Aim:

To demonstrate knowledge of the creation and operation of small business in New Zealand.

Business Proposal Guidelines:

Choose any type of small business that you are interested in researching and learning about. Your choice could be based on an industry that you would like to be involved with after your study or it could be a business idea that you have been thinking about pursuing.

The business needs to be small to medium size and be able to operate within New Zealand laws.

To give you a head start, you have been given $5,000 from a relative to invest in your business as capital and you bought a vehicle last year (freehold) that has a market value of $6,000, suitable as a work vehicle.

To cover any shortfall in start-up or operating costs, you intend to source the finance externally and any potential investor/s willtherefore need to see a business proposal. Where you intend to source these funds is up to you.

Aim to be concise and as realistic as possible. Don't leave this proposal to the last minute.

Advice:

You are encouraged to discuss your business ideas with each other, and to address any problems to your tutor. Be sure to start this assignment as soon as possible.

1. Executive Summary

Begin your plan with a brief summary of the main points in the plan. The summary should cover where you are now and where you want the business plan to take your business, based on the research methods you employed. It is best to write the summary last.

2. Business Model

Use this introductory section to explain the purpose of the business and what made you start it. Describe the products and services you have developed and what makes your business different. Be as specific as possible about your competitive advantage:

• What are your strengths and weaknesses?

• Where do you see the opportunities and threats?

• What type of market research will you be utilising and why?

• What are the critical success factors you have identified from the research in your product/service?

3. Business Strategy

Use this section to describe your growth plan for the business over the next three to five years:

• What Specialist services and support will you use? What, Where, Who and Why?

• Discuss the specific pathways that these specialists offer that can help you achieve your business goals.

• Analyse the external threats or opportunities that could affect your business and how these specialists could assist you to cope with them.

4. Legals

Potential investors will want to know the regulations and rules that will govern your business.

Use this section to list and describe four central government legalities that are closely associated with your type of business.

Businesses are also obliged to follow by local government bylaws.

Research a local government regulation and describe indetail how it will impact your operation.

5. Marketing

This will be one of the longer sections in the plan as you need to cover:

DISTRIBUTION
• What are the distribution channels for your products and services, such as your Web site, direct marketing, or distributors, retailers or agent
• Give a clear rationale to your answer above

PROMOTION
• How you will use e-commerce and technology in your business.
• Your promotion plan (include known variables) and marketing budget associated to promotions over a 12 month span.

BUSINESS ENVIRONMENT
• How you will build credibility and reduce risk for the customer doing business with you.

• Any collaborative partnerships you intend to form within the business environment

LOCATION

• How does the location of your business affect your target group/s

6. Operational

Lenders and investors will want to know how you intend to measure and control your product/service on an operational level.

Depending on your chosen business, propose three from the following list and fully disclose how you will measure and control performance.

• Quality
• Waste
• Product or Service
• Hours of Operation
• Any other operation consideration

7. Financial Budgets and Forecasts

Lenders and investors will closely examine your financial information. They will be doing you a favour, because if your financial figures do not make sense, you may need to re-examine your financial projections.

You need to provide detailed financial information to the plan, including:
• Profit and loss forecast
• Balance sheet forecast
• Break-even analysis

These source documents should show clearly:
• How much money you have invested in the business
• How much you need to start your business

8. Risk Management 

Investors will want to know how you intend to manage risk and what measures you will put in place for control purposes.

• Identify and describe three (3) areasof Risk Management in your operation

• Identify and describe two (2) types of insurance that are commonly required for your smallbusiness.

• For each form of insurance describe why it would reduce risk in a small business.

• Where do you intend to focus control measures in your business?

• Based on the industry you will be working in, what control measure/s will you need to consider?