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What business is needed?

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Introduction

To: Donald Powell Title: What business is needed? Introduction: I have been asked by Donald Powell to give him advice. He has decided to set up a local retail company using his redundancy payments of �10,000. He has no real experience and is seeking help. My report will be due for January 2001. Action taken: In order to complete this assessment, I will use my business studies textbooks, handouts, notes and my knowledge to help Mr Powell run a successful retailing business. I will also prepare and undertake a questionnaire, providing Mr Powell the necessary information to help him. Findings: After conducting my questionnaire, my results show the following... Gender F F F F F F F F F M M M M M M M M M From the chart, you can see that I questioned 50% males and 50% females. This means there should be no sex bias in my results and I will be able to get a good indication of what retail outlet males and females want. Age 17-20 17-20 17-20 21-30 21-30 31-40 31-40 31-40 41-50 41-50 51-60 Over 61 Under 16 Under 16 Under 16 Under 16 Under 16 Under 16 By looking at these results, I can clearly state that I surveyed a range of ages. Donald Powell and myself can use these results to gain more knowledge on what people of all ages want. Do you shop on the Internet? N N N N N N N N N N N Y Y Y Y Y Y Y From these results, I have gathered that the majority of people do not shop on the Internet. However, Donald Powell can hook his company onto the net so the other 42% of customers can order goods online. Where do you live? Broadfield Broadfield East Grinstead East Grinstead Gossops Green Ifield Ifield Langley Green Langley Green Maidenbower Pound Hill Southgate Southgate Three Bridges Worth Worth Worth Worth I undertook this question to find out where people come from to shop in Crawley. ...read more.

Middle

This would encourage share ownership, as Donald Powell's personal wealth is kept secure, should the company fail. Shares can be advertised and sold through the stock exchange. The shares can be sold to any member of the public. This can allow Donald Powell to raise a vast amount of capital. If Donald Powell made a mistake which proved to be very serious, his business would be sued, not Donald Powell himself. As Donald Powell's business becomes larger, there will be a lot more scope for specialisation. Specialist in different jobs could be employed. Employees will concentrate on only a few tasks they are good at. Not only will this allow Donald Powell's business to run things much more efficiently, but also Mr Powell will not need to worry whether he lacks certain business skills. (Specialisation increases output). As Donald Powell will be running a larger business, banks will be more willing to lend larger business loans, as he will be likely to repay them on time. Loans with a lower rate of interest may be obtained. As Donald Powell's business will be a lot larger, he will be more likely to buy things in bulk. Hence, the unit cost of production will fall. (Get cheaper). Any owner that purchases more than 50% of the company's shares can be said to have taken over the business. This can happen anytime if shareholders (such as Donald Powell) are willing to sell their shares. E.g. BMW mounted a successful take over of Rover. Large businesses can be difficult for Donald Powell to control and manage leading to inefficiencies e.g. managers wasting money and leading to disagreements and industrial action. This can lead to rising unit costs in production known as diseconomies of scale. Donald Powell's interests e.g. growth, market share may differ from shareholder's interests e.g. profit leading to higher dividends The setting of a PLC is time consuming and costly. ...read more.

Conclusion

The EU can also help by granting money to Mr Powell to improve his business in a variety of ways. In the private sector, there are many sources of help. In my mind, the most useful ones seem to be banks, management consultants and Trade associates. This is because they all provide the necessary thing for Donald Powell to run his business e.g. banks provide him with advice and loans, Management consultants assess Donald Powell's business and tell him what needs improving and Trade associates can advise Donald Powell's business concerned with industry. Accountancy is also fairly important but not the most. Recommendation: After looking at all of my findings, I have come to the following recommendations: Donald Powell should make sure his company is on the Internet as 42%, nearly half of the people order goods and services online. The most popular choice of store was a record store along with a men's designer wear shop, cookery store and a clothes shop. (For males and females). In general, clothes shops are in most demand. I have concluded from these results that Mr Powell should set up a unisex clothes shop Therefore, the shop will be more popular as both members of sex will go and visit it. Mr Powell's infrastructure must be very good. However this is not really a problem as Crawley has many train stations, motorways, airports and other strong road links. E.g. Gatwick airport, M25, Crawley train station, M23 e.t.c... (See map) I would recommend Donald Powell to locate his retail store in the County Mall, as many people shop there most often. However, locating Donald Powell's business may also have some disadvantages, such as being expensive and not having a lot of space. I would recommend Mr Powell to operate as a private limited company as it is quite inexpensive to set up and would enable him to take advantage of larger scale business opportunities. Name: Rajvir Sangha Position: Pupil of business studies Date: 20/01/03 ...read more.

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