Introduction

Planning is a quite important process which affects the overall functionality of a business concern. Business ventures normally get initiated at a quite smaller scale. Many a time’s money or capital can be invested by more than one individual or groups. The main aim of people who invest in funds is mainly earning higher profits. Business ventures in competitive market get initiated due to demands of the market or the lack of supply.

This report has been framed on Unicorn which is a small scale business concern located in Manchester, UK. It is basically a grocery store that deals in organic food products at fair prices. This report looks at various topics such as different types of business concerns along with their risks and benefits. Also this report focuses on various factors that drive market potential along with skills that help in developing business cases. Lastly this report mentions details regarding pitching of a business proposal.

1.1 Analysis of different types of business concerns based on their risks, benefits and limitations.

Case Scenario: This report has been framed base on a supermarket chain store of the UK named as Unicorn groceries. This organisation was basically chosen so as to evaluate the impact any new development idea or plan has on small and medium sized business concerns.

Business concerns can be of various types depending on their size scale and area of operations as well. These business concerns can further be divided into 5 broad categories:

Type of business concern	Risks	Benefits	Limitations
Sole Proprietorship	Personal assets of individual are considered as assets of business	It is owned by one person hence decision making becomes quite easy.	Raising higher amount of funds is quite difficult.
Partnership	Each partner is jointly and severally liable for another.	Higher amount of profits can be generated as compared to sole proprietorship.	Decision making is a complicated process
Company	There are a number of risks in companies such as strategic, regulatory and financial risks (Honig and Hopp, 2016).	It is a separate legal entity.	Business decision making happens to be a quite complex process as number of people increases.

1.2 Analyse sources of finance for different business concerns.

Finance acts as the lifeblood for every business entity. The amount of funds required by a business concern may differ depending upon the size and scale. Sources of finance which are used by business concerns have further been stated as under:

• Savings: It is an amount that remains unspent with a person or anything that an individual has not utilised. It is generally calculated by subtracting expenses from net income received. This amount can be used by entrepreneurs as capital in their business concerns.

• Loans: A loan refers to a refundable amount that is lent to anyone in return for a minimal rate of interest. In the present context, owners and managers of Unicorn prefer taking out a long-term loan from a bank as it is a safe and secure method of funding.

• Profits: Profits is something a business earns in respect of goods and services rendered. The profit of a firm is calculated by subtracting the amount spent from the amount gained.

• Private Equity: Private equity refers to a class that comprises of alternate investment options. Capital or funds in this category are not listed on a stock exchange. It comprises of funds and investors who have a mind-set regarding directly investing in private business entities.

In the context of Unicorn, groceries owners and managers have chosen bank loans to be a successful option for availing funds.

1.3 Legal considerations regarding planning of a business venture.

Planning a successful business venture is a complex process and involves a number of steps and techniques. It is basically a process which deals with activities and processes that help in achieving desired goals or objectives. There are a number of legal constraints that each organisation is required to follow while undertaking its business operations.

• Health and safety at work act 1974:  “(HASAWA) lays down wide-ranging duties on employers. Employers must protect the ‘health, safety and welfare’ at work of all their employees, as well as others on their premises, including temps, casual workers, the self-employed” www.worksmart.org.uk/health-advice/health-and-safety/employer-duties/what-health-and-safety-work-act

This act clearly defines the duties of the employers, employees and all other relevant person’s that exist at a workplace.  The main aim of this act is to maintain a safe and secure working environment in the workplace and ensure the health of their employees. This helps in developing a sense of security in employees.

• Contract (right of third party) act 1990: Contract act in UK was proposed in the year 1990. “The Contracts (Rights of Third Parties) Act 1999 (Third Party Rights Act 1999) can be used to give a non-party to a contract a right to enforce some terms of the contract”. www.uk.practicallaw.thomsonreuters.com. 

It is basically a body of rules and laws that is meant for regulating or controlling various contracts and contractual agreements in the UK. The main aim of this act is to maintain effectiveness in contractual agreements and business practices along with protecting the rights of buyers as well as sellers.

• Employment law: As per this act employees are entitled to certain legal rights such as receiving a week’s notice each year along with minimum wages of around 7.50 pounds per hour as well as maximum average working week of around 48 hours. All these rights help in raising confidence and motivation of employees and develop a sense of belongingness in them.

2.1 Analyse market conditions that impact on setting up a new business venture.

For effectively analysing the market conditions that have an impact on business venture can be ascertained by conducting a PEST analysis of the market.

• Political: This factor deals with political condition of a business environment. Various rules and policies of the UK can affect the business. In present context it has been observed that managers of Unicorn Groceries will have to effectively go through political conditions of a country before planning any new ideas. It can be said that the political intervention in businesses in the UK and the city of Manchester is minimal. Hence, there would not be any significant impact of political factors on the organization.

• Economic: It includes various economic factors such as the current state of the economy of that country, exchange and inflation rates and the disposable income of customers. In relation to Unicorn Groceries, it has been observed that managers will have to consider certain economic elements so that they can decide which policies can be adapted in their organisation.

• Social: Various elements in context of social factors are level of health, educational backgrounds, growth rate of population, religious and social beliefs of people etc. Managers of Unicorn groceries will need to examine cultural and social elements before adopting any changes in their production processes or products they sell.

• Technological: Technological factors as the name says refers to advancements or innovations in technology. For example whenever a business wishes to adopt a new technology they need to first check whether it will be successful or not. Managers of Unicorn will have to evaluate various tools and techniques before choosing any one best method. This will be helpful as it will provide a competitive advantage to their company.

2.2 Summary of the results

The PEST analysis had pointed towards some important considerations that the Unicorn Groceries would have to maintain. In regards to the political factors there are nit many hindrances that can affect the operations of the company. The economic elements to be considered are the taxation aspects affecting the retail businesses across the UK. The socio-cultural aspects that would affect the organization are the growing trend for quality product consumption among the people. The next most important aspect are the technological factors that affect the organization. The latest in technology have to used that can help customers get the exact commodities that they would like to have.

Another important variable in this context is the competitor analysis. It is basically a tool which states the strategies and policies considered by the competitors or their method of doing business operations. It is basically an in depth analysis of a competitors state. As a result, the managers of Unicorn have chosen Porter’s Five force model.

2.3 Analyse gaps in the market for potential products.

Case Scenario: This report has been framed base on a supermarket chain store of UK named as Unicorn groceries. This organisation was basically chosen so as to evaluate the impact any new development idea or plan has on small and medium sized business concerns.

Gap analysis is an important tool which examines differences in performance of business along with software applications. It helps in determining whether goals and objectives of a business are being met or not. It is an essential tool that helps in comparing present and standard performance. Gap analysis in context of Unicorn was considered so as to achieve the following benefits.

• Finding the scope of development by launching or innovating new products and services.
• Gap analysis also benefits in finding new and emerging trends that are present in current market.

By conducting a gap analysis business owners come to known about current market scenario and trends. Also it helps in examining what technology or tools will be beneficial for growth and development of a business.  It is basically a 3 step process which includes analyse the current state of a business along with identifying the ideal future state. Last step in gap analysis process is to find effective tools and techniques that help in bridging the gap.

2.4 Gap Analysis of Unicorn

Current state	Future state	Gap description	Next step
The target mission and vision statement for the company are set to tackle the current challenges in the retail grocery markets of the UK. The processes that the company would like to improve are the supply line for the organic food products. Additionally, the organization would like to improve its product offerings.	In the future the company would like to target the growing number of health conscious people across the UK. The company would like to increase sales by 150% in four years’ time. The company would like to improve their product offerings by 100%.	There is a gap that exist in the current supply line that need to be addressed to achieve the future targets. The gap that has been identified is the number of effective suppliers. The current suppliers are not many and do not have the necessary potential to improve the supply rate. Hence, new suppliers would be required.	New suppliers are required. More essential interactions with the farm communities are required. There should be more effective interactions and business relationship development with the organic farmers.

2.4 Analyse target markets for a business venture.

Target market is an important key word which states or defines a specific and defined customer segment within the serviceable market of business. Defining a target market helps a business concern in providing an easy decision regarding market position (Cosenz, 2017). By adopting

this approach small scale business concern such as Unicorn gain an advantage in competing with large scale business concerns. Defining a target market is a quite complex process and infuses a number of steps such as segmenting the market, identifying USP, analysing or examining customer base along with analysis of competitor’s customer base as well. Also there are a number of factors that affect analysis of target market. These factors have further been stated as under:

• Socio economic: Factors that are used to examine situations or trends that are prevailing in a society are referred to as socio economic factors. All these factors are quite interrelated to each other. For example; Income of an individual determines his spending power.

1. Age: Age is another key factor that affects target market. For example business concerns that deal in manufacturing toys will target customers within a group of 0-10 years.

• Gender: Another significant factor in this context is gender. It examines whether a business concern targets male population more or female population. For example, cosmetic brands such as Maybelline, L’Oreal attract the female crowd more as compared to the male crowd.

Hence, it can be said that the most important factors that have been identified for the target market are income, age and gender. In this case the socio-economic background of the people need to be middle to upper middle income group. The age that has been considered to be effective in terms of the target market of the organization is between 25 to 40 years of age. The gender in this case that would be given more preference are female. The female customer base are more likely to take interest in organic food products. Thus, it would be fair if the company creates the market strategies considering these factors.

3.1 Develop the mission, vision, aims and objectives of the business.

Case Scenario: This report has been framed base on a supermarket chain store of UK named as Unicorn groceries. This organisation was basically chosen so as to evaluate the impact any new development idea or plan has on small and medium sized business concerns.

In present context Unicorn is a small scale business concern in UK which operates in grocery or retail sector (Burns, 2017). Various key terms such as aims, objectives, vision, mission has been mentioned as under:

• Vision: Vision of Unicorn grocery is “To enhance their customer base by providing excellent quality goods and services.”

• Mission: Mission of Unicorn Groceries is “To maintain a stable brand image in competitive market against its rival firms.”

1. Aims: In this context main aim of Unicorn Groceries is “To be a leader in retail sector in context of small and medium firms in UK.”

• Objectives: Objective is something that a company wishes to achieve within a specified time frame. In context of Unicorn its objectives is to increase its sales by 20% in 2 months (Rakićević, Omerbegović-Bijelović and Lečić-Cvetković, 2016).

The mission vision and values were developed considering the value of work that the organization wanted to partake in the future. The mission has been developed keeping in mind the future prospects of healthy organic food considering the changes in the mind of the UK publics. Excellent quality food is something people are more inclined towards buying in the midst of the low quality products that are chemically enhanced. Thus, the value of the product would be determined by the future market trends. The objectives encompass all the major achievements that the organization would like to make in the near and distant future. This brings forward the most important things that the company would like to achieve in course of better development and growth.

 

3.2 Interpret external factors to justify need for your business product.

Factors that are present outside the controlling of a business environment are referred to as external factors. External factors are generally examined or evaluated by conducting a PEST analysis which has further been stated as under:

• Political factors: In context of UK political factor plays a quite significant part as political stability happens to be a power or strength of a country. In context of Unicorn entrepreneurs will need to assess political factors so as to achieve benefits from political conditions.

• Economic factors: Economic combination or landscape plays a quite important role in PEST analysis. It includes various elements such as economic rates, inflation deflation rates, GDP etc. All these factors play a quite important role in planning a new business plan or strategy.

• Social factors: UK has a quite large consumer market base. This lays a quite significant impact on businesses and their growth. Also these factors lend various growth opportunities to business concerns and help them in enhancing their growth and profitability (Jansen, 2017).

• Technological factors: UK happens to be most economically and technologically developed economies f the world.  London happens to be a hub for technological and economic advancements. Using new and innovative tools and techniques helps in providing a large number of growth opportunities to entrepreneurs of small scale business ventures in UK.

Another important external factor measurement that can be utilized is the Porter’s five forces to determine the essential factors of the external environment for the organization.

Customer bargaining power- the bargaining power of the customers are significant as many of the current firms are providing organic food values to the customers.

Supplier bargaining power- The supplier bargaining power is medium. There is high demand for organic produce from many of the newer companies. The bargaining power of suppliers are steadily increasing.

Competitors- The main competitors are the large organizations that are operating in the retail business. The competing firms are always looking forward to innovate and grow.

Threat of new entrants- The threat of new entrants are large considering the organic food businesses. Newer companies are rising and providing better organic foods. Some of these organizations are directly linked with the large greenhouses in the country.

Threat of substitute products- The threat of substitute products are low as the product itself is an alternative to the other common products that are available. The threat of substitute products are low for the business.

Hence, it can be said that the larger problem issues are pertaining to the competitors, the emerging organizations and the suppliers.

3.3 Specify the business product to meet needs.

In context of Unicorn, it is a grocery store which provides goods and commodities of retail sector. In the present scenario Unicorn is planning to launch a new and innovative product Choco Latte which is a combination of cold coffee and chocolate shake. Various factors that were considered while planning for this product are:

• Purpose: Main aim of entrepreneurs behind innovating or bringing in this product is to enhance their loyal customer base and attracts kids towards their brand (Stenholm and Renko, 2016).

• Pricing: Price of this product is kept quite low so that customers are willing to purchase this product and try it.

• Target Market: In context of target market, entrepreneurs right now specifically concentrate on age groups 5-25 years as this product is a chocolate based drink and is  expected to attract younger generation more.

 

3.4 Propose business structures and systems that will deliver business aims and objectives.

For effective achievement of goals and objectives, various factors such as business structures and systems have been stated as under:

• Organisational structure: Organisational structure refers to a system that outlines how an activity is to be undertaken in a business concern. It also determines the flow of information. In context Unicorn managers follow a functional organisation structure. The organizational structure in Unicorn is mechanistic. This means that a single flow of command is utilized in decision making. This would help to keep a steady flow of command that can help to better integrate the functional attributes of the organization.

• Resource management system: It is a solution which helps in efficient management of non-mobilising handling resources. An example of an effective resource management system is airline ticket counters, Kiosks operations systems etc.

• Communication and customer service: Communication is a process which deals with transfer or exchange of information. Entrepreneurs in Unicorn adopt written communication method for exchanging information in their business concern and also serving customers as well (Burns and Dewhurst, 2016).

• Technology: Technology is a quite broad term which explains new and innovative tools and techniques that can be used for undertaking business operations. Unicorn uses new and advanced tools and techniques for achieving effectiveness in business operations.

 

 

3.5 Produce business planning forecasts based on targets.

Business planning forecasts is an effective tool which explains various opportunities that may be available to business concerns in near future. There are a number of ways forecasts can be explained.

• Financial forecasts: It is an important tool which which refers to an estimate of financial outcomes that may occur in future in a company. This greatly helps in budgeting and valuation of a business. The financial forecast method that would be utilized by Unicorn is annual growth forecast. Through this a projected revenue growth mechanism would be created to understand the value it provides to the organization. The role of Unicorn would be to align the growth prospects with their functional abilities and enhance their performance positions. The benefits that they would receive are being better prepared for the future challenges that may arise.

• Physical forecasts:  Forecasting that is based on geographical divisions or factors are referred to as physical forecasts (Scarborough, 2016).

• Sales forecasts: It is an important forecasting tool which explains future opportunities that may be available for business entities in sales . Companies may even use past sales data as well as economic trends as well.

3.6 Identify business responses if targets not met.

If any business concern is not able to generate sufficient amount of funds then there may be a number of responses which a business may have to face such as insolvency, bankruptcy, etc. Also if a business venture wishes to expand its business operations then they will have to further arrange more amount of funds for achieving growth of their business operations.

1. Insolvency:  It is a state in which a business official is unable to pay debts of a person or a company. There are basically two forms of insolvency namely cash flow insolvency and balance sheet insolvency. This is one of the options that the company would consider if the targets are not met. The organization would rather go for a balance sheet insolvency.

• Bankruptcy: It is an important medium which states that a person has run into losses and is not able to pay his debts any further. It is a condition that is imposed by court of law.

If the targets are not met, the companies can adapt new strategies to re-market their existing products. Moreover, the company can introduce newer products to gain better acceptance in the market.

4.1 Pitch for funding for a business proposal

A business proposal contains ideas of an entrepreneur which they promote in front of investors so as to get funds (Burns, 2017). For pitching a business proposal various points should be followed by the business person such as;

• Business person should prepare an effective presentation which provides support to them and helps in impressing their investors.
• They should be well versed and well prepared and should study each detail of the business idea properly. It will be helpful in case the clients convey any questions regarding their business ideas.

4.2 Present documentation to support your pitch.

While pitching a business idea entrepreneurs or businessmen can even take support by presenting certain important documents and tools such as vision mission of the business idea, growth prospects regarding business ideas etc (Cosenz and Noto, 2018). Businessmen can even provide details regarding forecasts and what they wish to achieve in their near future. This will be quite useful as investors will feel safe and secure while investing their money.

 

CONCLUSION

From the above mentioned report it has been concluded that planning a new business venture is quite an important process which states various ways and processes that help in developing a business plan. This report encloses PEST analysis of target market which helps entrepreneurs inexamining various ways in which effectiveness in a business can be achieved. Also this report contains vision mission and aims and objectives of a business concern along with various types of forecasts and help in effective business growth and productivity enhances. Finally, light has also been thrown on identification of business responses along with pitching a business proposal.

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Jansen, W., 2017. New business models for the knowledge economy. Routledge.

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