Business Plan facts & stats

Question 1

What is the executive summary in a business plan?

Accepted Answer

A short overview of the whole plan. The executive summary comes first and sums up the business, its market and its goals.

Question 2

What is a target market?

Accepted Answer

The specific group of customers a business aims to serve. Defining a target market helps a plan focus its product, pricing and marketing.

Question 3

Which financial statement shows revenue, expenses and profit over a period?

Accepted Answer

The income statement. The income statement, or profit and loss account, reports performance over a period.

Question 4

What is a value proposition?

Accepted Answer

A clear statement of why customers should choose your offer. A value proposition explains the benefit customers get and why it beats alternatives.

Question 5

What are fixed costs?

Accepted Answer

Costs that don't change with how much you sell, like rent. Fixed costs stay the same over a period; variable costs rise and fall with output.

Question 6

A product sells for 10 per unit, costs 6 per unit to make, and fixed costs are 2,000. How many units to break even?

Accepted Answer

500. Each unit contributes 10 − 6 = 4 toward fixed costs, and 2,000 ÷ 4 = 500 units.

Question 7

How many building blocks make up the Business Model Canvas?

Accepted Answer

9. The canvas has nine blocks, including customer segments, value propositions and revenue streams.

The basics