Premium Essay

Plan Small Business Finances

In: Business and Management

Submitted By Ollio85
Words 1303
Pages 6
Plan Small Business Finances
Assessment 1: Simulated Workplace Scenario:
Introduction:
For the case of this task, I will be simulating that I have invested my life savings to start a small business, that of a bakery. Having had previous skills in this industry, and already locating an ideal position with minimal competition, I will now undertake a number of financial projections for the business, with the end goal being to obtain finance to help with the start-up costs. The document will cover aspects as follows:
Part A:
• All costs, fixed and variable, relating to the start-up and general running of the business.
• Prices of goods based off of costs and profit margin.
• Break even sales points.
• Pricing strategies related to market conditions.
• Projected profit statement.
Part B:
• Set profit targets/goals.
• Identify working capital requirements.
• Identify asset requirements and asset management strategies.
• Prepare cash flow projections.
• Identify capital investment requirements.
• Select budget targets and monitor financial performance.
Part C:
• Start-up and ongoing financial requirements
• Sources of potential finance.
• Cost of securing finance and strategies in order to obtain it.
Part A: Research: The general running of the business will be done by myself and 2 full time employees, from a single location, operating 6 days a week, Monday through Saturday. The initial set up costs for the location, including 2 months of upfront rent and a security deposit are:
• $8000 – Rent in advance
• $4000 – Security deposit
• $1000 – Fit out and mild renovations
• $2500 – Machinery and equipment
• Total - $15,500 Start-up costs.

The estimated costs from this point, on a month by month basis will be:
Variable Costs:
• Baking ingredients - $3000
• Utilities (Gas, Water and Electric) - $200
• Local Advertising - $500
• Waste…...

Similar Documents

Premium Essay

Pestle Analysis

...Choosing a Method of Financing a Business By Derek Dowell, eHow Contributor Banks may want to lend you money if you present a well-prepared business plan. Whether you're starting a new business from scratch or operating a successful business already, securing financing first requires you to think about the best method to go about it. There are many factors to take into account, though some may vary according to an entrepreneur's personal situation. Poor management is the most frequent cause of small-business failure, according to the Small Business Notes website, but it is closely followed by insufficient financing. Other People Are Reading * The Disadvantages of External Equity * Financing Methods for Capital Purchases 1. Funding Availability * The first thing to do when choosing a method of financing your business is to determine what your range of options are. Small Business Notes lists the most common sources of finding money to start a business: personal savings (72 percent), banks (45 percent), friends/relatives (28 percent), individual investors (10 percent), government-guaranteed loans (7 percent) and venture capital firms (1 percent). Most people will not be able to rely on a single source, since banks expect the business owner to put some of his own money at risk in the venture. Spend some time thinking about what sources you can access. Personal Savings * Choosing to risk personal savings on a business venture requires serious......

Words: 1297 - Pages: 6

Premium Essay

Evaluating Sme Toolkits

...Marketing Capability of Small Businesses: The use of Diagnostic Audits to Benchmark an SME’s competencies against critical marketing success factors Contents Introduction-2 The Identification of Critical Success Factors in Marketing-2 Showcasing/Evaluation of key diagnostic audit tools-4 Conclusion-6 References-7 Introduction In this paper I will showcase how supporting the Development of Marketing Capability of Small Businesses and The use of Diagnostic Audits to Benchmark an SME’s competencies against critical marketing. Small businesses struggle with lots of elements of the business world both external and internally exploring the use of business tool kits, the paper will discuss how these will help SME’s and which kind of tool kit is best for certain company’s. Small micro-businesses generally only employee between 0-9 people, which in 2012, there were 4.7 million micro businesses within the UK. This figure constituted towards 96% of all businesses (Parliament.uk, 2013). SME’s will play a key role in helping to stimulate economic growth in the UK and help the recovery from recession. The Identification of Critical Success Factors in Marketing The introduction of a product to a market place with success is a difficult process, given that successes in a sector can be few and far between for small business. Segmentation is a key issue, exploiting gaps within this market, can lead to rapid growth when coupled with a good marketing plan. It is......

Words: 2259 - Pages: 10

Premium Essay

Finnace

...(McLaney and Atrill: 2010) suggest that finance is concerned with the way in which funds for a business are raised and invested. Any business irrespective of its size and nature requires sources to raise finance. Different types of sources of finance are available to different types of businesses. Broadly the two types of sources of finance are internal and external. Internal sources are from within the business and external sources are outsourced extrinsically. The three main legal statuses of business constitute of being a sole trader or partnerships and Private Limited Company. Sources of finance available to each of these are discussed below. Sole Trader and Partnership: Sole traders and partnerships refer to the simplest forms of business organization. A sole trader is an individual who runs a business from his own name, providing all the capital and assuming all the risks. A partnership can include more than one individual. Sole trader and partnerships have a range of options to get finance. Personal Savings and Loans * Put simply, personal savings is the amount of money a person has at his disposal. It becomes a source of finance when the sole trader or a partnership member is willing to invest it in his business. It is up for the individual to decide whether he wants to keep his savings or use them to buy equipment, vehicles, tools or other things his business's needs. Loans from friends and family also amount to a source of finance. Working Capital *......

Words: 3193 - Pages: 13

Premium Essay

Small and Payment Banks in India

...guidelines for small banks and payment banks. Payment banks and small banks are “niche” or “differentiated” banks; with the common objective of furthering financial inclusion. While small banks will provide a whole suite of basic banking products, such as, deposits and supply of credit, but in a limited area of operation, payments banks will provide a limited range of products, such as, acceptance of demand deposits and remittances of funds, but will have a widespread network of access points particularly to remote areas, either through their own branch network or through Business Correspondents (BCs) or through networks provided by others. They will add value by adapting technological solutions to lower costs. GUIDELINES:- • Purpose There is a need for transactions and savings accounts for the underserved in the population. Also remittances have both macro-economic benefits for the region receiving them as well as micro-economic benefits to the recipients. to migrant labour workforce, low income households, small businesses, other unorganised sector entities and other users, by enabling high volume-low value transactions in deposits and payments / remittance services in a secured technology-driven environment. The objectives of setting up of small banks and payment banks will be for furthering financial inclusion by (i) provision of savings vehicles to underserved and unserved sections of the population, and (ii) supply of credit to small business units, small farmers,......

Words: 2576 - Pages: 11

Premium Essay

Business Plan

...business.gov.au Business Plan template A good business plan can help you secure finance, define the direction of your business and create strategies to achieve your goals. The business.gov.au Business Plan template steps you through the process of creating a solid, well-structured plan tailored to your business. New! Create your business plan on your iPad by downloading our free MyBizPlan iPad App. Search ‘MyBizPlan’ in the App Store now! Copies of the latest version of this template and the guide can be downloaded from www.business.gov.au/businessplan. If you need further information, assistance or referral about a small business issue, please contact the Small Business Support Line on 1800 777 275. Using this template Before you complete this business plan template and start using it, consider the following: 1. Do your research. You will need to make quite a few decisions about your business including structure, marketing strategies and finances before you can complete the template. By having the right information to hand you also can be more accurate in your forecasts and analysis. 2. Determine who the plan is for. Does it have more than one purpose? Will it be used internally or will third parties be involved? Deciding the purpose of the plan can help you target your answers. If third parties are involved, what are they interested in? Although don’t assume they are just interested in the finance part of your business. They will be......

Words: 1284 - Pages: 6

Premium Essay

Assigment Module 1

...1-finance is essentially any transaction in which money or money like instrument is exchanged for another money or money like instrument. So we can say the concept of finance is very old it, has taken place probably since the roman or the Chinese dynasty era. Finance is used in the market. A market is a place that allows forces of demand and supply to operate. Where sellers and buyers trade services goods, contracts, for money or barter, this is the place where finance also takes place. You can’t have one without the other. There are different types of markets, according to our book in United States there is real estate market, the internet and commodity market. All these market have one thing is common which is finance, they all involve some type of trade, information trade, goods trade and property exchanged for some type of money. 2-Economic capital is the money value, how much monetary asset it has to cover expenses, and other financial needs; it’s what we consider solvency. Financial capital it’s a much broader term, it’s anything related to money and assets to a company, it’s a dollar value claim on economic capital which includes cash, accounts receivables, stocks, and bonds. 3-Oportunity cost is the benefits you could have received by taking an alternative action, for example investing money in a savings account where you get 3% interest or on a another type of investment where you could have received 10% interest. Entrepreneurs face this dilemma every time they......

Words: 1171 - Pages: 5

Premium Essay

Andy Rexford - Custom Stitches Essay

...Abstract Andy Rexford started an embroidery shop in his garage. It was a small business he began in his garage and took one or two small jobs that are time that the big businesses were not willing to take in as jobs. His business, Custom Stitches grew into a full-time family business that made over $750,000 a year. His business supplies embroidery work for local colleges and businesses. Not only does he take on big jobs he also is still willing to take the small jobs that other businesses are not willing to take on. In the beginning he began with one two headed machine and now has five, six headed machine that embroider the same designs simultaneously on six items. He now wants to get rid of the old two headed machine that started it all. Rexford attended a workshop on business planning and has spent the last two months developing a business plan for Custom Stitches. While developing his business plan Rexford wants to pass on the opportunity for his business to grow within the next few years. With his new accountants, contacts and plans for the future Rexford truly believe that he can double the size of his business within two years. The only challenge he faces is finding money to finance his growth and will need $700,000 in external capital to meet his goals. Rexford is now sitting at his desk looking at his business plan wondering where he could find that much money to finance his company's growth. In this paper I will suggest well Rexford needs to look for his......

Words: 1264 - Pages: 6

Premium Essay

Accounting

...A budget is a quantitative expression of the money inflows and outflows that reveal whether a financial plan will meet the organisational objectives or as a quantitative plan of action relating to a given period of time which may include planned revenues, expenses, assets, liabilities and cashflows. Business budgeting is one of the most powerful financial tools available to any small-business owner. Put simply, maintaining a good short- and long-range financial plan enables you to control your cash flow instead of having it control you. Budgeting is a quantitative expression of a plan or action prepared in advance of the period to which it is related. Budget sets out the costs and revenues that are expected to be incurred or earned in future period. Budgeting is one of the most important skills that you can have. In any economic forecast, planning and budgeting are crucial when it comes to conserving and increasing your resources. The use of a budget can be helpful to not only individuals and families, but companies as well. In order to stay afloat, every company from the small business to the large corporation must keep track of their finances in order to succeed. Often they utilize the services of an accounting professional to keep this information in order. However if you are the owner of a small business or simply trying to deal with your home finances, you may not have the luxury of hiring a professional and need to do the work on your own...

Words: 252 - Pages: 2

Premium Essay

Biomedical Engineer

...Guide on Access to Finance GUIDE ON ACCESS TO FINANCE Financial services and tools available in Egypt supported by the Center for International Private Enterprise (CIPE) Sponsors PANTONE 202 U C:0 PANTONE 188 C M :100 Y : 65 K : 47 C:0 M : 79 Y : 65 K : 47 PANTONE Cool Gray 10 U PANTONE Cool Gray 10 C C:0 C:0 M:0 Y:0 K : 72 M:0 Y:0 K : 72 Guide on Access to Finance ! The Egyptian Junior Business Association (EJB) is a nongovernmental organization, established in 1999 and formally registered in 2000 with a vision to become the “association of first choice among Egyptian Junior Business people who are committed to the development of a culture of Excellence, Ethics and Public Service” and a mission to “Provide a platform for dynamic business people to affect a positive business environment through Business Development & Social Responsibility promoting a culture of excellence & business ethics.” The Center for International Private Enterprise is a non-profit affiliate of the U.S. Chamber of Commerce and one of the four core institutes of the National Endowment for Democracy. CIPE has supported more than 1,000 local initiatives in over 100 developing countries, involving the private sector in policy advocacy and institutional reform, improving governance, and building understanding of market-based democratic systems. CIPE provides management assistance, practical experience, and......

Words: 22311 - Pages: 90

Premium Essay

As Business Notes

...AQA AS Business Studies Unit1 (BUSS1) Course Companion AQA AS Business Studies Unit 1 (BUSS1) Course Companion Publishers Information AQA AS Business Studies Unit 1 Course Companion 1st Edition August 2008 Author: Jim Riley © Tutor2u Limited All Rights Reserved No part of this material may be reproduced in whole or in part without the express written permission of Tutor2u Limited. This publication is not endorsed or approved by AQA. Tutor2u Limited Boston House 214 High Street Boston Spa LS23 6AD Please contact jimriley@tutor2u.net with details of any errors, omissions or suggestions for future editions. © Tutor2u Limited All Rights Reserved www.tutor2u.net AQA AS Business Studies Unit 1 (BUSS1) Course Companion Contents Introduction to AQA AS Business Unit 1 .....................................................................6 Section 1: Starting a Business ......................................................................................7 Enterprise and Entrepreneurs .......................................................................................8 Introduction ......................................................................................................................................... 8 Entrepreneurs ..................................................................................................................................... 9 Motives for starting a business ................................................................

Words: 41888 - Pages: 168

Premium Essay

Nbfi in Microeconomic Development in Bangladesh

... School of Business United International University FINANCING OPTIONS FOR SMALL AND MEDIUM ENTERPRISES (SMES): EXPLORING NON-BANK FINANCIAL INSTITUTIONS AS AN ALTERNATIVE MEANS OF FINANCING THE CASE OF BANGLADESH Submitted To Submitted By James Bakul Sarkar Md. Moniruzzaman Assistant Professor ID: 111091381 School of Business Bachelor of Business Administration Bachelor’s Degree Thesis in Business Administration ACRONYMS SMES SMALL AND MEDIUM-SIZED ENTERPRISES NBFI NON BANK FINANCIAL INSTITUTIONS. FFS FORMAL FINANCIAL SYSTEM IFS INFORMAL FINANCIAL SYSTEM FMF FEDERAL MINISTRY OF FINANCE CBN CENTRAL BANK OF NIGERIA NDIC NIGERIAN DEPOSIT INSURANCE CORPORATION SEC SECURITIES AND EXCHANGE COMMISSION NIC NATIONAL INSURANCE COMMISSION FMBN FEDERAL MORTGAGE BANK OF NIGERIA NDIC NIGERIA DEPOSIT INSURANCE CORPORATION SEC SECURITY AND EXCHANGE COMMISSION NAICOM NATIONAL INSURANCE COMMISSION ABSTRACT TITLE: FINANCING OPTIONS FOR SMALL AND MEDIUM-SIZED ENTERPRISES (SMES): EXPLORING NON-BANK FINANCIAL INSTITUTIONS AS AN ALTERNATIVE MEANS OF FINANCING. AUTHOR: Md. Moniruzzaman SUPERVISOR: James Bakul Sarkar DEPARTMENT: School of Business, United International University...

Words: 13904 - Pages: 56

Premium Essay

Managing Financial Resources and Decisions

... Task. 1:1.1 AC identify the sources of finance available to the business. 1. Government grants A grant of monetary help with the type of cash by the government to a qualified grantee with no desire that the trusts will be paid back (staff, 2015) 2. Leasing Is a system that permits people to claim and make utilisation of specific resources for medium to long haul financing periods consequently for beforehand set between time instalments (Ahali.com, 2015) 3. Friends and Relative They may offer advances without security or consent to a more drawn out reimbursement period (Business gateway, 2015) 4. Government program Chosen, state, and neighbourhood governments have programs expected to help the financing of new interests likewise, little associations. The assistance is much of the time in the kind of an organization certification of the repayment of a development from a customary advance master Anon, (2015). [Online] available at: 5. Life insurance Is a way of ensuring your family or your friendship ones in the event that you pass away (you tube, 2012). 6. Personal savings The primary spot business visionaries ought to search for start-up cash is in their own pockets. It is the slightest costly wellspring of stores accessible (13 sources of finance, 2015). 7. Bank loans A development made by a bank to be repaid with eagerness at the exceptionally most recent a modified......

Words: 1195 - Pages: 5

Premium Essay

Captek Inc - Functional Area Plan

...Directors [Team’s chosen name for the corporation – TBD in Unit 10] By Terra Allen, Accounting/Finance Manager, Michael Argentino, Marketing/Sales Manager, George Dickson, Operations/Production Manager, Doris Toliver, HR Assistant Manager, Felicia Parris, IT Assistant Manager March 14, 2014 Introduction to the Proposal’s Purpose and Content [Team’s chosen name] Corporation is a medium-sized manufacturing company with 250 employees. It directly markets one product: a unique coffee cup with a patented ball bearing sliding mechanism. Nathan Jr. and a group of 10 other executives run the company. [Team’s chosen name] Corporation has received a large sum of money from a venture capitalist. The venture capitalist and Nathan Jr. are predicting 100 percent growth in five years. To achieve that growth, productivity will need to increase at a similar rate. Therefore, this proposal provides a suggested business model update. Further, the functional areas updates are indicated to assist the business model to predict, plan, and implement future growth and profits. In this proposal, the problem of the outdated business model and functional areas is addressed with new ideas and new employees to implement them. The 100 percent growth projection in five years can become a reality with the managers’ ideas about these questions: 1. What will my updated business model look like? 1. How can my functional area managers modify their activities and objectives......

Words: 1434 - Pages: 6

Premium Essay

Hnd Level 5 Pearson

...BTEC Level 5 HND Business and Management | Assignment Name: | Managing Financial Resources and Decisions | Section 1: Understanding the Source of Finance Available to Business IDENTIFY THE SOURCES OF FINANCE AVAILABLE TO BUSINESS In order to set up a business the owner or business needs money to get it going, and in cases of established businesses, keep it growing. Business owners will usually use some of their own money coupled with other sources of finance to start their business. There are several ways to acquire financing and a few of them are personal capital and borrowing from friends, borrowing from a bank, factoring, invoice discounting, leasing, hire purchase and franchising. For larger companies they have the advantage of being able to sell shares to raise capital, they can also have large investors, and being able to ‘raise capital’, they can also retain earnings in order to use the money as cash flow for further developments in the company or for a particular project (this money belongs to shareholders). Companies who are already established can retain their profits for a period of time and use this money in the future for projects or business needs, this is usually shareholder dividend and ultimately belongs to the shareholders, but the company is using it to expand or better the business. The selling of company assets is also seen as a way of raising capital, however if you are selling off your assets how does this help your business, you will lose......

Words: 3778 - Pages: 16

Premium Essay

Making a Success of Your Business

...Making a success of your business Essential checklists sponsored by sponsored by With more than 64,000 small and midsize customers worldwide, SAP is a leading provider of business applications and an established and highly successful player in the small and midsize enterprise (SME) market. SAP offers a broad and innovative solution portfolio for small businesses and midsize companies to meet the heterogeneous demands of SME customers. SAP solutions for small businesses and midsize companies include SAP(r) Business One, a single integrated application for successfully managing small businesses; SAP(r) Business ByDesign(tm), the software industry’s most complete, integrated and adaptable on-demand solution for midsize companies; and SAP(r) Business All-in-One, a customizable and extensible solution for midsize companies with deep industry best practices built in. Sold, implemented and maintained through SAP and an expanding network of qualified partners, all of the solutions are competitively priced, easy and quick to implement and scalable to customers’ growing business needs. The SAP solutions specifically designed for SMEs help enable small businesses and midsize companies to lower operating costs, improve operational excellence, gain better business insight and control, and grow their businesses flexibly. Additional information is available at www.sap.com/sme Chartered Management Accountants are the first choice for financially qualified business leaders. The......

Words: 5458 - Pages: 22