As a student at Challney High School for Boys, my task is to decide whether there is a gap in the market at the school to provide an alternative supply of fast food to the students in years 7-10.

Authors Avatar

Business Studies

Coursework Guide

2003

Enterprise Option

Name     Form

Teacher Mrs Bunker

CHALLNEY HIGH SCHOOL FOR BOYS

Business Studies Coursework

Enterprise

‘Is there a gap in the market for fast food at Challney?’


Introduction

As a student at Challney High School for Boys, my task is to decide whether there is a gap in the market at the school to provide an alternative supply of fast food to the students in years 7-10.  I will have to compete against three different suppliers of fast foods.  One is the Buttery, the second is a company selling ice cream and the third will be selling Samosas.

Business Opportunity

Business Description

Business Formats

The British Economy is based on two sectors, the Private sector and the Public sector. The private sector provides services solely for the individuals who are involved in the company e.g. Shareholders. The public sector provides services such as schools and hospitals etc.

  1. Sole Trader

A sole trader is a business which is owned by one person and it is also controlled by one person. This person is known as a sole trader (proprietor). Many sole traders can be found in local high streets. Sole traders are the most popular types of business in the UK because of its many advantages. Some examples of sole traders may be a hairdresser, electrician etc.

Advantages

  1. It is easy to set up as not much capital is required.
  2. The accounts do not have to be made public.
  3. The owner is his/her own boss and quick decisions can be made.
  4. The business can provide personal attention for its customers.

Disadvantages

  1. It is hard to expand the business because there is less start up capital.
  2. The hours are very long and there are a few holidays.
  3. The owner may not be good at running the business and then the business would collapse.
  4. If the owner becomes very ill or dies it would be very difficult to maintain the running of the business.

  1. Partnerships

A partnership is a business which has between 2 and 20 people who jointly own a business and work in it together. There is a contract drawn up by the partners stating the profits and losses are shared equally amongst the partners as stated in the Partnership Act 1980. The act also states all partners have an equal say in the running of the business and all partners must agree before new partners are allowed into the firm.

Advantages

  1. There are more people to put money into the business whereas a sole trader does not have many people to put money into the business.
  2. The accounts do not have to be made public as a sole trader.
  3. Each partner has the same amount of management and responsibility in the business.
  4. It allows greater time off and there are more holidays than sole traders.

Disadvantages

  1. There is a limit on the size on which they can grow
  2. Partners in the business could argue amongst each other about the control of the business
  3. A death of a partner can lead to the end of the partnership.
  4. Small partnerships find it difficult to raise capital.

3) Private Limited Company

A private limited company is a company whose shares are not able to be bought on the stick exchange. In order for the shareholders to sell their shares to the general public they must get permission of the existing owners if they wish to sell. The owners are not personally liable for the firm’s debts. The limited liability which comes with a Private limited company means that the owners only risk losing the amount of money which they invested in the company and nothing else. The board of directors are the main shareholders of the business. The Private sectors primary motives are to make profit and survive.

Advantages

  1. There is more capital available because there are more owners.
  2. The owners have limited liability status.
  3. The company has its own legal identity.
  4. If a shareholder retires or dies the running of the business can still continue.

Disadvantages

  1. The shares are declined to the public.
  2. It is essential for the accounts to be published.
  3. There is a limit to the amount of capital that can be raised.
  4. If a sole trader or partnership becomes a private limited company they could lose some control over how the business is run.

4) Public Limited Company

A public limited company is a company whose shares can be bought or sold on the stock exchange. The public limited company thus has a wider scope and the businesses shares are available to anyone, this means it has much more working capital to start off with and so the company is likely to run smoothly with the large cash input.

Advantages

  1. Shareholders have limited liability status.
  2. More shares can be made because the shares can be sold to the general public.
  3. There is only little difficulty in borrowing money.
  4. The company can afford to employ professional people such as lawyers, accountants and personnel staff.

Disadvantages

  1. The company could experience diseconomies of scale as it grows.
  2. Communication between management and workforce could become very difficult due to the company being large.
  3. There is no control over who can buy shares.
  4. It is essential that the full accounts are published.

My company will be a private limited company as there are more than 20 people in charge to help run the business and it is necessary to be a private limited company rather than a partnership. This will mean that the owners of the company are not personally liable for any losses which the company may suffer from. Because we are only a private limited company this will mean that we can only sell shares to friends, family and buy the shares ourselves rather than putting our shares on the stock exchange. We cannot be a sole trader as there is more than 1 person and a sole trader is normally run by 1 person.

Present Market and Local Business Environment

The main rival of our company (Bhaji Bazar) at the moment are the cafeteria, the buttery and two small companies selling samosas and ice cream. The cafeteria sells doughnuts and the buttery sells coke and other refreshments too. I think the biggest rival of our company will be the cafeteria because it has the best fast food available and it is very popular. We will need to persuade people to buy our product. Our market segment is Muslim boys aged between 11-15 years old as our customers will be boys from Challney high school for boys aged 11-15 years old. This means that the whole school would be out target audience and more people would buy from us. This might be because the students the students in the cafeteria are not provided with soft drinks but hot drinks and they might prefer a change in fast food. Our company would sell soft drinks and better fast food. Because the students are looking for a different product which the cafeteria or buttery does not supply we could expect quite a lot of

people turning up at out stall. Our market segment could also include the different ethnic groups such as Pakistani and Bengali.

Gap in the Market and Unique Selling Points

In our school where we will run our business we have discovered that there may be a gap in the market for fast food at Challney. The main aim of our business is going to be to fill this gap in the market. Our product would need to taste nice in order for people to buy it. If we were selling products which were not pure (halal) then we would not be able to sell them. This is due to the fact that 95% of the pupils in Challney high school for boys are Muslims and if we sell products which were not halal then no one would buy our product. This would lead to problems for our business as we are wasting our Working Capital. If no one bought our products then it would go to a waste and then we would be making no profit at all. Under the Fair Trading Regulation Laws we would need to tell our customers what our product contains because if we told them that it was halal and it is not then we would be lying to them and that would be breaking the fair trading regulation laws. This means all our products would need to be halal in order for us to sell them. In our questionnaire we would need to place a question asking non-Muslims if they would be willing to buy any non halal products. The thing that is unique about our market is our product would be on sale to everyone whereas the cafeteria only supplies food to years 7-9 and the buttery supplies food to years 7-10. But the buttery and cafeteria both supply for the teachers. The thing that is unique about our product is that the product will be very cheap whereas food in the cafeteria and the buttery can be very expensive. We will find out what is unique about our market and product by doing a questionnaire to find out what type of products consumers want.

Aims

The main aim of our business is to make as much money as possible. The more money our business makes the more experience we gain and that is what we want to gain. We will work in a team to run our business. Another aim of our business would be survival as it is important for our business to make as much profit as possible. Also another of our aim during the course of running our business is we will want to break even as soon as possible. If we don’t break even while we run our business then the setting up of the business would be completely pointless and we will not have made any profit as making a profit is our top aim. As soon as we break even this would mean that we are not making a profit or making a loss. Once we reach our break even point then this would mean that our business has been successful and we would able to look to the future rather than the past. Our prices should most probably be high enough for us to break even very quickly and we can start looking at maximising our profits. If we can make a good profit then we could pay back the share holders dividends who invested in our business to help us get the business running. If our product is very popular then we would raise the price of our bhajis by 10% so we could make as much profit as we can. If we do not have many sales from the start of running our business then we would reduce the price of our product to maximise our sales and profits too. We could also maximise our sales by doing special offers such as buy 2 get 1 free or we could have a special day where everything has 10% off such as Bargain Tuesday. If we can maximise sales then we would automatically maximise profit. It is very essential to gain experience of running a business for the first time ever because it helps you to learn how to run a business and if later in life you open up your own business this experience you gain now would be very useful then. If you make any mistakes now then later in life you can prevent these mistakes from happening again if you run your own business. Meeting customer needs will be very important in running our business because if we sell a product which is not halal then hardly anyone would buy it and then all our stock would go to waste. It is essential that all our customers would be satisfied because then they would buy from us again and then they would tell their friends about our product. We must make sure that all our customers are satisfied because if there is an unsatisfied customer with our product then he would go and tell his friends about it and then people would be discouraged from buying our product. This means that our company could end up losing profits and sales.

Join now!

Cash Flow Forecast for Bhaji Bazar

The cash flow forecast above is for Bhaji Bazar and it shows a slight increase in cash balance each day and this means that we are making a steady profit. This cash flow forecast was created to show how are company should progress. We would be making a reasonable amount of profit by the £10.00 share capital that would be raised by the company.

Objectives

My primary objective is to complete what I have set out to do which was to fill the gap in the market for fast food ...

This is a preview of the whole essay