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Business Studies for Secondary Schools

Helps in securing finance: A business entrepreneur may be able to prepare and
plan can help an entrepreneur decide how overcome these challenges ahead of time
much money is needed to start and operate with a business plan.
a business. An entrepreneur may decide to Enables better understanding of business
take out a business loan or invite investors competition: Creating a business plan
to be part of the business. Businesses obliges entrepreneurs to analyse their
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often require funds, and a business competitions. All businesses compete
plan can help an entrepreneur present a directly or indirectly; thus, it is critical to
business idea to potential investors. If an understand the competitive advantages
entrepreneur applies for a business loan, of entrepreneurs’ businesses. Small
they may need a thorough business plan business owners and those aspiring to
to demonstrate the viability of a business start a business may need a business plan,
idea to potential lenders such as investors, as it helps in offering their products in a
banks and other financial institutions. clear and simple manner. Hence, if small
Helps to improve marketing: Once an business owners take the time to design
entrepreneur has a business, they need and develop a business plan, they are
to reach customers through marketing. more likely to enjoy the returns from their
Marketing is an important aspect of businesses.
a business plan as it helps to define
the business’s target markets, target Exercise 4.1
customers, and the agent or company to
be contracted to promote and place its 1. You and your friend are thinking of
product or service in these markets. starting small businesses of selling
school supplies. Before launching,
Helps in managing the workforce: you decide to write a business
Business plans provide details of the plan, but your friend thinks it is a
workforce required by the business. With waste of time and prefers to start
a business plan, business owners have the immediately. Advise your friend
bonus to pre-determine the requirements about developing a business plan
of the organisation in terms of the total based on the following:
manpower required.
(a) Three key reasons why business
Helps in risk management: Businesses planning is important.
involve a lot of risks that may affect the
operations and the general existence of (b) How your friend’s business,
the business. A business plan can also which lacks a business plan,
help an entrepreneur to predict potential might struggle compared to
problems like low seasons or changing yours?
customer trends, tastes, or habits. An

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