Business 3.0 / 5 based on 1 rating ? Business StudiesA2/A-levelAQA Created by: SBDLCreated on: 09-12-12 10:46 How would business software help Wade manage his b Database: hold information of contacts, suppliers - Allow him to contact them if about promotion deals or if there is any difficulties with equipment. Staff contact; hours, wages etc. keep on track Spreadsheet: financial costs can be calculated helps him with a financial plan 1 of 12 Benefits of a business software to Wade? Wade can keep database info up to date and refer to any records. - He can then base his decisions on previous records Reduce his working hours - only wanted to supplement pension. Wade not experienced so would naturally work long hours. This is cut. Draw up forecasts from spreadsheet and avoid cash flow crises 2 of 12 Why would Wade's cash flow forecast be inaccurate? difficult to measure competitor's behaviour (new or old - 39% growing market) costs higher than expected eg tax or inflation knock-on effect with paying loans no experience 3 of 12 Problems Wade could face in forecasting his cash f seasonal business. slow inflow 5,7,12 days means slower inflow external factors; interest rates, competitor behaviour 4 of 12 Affects on BEP VC increase/decrease 'As a result' contribution per unit increase/decreases Therefore 'BEP' increase/decreases Which means Wade should raise prices/can lower prices 5 of 12 For/Against BEP analysis FOR: 'What If' - sensitivity analysis on changing variables support fund, investors will know when they get a return AGAINST: inaccurate - variable costs difficult 5,7,12 to sort 'average price' 6 of 12 Why make profits? investors will wait to see a return made a loss already supplement pension 7 of 12 2 Resources Required Information: research data; building firms, en-suite etc competition; establish price and promotion Business Links provide legal info Human: flexible staff fully trained high quality 8 of 12 Resources about the Market trend sales Ladyline action = estimate sales potential Suppliers cost reliability quality delivery 9 of 12 For/Against Minimal Resources FOR: lower costs = low sp = price sensitive = encourage customers lower costs = lower loan = low interest = reduce cash outflow AGAINST: low quality = questioned = unhappy = reputation harnished safety paramount = accidents = litigation and insurance prem negative word of mouth - legal action EVALUATE: resources can't be comprimised harm image destroy proposed USP 10 of 12 Budgets Calculate Variance; actual - budget Benefits: control and monitor = set up costs are high sums = dining, en-suite etc are costly = manage finances and prevent over spending raise money to fund = investors want to see plan and financial evidence of effective management 11 of 12 Budgets 2 Benefits of VA; identify unexpected costs corrective action - adjust costs assess sales forecast accurate? Drawbacks of Budgeting accuracy - no experience/ start-up other factors - price, competitors, quality EVAL: economic trends affect sales budgeting crucial short-term 12 of 12
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