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Testing A Business Plan: Reality Test
Testing A Business Plan: Reality Test
Reality Test:
The reality test has internal and external components.
Value Test:
To convince lenders and investors to put their money into the ventures, a
business plan must prove them that it offers a high probability of repayments
or an attractive rate of return. The ventures must have a long term strategic
vision and a particular focus on operations. Entrepreneurs must be able to
demonstrate their knowledge of :
A business plan must have some financial risk. We can measure this financial
risk in four way such as leverage, liquidity, profitability and current ratio. Value
test is valid if we analyze these financial risk.