Thursday, January 30, 2020
Setting up a business - new business case study questions Essay Example for Free
Setting up a business new business case study questions Essay AO1: Knowledge AO2: Application and analysis: developing your explanation and using examples relevant to Josefs business. Explain two ways in which a bank can help a new business such as Josefs (4 marks) The first way in which a bank can help Josef is by giving him a loan of Ã ¯Ã ¿Ã ½10,000 to help him to set up his business, there are many start up costs ie: equipment and computers that he will need to cover and it is important that he has enough money. Another way they can help is by offering advice; the bank can appoint a small business advisor as Josef is a young, inexperienced small business owner, they can help him with financial issues, keeping records and taxes. Would completing a business plan make sure that Josefs business was successful? Give reason for your answer. (9 marks) AO1: Kn. 1 mark AO2: App 2 marks (explain and developing your point, with examples relevant to Josefs business AO3 / AO4: Evaluation: Justify (give reasons) your ideas. Drawing up a business plan would certainly help Josefs business but it does not guarantee its success. It is important for Josef to put together a plan as it helps him realise everything that needs to be done, for example, all the different market research and promotions. He will also put together forecasts for cash flow and budgets and this will help him foresee any problems so therefore he can organise an overdraft for that time. The business plan will certainly help him obtain a loan which will allow him to invest the money into developing his service and keeping ahead of the competition this will help him be successful. On the other hand the business plan may not be accurate and could lead to bad decision making. The banks may not have faith in his business idea and may not lend him money, therefore not having cash in his business to cover all his start up costs. More importantly he may not run the business very well and this will lead to many problems further down the line. I think a business plan is very important to guide an entrepreneur but it must also be flexible and reviewed over time. Explain two reasons why someone might choose to buy a franchise from The Greenhouse (5 marks) AO1: Kn: state reasons AO2: Ap An give the benefits and provide a detailed explanation using examples from the case study As stated in the case study the Greenhouse restaurants are known for their quality food and quality service, the business is already a success and an entrepreneur maybe interested because they know the business will do well because of its excellent reputation, it is seen as less of a risk. Another benefit of owning the Greenhouse franchise is that an entrepreneur will receive training from the franchiser, much of the hard work is done in terms of marketing and design of the restaurants and menus etc this will save an entrepreneur a lot of cost and therefore allowing them to enjoy higher profit margins. Phil and Sandra are thinking of offering higher wages than those paid in other restaurants. Do you think that this is the best way to motivate staff? Give reasons for your answer. (9 marks) AO1: Kn. 1 mark AO2: App 2 marks (explain and developing your point, with examples relevant to the business) AO3 / AO4: Evaluation: 6 marks Justify (give reasons) your ideas. There are many ways in which Phil and Sandra can try to motivate their workforce to work harder. Offering higher wages is just one way and in many cases can be appropriate. Money is the main motivate for many people, especially those employed in the low wage catering industry and if wages increase your workers are less likely to leave and more likely to feel happier in the work place and work more productively. Some people view wages as an indication of their worth however many other people and theorists believe that other things are just as important, such as free health insurance, being recognised for hard work through rewards such as employee of the month and also given trust and extra responsibility. All of these are important in building confidence of your workforce and therefore an effective workforce. Although money is a motivator for some it could increase the costs of Phils and Sandras business and they maybe better off choosing other non-monetary methods to ensure they make as much profit as they can. Explain why batch production might be a better way for Connie to make cakes (5 marks) AO1: Kn: state reasons AO2: Ap An give the benefits and provide a detailed explanation using examples from the case study Connie makes different types of cakes, birthday, weddings and other occasions, if she bakes them in batches than it will be more efficient as it can save on costs ie: cooking fuel. It will also save a lot of time as baking one individual cake at a time would take much longer than if they were baked in batches. Being more efficient will save money and help connie make more profit.