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Business Center Insurance Requirements Assignment
Business Center Insurance Requirements Assignment is in continuation with the Business Center Management Assignment. It discuss about the insurance requirements, management plans and staffing, etc.
The following business insurance policies are taken for the proposed business of VIVA BALL CENTRE by considering the business type and business operations. As the core business is with dealing with the customers and has to have the employee for the business operations. The business needs the employers’ liability insurance, public liability insurance and the product liability insurance.
All businesses need to be insured against risks, such as the theft of equipment or work-related injury to staff. The business are more vulnerable to have incidents, accidents, mishap to cover this insurance companies has the indemnity. Certain types of insurance are compulsory for the some business. There are other optional insurance policies could give the business extra protection (Porter, 1998).
Employers’ liability insurance
Employers’ liability insurance covers all the business employees’ illness or injuries arising while performing their jobs. This insurance has to be taken as soon as the business employee someone. By the law business must have cover of at least 5 million GBP, now most of the policies now providing cover of 10 million GBP. The business needs to display the current certificate of employers’ liability insurance at each place of business. Where employees can view and read it easily or it can be displayed electronically if the employees can access to the computers. Failure to display a certificate or unable to produce it when health and safety inspectors asked the business are liable to pay a fine of up to 1000 GBP and fined of 2500 GBP for each day if the business has incorrect policies (Kleiner, 2003).
Public liability insurance covers your business against accidents to member of the public or damage to property that occurs as a result of your business negligence. It also covers any related legal framework costs and is normally linked to employers’ liability insurance in policies for small business.
Product liability insurance is a type of cover that protects the business specifically from claims made following damage or personal injury sustained as a result of product manufactured or supplied by the business. These policies cover you against claims for personal injury caused by a faulty product and will defend unjustified claims, such as when a product that has no faults has been used incorrectly (McKeever, 2010).
This type of business does not require a large number of employees to be employed, in order to run viva football centre successfully, smoothly and more important to avoid any conflicts within the organisation (Mckeever, 2008). Employees will be allocated in three different groups, two groups will be working five shifts a week which is 40 hours a week and the shift will be not more than eight hours. This method has been adopted in order to comply with the rules and regulations in the British labour law (Ford, 2007).
As activity manger and a Receptionist are essential positions the company will employ full time employees and their salaries will be as follows:
|Job||Rate in hour||Earing in a day||Monthly salary*|
|Activity Manager||£7.50 per hour||£7.50 8 hours = £60||£60 25days = £1500|
|Receptionist||£7 per hour||£7 8 hours = £56||£56 25 days = £1400|
*the maximum that the employee can work is 5 days a week.
- John will be working as Activity Manager.
- Sarah will be working as a Receptionist.
They will be working 5 days a week in total of 40 working hours weekly.
- Sam will be working as Activity Manager.
- Laura will be working as a Receptionist.
They will be working 4 days a week in total of 32 working hours weekly.
- Steve will be working as Activity Manager.
- Amanda will be working as a Receptionist.
They will be working 5 days a week in total of 40 working hours weekly.
|Day||From 8am till 4pm||From 4pm till 11pm|
|Monday||Group A||Group B|
|Tuesday||Group A||Group C|
|Wednesday||Group B||Group C|
|Thursday||Group A||Group B|
|Friday||Group C||Group B|
|Saturday||Group A||Group C|
|Sunday||Group A||Group C|
To begin with the company’s accounts are going to be managed by an accountancy agency as it is much cheaper than hiring a full time accountant. The services that we provide are going to be available trough our website, by phone or on the spot. Online reservations can be refunded no less than 12 hours before the selected time frame and can be amended not less than 8 hours before.
Payment can be made online trough our secure payment page using credit card, debit card or PayPal also payment can be made on the spot. All of the customers personal information will be kept in a secure customer data base where and wont be forwarded to a third party under any circumstances (Pinson, 2008). The data base is going to help keep track of the customers and their orders which is going to result in faster response and easier Business Sustainability and will allow us to allocate loyal customers and give them better deals. Also the data base can provide useful information under the form of tables and graphs reflecting important factors like customer pic-hours, efficiency of operations and more which on its hand will guide us in to improving the services we provide and work on problematic areas within the business (Ford, 2007). The normal working day will start at 9:00 am every day where the receptionist and the activity manager will be at their positions no later than 8:45 am. The receptionist will stay behind the reception desk where it is going to deal with our computerised reservation system which is linked to our website and as soon as an order reservation come through the system will be automatically updated. Also the receptionist will deal with all of the telephone and on the spot reservations or amendments. Arriving customers will go to the reception desk and after their reservation is verified they will be redirected to their allocated football pitch. The activity manager is going to make sure that everything on the pitch goes smooth and any need of the customer’s concerning our services will be satisfied for example if they need anything like a football or shirts to distinguish between the two teams. After each game if the pitch is in need of any maintenance it has to be arranged by the activity manager. Around 4:00 pm the second shift will replace the first shift and the day will continue as usual until 12:00 pm when is the closing time of the football ground (Thomas, 2008).
In case that the unexpected happens:
In case that the lights of the pitch go out during a night session immediate measures will be taken by the activity leader first if the problem is not in the power supply in which case the UPS will take care of it the customers will have to be moved to another pitch. If there is no available pitch their reservation will be moved for the next available hour or any other hour that may suit them (Pinson, 2008).
In case of a customer injuring himself on the pitch the activity manager is going to provide first aid and if needed he/she will call the ambulance.
In case that anyone from the staff calls in sick there is always going to be a previously instructed part time worker ready to take on the place.
In case of malfunction of any machinery, toilets, showers or appliances a repair service will be contacted immediately in order to get rid of the problem ASAP.
Because in UK the weather can change quickly it can easily become unsuitable for some customers to play football. In this case by request of the customers the reservation will be moved for another more suitable date.
In case of a peace of the artificial grass on the pitches gets riped and is being even a minor problem for the customer’s game a replacement patch will be installed immediately by the activity manager.
In case of a computer server failure a replacement backup computer will be brought out so the work can continue as normal until the broken machine is fixed or replaced. To make sure that no information is lost a backup copy of the server will be made by the receptionist at the end of every shift.
In case lost property is found it will be collected, tagged with the exact location and time at which it was found and kept until it is collected by its owner.
Advertising and Promotion:
As the business is related to sport, our advertising should target people who are interested in sports in general and football in specific. Our target by age is to aim on people who are youth and aged between 15 to 35 years old, targeting by gender, our aim is to target both males and females but to focus on males as they are more interested in football than females. Moreover the advertising campaign in the short term should target local people within 50 miles area around Bournemouth. As the business is new and recent the advertising campaign aims to let people know that we exist, increase our services awareness and boost our sales (Pinson, 2008).
According to billboardsonthemove.com people spend an average of 3 seconds in looking throw advertisements, hence advertisements should be clear and attractive and target the right people and that is to make them go throw the advertisement and to know more about us and our services.
The advertising campaign will go throw different stages:
- Define the main target
- Understanding of customers needs
- Sketch a good advertisement and that is by using clear designs, a well written headlines and texts and maintains a single theme for all our advertisements and that is to create an image for the centre in just seeing the advertisement. (www.businesslink.gov.uk, 2011)
creating a website for Viva Ball Centre that identify our services, prices, opening hours, location and a booking service. (The cost of the website will be in the start up costs)
Next step will be in designing, printing and spreading of 10,000 flyers and leaflets and target schools, Bournemouth University, student’s halls of resident, language centres, sports centres (gym, swimming pools, leisure centres) and town centre. The cost of this operation will be a £526 for 10000 x A3 leaflet full colour printed on 135gsm gloss art paper in addition to a £120 for the design and a £60 distribution costs (pins sticky tapes, other costs). (www.flyersprint.co.uk)
The use of the internet advertisements and that is by creating a page on Facebook and share it in other local pages. (Free)
Create an advert that is linked to the centre website on Facebook with the use of filtering and targeting options were an estimated reach of 52,000 people (Stutely, 2002):
- who live in the United Kingdom
- who live within 40 kilometres of Bournemouth
- between the ages of 15and 35inclusive
- who are male
This advertising will cost 0,66 p per click on the add according to our options and filtering, with a budget of £2500 for the period 15 days before the opening and 15 days after the opening of the centre. (www.facebook.com/ads/create/)
Contact with local newspapers (Bournemouth Echo) and get offers for an advertising space in the newspaper for a budget of £1500 on a 10 days period. (Cost vary depends on offer)
Print brochures with the same design as the flyers including vouchers for example 20% discount. 10,000 brochures A3 size costs £159. (www.e-printing.co.uk)
Print 10,000 business card with a cost of £150. (www.e-printing.co.uk)
Promotion can be in the centre in different forms, for example when customers play 5 separate hours they get the sixth for free, a membership that loyal customers could have to enjoy discounts.
Details of start-up cost
The Total start-up capital requirement for the football centre would be about $2163500. The Distribution of the initial capital required is given as follows:
|Total start up expense||£448625|
Source of finance
|Source of fund||Amount (£)|
Product or Service pricing:
In general pricing is considered the process that the company set to achieve its main goal which is receiving money for an exchange to its products or services. Pricing factors are varies between service
A product or service pricing should achieve three main points:
- Achieve the business’s main goal which is profitability
- Maintain the services positioning.
- Shape the realities of the market place
A business pricing objective should be set and acknowledged and that is to set up the best pricing, were objectives can include:
Profit and revenue maximisation: look for maximising profit in the short term considering costs and revenue on the long term with no consideration to profit margins.
Quantity maximisation: this is to maximise the quantity of hiring hours sold.
Survival: this is to set a price that cover the costs and achieve at least a breakeven point.
This is to set a price level and that is to meet the pricing objectives, were methods can include
Value pricing: this is when the price is based on the services we offer and the uniqueness of it (Stutely, 2002).
Cost plus pricing: this is when the price is set at the service cost in addition to a certain amount of profit.
Demand based pricing: this method is based on the demand of products or services were it could raise or decrease depending on the demand and its perceived value. [Also Read Retailers’ Pricing Strategy Assignment.]
Target return pricing: this method is to achieve a specific return based on the amount that has been invested. (www.netmba.com, 2010)
The method that the centre will implement is the demand based pricing, were prices will rise in peak hours and decrease in of peak hours depends on demand. This method will be implemented to achieve all the pricing objectives from raising the quantity of hours by decreasing the prices in off peak hours to move up demand on these hours as seen in the table
|Day/ Per hour||8-13||13-17||17-19||19-21||21-00|
|Monday||25||35||45||55||45||£ per Hour|
|Tuesday||25||35||45||55||45||£ per Hour|
|Wednesday||25||35||45||55||45||£ per Hour|
|Thursday||25||35||45||55||45||£ per Hour|
|Friday||25||35||45||55||45||£ per Hour|
|Saturday||35||45||55||55||45||£ per Hour|
|Sunday||35||45||45||55||45||£ per Hour|
Our prices and compared to our competitors are attractive and smart compared to the services we provide from a high quality pitches, clean showers, changing rooms, restaurants, bars and other entertaining facilities, were customers can enjoy a complete satisfactory services. Even though competitors could have a cheaper prices than ours but still their services cannot be compared to ours, since we offer a high quality services that cannot be provided by them. The prices were put differently depending on the time slot, were peak hour’s prices rises and decrease in off peak hours to motivate people to come and play in the centre (Stutely, 2002). Moreover the promotion that the centre will be doing and the discount that members could enjoy will make our prices really competitive.
The Sales forecast for the VIVA football centre would be according to the availability in the centre. The Demand and availability of the football centre would be matched in such a way that revenue coming out of the football centre can be maximised. The Following chart shows the sales, gross margin and net profit for the VIVA football centre.
Chart1: Showing the sales forecast for the VIVA football centre
As shown in the chart in the first year of the inception our football centre will made the sales of about $800000 and the sales would increase by 25% in the next year rising to about $100,000 and in the third year of operations of the football centre the sales will reach to $130,000. Hence each year growth of more than 25% is expected for the football centre. The Projected yearly sales data on quarterly basis is as follows:
|Sr. no||Sales for 3 years on quarter basis||Sales data ($)|
|Total sales in first year||800,000|
|Total sales in year 2||10,00,000|
|Total sales in year 3||1300,000|
Table1: Showing the projected sales data for the football centre in initial 3 years
The Total day to day expenditure details for the VIVA football centre other than the fixed asset of the centre would consist of various cost elements such as rent cost, lighting cost, heating, telephone bills, office supplies, cleaning, maintenance/repairs, etc. The Description of all such cost for the VIVA football centre is as given follows:
|Sr. No.||Expenditure||Amount ($)|
|3||Repair and maintenance||4800|
|Total day to day expenditure||204100|
Table2: Showing the day to day expenditure of the VIVA football centre
Monthly cash flow projections
The Monthly cash flow projections for the football centre will directly depend upon the demand and availability of the football centre. Hence based on the demand and availability monthly cash flow projections for the football centre are as follows:
Figure2: Showing monthly cash flow projection for the VIVA football centre
There are two different bars in the figure, the blue bars shows the net cash flow into the company which is the difference of cash inflow and outflow while the other bars shows the monthly cash balance for the VIVA football centre. [Read about Business Plan Assignment: Porter’s Analysis]
The Breakeven analysis for the VIVA football centre shows the sales at which football centre would be operating at no loss and no profit margin. Hence the breakeven sales point for the VIVA football centre as shown in the figure would be:
- Monthly break even units 1104
- Monthly revenue $52752
Chart2: Showing the breakeven point for the VIVA football centre
Profit and loss forecast
The Projected profit and loss forecast for the VIVA football centre can be made by reducing the day to day expenses of the football centre out of the total income generated by the football centre as there is no cost of sale in this case. Hence profit and loss projections for the football centre are as follows:
|Expenditure and Income||Amount ($)|
|Direct cost of sales||0|
|Repair and maintenance||4800|
|Total profit for year 1||631270|
Table3: Showing profit and loss projections for the VIVA football centre
Overcast Balance sheet
The Balance sheet of the VIVA football centre after the first year of the operations would look like as follows:
|Assets||Amount ($)||Liability||Amount ($)|
|Current assets||Current Liability|
|Account receivable||57126||Current borrowings||0|
|Inventory||0||Other current Liab.||0|
|Other current asset||0||Long term liability||1250000|
|Paid in capital||1250000|
|Total liab and cap||423130|
Table4: Showing the balance sheet of the VIVA football centre in first year of operation
- Michael E Porter, 1998, “Competitive advantage”, pp42-98
- Mike Mckeever, 2008, “How to write business plan”, pp 14-79
- Eugene Kleiner, 2003, “The Successful business plan”, pp33-77
- Arthur De Thomas, 2008, “Writing a convincing business plan”, pp14-98
- Brian R Ford, 2007, “Ernst and young business plan guide”, pp73-134
- Mike McKeever, 2010, How to Write a Business Plan
- Joseph A. Covello, Brian J. Hazelgren, 2005, Your first business plan: a simple question-and-answer format designed to help you write your own plan