Cash Flow Statement Analysis

This assignment provides a detailed cash flow statement for a business over four years. It breaks down the statement into three categories: operating, investing, and financing activities. The analysis highlights changes in cash balance, sources of funding, and uses of cash throughout the period. Students are expected to interpret the data and draw conclusions about the company's financial health and performance.

BUSINESS PLAN FOR
SUMMER FESTIVAL

Table of Contents
MAIN BODY...................................................................................................................................1
Business Plan: Part 1........................................................................................................................1
Nature of the business.................................................................................................................1
Stating USP and explaining why business would have a competitive edge...............................1
What type of formation is chosen for business and outlining business model...........................1
Identifying existing competitors.................................................................................................1
Using UK and local statistical data and assessing demand or market for your service..............2
Business Plan: Part 2........................................................................................................................2
Applying McCarthy’s 4Ps and relevant models..........................................................................2
Explaining job roles assigned to employees...............................................................................3
Discussing advantages & disadvantages of having Zero-hour contract workers and Agency
staff..............................................................................................................................................4
Identifying customer target market and customer cohorts..........................................................5
Business Plan: Part 3........................................................................................................................5
How business could expand in the future and listing strategies..................................................5
Financial Forecast.......................................................................................................................6
REFERENCES................................................................................................................................8

MAIN BODY
Business Plan: Part 1
Outlining Business Venture
Nature of the business
Reliable Events Ltd will be engaged in event planning business and would organise
summer festival held in UK. The business would be able to provide higher amount of satisfaction
to the people as they like summer festival a lot. This will enhance profits for the business and
will be able to establish a place in UK market.
Stating USP and explaining why business would have a competitive edge
USP of organisation is offering unique quality of event entertainment that the event
industry has to offer to attendees in the summer festival. Reliable Events Ltd will organise events
in a better manner by adhering artists' needs with much professionalism (Laakkonen, 2017). The
business would have a competitive advantage as it will be able to provide effective summer
festival which will offer customers with quality entertainment and that too at affordable prices in
the best manner possible.
Business Type
What type of formation is chosen for business and outlining business model
There are various business formation such as partnership, company, sole proprietorship
and many others. Business will choose company formation as it has many advantages. This is
evident from the fact that company is an artificial person which cannot die. Moreover, large
amount of funds can be gathered by arranging from borrowings, raising money from shares,
venture capital etc. Thus, direct sales business model will be applied as direct tickets will be sold
to customers (Piazza and et.al., 2018).
Research
Identifying existing competitors
The competition is fierce as event planning companies are AOK events, Ashfield
Meetings & Events, Banks Sadler and many more competitors leading to have immense
competition in the industry.
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Using UK and local statistical data and assessing demand or market for your service
It can be analysed from the data that UK events industry currently values 39.1 billion
pounds (New report values UK events industry at £39.1bn. 2018). This report shows that events
industry provides that economic growth of UK is effectively enhanced in a better manner. In
addition to this, festivals and cultural events values 1.1 billion pounds. Hence, Reliable Events
Ltd will be able to establish good position in the market and further desired profits would be
accomplished.
Business Plan: Part 2
Applying McCarthy’s 4Ps and relevant models
Place-
The place is one of the essential factor in marketing mix. Business requires to conduct
effective marketing research so that desired location could be chosen for starting operations in
the best manner possible. Reliable Events Ltd would be located in the heart of London city so
that people may easily visit in the summer festival event held in the country. It is required that
place chosen must provide better results, else cost maximises and output gets lower and as a
result, business face losses up to a high extent. It can be assessed that organisation would be able
to enhance its market position in the event industry by establishing well-mannered strategies.
Product-
The product is what business will sell to its potential customers to make them loyal by
increasing their satisfaction level up to a major extent. It can be evaluated that business would
organise summer festival in London which will be held annually in Mid-June. Apart from this,
round the year, music events, concerts would be organised so that customers would be satisfied
in the best manner possible. It is required that customers or festival lovers should be provided
with superior quality entertainment and as such, all efforts will be applied so that business may
be able to accomplish stated objectives in a better manner. Thus, it can be said that Reliable
Events Ltd will offer quality services to festival lovers and will attain desired revenue for
meeting its operating costs (Valente, 2017).
Price-
It is another important element in marketing mix as it provides clarity to customers as to
what they have to pay for availing services or products. Reliable Events Ltd will have to adapt
to proper pricing strategy as it is the main factor which attracts customers to avail services in the
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best manner possible. On the other hand, there are various pricing strategies such as price
skimming, penetrating strategy, cost-plus pricing being adopted by businesses. Cost-plus is basic
pricing which includes that costs are ascertained by organisation and certain profit mark up is
added to arrive at total price. While, price skimming means to offer services at higher costs than
they are and can be availed at low price. This strategy is usually adopted by well-reputed firms
which have good market share and hiking prices will not disband customers.
The penetrating pricing strategy is to set lower prices of commodities which is generally
lowly priced in comparison to competitors. Reliable Events Ltd will effectively use penetrating
pricing strategy so that business may be able to attract customers and market share will be gained
in a better manner. Hence, by applying such strategy for pricing, customer base will be made in
effective way.
Promotion-
Last part of marketing mix is to implement promotional techniques so that customers
would become aware of offerings by company in effective manner. It can be said that there are
various techniques for promoting business which can be used by organisation to attain maximum
promotion with ease (Weiler, 2017). In relation to this, social media marketing is one of the
modern and powerful tool available for marketing services by Reliable Events Ltd. The social
media channels such as Instagram, Facebook, Tumbler and Twitter are some of the channels
which will provide benefit to company in attaining desired level of promotions. The rationale
behind choosing social media as marketing tool is that it is cost-effective and time-saving.
Moreover, TV advertisements, magazines will be used as well for better impact on people.
Employees
Explaining job roles assigned to employees
Event Manager
The role of Event Manager of Reliable Events Ltd would be managing summer festivals
and other events from time-to-time in a better manner. He has the role for liaising with clients for
finding out their exact requirements. Produce detail proposal for events which includes venues,
legal obligations and budgets etc. Research for newer opportunities for enhancing client
requirements. Generate post-event evaluation for informing about future events quite effectually.
Event Coordinator-
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The duty and role of Event Coordinator of Reliable Events Ltd will be provide better
services to clients so that they may feel delighted in event. He has the role for controlling an
event right from its inception to clean up. This means that he has to efficient in performing his
role so that customers may feel satisfied and enjoy experiences quite effectually. He will usually
meet clients for working out plan, book locations, food, staff and clean up. Hence, Reliable
Events Ltd would generate desired profits since its inception.
Event Specialist-
The role of Event Specialist in Reliable Events Ltd is to serve as an event expert. To
effectively work closely with commodities and solutions managers for identifying content,
promotion and event logistics in effective manner. Moreover, he has the responsibility to manage
calendar for upcoming events, manage project timelines and producing event budget.
Discussing advantages & disadvantages of having Zero-hour contract workers and Agency staff
Zero-hour contract means temporary selection of employees on a contract basis. In
simple words, workers are employed for accomplishing particular work and are disbanded when
it gets completed (Suzuk. and et.al., 2018). It is useful for employers which have seasonal
business. When there is need of high demand, firm would recruit workers and in the absence of
work, no further cost of paying out salaries to employees prevails.
Advantages
 The biggest and important advantage of implementing zero-hour contract for firm is that
much flexibility is accomplished. This means that for attaining temporary need of
demand, firm could recruit employees quite effectually.
 It is advantageous to deal particularly in unforeseen event or to deal with sudden increase
in workload. This helps to overcome problems in effective manner. Moreover, it can be
analysed that no obligation is seen on both employers and employees as contract is on
temporary basis.
Disadvantages
 It is disadvantageous to employers as when people are not under any obligation, they will
not effectively work upon their duties and it would get difficult for setting priorities on
employees.
 In zero-hour contract, it is difficult for employers as to how it increase productivity in the
best possible manner as there are differences in quality of work and service delivery.
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Agency Staff
Advantages
 It is time-saving mechanism for both employees and employers as demand can be met by
employers by posting advertisement on agency staff which then revert back to employees
and they are hired.
 It is advantageous as employee's ability to work can be judged by the employers and then
final decision can be made either to hire candidate or not.
Disadvantages
 Main disadvantage of agency staff is risky for employer as temporary workers working
with permanent employee might develop resentment without providing them equal
benefits as provided to permanent workers.
 Legal issues are evolved as when employers place workers for a longer time period and
further, if they are not hired (Nielsen, 2017).
Customers
Identifying customer target market and customer cohorts
The target customers for accomplishing goals by Reliable Events Ltd will be between age
group of 20-45 males and females which are fond of summer festival and related enjoyable
events in effective manner. This will provide company with attainment of good customer base as
they will be able to enhance their satisfaction level up to a high extent. Target market on the
basis of age group will be provide immense satisfaction to public and they will become loyal to
firm quite effectively. Customer cohorts means instead of looking and gathering attention of
customer on individual basis, they can be placed into groups called cohorts. The persons should
share same yet distinguished characteristic from other person in the same cohort.
Business Plan: Part 3
How business could expand in the future and listing strategies
There are four growth strategies which could be implemented by Reliable Events Ltd in
the future-
Market Penetration-
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It is the market growth strategy in which firm seeks for higher volume of sales of existing
products in existing market so as to attain more amount of profits in the best manner possible
from present market and make customers loyal to it. Reliable Events Ltd will implement this
growth strategy for better profits.
Market Expansion-
In this, business aims for maximising its sales volume by exploring new markets for it so
that it may be able to satisfy more customers. Reliable Events Ltd could use this strategy by
expanding to Scotland, Wales and whole of UK.
Market development-
This is the strategy for developing new products for selling in existing markets only. Firm
could improve upon its services for maximising satisfaction of people (Talathi. 2018).
Diversification-
It is a growth strategy in which business provides wider range of products which are not
from its existing product portfolio and attain more profits. However, proper market research is
required to be conducted for attaining desired objectives.
Financial Forecast
Projected Cash flow statement
Particulars 2018 2019 2020 2021
Operating activities
Net Profit/ (Loss) 450000 500000 600000 700000
Adjustments accounted for
Depreciation 5000 10000 15000 20000
Trade Receivable
(lncrease)/Decrease -49385 -240000 -20000 -100000
Inventory
(lncrease)/Decrease 0 0 0 0
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Other current assets (CA)
(lncrease)/Decrease 0 0 0 0
Trade Payables
(lncrease)/Decrease 0 0 0 0
Other current liabilities (CL)
(lncrease)/Decrease 0 0 0 0
Cash flow from operating
activities 405615 270000 595000 620000
Investing activities
Bought Plant and Machinery -25000 -25000 -20000 -35000
Sold Plant and Machinery 0 0 0 0
Cash flow used in investing
activities -25000 -25000 -20000 -35000
Cash flow remaining for
financing activities 380615 245000 575000 585000
Financing activities
Long term debt
Changes observed in equity
part 400000 0 0 0
Cash flow from financing
activities 400000 0 0 0
Beginning cash balance 70000 50615 295615 870615
Increase/ (Decrease) in cash -19385 245000 575000 585000
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and cash equivalents
Ending cash balance 50615 295615 870615 1455615
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