1
Key Activities
Key Partners
Key Resources
True or False - Short-term finances are needed for the repayment of purchases in 10 years' time
False
Less than 1 year
Finish the sentence: Variable Costs ...
increase as output increases.
4 examples of Key Resources
Physical Assets
Financial Resources
Human Capital
Intangible Assets
2 examples of Variable costs for a bakery?
Eggs
Milk
Flour
etc.
What are the 2 key costs of a business?
Variable Costs
Fixed Costs
Who are the Key Partners?
The external people or organisations a business works with to deliver service on a day-to-day basis.
1 Limitation of Cashflow
Does not take into account potential unexpected events e.g., recession
True/False - Fixed costs change depending on level of output
False
Stay the same regardless of output levels
Complete the sentence:
Closing Cash Surplus means the business has a __________ bank balance at the end of the term.
Closing Cash Surplus means the business has a positive bank balance at the end of the term.
Remember:
Surplus = Super (positive figure)
Complete the sentence:
Closing Cash Deficit means the business has a __________ bank balance at the end of the term.
Closing Cash Deficit means the business has a negative bank balance at the end of the term.
Remember:
Deficit = Down (negative balance)
2 reasons a business prepares a Cashflow Forecast
To avoid deficits
Improved financial control
Aids raising finance
Can plan for positive net cashflows
What are the key Activities?
The most important tasks the business must carry out - things done day-to-day for a business to operate.
3 Potential revenue streams for a business
Product sales
Service Fees
Subscription Model
Advertising Revenue
Licensing/Franchise Fees
Sales Commission
Renting/Leasing Assets
3 examples of Key Partners
Suppliers
Distributors
Outsourcing
Strategic Alliance
Joint Venture
Licensing
4 examples of Key Activities
Product design and development
Manufacturing
Marketing and Branding
Distribution and Logistics
Customer Experience and Support
App and Website Development
Is a bank overdraft needed to cover a debt in 5 years' time?
No
Bank overdraft is a short-term source of finance
Why might Variable costs decrease or stay the same even though output is increasing?
Because the business is now benefitting from Economies of Scale
What are the Key Resources?
The essential assets the business needs to operate.
4 factors must a business consider in choosing sources of finance
Cost
Purpose
Amount
Control
Collateral / Security
3 actions a business can take to address future Cashflow problems
Spread big payments over time
Increase Receipts (income)
Reduce Payments (expenditure)
Avail of short-term finance to cover deficit
3 types of Medium-term source of finance
Leasing
Medium Term Loan
Hire Purchase
How might fixed costs change in the renewal/exit phase of the product or service?
A business looking to renew itself by pivoting product range or entering a new market, may take on new fixed costs.
4 examples of Short-term finance
Bank Overdraft
Accrued Expenses
Trade Credit
Factoring Debts
4 examples of Long-term source of finance
Long-term loan
Debenture
Equity/Share Capital
Venture Capital
Retained Earnings
Grants