Return to site



· 案例展示

1 | P a g e


22567 Planning and Control for Small Business Enterprises

Spring Semester 2018


75 marks (60% subject result)

This case study will cover the following areas of Small Business Enterprise (SBE)

 Considerations in Starting a New SBE

 Financial Preparation

 Planning for Growth

 Succession Planning


You are working for a small business advisory service company, ‘Buzz Consultants Pty Limited”. Your previous duties required you to report to a manager who has mentored you for the last 12 months. You will now be taking more responsibility and consult closer with clients.

This month you will be introduced to two new clients, Kam and Lincoln. They will be setting up a small business that constructs and sells portable washing & dryer machines. Their business name will be ‘K & L Portable Washers & Dryers’.

Their products are easily portable and will suit those who regularly move location or like to camp away from home for lengthy periods. They plan to sell directly to retail stores, such as, camping retailers, some rural department stores and hardware stores. Eventually, they will consider selling online and in the major cities once they have systems in place that ensure larger production levels can be maintained efficiently and effectively.

However, they will start concentrating on selling to independent hardware stores in the state so that they can promptly meet the initial demand at their desired quality.

Initially, Kam and Lincoln will begin producing only 2 products.

1. Plug & Go - Washer & Dryer (PGWD) – electrically operated using a power point.

2. Teeny Tiny Washer (TTW) – manual machine

When the business’s cashflow has increased, Kam and Lincoln intend to promote and sell a third washing machine that they have developed. It will be called “Solar Wash”, (SW) and operates by solar energy. They are currently completing a patent for this product.

Kam and Lincoln’s business will involve:-

i) Purchasing parts/sections of these machines

ii) Building their machines with these parts

iii) Selling these machines to retail stores

iv) Repairing these machines

v) Charging a fee for out-of-warranty repairs 2 | P a g e

Kam and Lincoln are planning to open the business by the 1st July, 2018.

Kam and Lincoln’s new business:-

 May operate from a large garage for the first 12 months. They may change their decision before they begin but at this point intend to operate from Kam’s garage.

 After 12 months from the start of his business, they intend to rent a small warehouse with a partitioned section for an office.

 Repairs: If required, will be carefully managed and planned by Lincoln to ensure these commitments are met in a timely and organised system.

 Services and products are separately shown on invoices.

 Intend to purchase sections of their products from several suppliers.

 Will endeavour to have quality control systems in place for each product built - to minimise any disgruntled customers and obtain good reviews.

 Have already purchased some specific equipment and products.

 Have sufficient joint funds to support their new business for a while but want to begin making a profit within the first year.

They both need guidance and support, so have made an appointment to see your manager for advice. Your manager will be introducing you as their consultant and point of contact for ‘Buzz Consultants’



(12 MARKS)

To impress Kam and Lincoln at your next meeting, you will prepare a report that will demonstrate your understanding of their business, the industry and knowledge about starting a new business enterprise. This information should be relevant so that it will assist Kam and Lincoln in making the best business decisions at this early stage of their Business Cycle.


Provide a report extract that must include points 1, 2, 3 & 4 plus you must select two other points from 5 to 11 from the list below.

As it is an extract, an executive summary or contents page is not required.

Maximum of 2 one-sided pages (1 x A4 pages both sides)

Answer Points 1, 2, 3 & 4

1. Description of the

i. Business

ii. Targeted customers

iii. Physical location

2. Investigate the competitors on the market.

i. List each competitor’s names, their location, if they sell online or in store and the name/s of their product/s

ii. Using the products listed in i) above, provide a comparison table to Kam & Lincoln’s products of product size, functions and price. Also include in this table, the advantages and disadvantages between the competitors’ products and your clients’ products.

3 | P a g e

3 a) Discuss legal requirements when selecting a business name. Refer to the appropriate Australian authorities.

b) List some local council regulations that may impact any of your clients' business decisions. Research a specific local council in Sydney and use this as your example.

4 a) Costing process. Discuss what costs your clients should consider when determining the selling prices for services & products.

b) List and discuss key performance indicators that can be used at start-up for this business and after the start up period.

Answer any 2 points from the list below.

Your answers must demonstrate research from current and relevant sources. Include in your selected point how your answer may change or differ if the business was at its growth/take-off stage and not at its pre-start stage.

5. Clearly explain and discuss appropriate insurances, mandatory and optional, that Kam and Lincoln should consider.

6. Discuss and provide information about E-Business considerations. This will include promotion online, required website registration, suitable methods of receiving payments, security, webinars and new issues concerning the Privacy Act.

7. Record keeping and compliance. Discuss the importance of timely record keeping, how to decide who will be responsible for general record keeping and who may be responsible for meeting tax compliance requirements. Include in your answer what is meant by internal control and why it is important.

8. Discuss the importance of efficiently and effectively managing the business’s Accounts Receivables, such as, invoicing, receipt, follow-up, credit level, review of outstanding debtors. Include the importance of internal control systems.

9. Provide a list of information that Kam and Lincoln should include in the employees’ Policy & Procedure Manual within the manufacturing environment. Include a description of each point on the list. Do the same for potential employees that work in administration and reception.

10. List and explain the employer’s obligations that Kam and Lincoln should be aware of when employing staff. List organisations (providing their website) that may provide further and/or supporting information and resources for employers.

11. Aware of Kam and Lincoln’s environmental friendliness, list & discuss some aspects of environmental considerations. You may refer to local and state government requirements, including the EPA.

4 | P a g e


(35 MARKS)

Starting a new business is not easy and financial preparation and analysis is necessary.

Kam and Lincoln are aware that a large proportion of new small business enterprises in Australia fail in the first few months of operations and many more within 5 years. Lack of planning, little knowledge of business costs and the associated lack of cash flows are the most cited reasons of failure.

Kam and Lincoln approach you for further assistance. They want to learn about the process of operational planning by understanding the true costs of the business, in particular, labour costs, fixed and variable costs.

A) Payroll, Revenue and Cashflow Budgets (Worksheets 1 & 2)

After speaking to Fair Work Australia, Kam and Lincoln believe that The Manufacturing and Associated Industries and Occupations Award 2010 is the applicable award for their factory staff, except those employees who work in administration or bookkeeping roles.

You have provided Kam and Lincoln with a spreadsheet template and have requested that they use this to estimate the business’s labour costs to the 30th June, 2019

They have partly completed the payroll worksheet. (Worksheet 1: Payroll Budget).

The information provided on this worksheet will assist you in completing a Profit & Loss Budget and a Cash Flow Budget for Kam and Lincoln’s business from the period 1st July, 2018 to 30th June, 2019.

In this way, you will be able to forecast the payments and their due dates payable, including, net pays, employer superannuation and PAYG withholding.

REQUIRED: (Worksheet A: Payroll Budget) and (Worksheet B: Cashflow and P&L Budget)

For the period, 1st July, 2018 to 30th June, 2019, you are required to:-

1. Complete the Payroll Budget Worksheet. You will estimate some revenue and costs based on the extra information given by your clients. (Worksheet A: Payroll Budget).

2. Prepare a Monthly Cash Flow Budget. This will assist Kam and Lincoln in keeping a record of the frequency of business cash payments. (Worksheet B: Cashflow and P&L Budget)

3. Prepare a Monthly Profit and Loss Statement Budget. (Worksheet B: Cashflow and P&L Budget)

Note: Revenue will be calculated using the estimated number of products sold for that period. Revenue is represented by Total Sales as derived from Product Sales and any repairs. 5 | P a g e

B) Report explanation


You will meet with Kam and Lincoln to discuss the budgets. To prepare for this meeting you will write a list of points to discuss under the following headings:-

1. Discuss & explain the importance of at least 3 key performance indicators that can be obtained from these worksheets (max 200 words).

2. Give relevant reasons why the cash flow budget is an important tool for Kam and Lincoln (max 150 words)

3. Discuss the use of variances between actual and budget, such as, the meaning of variances and how this information can be used (Max 150 words).

4. Write an explanation of the breakeven point for Kam and Lincoln (max 200 words)

Include the following:-

- Explanation of breakeven point (what it is used for and how it assists business owners)

- An explanation of the various types of costs and their effect on the breakeven point. Include the use of the contribution margin.

- Explain the difference/s between the terms of the ‘breakeven point’ and ‘living costs’.



Assume that Kam and Lincoln have been operating successfully for over 3 years.

REQUIRED: (Worksheet 3: Forecasting)

Prepare a forecast of the business’s revenue using the provided worksheet (Worksheet C: Forecasting).

1. Using actual revenue as obtained from the last 3 year’s financial statements (that is, revenue for the period 30/6/2019, 30/6/2020 and 30/6/2021), you are required to forecast revenue for the period 1/7/2021 to 30/6/2022 using various techniques as demonstrated in class, including regression analysis.

2. Discuss the reliability of forecasting methods, in particular using such methods as regression techniques. Include other factors that could be considered when forecasting for Kam and Lincoln’s business? (Maximum 220 words)

6 | P a g e



Kam and Lincoln have made an appointment to meet & discuss the expansion of their successful business. They wish to discuss separately each of the following:-

a) Purchasing a business property at a cost of $450,000. They intend to move their business into this property within 5 months as their current lease is expiring soon.

b) Acquiring new equipment at a cost of $165,000.

c) Employing an additional employee estimated at $55,000 per year.

These plans require funding.


For each of the above, discuss the financial options available for Kam and Lincoln in obtaining finance.

Note that each borrowing may be sourced differently due to the nature of their purpose.

(Maximum words 500)


Although Kam and Lincoln have enjoyed the experience of operating their own small business, they both wish to leave to business.


Write a professional letter to Kam and Lincoln that states what they need to consider before listing their business on the market for sale. This may include:-

1) What should be considered as worth mentioning in their ‘business for sale’ contract, such as:-

i) Assets, such as, furniture, fittings, equipment, computers.

j) Their expertise assistance

k) Employees

l) Exit period by Kam and Lincoln

m) Warranties

n) Accounts receivables and accounts payables

2) Consider their current financial situation, such as, their current debts.

(Maximum 700 words)


ASSIGNMENT: A full printout of your assignment must be submitted to your lecturer

EXCEL WORKINGS: Ensure that you include a print out of your worksheets and also email your files to your teacher.

TURN-IT-IN: Before handing in the written assignment you must submit the final version to the turn-it-in program available on UTS Online. Also ensure that you print a copy of your Turn-it-in similarity report and include this with your assignment.

DUE DATE: Friday 19th October, 2018 (Box will be allocated) or in class on Wed, 17th Oct.

All Posts

Almost done…

We just sent you an email. Please click the link in the email to confirm your subscription!