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Business Start-Up - Coggle Diagram
Business Start-Up
Challenges When Starting a Business
having enough working capital
creating a USP
raising long-term finance
availability of suitable staff
choosing right production method
Production Options
batch - identical batch / machines
mass - continuos flow / hgihly automated
job - specific / tailored to need /unique
Changing from job to batch/mass
loss of USP
reduced prics = lower profit
investment required
Changing from batch to mass
capital investment required
impact on staff (more machinery)
fewer options for customers
Business Plan
marketing plan (4Ps)
production plan (job/batch/mass/quality symbols)
market analysis (data)
financial plan (break-even/cash-flow/predictions)
details & ownership
Importance of Business Plan
anticipates problems
attracts investors
focuses on future
acts as means of control
Business Plan uses for Stakeholders
financial institutions - shows that business is viable
management - compare performance with goals
shareholders - calculate if ROI is worth risk
suppliers - whether or not sell goods on credit
employees - culture/ojectives & job security
Benefits of Break-Even Analysis
forecasts profits
shows size of safety net
Limitations of Break-Even Analysis
costs (may change)
returns/refunds (not accounted for)
selling price (may change)