business plan

  

Definition

Set of documents prepared by a firm's management to summarize its operational and financial objectives for the near future (usually one to three years) and to show how they will be achieved. It serves as a blueprint to guide the firm's policies and strategies, and is continually modified as conditions change and new opportunities and/or threats emerge. When prepared for external audience (lenders, prospective investors) it details the past, present, and forecasted performance of the firm. And usually also contains pro-forma balance sheet, income statement, and cash flow statement, to illustrate how the financing being sought will affect the firm's financial position.

Use business plan in a sentence

  • The company published its most recent business plan in 2014 and distributed it to a group of potential investors and other interested parties.

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  • Ellen started to worry about the new management when they unveiled a vague and somewhat unrealistic business plan during the first meeting with the entire staff.

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  • The investors knew the business plan was going to change with the ever changing markets but they liked the direction the company was going at the particular moment.

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