42

Marketing Plan

Question 43

Items to include in this section: Marketing Plan OPSS

Answer 43

* Overall marketing strategy. * Product, price, promotions, and distribution. * Sales process (or cycle). * Sales tactics.

Question 44

The best way to describe a start-up’s marketing plan is to start by articulating its ___________________ and then talk about how these overall aspects of the plan will be supported by __________________

Answer 44

marketing strategy, positioning, and points of differentiation; price, promotional mix, and distribution strategy.

Question 45

If you’re developing a completely new product or service, you need to include a section in your business plan that focuses on the status of your development efforts.

Answer 45

Design and Development Plan

Question 46

Items to include in this section: Design and Development Plan DCPP

Answer 46

* Development status and tasks. * Challenges and risks. * Projected development costs. * Proprietary issues (patents, trademarks, copyrights, licenses, brand names).

Question 47

T or F Many seemingly promising start-ups never get off the ground because their product development efforts stall or the actual development of the product or service turns out to be more difficult than thought.

Answer 47

T

Question 48

Outlines how your business will be run and how your product or service will be produced.

Answer 48

* Operations Plan

Question 49

A useful way to illustrate how your business will be run is to describe it in terms of ____________ (unseen to the customer) and __________________ (seen by customer)

Answer 49

"back stage"; "front stage"

Question 50

Items to include in this section: Operations Plan GBF

Answer 50

* General approach to operations. * Business location. * Facilities and equipment.

Question 51

The operations plan is best kept ______ and _______

Answer 51

short; crisp

Question 52

The management team of a new venture typically consists of

Answer 52

founder or founders and a handful of key management personnel.

Question 53

Items to include in this section: Management Team and Company Structure MBBC

Answer 53

* Management team. * Board of directors. * Board of advisers. * Company structure.

Question 54

What do investors look for after the executive summary to assess the strength of the people starting the firm

Answer 54

Section 9: Management Team and Company Structure

Question 55

should be prepared that shows the major events required to launch the business.

Answer 55

Section 10: Overall Schedule

Question 56

Examples of milestones: ICROSO

Answer 56

* Incorporating the venture. * Completion of prototypes. * Rental of facilities. * Obtaining critical financing. * Starting production. * Obtaining the first sale

Question 57

The final section of a business plan presents a firm’s _________________

Answer 57

pro forma (or projected) financial projections.

Question 58

The first rule in making an oral presentation is?

Answer 58

to follow directions.