Marketing Essentials

Section 1: The Business Plan

After You Read Online Action

Reviewing Key Terms and Concepts

1. A business plan is important because it describes the proposed business to potential investors or lenders, it guides you as you open the business, and it helps you to manage the business’s profitability
2. Description and analysis of the business situation, organization, marketing plan, and financial plan for the proposed business.
3. A trading area is the geographical area from which a business draws its customers. Before going into business, you must analyze the trading area with respect to geographic, demographic, and economic data as well as competition.

Integrating Academic Skills

4. Buying Power Index = .00972; (.5 X .0103) + (.3 X .0099) + (.2 X .008) = .00515 + .00297 + .0016 = .00972
5. Answers will vary; you should include such factors as employment levels, major industries, income, education, cultural/ethnic characteristics, etc.