Business Planning and Entrepreneurship

This assignment covers various topics related to business planning and entrepreneurship, including writing a business plan, starting new small business institute programs, community sustainability plans, business model innovation, and more. It provides a comprehensive overview of the subject matter, with relevant information from academic sources and real-world examples.

Running head: MANAGING INTERNATIONAL BUSINESS
Managing international business
Name of the student
Name of the university
Student ID
Author note

1MANAGING INTERNATIONAL BUSINESS
Table of Contents
1
.Executive summary...................................................................................................................2
2. The business concept..............................................................................................................3
2.1 Description of Franchise and its unique selling...............................................................3
2.2 Goals and Potentials of Franchise at Our Tampines Hub................................................4
3. Research and analysis............................................................................................................5
3.1 Target market and their needs..........................................................................................5
3.2 Market size and the trends based on research data..........................................................5
3.3 SWOT analysis.................................................................................................................6
4. Marketing plan formulation...................................................................................................7
4.1 Pricing Strategy................................................................................................................7
4.2 Promotional activities.......................................................................................................8
5. Management / Organization design.......................................................................................9
5.1 Legal obligation...............................................................................................................9
5.2 Requirement of personnel................................................................................................9
6. Financial analysis.................................................................................................................10
6.1.1 Income statement........................................................................................................10
6.1.2 Cash flow....................................................................................................................11
6.1.3 Balance sheet...............................................................................................................13
6.2 Break – Even analysis....................................................................................................13
7. Investment analysis..............................................................................................................15
7.1 Sources of capital...........................................................................................................15

2MANAGING INTERNATIONAL BUSINESS
7.2 Expected financial returns..............................................................................................15
8. Critical risks analysis...........................................................................................................16
8.1 Potential risks of setting up at ‘Our Tampines Hub’......................................................16
8.2 Alternative course of action...........................................................................................17
Reference and Bibliography.....................................................................................................18

3MANAGING INTERNATIONAL BUSINESS
1. Executive summary
Te main objective of this business plan is to discuss the opening of franchise for Our
Tampines Hub at Jorung East of Singapore for the Angel Investors for investing in the
project. Various facilities that will be provided by the hub as same as the services that are
already provided by Our Tampines Hub are - open reception plan and the public place that
will include workstations, versatile meeting rooms and public hall, children’s play area,
nursery and day care area, wellbeing and health areas. The mission of the franchise will be to
offer high quality life to the residents of Tampines as well as Juron East. It will further enable
them to achieve the educational, social and economic goals and to be part of the caring,
prosperous and strong local community. There will be generally three groups of customers
from the locality of Tampines and Jurong East. They are – School students, children and
young group, adults and families and corporate, clubs and organizations. It is expected that
the growing trends of community hub will become a high and lucrative demand for the
residents in that area. This approach is also welcomed by the council as it is expected to
improve the life standards of the residents. The total funds required for starting up the
business will be $ 446,050. Out of the total requirement 44% of total fund will be raised
through equity and 56% will be raised through debt.

4MANAGING INTERNATIONAL BUSINESS
2. The business concept
Our Tampines Hub is the 1st ever integrated lifestyle and community hub in
Singapore. It brings together various agencies and provides wide ranges of diverse and
comprehensive service, facilities and programmes. The project is headed by the association of
people and it is located at the former Tampines Sports Hall and Tampines Stadium. The
residents from Tampines can enjoy various sports facilities, countless amenities and
programmes associated with community club, art facilities, retail shops and hawker centre.
The Tampines Hub project is actually designed for the residents, by the residents. The hub
received BCA Green Park Millenium award from owing to their efforts for promotion of the
eco-friendly habits. However, owing to the grand success of the hub, the management is
planning for a new development and it will inject the vibrancy to town. It is planned for
opening the franchise business of Our Tampines Hub that will be opened in the location of
Jurong East of Singapore as the area is developing fast with various facilities (Our Tampines
Hub - Community-lifestyle-hub, 2018).
2.1 Description of Franchise and its unique selling
The franchise hub of Our Tampines Hub will be registered with the Local Government of
Singapore for the advantages of community. It is planning to be managed by community and
residents from Jurong East. Through the open meetings of the community it is planning to
engage wide range of community and voluntary groups that will be operated through Jurong
East (Units, 2014). Key features of the hub will be as follows –
 Any person can subscribe the share for becoming member
 Each shareholder will have the right of one vote irrespective of the size of holding
 No artificial restrictions will be there for membership
 It can borrow capital through loans, grants or share issue.
 The management will publish the financial reports annually
 The management committee will be headed by at least 3 members
 The management will hold AGN in each year for selecting the committee and
conducting various businesses (Blank, 2013).
The hub will be designed by the top class architects for achieving highest level of
environmental standard through usage of the modern techniques of buildings and improving
the stock and ranges of various public amenities in the locality (Ward, 2016). Various

5MANAGING INTERNATIONAL BUSINESS
facilities that will be provided by the hub as same as the services that are already provided by
Our Tampines Hub are as follows –
 Open reception plan and the public place that will include workstations
 Versatile meeting rooms and public hall
 Children’s play area, nursery and day care area
 Recreational and activity space
 Ancillary storages and toilets
 Wellbeing and health areas
 Environment friendly surface with grass-crete for Parking of 50 cars
In addition to those mentioned above, it will make improvements and changes that will
include –
 Consultation booth for confidential discussions
 Security arrangements and general access
 Enhanced provision for special needs of the people those are facing physical
disabilities and learning challenges
Further, the unique service that will be provided is that there will be informal chat of 30
minutes with the lifestyle advisor regarding the changes that can improve the lifestyle of the
person. Further, the advisor will answer the questions that may be raised by the member
regarding the issues faced by him (Bryman & Bell, 2015). The advisor will not tell the
member what to do rather they will work on the suggestions that will be provided by the
member. It will also provide unique appointment style like walk and talk under which the
member and advisor will have a walk and discuss the issues instead of discussing in sitting in
office.
2.2 Goals and Potentials of Franchise at Our Tampines Hub
The vision of the franchise will be to offer high quality life to the residents of Tampines as
well as Juron East. It will further enable them to achieve the educational, social and economic
goals and to be part of the caring, prosperous and strong local community. To achieve its
vision it will try to achieve the following mission –
 Manage the community building that will deliver high quality facilities and wide
range of activities that will be accessible for all the sectors of local community.

6MANAGING INTERNATIONAL BUSINESS
 Update and develop the hub on continuous basis for meeting the changes in
expectations and requirements of the community
 Developing activities that will increase the participation in the civic life that will
include providing services to the local residents with the opportunities of
volunteering, self-development and the involvement in making of local decisions.
3. Research and analysis
3.1 Target market and their needs
There will be generally three groups of customers from the locality of Tampines and Jurong
East. They are –
 School students, children and young group – engaging with the providers of local
schools, children’s service and special requirements will develop the programmes that
will fulfil the demand of the residents and will strengthen the links and engagement of
youth leaders.
 Adults and families – with efficient programming and marketing sales in the hub, it is
likely to enhance the services. It will further bring the adults and families into the hub
and will provide positive influence for accelerating the influx (Council, 2014).
 Corporate, clubs and organizations – information from the Our Tampines Hub
demonstrated how Jurong East and other surroundings will be benefitted from
opening of franchise of the hub. It is further required to mention that the growth in
new hub business and innovation centres in that area will provide opportunities to the
local enterprises and companies for taking up new commercial opportunities (Finch,
2016).
3.2 Market size and the trends based on research data
As per the market research it is projected that there will be significant development in the
community hub and lifestyle business on continuous basis. Therefore, the demand for good
services and facilities will continue to grow (McKeever, 2016). It will further drive the
demand for wellbeing and health services, leisure, childcare services, social and family
activities and nursery provisions. It is expected that the growing trends of community hub
will become a high and lucrative demand for the residents in that area. This approach is also
welcomed by the council as it is expected to improve the life standards of the residents.

7MANAGING INTERNATIONAL BUSINESS
3.3 SWOT analysis
Taking into consideration the above factors the business plan reviewed the external
(opportunities and threats) and internal (strengths and weaknesses) factors that will dive the
plan are as follows –
Strength –
Various strengths of this business plan will be –
 Experience – multi-award winning Our Tampines Hub’s extensive and community
experience will be used for this franchise to maintain and deliver dynamic facilities
and programmes that will be capable to engage all the members from Tampines and
local community (Kruijsen, Owen & Boyd, 2014).
 Sustainability – the hub will be developed and created based on the principles of
sustainable and strong management proposition
 Networks and involvement of stakeholders - strength of combined support networks
that are already available with Our Tampines Hub will assist in establishing strong
network which in turn will involve the stakeholders and the members.
Weaknesses –
On the contrary, the management have to overcome the following weaknesses –
 Lack of resources – available resources to the hub will be difficult to accumulate.
Therefore, in absence of sufficient resources the project planning and conception may
get hampered.
 Lack of awareness – local community may become distant from project. The reason
behind this is that previously they were involved in various consultations which in
turn may make them disengaged and weary (Simpson, 2014).
 Access to the information regarding present market – as there is regular changes and
updates in the demand and the available data regarding demand and risks are
historical, the management may not be able to plan based on current demand criteria.
 Lack of business and commercial expertise – requirements of the project for it to be
sustainable financially is accessing of the full capital. It will require the business to
adopt the commercial outlook for balancing the social demands.
Opportunities –

8MANAGING INTERNATIONAL BUSINESS
 Efficiencies in accessing the funds and supports – as the Our Tampines Hub already
achieved huge success in Tampine area, it will be efficient for the franchise business
to access supports and funds
 Targeted funding – there is opportunity for initiating various social action related
projects that is linked to sales plan that will attract the resources from third party
either towards infrastructure or funding posts (Harada, Yagi & Sashida, 2013).
 Design facilities as per the requirements – it will provide flexibility through the early
agreement and development of business plan and it will allow the potential voluntary
and commercial partners to influence the building’s internal design. It will further
bring the additional resources and funding for the project for maximising the
efficiency and effectiveness (Leigh & Blakely, 2016).
 Changing demographics – growing population and start of new projects like high
speed rail and various other services will provide social as well as commercial
opportunities in sector of hospitality, well being, childcare and exercise.
Threats –
 Resident engagement – the local community are not able to embrace the project
 Enhancing the cost of capital – as the construction costs are increasing rapidly, it may
reduce the scope and scale of facilities if any unforeseen delays take place (Botha &
Robertson, 2014).
4. Marketing plan formulation
4.1 Pricing Strategy
Pricing schedule of the hub will be as follows –
Deluxe room Luxury room Classic room Garden area
Hiring of hall $ 150 $ 130 $ 100 $ 180
Hiring of meeting
room
$ 90 $ 75 $ 65 $ 100
Hiring of event space On request $ 35 per hour On request $ 40 per hour
Exercise classes N/A $ 100 per month N/A
The charges will be reasonable with excellent value and will allow the target group to receive
the facilities on continuous basis. Detailed price range for full range of the activities and
facilities will be confirmed once the final facilities and programme are confirmed.

9MANAGING INTERNATIONAL BUSINESS
Subsidised activities and reduced rates will also be provided with the principle of the hub.
The commercial lets and hires rates will be competitive in the market and will be subject to
booking nature. The pricing strategy of the company is expected to represent competitive
value on the basis of the range and quality of the available facilities. Further, it seeks the
commercial partner for running wide range of services that will include exercise classes,
nursery classes and classes for disable children. Further, the pricing may be required to be
more flexible for maximising the overall revenues. This will involve the premiere pricing
under which the packages will be provided in discounted price if chances are there to earn
additional revenues. The cancellation policies and the policies associated with administration
charge and late payment will be developed in next 6 months period after consultation with the
management and finance department.
4.2 Promotional activities
The promotion will be done on two aspects. These are –
1. Raising interests and awareness in new hub – new volunteers will be recruited for
procuring new services. They will communicate with the local community and
communities from Tampians and analyse their expectation and aspirations taking into
consideration the services that are projected to be offered. The principle for awareness
is repeating the message constantly. Therefore, with the assistance of the steering
member group it will create the positive approach for using the activities for
generating every opportunity. It will further establish the positive relationship with the
the media like television, radio and local newspaper to identify their stories for good
causes.
2. On-going marketing for the hub – the on-going sales and promotional plan for new
franchise of Out Tampines Hub will be prepared 3 months prior to the starting of the
hub. It will reflect the specification and final mix of the facilities and will confirm the
activities for the programme. The on-going marketing will include the following –
 Offer free exercise classes and workshops – initially the members registered for the
exercise classes will get 10 days free subscription with one month subscription.
Further, 10% discount will be allowed on booking the meeting hall, event space.
 Join with the Our Tampines Hub for generating customer demand – members
registered with Our Tampines Hub will get 5% discount for using services from the
franchise hub.

10MANAGING INTERNATIONAL BUSINESS
5. Management / Organization design
5.1 Legal obligation
The new franchise will required to be registered with the company registrar in Singapore with
the following details –
 Name of the business
 Description of the business activities
 Details of shareholders with their shareholding percentage
 Name of the directors
 Particulars regarding the company secretary
 Memorandum and the articles of association (Brinckmann & Kim, 2015).
Further, the franchise will be bound by the following commercial law for carrying out the
business –
 Law of contract
 Competition law
 Forms of business organizations
 Singapore income taxation
 Insurance law
Further, the franchise is legally bound to pay 5% of the sales as royalty to the Our Tampines
Hub as per the contract (Burns, 2016). Moreover, both the parties are required to go through
the contract terms and clauses before starting up as the franchise.
5.2 Requirement of personnel
The business will recruit employees from local community as they have better knowledge
regarding the priority and expectation of the local community (Massa & Tucci, 2013). Other
people will be recruited from voluntary groups. The required personnel will be as follows –
 The accountant – 2
 Direct employees for maintaining the hub – 80 (including the employees for
supervising, cleaning and maintaining)
 Management level – 10 (including the directors, executives, secretary)

11MANAGING INTERNATIONAL BUSINESS
In addition to the above mentioned people for growing affordably and quickly the hub will
require various 3rd party collaborations where the commercial acumen and specialism will
enable the business to get faster and greater returns. Depending only on in house staffs can be
time consuming and expensive owing to the training and recruitment cost (Schaper et al.,
2014).

Running head: MANAGING INTERNATIONAL BUSINESS
6. Financial analysis
6.1.1 Income statement
Particular
s
1st Year 2nd Year 3rd Year
Jan Feb Mar April May June July Aug Sept Oct Nov Dec
1st
Qrtr
2nd
Qrtr
3rd
Qrtr
4th
Qrtr
1st
Qrtr
2nd
Qrtr
3rd
Qrtr
4th
Qrtr
Sales
$
-
$
45,000
$
62,000
$
75,000
$
72,000
$
67,000
$
75,000
$
78,00
0
$
68,000
$
76,000
$
71,000
$
78,000
$
3,20,00
0
$
3,40,00
0
$
3,80,00
0
$
4,20,00
0
$
5,40,00
0
$
5,80,00
0
$
6,20,00
0
$
6,50,00
0
(-) Cost of
goods sold
$
-
$
27,000
$
37,200
$
45,000
$
43,200
$
40,200
$
45,000
$
46,80
0
$
40,800
$
45,600
$
42,600
$
46,800
$
1,92,00
0
$
2,04,00
0
$
2,28,00
0
$
2,52,00
0
$
3,24,00
0
$
3,48,00
0
$
3,72,00
0
$
3,90,00
0
Gross
profit
$
-
$
18,000
$
24,800
$
30,000
$
28,800
$
26,800
$
30,000
$
31,20
0
$
27,200
$
30,400
$
28,400
$
31,200
$
1,28,00
0
$
1,36,00
0
$
1,52,00
0
$
1,68,00
0
$
2,16,00
0
$
2,32,00
0
$
2,48,00
0
$
2,60,00
0
Less:
Expenses
Account
ants fees
$
500
$
500
$
500
$
500
$
500
$
500
$
500
$
500
$
500
$
500
$
500
$
500
$
1,800
$
1,800
$
1,800
$
1,800
$
2,100
$
2,100
$
2,100
$
2,100
Advertis
ing and
marketing
$
2,000
$
1,500
$
1,200
$
1,200
$
1,100
$
800
$
800
$
700
$
500
$
600
$
500
$
600
$
1,200
$
1,100
$
700
$
800
$
700
$
600
$
500
$
600
Bank
fees and
charges
$
-
$
-
$
-
$
-
$
-
$
-
$
300
$
-
$
-
$
300
$
-
$
-
$
450
$
450
$
450
$
450
$
600
$
600
$
600
$
600
Deprecia
tion
$
1,750
$
1,750
$
1,750
$
1,750
$
1,750
$
1,750
$
1,750
$
1,750
$
1,750
$
1,750
$
1,750
$
1,750
$
1,750
$
5,250
$
5,250
$
5,250
$
5,250
$
6,000
$
6,000
$
6,000
Licensin
g fees
$
15,000
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
Franchis
e royalty $
-
$
2,250
$
3,100
$
3,750
$
3,600
$
3,350
$
3,750
$
3,900
$
3,400
$
3,800
$
3,550
$
3,900
$
16,000
$
17,000
$
19,000
$
21,000
$
27,000
$
29,000
$
31,000
$
32,500
Utilities $
600
$
600
$
600
$
600
$
600
$
600
$
600
$
600
$
600
$
600
$
600
$
600
$
1,800
$
1,800
$
1,800
$
1,800
$
1,800
$
1,800
$
1,800
$
1,800
Telepho
ne charges
$
60
$
70
$
50
$
55
$
65
$
75
$
80
$
60
$
55
$
50
$
60
$
70
$
240
$
280
$
250
$
290
$
310
$
280
$
270
$
300
Loan
repayments $
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
5,000
$
5,000
$
5,000
$
5,000
$
7,500
$
7,500
$
7,500
$
7,500
Rent and
rates
$
9,000
$
9,000
$
9,000
$
9,000
$
9,000
$
9,000
$
9,000
$
9,000
$
9,000
$
9,000
$
9,000
$
9,000
$
27,000
$
27,000
$
27,000
$
27,000
$
27,000
$
27,000
$
27,000
$
27,000
Renovati
on cost
$
7,800
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
8,500
$
-
$
-
$
-
$
10,000
$
-
$
-
$
-
Stationar
y and
printing
$
100
$
90
$
80
$
110
$
120
$
90
$
110
$
100
$
110
$
120
$
130
$
120
$
340
$
370
$
320
$
330
$
340
$
360
$
310
$
350
Salaries
and wages
$
10,000
$
10,000
$
10,000
$
10,000
$
10,000
$
10,000
$
10,000
$
10,00
0
$
10,000
$
10,000
$
10,000
$
10,000
$
36,000
$
36,000
$
36,000
$
36,000
$
42,000
$
42,000
$
42,000
$
42,000
Recruitme
nt and
training
$
10,000
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
7,500
$
-
$
-
$
-
$
8,000
$
-
$
-
$
-
Insuranc
e
$
2,500
$
-
$
-
$
2,500
$
-
$
-
$
2,500
$
-
$
-
$
2,500
$
-
$
-
$
3,500
$
3,500
$
3,500
$
3,500
$
4,200
$
4,200
$
4,200
$
4,200
Total
Expenses
$
59,310
$
25,760
$
26,280
$
29,465
$
26,735
$
26,165
$
29,390
$
26,61
0
$
25,915
$
29,220
$
26,090
$
26,540
$
1,11,08
0
$
99,550
$
1,01,07
0
$
1,03,22
0
$
1,36,80
0
$
1,21,44
0
$
1,23,28
0
$
1,24,95
0
Profit
before
taxes
$ -
59,310
$ -
7,760
$ -
1,480
$
535
$
2,065
$
635
$
610
$
4,590
$
1,285
$
1,180
$
2,310
$
4,660
$
16,920
$
36,450
$
50,930
$
64,780
$
79,200
$
1,10,56
0
$
1,24,72
0
$
1,35,05
0
Taxes paid
@ 30%
$
-
$
-
$
-
$
161
$
620
$
191
$
183
$
1,377
$
386
$
354
$
693
$
1,398
$
5,076
$
10,935
$
15,279
$
19,434
$
23,760
$
33,168
$
37,416
$
40,515
Net Profit
after tax
$ -
59,310
$ -
7,760
$ -
1,480
$
375
$
1,446
$
445
$
427
$
3,213
$
900
$
826
$
1,617
$
3,262
$
11,844
$
25,515
$
35,651
$
45,346
$
55,440
$
77,392
$
87,304
$
94,535

11MANAGING INTERNATIONAL BUSINESS
6.1.2 Cash flow
Cash flow forecast
1st Year 2nd Year 3rd Year
Particular
s
1st
Qrtr
2nd
Qrtr
3rd
Qrtr
4th
Qrtr
1st
Qrtr
2nd
Qrtr
3rd
Qrtr
4th
Qrtr
1st
Qrtr
2nd
Qrtr
3rd
Qrtr
4th
Qrtr
OPENIN
G
BALANC
E
$
20,000.
00
$
15,650.
00
$
1,46,31
4.50
$
2,83,45
4.00
$
4,18,45
4.00
$
6,22,29
8.00
$
8,51,81
3.00
$
11,15,4
64.00
$
14,12,8
10.00
$
17,92,2
50.00
$
22,17,6
42.00
$
26,76,9
46.00
Cash
incoming
Sales
$
1,07,00
0.00
$
2,14,00
0.00
$
2,21,00
0.00
$
2,25,00
0.00
$
3,20,00
0
$
3,40,00
0
$
3,80,00
0
$
4,20,00
0
$
5,40,00
0
$
5,80,00
0
$
6,20,00
0
$
6,50,00
0
Total
incoming
$
1,07,00
0.00
$
2,14,00
0.00
$
2,21,00
0.00
$
2,25,00
0.00
$
3,20,00
0.00
$
3,40,00
0.00
$
3,80,00
0.00
$
4,20,00
0.00
$
5,40,00
0.00
$
5,80,00
0.00
$
6,20,00
0.00
$
6,50,00
0.00
Cash
outgoing
Account
ants fees
$
1,500.0
0
$
1,500.0
0
$
1,500.0
0
$
1,500.0
0
$
1,800
$
1,800
$
1,800
$
1,800
$
2,100
$
2,100
$
2,100
$
2,100
Advertis
ing and
marketing
$
4,700.0
0
$
3,100.0
0
$
2,000.0
0
$
1,700.0
0
$
1,200
$
1,100
$
700
$
800
$
700
$
600
$
500
$
600
Bank
fees and
charges
$
-
$
-
$
300.00
$
300.00
$
450
$
450
$
450
$
450
$
600
$
600
$
600
$
600
Deprecia
tion
$
5,250.0
0
$
5,250.0
0
$
5,250.0
0
$
5,250.0
0
$
1,750
$
5,250
$
5,250
$
5,250
$
5,250
$
6,000
$
6,000
$
6,000
Licensin
g fees
$
15,000.
00
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
Franchis
e royalty
$
5,350.0
0
$
10,700.
00
$
11,050.
00
$
11,250.
00
$
16,000
$
17,000
$
19,000
$
21,000
$
27,000
$
29,000
$
31,000
$
32,500
Utilities $
1,800.0
0
$
1,800.0
0
$
1,800.0
0
$
1,800.0
0
$
1,800
$
1,800
$
1,800
$
1,800
$
1,800
$
1,800
$
1,800
$
1,800
Telepho
ne charges
$
180.00
$
195.00
$
195.00
$
180.00
$
240
$
280
$
250
$
290
$
310
$
280
$
270
$
300
Loan
repayments
$
-
$
-
$
-
$
-
$
5,000
$
5,000
$
5,000
$
5,000
$
7,500
$
7,500
$
7,500
$
7,500
Rent and
rates
$
27,000.
00
$
27,000.
00
$
27,000.
00
$
27,000.
00
$
27,000
$
27,000
$
27,000
$
27,000
$
27,000
$
27,000
$
27,000
$
27,000
Renovati
on cost
$
7,800.0
0
$
-
$
-
$
-
$
8,500
$
-
$
-
$
-
$
10,000
$
-
$
-
$
-
Stationar
y and
printing
$
270.00
$
320.00
$
320.00
$
370.00
$
340
$
370
$
320
$
330
$
340
$
360
$
310
$
350

12MANAGING INTERNATIONAL BUSINESS
Salaries
and wages
$
30,000.
00
$
30,000.
00
$
30,000.
00
$
30,000.
00
$
36,000
$
36,000
$
36,000
$
36,000
$
42,000
$
42,000
$
42,000
$
42,000
Recruitme
nt and
training
$
10,000.
00
$
-
$
-
$
-
$
7,500
$
-
$
-
$
-
$
8,000
$
-
$
-
$
-
Insuranc
e
$
2,500.0
0
$
2,500.0
0
$
2,500.0
0
$
2,500.0
0
$
3,500
$
3,500
$
3,500
$
3,500
$
4,200
$
4,200
$
4,200
$
4,200
Income tax
$
-
$
970.50
$
1,945.5
0
$
8,150.0
0
$
5,076.0
0
$
10,935.
00
$
15,279.
00
$
19,434.
00
$
23,760.
00
$
33,168.
00
$
37,416.
00
$
40,515.
00
Total
outgoing
$
1,11,35
0.00
$
83,335.
50
$
83,860.
50
$
90,000.
00
$
1,16,15
6.00
$
1,10,48
5.00
$
1,16,34
9.00
$
1,22,65
4.00
$
1,60,56
0.00
$
1,54,60
8.00
$
1,60,69
6.00
$
1,65,46
5.00
Monthly
cash
balance
$
-
4,350.0
0
$
1,30,66
4.50
$
1,37,13
9.50
$
1,35,00
0.00
$
2,03,84
4.00
$
2,29,51
5.00
$
2,63,65
1.00
$
2,97,34
6.00
$
3,79,44
0.00
$
4,25,39
2.00
$
4,59,30
4.00
$
4,84,53
5.00
CLOSING
BALANC
E
$
15,650.
00
$
1,46,31
4.50
$
2,83,45
4.00
$
4,18,45
4.00
$
6,22,29
8.00
$
8,51,81
3.00
$
11,15,4
64.00
$
14,12,8
10.00
$
17,92,2
50.00
$
22,17,6
42.00
$
26,76,9
46.00
$
31,61,4
81.00

Running head: MANAGING INTERNATIONAL BUSINESS
6.1.3 Balance sheet
Balance sheet forecast
Particulars 1st Year 2nd Year 3rd Year
Current assets
Cash $ 4,18,454.00 $ 14,12,810.00 $ 31,61,481.00
Accounts receivables $ 1,53,500.00 $ 1,20,000.00 $ 2,10,000.00
Inventory $ 39,101.00 $ 42,000.00 $ 65,000.00
Total current assets $ 6,11,055.00 $ 15,74,810.00 $ 34,36,481.00
Non-current assets
Plant, property & equipment $ 50,000.00 $ 50,000.00 $ 45,000.00
Land and building $ 40,000.00 $ 40,000.00 $ 45,000.00
Furniture & fittings $ 5,000.00 $ 5,000.00 $ 15,000.00
Computer equipment $ 10,000.00 $ 10,000.00 $ 15,000.00
Total non-current assets $ 1,05,000.00 $ 1,05,000.00 $ 1,20,000.00
Total assets $ 7,16,055.00 $ 16,79,810.00 $ 35,56,481.00
Current/short-term
liabilities
Accounts payable $ 1,50,000.00 $ 5,80,000.00 $ 15,00,000.00
Bank charges payable $ 90,000.00 $ 2,10,000.00 $ 3,20,000.00
Interest payable $ 40,000.00 $ 53,404.00 $ 75,000.00
Accrued wages $ 35,000.00 $ 52,000.00 $ 85,000.00
Income tax $ 11,046.00 $ 20,000.00 $ 75,000.00
Total current liabilities $ 3,26,046.00 $ 9,15,404.00 $ 20,55,000.00
Long-term liabilities
Borrowings $ 2,50,000.00 $ 3,50,000.00 $ 7,50,000.00
Total liabilities $ 5,76,046.00 $ 12,65,404.00 $ 28,05,000.00
Owner's equity
Issued capital $ 1,76,050.00 $ 1,76,050.00 $ 2,36,810.00
Shareholder's equity $ 20,000.00 $ 1,20,000.00 $ 2,00,000.00
Retained earnings $ -56,041.00 $ 1,18,356.00 $ 3,14,671.00
Total equity $ 1,40,009.00 $ 4,14,406.00 $ 7,51,481.00
Total liabilities and equity $ 7,16,055.00 $ 16,79,810.00 $ 35,56,481.00
6.2 Break – Even analysis
Break -even analysis
Timeframe (e.g. monthly/yearly)
Average price of each product/service sold $ 1,800.00
Average cost of each product/service to make/deliver $ 1,100.00
Fixed costs for the month/year $ 2,10,000.00
Profit percentage $ 0.39
Total sales needed to break-even $ 5,40,000.00
Number of units sold needed to break-even 300

14MANAGING INTERNATIONAL BUSINESS
Break even calculation
Sales level 100 unit 300 unit 500 unit
Sales revenue $ 1,80,000.00 $ 5,40,000.00 $ 9,00,000.00
Variable cost $ 1,10,000.00 $ 3,30,000.00 $ 5,50,000.00
Fixed cost $ 2,10,000.00 $ 2,10,000.00 $ 2,10,000.00
Total cost $ 3,20,000.00 $ 5,40,000.00 $ 7,60,000.00
Profit $ -1,40,000.00 $ - $ 1,40,000.00
100 unit 300 unit 500 unit
0
100000
200000
300000
400000
500000
600000
700000
800000
900000
1000000
180000
540000
900000
320000
540000
760000
Break even analysis
Sales revenue
Total cost

15MANAGING INTERNATIONAL BUSINESS
7. Investment analysis
7.1 Sources of capital
Equity $ 196,050.00
Debt $ 250,000.00
Total $ 446,050.00
Percentage of equity 44%
Percentage of debt 56%
It can be seen from the above table that the total funds required for starting up the business
is $ 446,050. Out of the total requirement $ 20,000 will be contributed by the owners, $
176,050 will be raised from issuing the shares and rest $ 250,000 will be raised through
long-term debt. Therefore, 44% of total fund will be raised through equity and 56% will be
raised through debt (Gatti, 2013).
7.2 Expected financial returns
Valuation of the firm –
Weighted average cost of capital –
E = funding from equity = $ 196,050
D = Funding from debt = $ 250,000
V = E + D = $ 446,050
WACC = (E/V)*Re + (D/V)*Rd (1-t) (Brusov, Filatova & Orekhova, 2013)
Where, E/V = weight of equity = 0.44
Re = cost of equity = 0.08
D/V = weight of debt = 0.56
Rd = cost of debt = 0.04
T = tax rate = 0.17
WACC = (0.44*0.08) + [(0.56*0.04)*(1-0.17)

16MANAGING INTERNATIONAL BUSINESS
WACC = 0.054 = 5.4%
Calculation of NPV –
Year Cash flow DCF @ 8% NPV
0 $ -446,050.00 1 $ (446,050.00)
1 $ 418,454.00 0.9434 $ 394,769.50
2 $ 1,412,810.00 0.89 $ 1,257,400.90
3 $ 3,161,481.00 0.8396 $ 2,654,379.45
NPV $ 3,860,499.85
As the project is giving positive cash inflow amounting to $ 38,60,499.85, the project shall
be accepted.
Calculation of IRR –
IRR = 189% (as per calculation in excel)
7.3 capital requirement from Angel Investor
Total 44% of the requirements will be raised through equity. Out of the which, $ 20,000
will be contributed by the owners and $ 176,050 will be raised from issuing the shares to
Angel Investors (Brusov, Filatova & Orekhova, 2014). Therefore, percentage of
shareholding offered will be = (176,060/196,050*100) = 89.80%.
8. Critical risks analysis
8.1 Potential risks of setting up at ‘Our Tampines Hub’
Various potential risks are there with regard to setting up of the franchise at Our Tampines
Hub. These are –
 The franchise may not understand the legal structure of setting up the franchise
which in turn may lead to unintended liabilities.

17MANAGING INTERNATIONAL BUSINESS
 The franchise may not be able to secure the advance booking as well as revenues as
the residents from Tampines may not wish to take the membership from the
franchise and may wish to continue with the membership of Our Tampines Hub.
 As it is the franchise of Our Tampines Hub, the expectation of the community from
the franchise will be of the same level as the Our Tampines Hub. Therefore, the
facilities may not meet the expectation of the community (Brinckmann & Kim,
2015).
 Negative impacts from the community may lead to additional costs and lack of
access to the grants and funding.
8.2 Alternative course of action
The company planned some alternative course of action to mitigate the above mentioned
risks. These are –
 One lawyer will be hired who will manage all the legal matters and who will
provide legal guidance to the management. He will further provide the guidance
regarding the consequences so that the actions can be taken at initial level
 For securing advance bookings as well as revenues the management will carry out
researches regarding the preference and demands of the community. For this
purpose, few employees will be fully engaged to communicate with the
community.
 For minimising the negative impacts, the franchise will establish sound policies
regarding management of the environment and will work with the construction
partners and architects for improving the building structure.
 Apart from above all these, 10 employees will be there who will be engaged to look
after the issues of the members and solve it as early as possible. Further, there will
be 24*7 help line desk where the people can communicate regarding their issues.

18MANAGING INTERNATIONAL BUSINESS
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