Business Cost Analysis and Funding Options

The assignment begins with a list of startup costs for a hypothetical business venture, categorizing them as direct costs and overhead expenses. It then proceeds to identify additional investment opportunities that can be included in an enterprise to run a business entity more effectively. The document includes references to relevant academic journals and books on small business management and entrepreneurship.

Small business
Management

Table of Contents
EXECUTIVE SUMMARY.............................................................................................................1
Business overview.......................................................................................................................1
Financial overview......................................................................................................................1
Vision statement..........................................................................................................................2
Business objectives.....................................................................................................................2
Opportunities and threats............................................................................................................2
Business summary.......................................................................................................................3
Market analysis...........................................................................................................................3
Types of customers.....................................................................................................................4
Types of product or service.........................................................................................................4
Marketing and promotion............................................................................................................5
Main competitors........................................................................................................................5
Start up costs and funding...........................................................................................................5
REFERENCES................................................................................................................................6

EXECUTIVE SUMMARY
In today's scenario number of small companies are growing in a fastest way due to
increment in consumer demand. However, various entrepreneurs are coming with innovative
ideas in order to offer best or distinguish products to entire society (Barbero, Casillas and
Feldman, 2011). Therefore, assignment is going to highlight an appropriate business plan which
is required to businessmen for establishing a new organization at marketplace. Moreover,
financial overview, competitors analysis, objectives of an enterprise, opportunities or threats and
analysis of several necessary facts or figures are outlining in this project.
Business overview
“Foodie RESTRO” is a small business entity which is established in a local area of
European marketplace in order to offer various options in foods or beverages. Moreover, their
main objective is to facilitate common people with various tasty or delicious dishes such as;
sandwiches, burger, fried rice, Manchurian, Pasta and several types of hot or soft drinks. Along
with this, ingredients used for cooking these foods are healthy in nature as well as customers
received fresh dishes because employees are working 24*7.
Basically, initial investment of an entrepreneur is around “10000£” whose first or
foremost aim is to capture the attention of maximum clients by offering them with best services
or food quality. Therefore, it has been assessed that managers of an enterprise is forecasting that
annual profit of a company is almost "£20, 500” at the end of first year, 2nd year it has been
assumed as a “£ 71, 200”. As a result, economy of a nation get developed due to enhancement in
living standard of common people by offering them with employment opportunities (Colombo
and et. al., 2012).
Financial overview
After analysing current situation of an enterprise managers are trying to expand their
business entity by forecasting their company sales of initial year. Mainly, in order to improve the
existing positioning an association needs to assess their financial department by forecasting
profit of first year.
Thus, sales for initial year is assumed around £50,100. Hence, it has been analysed that
there is a major difference between actual performance of a company and projected one. As a
result company is facing high range of loss due to which it requires changes in their current
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strategy, financial schemes, policies and so on. Therefore, an appropriate cash flow statement
and profit or loss account is highlighted as follows:-
According to above graphical representation it is forecasted that in second year firm is
improving their performance by increasing their sales which resulted in maximization of
organizational profit. For example; initial year annual income of an enterprise is around "£20,
500 whereas in coming year it get increased by 10000£ and become almost 35, 500£”
Vision statement
“Foodie RESTRO” believes in offering reasonable products or services to their
consumers as compare with their competitors. Main vision of an association is to bring two best
factors at one place that is ; price and quality (Eid and El-Gohary, 2013). Along with this, their
main motive is to establish their goodwill at marketplace by continuing their business for longer
period of time in order to become one of the successful or best food restaurant in local areas of
UK.
Business objectives
Goals of an enterprise is classifying into short term, medium term and long term period
for enhancing their organizational performance. Short term:- Trying to fulfils the needs or desired of maximum clients. Medium term:- In coming years managers of an enterprise is planning to grow their
business by expanding existing business into some other regions.
 Long term:- Dream to become one of the best food restaurant across the UK by acquiring
trust or loyalty of numerous clients. Additionally, believes in establishing their positive
image at marketplace by gaining maximum return on their investment.
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Opportunities and threats
Opportunities:-
 Uniqueness of products offered by an enterprise.
 Monopoly at marketplace. One of the major opportunity is that offering of external catering in coming time period.
Threats:-
 Emergence of competitors nearby “Foodie RESTRO”. For example; around 2 mile radius
of company premises due to which competition may increase.
 Changes in consumer taste or preferences as well as trends.
 Natural disaster and various other factors which uncontrollable by the organization
(Gabrielsson, Tell and Politis, 2010).
Business summary
It consist of entire details of an association such as; address, contact number, e-mail
address, website, bank information, key people and so on.
Address:- Elegant property nearby by XYZ street, Town, country UKXXX
Telephone no. 1234567
Email- [e-mail]
website :- www. [e-mail]
Legal status: Sole trader
Beginning of financial year: April
Important people:- Robert Smith
Job title:- Entrepreneur
Skills:- Performed as a head chef for more than five years I have acquired maximum
number of talent or knowledge which aids while introducing a new business. For example;
management of employees, handling of pressurized environment, ability to design attractive
menu. Along with this I have very passionate towards food due to which I hope to create a
successful business by satisfying the need of distinct consumers.
Responsibilities:- As an entrepreneur I am responsible to contact with various suppliers
in order to acquire best ingredients for cooking food as well as trying to offer qualitative
products at affordable price.
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Market analysis
According to this term, managers of an association needs to analyse the current scenario
of a market in order to understand the status of food industry at marketplace. Therefore, it is
determined that demand of fast food get increases day by day due to growth in industry. In fact,
outsider foods are seen as a first priority for most of the clients. Thus, it is essential to select best
location for establishing a premises such as; near by residents, industrial area and universities.
However, British market of fast foods are growing by almost 2.8 million. Along with this,
managerial team needs to conduct programmes for analysing availability of public (Sampaio,
Thomas and Font, 2012).
High street questionnaire – Product research:- According to this term an association
need to design an effective question paper in order distribute amongst public for acquiring their
views or opinions. Thus, around a week almost 500 people are expressing their views on product
at various time period. Hence, around 56% are men and rest 44% are women's.
Types of customers
 Maximum number of clients are belong from the age group of 20 to 50.
 Official persons living in local region visit for enjoying their evening with fast foods or
drinks.
 Keen interested in fresh products.
Morning consumers:-
 Customers purchase foods in between 7:00 AM- 11:00AM.
 Almost 80% are purchasing various types of coffee, drinks.
Afternoon consumers:-
 Buying foods for lunch in between 12:00PM to 3:00PM
 Nearly 50% individuals are purchasing soft drinks also.
Types of product or service
“Foodie RESTRO” is engaged in offering best or qualitative food services which consist
of various types of fast foods, drinks and other things (Schermerhorn and et. al., 2014). Thus,
some of the essential products which is offered by company is describing as follows:-
Different types of foods:-
 Manchurian
 Italian
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 Bread cake
 Burger
 Fried rice
 Sandwiches
Various kinds of drinks:-
 Cold coffee
 Hot coffee
 Cold drinks
 Wine
 Vodka
All these above commodities are offered in an enterprise at different range.
Marketing and promotion
Advertisement is considered as one of the essential factors for company success or
development because it aids in maximizing sales of an enterprise. However, their main objective
is to facilitate consumers with various qualitative goods (Storey and Greene,2010). Thus, some
of the essential strategy which is used by an enterprise for promoting an organization is
highlighted as follows:-
 Social media:- According to this factor an association use the online services to capture
the minds of consumers.
 Advertisement in local newspaper by designing an attractive pamphlets.
Main competitors
It has been determined that various number of companies are emerges at marketplace or
in local regions for gaining maximum revenue. Along with this, one of the successful
“supermarket” is also established which act as a major competitor for “Foodie RESTRO”.
Start up costs and funding
Capital act as a backbone for overall organization because all the activities are managed
or regulated with the help of sufficient funds (Wagener, Gorgievski and Rijsdijk, 2010). Thus,
selected firm is assessing their initial investment and funds before designing their product or
services. However, company is facing various number of costs such as; direct, indirect,
miscellaneous expense, overhead and so on. Apart from this, it is essential for enterprise to
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consider fixed assets and variable cost in order to control extra expenses for maximizing
company profit (Business Plan, 2018). In fact, an organization may acquire funds from various
sources such as; equity, shareholders, loans, grants, sale on assets hence forth. Hence, few of the
start up cost are describing as follows:-
Costs Amount
Direct cost
 Bread
 Turmeric
 Cups
 Milk
 Foil paper
 Soft drinks
 Straw
 Sugar
 Salt
 Vegetables
Total
XXX
 XXX
 XXX
 XXX
 XXX
 XXX
 XXX
 XXX
 XXX
 XXX
 XXX
XXX
Overhead
 Promotional
 Property and rent
 Premises
Total
YYY
 YYY
 YYY
 YYY
YYY
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Hence as per above cost, it has been analysed that number of additional investment are
identified which might be included in an enterprise to run a business entity in much more better
way.
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Income Statement
[Name]
[Time Period]
Financial Statements in U.S. Dollars
Revenue
Gross Sales 50000
Less: Sales Returns and Allowances 20000
Net Sales 30000
Cost of Goods Sold
Beginning Inventory 10000
Add: Purchases 1500
Freight-in 2000
Direct Labour 1000
Indirect Expenses 3000
Inventory Available 17500
Less: Ending Inventory 15000
Cost of Goods Sold 2500
Gross Profit (Loss) 27500
Expenses
Advertising 200
Amortization 300
Bad Debts 500
Bank Charges 700
Charitable Contributions 200
Commissions 100
Contract Labor 100
Depreciation 300
Dues and Subscriptions 500
Employee Benefit Programs 600
Insurance 400
Interest 200
Legal and Professional Fees 100
Licenses and Fees 100
Miscellaneous 100
Office Expense 100
Payroll Taxes 100
Postage 120
Rent 200
Repairs and Maintenance 200
Supplies 250
Telephone 500
Travel 200
Utilities 100
Vehicle Expenses 600
Wages 600
Total Expenses 7370
Net Operating Income 20130
Other Income
Gain (Loss) on Sale of Assets
Interest Income
Total Other Income 0
Net Income (Loss) 20130

REFERENCES
Books and Journals
Barbero, J.L., Casillas, J.C. and Feldman, H.D., 2011. Managerial capabilities and paths to
growth as determinants of high-growth small and medium-sized
enterprises.International Small Business Journal. 29(6). pp.671-694.
Colombo, M.G. and et. al., 2012. Introduction: Small business and networked innovation:
Organizational and managerial challenges. Journal of Small Business
Management. 50(2). pp.181-190.
Eid, R. and El-Gohary, H., 2013. The impact of E-marketing use on small business enterprises'
marketing success. The Service Industries Journal. 33(1). pp.31-50.
Gabrielsson, J., Tell, J. and Politis, D., 2010. Business simulation exercises in small business
management education: using principles and ideas from action learning.Action
Learning: Research and Practice, 7(1), pp.3-16.
Malhotra, R. and Temponi, C., 2010. Critical decisions for ERP integration: Small business
issues. International Journal of Information Management. 30(1). pp.28-37.
Sampaio, A.R., Thomas, R. and Font, X., 2012. Small business management and environmental
engagement.Journal of Sustainable Tourism. 20(2). pp.179-193.
Schermerhorn, J. and et. al., 2014. Management: Foundations and Applications (2nd Asia-
Pacific Edition). John Wiley & Sons.
Storey, D.J. and Greene, F.J., 2010. Small business and entrepreneurship. Financial
Times/Prentice Hall.
Wagener, S., Gorgievski, M. and Rijsdijk, S., 2010. Businessman or host? Individual differences
between entrepreneurs and small business owners in the hospitality industry. The
Service Industries Journal. 30(9). pp.1513-1527.
Online
Business Plan, 2018. [Online]. Available through:
<https://www.investopedia.com/terms/b/business-plan.asp>.
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