Business Plan: Enterprise and Entrepreneurship for Music Label Records

This report presents a comprehensive business plan for Records, a music label startup focused on providing innovative music services. The plan details the company's target audience, which includes individual music producers and music production companies, and its unique selling proposition of creating unique trademarks and logos to establish a strong digital presence. The report includes an analysis of competitors, such as Parlophone Records and Island Records, and a skills assessment highlighting the importance of leadership, persuasion, and critical thinking. Financial aspects are covered with a profit and loss account, cash flow forecast, and a breakdown of start-up costs. Funding resources such as invoice factoring, venture capitalist financing, and loans from financial institutions are also explored. The business will operate as a limited company, utilizing environmental and quality management systems, with a vision to expand internationally and gain global recognition. The business plan emphasizes the importance of a well-structured approach to navigate the competitive music industry and achieve sustainable growth.

Enterprise and
Entrepreneurship

Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Proposed future business........................................................................................................1
Customers...............................................................................................................................1
Competitors............................................................................................................................2
Skills Analysis........................................................................................................................2
Profit and loss account and cash flow forecast.......................................................................3
Funding resources...................................................................................................................5
Breakdown of start-up costs...................................................................................................8
Type of organization and management information system..................................................9
Vision of the company............................................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Starting an enterprise is a complicated process, because it involves moving forward in an
uncertain environment and ensures optimal utilization of resources to gain initial success
which supports long term presence of the startup (Sohns and Diez, 2018) The current
competitive environment is the primary reason for failure of many start-ups. This increases the
importance of creating a detailed business plan which facilitates sustainable growth of the
company. This report includes a business plan for sustainable growth of the company created in
assignment 1. The company for which a business plan is created in this report is records. The
business plan includes information about the services offered by the company along with target
audience and main competitors. In addition to this, the start trip costs other financial aspects of
the company are also included in the business plan.
MAIN BODY
Proposed future business
The proposed business is of a recording label which proved provides consumers
innovative and entertaining music. The company will provide the consumers services through
which they can create specific and attractive trademarks, symbols, logo designs we tell them
reach their target audience and effectively sell entertaining music to gain profits.
Customers
Target Audience: Target audience of the company is music producers which includes
individual music producers and music producing companies, the firm will provide them services
of developing the suitable logo and trademark which helps them connect them today music
audience and establish a physical presence in the music industry. This target audience is
determined on the basis of behavioral segmentation. Behavioral segmentation involves dividing
consumers on the basis of their previous purchase decisions (Shan and et. al., 2018). The target
audience of the company is divided on the basis of their previous decisions do you need it too
feeling purchase of music stop. This is a suitable target market segment for records as they
require services to produce unique logos and trademarks for music items to reach specific
audiences.
1

End Users: The end users of the services provided by records are music producers
including music producing corporations and individual musicians who want to produce logo,
trademarks or symbols for this music to gain physical evidence of their music services.
USP: Records will produce unique trademark, symbols and logos for the consumer
which help them gain a unique identity in the music industry and reach the listeners for their
specific music genre through the symbolism. In addition to this, the logos and trademark will
also help the consumer establish their musical identity on digital channels such as social media
which is essential for gaining success in the music industry.
Evaluation of the business position: Currently because of lack of recognition in the
music industry the position of the start-up firm is low. The advantage of such unknown position
is that the company can introduce their innovative idea is that the firm will face less competition.
The disadvantage of this position is that the firm may face difficulties in attracting clients
(Shawl, 2020).
Competitors
Competitors Market share Competitive Edge of records
Parlophone records This is a major company in
UK music industry with
highest market share.
Records will offer clients ways to
establish themselves digitally through
a logo which is important in the
current industry.
Island Records The market share of Island
records is also high with
many international
musicians connected to the
firm.
The respective firm will gain
competitive advantage by providing
services for gaining international
recognition through the use of digital
symbols
Skills Analysis
The main skill needed for creating a successful startup is leadership skill. This is
because leadership skills help entrepreneurs build high performing team and unite every
individual in the company to focus on attainment of the business objectives (Haghighi,
Mahmoudi and Bijani, 2018). In case of the startup records, I have the leadership skills required
for creating a team which is able to deliver the clients high quality services in a timely manner to
2

gain competitive advantage what other homes and establish a good position in the cutthroat
music industry. Apart from this, persuasion skills are also needed to build a successful
enterprise. This is because persuasion skills help gain clients and attract investors. I have
effective persuasion skills which will help me persuade external parties including suppliers,
investors and clients stay with the company for long time period. This will support long-term
profitability of records. Critical thinking skills are essential for creating an enterprise because
they help find creative solutions for various challenges and take the company out of difficult
situations to increase survival of the firm in the industry (Neck and Corbett, 2018). There is skill
gap in relation to thigh level critical thinking. This skill gap will be addressed by learning about
logical reasoning and different thoughts of reading to ensure that I look at various statements and
situations from different perspective. This will support improvement in my critical thinking skill
as it will be able to understand line of reasoning proposed by others and develop sound logical
concussions on my own. Knowledge of logical reasoning is essential for critical thinking skills as
critical thinking is rooted in rationality and logical reasoning.
Profit and loss account and cash flow forecast
P&L account
in £ millions 12/31/2022 12/31/2021 (adjusted)
Assets
Non-current assets
Goodwill 8,537 8,427
Other intangible assets 2,436 2,590,
Property, plant and equipment
and right-of-use assets
2,935 1,670
Investments accounted for
using the equity method
652 658
Minority stakes and other
financial assets
1,320 1,143
Trade and other receivables 89 59
Other non-financial assets 922 851
Deferred tax assets 1,087 1,051
3

17,978 16,449
Current assets
Inventories 1,745 1,735
Trade and other receivables 4,523 4,443
Other financial assets 63 71
Other non-financial assets 1,092 1,002
Current income tax
receivables
178 156
Cash and cash equivalents 1,636 1,405
9,237 8,812
Assets held for sale 102 82
27,317 25,343
Equity and liabilities
Equity
Subscribed capital 1,000 1,000
Capital reserve 2,345 2,345
Retained earnings 5,509 5,129
Bertelsmann shareholders’
equity
8,854 8,474
Non-controlling interests 1,591 1,364
10,445 9,838
Non-current liabilities
Provisions for pensions and
similar obligations
1,967 1,738
Other provisions 178 135
Deferred tax liabilities 95 127
Profit participation capital 413 413
Financial debt 4,612 4,638
Lease liabilities 1,116 32
Trade and other payables 363 353
Other non-financial liabilities 379 395
4

9,123 7,831
Current liabilities
Other provisions 214 299
Financial debt 388 660
Lease liabilities 276 7
Trade and other payables 4,840 4,718
Other non-financial liabilities 1,908 1,839
Current income tax payables 78 88
7,704 7,611
Liabilities related to assets
held for sale
45 63
27,317 25,343
Cashflow
in £ millions 2020 2021
Group earnings before interest
and taxes
1,825 1,621
Taxes paid (424) (534)
Depreciation and write-ups of
non-current assets
1,118 855
Results from disposals of
investments
(90) (7)
Gains/losses from disposals of
non-current assets
(3) (62)
Change in provisions for
pensions and similar
obligations
(95) (113)
Change in other provisions (3) (20)
Change in net working capital (34) (178)
5

Fair value measurement of
investments
(143) (157)
Other effects (61) 32
Cash flow from operating
activities
2,090 1,437
– thereof discontinued
operations
– –
Investments in:
– intangible assets (313) (295)
– property, plant and
equipment
(323) (325)
– financial assets (317) (258)
– purchase prices for
consolidated investments (net
of acquired cash)
(317) (556)
Disposals of subsidiaries and
other business units
228 113
Disposals of other fixed assets 330 191
Cash flow from investing
activities
(712) (1,130)
– thereof discontinued
operations
1 1
Issues of bonds and
promissory notes
75 942
Redemption of bonds and
promissory notes
(309) (400)
Proceeds from/redemption of
other financial debt
(67) (160)
Redemption of lease liabilities (247) (8)
Interest paid (260) (196)
Interest received 25 27
6

Dividends to Bertelsmann
shareholders
(180) (180)
Dividends to non-controlling
interests and payments to
partners in partnerships
(263) (356)
Change in equity 81 (59)
Other effects 17 18
Cash flow from financing
activities
(1,128) (372)
– thereof discontinued
operations
– –
Change in cash and cash
equivalents
250 (65)
Exchange rate effects and
other changes in cash and cash
equivalents
(12) 28
Cash and cash equivalents on
1/1
1,405 1,442
Cash and cash equivalents on
12/31
1,643 1,405
Less cash and cash equivalents
included within assets held for
sale
(7) –
Cash and cash equivalents on
12/31 (according to the
consolidated balance sheet)
1,636 1,405
Funding resources
Invoice factoring: Thais source involves quick attainment of funds by unlocking funds
from pending invoices to cover operational expenses and exploiting growth opportunities.
7

Business firms sell their accounts receivables to invoice factoring company in return of cash.
Securing funding from invoice factoring is advantageous for the respective company because it
is not time taking and provides financial flexibility to records.
Venture capitalist financing: Venture capitalist financing is type of funding source which
is usually accessible to start-up business firms that offer high growth potential but also have high
risk associated (Warhuus, Blenker and Elmholdt, 2018). This type of financing is managed by a
venture capitalist fund and the money invested in small business firm is from institutions or high
net worth individuals. Records need to gain funding from venture capitalist because venture
capitalists will be able to provide accurate advice for moving forward with the start-up
enterprise.
Loan from financial institutions: This is one of the most commonly accessed funding
source by small business organisations as it is provided by financial institutions. This source of
funding is given by the bank to an enterprise which is repaid with interests typically in monthly
instalments. Loans gained through financial institutions can be short-terms and long-term
depending on the needs of the enterprise (Ndou, Mele and Del Vecchio, 2019). Records will be
able to gain required financial amount through this funding source.
Breakdown of start-up costs
Start-up expenses In £
Legal 1,000
Stationary 2,500
Brochures 5,000
Consultants 15,000
Insurance 250
Rent 500
R&D 1,000
Equipment 3,500
Other 5,000
Total 33,750
Start-up assets needed
Cost Balance on starting data 494,000
Other shirt-term assets 5,000
8

Total Short term assets 499,000
Long-term assets 0
Total Assets 499,000
Total requirements 532,750
Type of organization and management information system
Records will be a limited company. This type of company is defined as an organization
which is legally separated from the owners of the company and is incorporated at the House of
Companies in UK. The advantage of choosing limited company as the classification of business
for records is protection of personal assets and increased credibility of the firm (Lee and Kelly,
2019). The management systems which will be utilized by the start-up company include
environmental management system which helps the company enhance environment performance.
In addition to this a quality management system will be utilized to ensure that high quality results
are delivered to the client.
Vision of the company
The vision of the company is “to market different recorded music, which gain the
attention of millions individuals, who are taking interest to listen music and play according to
occasion.” In the future the company will focus on expanding services to different international
markets to create global name in the music industry.
9

CONCLUSION
From the above report it is to mind that creation of a business plan is an important part of
building successful startup firm. Describing the proposed business is the first part after carefully
created business plan. Providing information about the target audience the end user and the
unique selling proposition of the company is also important as it helps communicate the reason
for investing in particular start up. The future vision of the company, the management system
used at the company and the legal aspects of the business is also including the business plan.
Financial information about the company along with the skills needed for running a business
such as leadership skills, persuasion skills and critical thinking skills are also included in an
accurate business plan.
10

REFERENCES
Books and Journals
Haghighi, N.F., Mahmoudi, M. and Bijani, M., 2018. Barriers to entrepreneurship development
in Iran’s higher education: A qualitative case study. Interchange. 49(3). pp.353-375.
Lee, B. and Kelly, L., 2019. Cultural leadership ideals and social entrepreneurship: an
international study. Journal of Social Entrepreneurship. 10(1). pp.108-128.
Ndou, V., Mele, G. and Del Vecchio, P., 2019. Entrepreneurship education in tourism: An
investigation among European Universities. Journal of Hospitality, Leisure, Sport &
Tourism Education. 25. p.100175.
Neck, H.M. and Corbett, A.C., 2018. The scholarship of teaching and learning entrepreneurship.
Entrepreneurship Education and Pedagogy. 1(1). pp.8-41.
Shan, S. and et. al., 2018. Assessing relationship and contribution of China's technological
entrepreneurship to socio-economic development. Technological Forecasting and
Social Change. 135. pp.83-90.
Shawl, S., 2020. Entrepreneurship Education Ecosystem in India: Current Practice and Proposed
Framework. IUP Journal of Entrepreneurship Development. 17(3). pp.7-18.
Sohns, F. and Diez, J.R., 2018. Explaining micro entrepreneurship in rural Vietnam—a
multilevel analysis. Small Business Economics. 50(1). pp.219-237.
Warhuus, J.P., Blenker, P. and Elmholdt, S.T., 2018. Feedback and assessment in higher-
education, practice-based entrepreneurship courses: How can we build legitimacy?.
Industry and Higher Education. 32(1). pp.23-32.
11