Business proposal

This document explains the details of your assessment, please read it carefully. Qualification/Programme: International Year One (IY1) Programme Module Name: Managing Financial Resources and Decisions Start Date: 30 March 2016 Deadline Date: 27 May 2016 Module learning outcomes: 1) Understand the sources of finance available to a business. 2) Understand the implications of finance as a resource within a business 3) Be able to make financial decisions based on financial information. 4) Be able to evaluate the financial performance of a business Assignment Title: Create an Investment Proposal Report for a business of your choice This assignment requires that you demonstrate that you can: 1) Understand the sources of finance available to a business. 2) Understand the implications of finance as a resource within a business 3) Be able to make financial decisions based on financial information. 4) Be able to evaluate the financial performance of a business Your will be marked against the following criteria: See assessment grid Assignment Purpose: To ensure that students are able to write an investor proposal Report that encompasses the learning outcomes above. This assignment counts for 100% of your module mark and 100% of your overall grade. The pass mark for this assignment is 40%*. *Progression marks may be higher for certain universities check with your centre. Assignment Instructions: For this assignment you need to write an Investor Proposal Report that consists of four tasks. You must complete each of the tasks and include them in your Report. The scenario for this assignment is as follows: You wish to start a new business but lack sufficient funds to do so. This means that you do not have savings of your own to use and your family do not have funds to give you either. You have been encouraged by your friends to go find external funding for your business idea, and this may include approaching potential investors, so that you may get it started as they believe it is a really good business idea. You must write an Investor Proposal Report to secure funding for a new business venture that you would like to start. The proposal is generally written using a Report format and is in sections, beginning with an introduction and outline, and then progressing to detailed plan sections. The overall intent is to secure investor confidence and, thereby, investor money. For the purposes of this module the Investment Proposal Report must highlight your ability to understand and manage financial resources and support financial decisions being made Task 1: Introduction and outline Introduction you are to give an outline of your business idea, how much funding you need and what the funding will be used for. You must indicate why you are approaching a particular stakeholder for funding. You must also explain why you think financial planning is important in this context i.e. applying for funding from an investor. Source of finance The amount of funding required must be indicated and justified. You must also indicate what is your preferred source of funding from the range of possible funders and why. You must indicate and explain the costs associated with this choice and justify why these are acceptable and the most advantageous for your plan. Also, what the alternative sources of funding were and why they were not selected specifically to this proposal (This should be linked to the choice of investor). Students should also explain what is the impact on their idea if they don”t get the necessary financing or if they have selected an inappropriate form of finance All coursework (unless direct otherwise by your tutor) must be word processed, double spaced, justified, fully referenced using the Harvard system, and in 12 pitch font, with page numbers and the word count. The word count does not include end of text references or appendices. Task 2: Financial documentation Financial documentation You must compile 3 financial documents based on estimated/projected figures. A very simple Profit & Loss Statement, Balance Sheet and a Cash budget appropriate for your form of business must be created. It is necessary that they are able to compile simple versions of such documents. You must also define each document and explain its purpose. Explain why these formats of the 3 documents are appropriate to your business Task 3: Analysis and interpretation of financial documents Return on Investment – You must use at least two Investment Appraisal techniques for this section to indicate what the Return On Investment (ROI) is for potential funders. Explain what an Investment appraisal technique is and its purpose. You must use the Payback period method and the NPV method. The results should be positive in order to encourage investment in the business idea. The figures used in these calculations are based on the financial documents that you have compiled in Task 2. You should also explain why the ROI is positive and identify which stakeholders would be interested in this information and why they would want this information. Accounting ratios to interpret financial statements: Once you have compiled your financial statements (Task 2) you must calculate the following ratios based on the information that is in those statements: Net profit margin; ROCE; Current ratio; Gearing ratio You must explain the benefit of this information to potential investors Task 4: Potential success and conclusion Explain and justify the venture”s potential success You must convince your potential financier of the success of your idea. To do this you must mention issues such as the importance and impact of financial planning on the success of your venture, a brief outline of your pricing strategy and why you have selected this approach and finally, the importance & benefit of budgeting for your venture”s success. Conclusion You must end the assignment with a conclusion in which you briefly summarise everything that you have said in your proposal, emphasise the potential of your idea and express the hope that they will give you the funding. Finally, you must include a references list. ***The idea that I have chosen for this assignment is a service where instead of having a tech store, it would be a van with a technician that may be ordered via an app that can fix phones, laptops, and other devices, in addition to having an option of buying electronics accessories such as headphones, USB cables, etc. This service will be available in central London and may expand to more areas in the future if it is a success. My notes: COSTS Van: £9,996 (Excluding VAT) Nissan E-Nv200 (Electric, 2015, new, automatic, AA) Wages: Annual: £21,060.00 Monthly: £1,755.00 Weekly: £405.00 Daily: £81.00 Hourly: £9.00 de Supplies: Screens: 1-2$ per screen (iphone 5/5s, iphone 6/6s) , 65-115$ max/100 screens (free shipping) Tools: £16/kit Wires/Cables: £20/set Technology (laptop, portable wifi, etc.): £1500-£2000 Other: £500 PESTLE Good political relationship with rest of the world Economically stable Diversity/overpopulated Advancements in technology Easy start up (sole trader) Electric van (no congestion charge) SWOT Fast/convenient/inexpensive Few workers Gap in the market Low/No barriers to entry (which may lead to rise of competition)