Unit 2 Investigating business

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Unit two - Investigating business                                         Chloe Rock - 3341

Introduction

I am planning to set up a mobile cook service which offers good quality food at good prices, the chefs will be available to go to people’s homes and cook for them, whether it be a casual meal for two or a dinner party with your friends. I will be opening a partnership business with me ad the main owner and two other silent partners.

Assessment criteria A – Business planning

AO1 - My business plan

Executive summary

I am aiming to set up and start a business sometime in 2010; I will be the main owner but will also have 2 silent partners who will be putting money into the money but will not be fully involved with all of the decision making. I have decided to set up this kind of business because it is totally unique and there is no other business that offers this kind of a service. The main idea of my business is that we go out to people’s houses and cook a meal for them; this can be for a quite formal event like a dinner party or just a casual meal for two.

My business opportunity

I’m planning to start this business sometime during 2010 this will give me enough time to get everything ready in time. Me and my two sleeping partners will all be putting money into the business and finding people with the right skills to carry out jobs within in the business such as a secretary, van driver and a couple of chefs. Effectively there are three of us involved in the business, although I will be bringing my skills and money to the business whereas the silent partners will just be bringing money into the business, the profits and the debts will be shared.

We have all signed a contract to bind our partnership together meaning that none of us are allowed to suddenly drop out or stop their contribution.

In the future I hope that the business will become better known and we can grow into a wider area and make the business bigger.

        

My marketing and sales strategy

The market that I will be operating in is obviously the catering market, which is quite a large market but I am adapting and changing the business to make it more successful. In the area which I am setting up I do have a few competitors but they only really cater for big events which means the service they offer is different to what I am trying to offer.

The market I am in can be quite expensive sometimes due to the amount of food that you may have to buy. Starting in this market can be quite expensive due to the amount of food you need to buy especially when you are using perishable goods which need to be replaced when they have gone out of date.

Management team and personnel

In my management team there is me and my two silent partners James and Jasmine. I will need to hire staff to help me to keep the business going, I will need a van driver, 2 chefs and a secretary.

My operations

I have chosen a location to base the main office and also an area in there where all of the chilled and frozen food will be permanently kept.

The location I have chosen is just the back of a shop as we are working with some other people who will need the shop front for their business, therefore we are both cutting costs by sharing a fair amount of rent per month and both getting what we need from it.

I have two cooks both of which have good experience in the business so they are more than capable of cooking up things that people want.

I am also going to have a secretary who will be doing all of the filing and any other basic office work.

We have decided to have two main computers and two laptops on which will be installed data storage systems and Microsoft word packages so that the secretary and I can work from the computers and the chefs will be using the laptops this ensures that there is plenty of communication between all staff members.

Financial forecasts

What a business plan is.

A business plan is a set of documents which I would need to create so that I can see my financial and operation objectives for the future, and also to show how exactly I will be meeting these. It is basically like a guide to my businesses policies and strategies which I will need to continually be adapting as things change.

Sometimes my accounts will need to be seen by someone who is not in the business, so that they can see what has previously happened, what is currently happening and what we forecast to happen I will need to prepare a balance sheet, a profit and loss account and also a cash flow forecast.

 

Sources of advice

There are various different sources of advice that are available when setting up a business, I have found a very helpful website called business link () which gives advice about starting up and managing your business. There is a department of trade and industry run by the government and they use different things to help out businesses in various local areas.

Banks can also help you; Lloyds bank has a book about successfully starting up a business and information on business loans. ‘New deal’ is a specific business which helps young people to start up new businesses. There are job centres in various different areas’ which also offer advice to people on starting up their own businesses.  

New businesses can get help with premises and management from the UK business incubation centre I had a look into what they do for businesses on their website () there are many different benefits that businesses get from being a member.

 

As you can see these were the first couple of things included on the page, they offer different training for businesses and their teams which have proved to help in many different new businesses cases.

There are also many private sources of advice like ‘live wire’, ‘the federation of small businesses’, ‘young enterprise UK’, ‘young entrepreneur site’, ‘Scottish enterprise’ and ‘the princes trust.’

I researched a little bit into the young enterprise UK; I used their website to find out more about what they do. ()

“The Young Enterprise Mission:

To inspire and equip young people to
learn and succeed through enterprise.

The Young Enterprise Vision:

That all young people will have the
opportunity to gain personal
experience of how business works,
understand the role it plays
in providing employment and
creating prosperity, and be inspired
to improve their own prospects, and
the competitiveness of the UK. “

Their mission is simple and achievable for a business they are specifying their help towards younger people and helping them into the business world.

AO2 - Aims and Objectives

An aim of a business is what you set out to do in your businesses. A business aim is like the goal of what the business wants to achieve.

 It may have several aims which they hope to achieve. Other businesses aims are too survive which you will need if your business is too grow bigger in the years too come.

Source (www.thetimes100.co.uk)

An aim is also where the business would like to go or wants to go in the future. It is a statement of purpose, like what we are here to do, for example we would like and want to grow the business in to the local area after 6 mouths. ()

Aims are very helpful for businesses as they set targets which help to motivate the employees. It’s good for businesses to set these targets as it also lays out what they want to achieve, it is laid out like a detailed step-by-step list of your business plan. A business needs to make sure that these aims are achievable in order for them to actually progress.

Objectives give the business a specific target of where they should be, various different plans can be made to achieve these targets. Objectives can also be used to motivate your employee’s.

S – Specific

Our business can cater to our customer’s specific needs meaning what ever food they would like us to provide we will be able to do that.  

M – Measurable

I need to be able to measure what I am going to do, for example I will make a profit of £500 in the two months of business

A- Achievable

The objectives need to be achievable and realistic otherwise they are quite pointless.

R – Realistic

I need to set achievable aims that my business will actually be able to meet, for example there is not point setting an aim to make a profit of £5000 in the first three months of starting up.

T- Time specific

It should be set to be achieved within a certain time period creating pressure to achieve them all within the time scale.

These are the most effective business objectives that meet the criteria. ()

Businesses obviously need to have their individual aims and objectives which are specific to their needs.

Possible aims for a business would be:

  • Make a profit
  • Survive as a business after a year
  • Possibly expand
  • Be environmentally friendly
  • Beat your competitors in sales  

 Marketing aims for a company like Kellogg's or Kraft will focus on identifying and meeting the needs of consumers which is what which could also be your aim. Kellogg's objectives were to:

  • encourage and support physical activity among all sectors of the population
  • use resources to sponsor activities and run physical activity focused community programmes for its consumers and the public in general
  • increase the association between Kellogg and physical activity
  • use the cereal packs to communicate the 'balance' message to consumers
  • Introduce food labelling that would enable consumers to make decisions about the right balance of food. Each of the objectives that were set for Kellogg was designed to contribute to a specified aim which would help them.

(www.thetimes100.com) Kellogg’s page

The aims and objectives of coca cola are to ensure a top quality product for their consumers, and to be the best in their market. They ensure this by using high quality products at all of the stages in their production line and also to make money by selling beverages.

("http://wiki.answers.com" http://wiki.answers.com)

Aims and objectives of my business

The aims and objectives of cooks for hire are to provide high quality food at a low cost.

Our aims are too:

  • Expand
  • Proved good quality food for our customers
  • Started making a profit after  1 year
  • Survive in this economic climate

My business is going to be based in Rochester but after 5 months I plan to expand to other local areas like Chatham, Gillingham and Strood.

We are also looking to provide lunches and not just dinners.

As we are expanding we will also need to hire more colleagues therefore it will be easier to expand and become better known.

We will meet our objectives by assuring that our staffs are well trained and therefore they will be meeting our customer’s needs. Also to make sure that our business is well publicised we are going to hold a press conference where we can show our potential customers what we are capable of and they can give us ideas to improve and feedback on what we can include to make our service better. I will be doing this 2 weeks before the official start up date of my business and it will be held and the Roffen on New Road () so that potential customers can sample what we are going to offer, it will be £75 for us to hire the conference room.

I am planning to buy my stock from a wholesalers such as bookers, and then the bigger our business gets and the profits are bigger we will be able to source our food from local producers. We will also need to speak to the customer before their actual meal so that if they have any specific requests then we will try to meet these needs.

I am planning to start making a profit after a year as this is when I will have more customers returning for our good service, also after around 6 months we will start to cater for bigger dinner parties which will also help us to expand to more customers. Our business will need to keep up with the current economic climate by doing constant market research into our competitors and their prices.

We will give our customers a chance to come to see us and let us know their exact requirements and we can discuss what we can do for them. We will have a set menu which will have 2 starters, 3 main courses and 2 desserts to choose from.

We aim to provide services to our customers at low cost but still using good quality products.

Our objectives are too:

  • Improve my product
  • Provide new offers
  • More exotic food

The customers will also need to let the cooks know what time they will need to arrive so that the cooks are prepared, the cooks will also need to know if they need any extra/different foods with them than the et menu so they can assure that in plenty of time they are prepared.

AO3 - Legal form

Different forms of business

Sole Trader

A sole trader is self employed and the owner of the whole business, you are in control of the whole business and will make all important decisions. Although this does mean that if anything goes wrong or you get into debt it will be all blamed on the sole trader, For example a plumber or a small shop keeper.

Advantages of being a sole trader:

  • You make your own decisions
  • You keep all of the profits
  • Your business does not have to pay corporate taxes so therefore there is less expenditure
  • You have total control of the business
  • It is relatively easy to set up

Disadvantages of being a sole trader:

  • You need to put a lot of your own savings and money into the business therefore it could take quite a while.
  • You will be responsible for any losses
  • You will have to pay for any debt
  • You have unlimited liability

Partnership

A partnership is run by 2-20 people; they will all share responsibility for the business and make all of the important decisions. The profit will be shared evenly and fairly between the business owners. A partnership can benefit a lot of businesses as you are all sharing your skills and money and putting them into the business rather than just the one owner putting their share in. In some cases people going in to partnerships feel it is necessary to draw up a deed of partnership, this is not required by law but it can be helpful in case of any disputes.

Advantages of being in a partnership:

  • You can share skills, knowledge and funds of all partners.
  • We do not all need to be at the business at the same time so we can have more
  • I can be in another place while my partners are in a different one at the same time.
  • There will be more input into the business.
  • I can be more organised.
  • I will have less work to do.

  Disadvantages of being in a partnership:

  • A partnership is long term and I might fall out and have arguments with other partners.
  • I can’t make decisions by yourself
  • I share the debts and my partner or partners may not pay their share.
  • I have to share all the profits.

Private limited company

A private limited company (PLC) sells shares to friends and family and offers them limited liability. They are unable to offer their shares to the public over the stock market, and the shareholders must also sell their shares back to the business and are not allowed to sell them to other shareholders.

Advantages of being a private limited company:

  • There is limited liability
  • It should be relatively easy and inexpensive to set up

Disadvantages of being a private limited company:

  • As you are paying your share holders there will be less profit
  • You will have to pay corporation tax so there are less payments

Business form

It is very important that you choose the right form of business as this could make or break your business. The goals of a business need to be considered when choosing your type of business as if you wanted to sell shares then you need to think about being a PLC as you can’t be a sole trader and sell shares although if I want my business to be quite small it is good to start as a sole trader or a partnership then you can change your business into a PLC to expand. This is why I have decided to set up in a partnership business with my two silent partners.

We will have to meet certain legal requirements and produce legal documentation.

The deed of partnership sets out how profits will be shared, and the different responsibilities and payments to partners.

Register as self employed with HM revenue and custom’s (HMRC). This must be done by each individual partner.

Mission statement

We are going to provide high quality food at a good price to our customers, as long as they are happy so are we.

To assure that we meet this statement we need to have good time management skills, this will make sure that our customers stay happy as we will always be there and ready for when they say.

AO4 – Stakeholders

Stakeholders are basically people who have an interest in the business. For example:

  • People in the community
  • The government
  • Employee’s
  • Customers
  • Managers
  • Shareholders

A stakeholder is any party that has an interest in an organization. Stakeholders of a company include stockholders, bondholders, customers, suppliers, employees, and so forth.

Source ()

The stakeholders have a specific interest in the business and the outcome/success/failure of what they are doing. Stakeholders usually have a big interest in the business when they have invested money into the business, however the employee’s also have a big interest as the business obviously control them and their wages.

Join now!

If a business sells shares then obviously all of the shareholders will also have an interest in the business and how it is doing, its future plans and its current operations therefore it is the businesses job to let them know exactly what is going on.

Most stakeholders become involved with a company because it needs those business resources. While this is typically thought of as capital for expansion and hiring, a business resource can also be the workers themselves. Of course, the company must give up something in order to acquire these resources. In some cases, ...

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