Assignment requires providing a formal business report to your bank manager regarding the launch of a new product to your existing product lines. In order to support your choice of the new product, you should assume that your existing products are in declining market and likely to be loss-making in the future.
•State your chosen business and what product you intend to sell. Provide in your own words, background as to the general price of goods available in the London area.
•Marks will be awarded for innovation, originality of approach, report format relevant references and quotations from suppliers and all expenses, their websites etc., Competitive benchmarking and supporting calculations. Research will need to be shown in this area.
•Clearly identify a target selling price for your company’s product using supporting arguments from your research of the current market and any other source.
•Produce a unit cost statement for the product, a break-even point with underlying assumptions to support your figures.
•Prepare a 5-year budget income statement using marginal costing principles.
•Undertake a 5 year net present value appraisal of your new business, state your initial investment costs and use your marginal profit as cash flows.
•Provide suitable recommendations for the business and a conclusion.
•Identify and discuss 2 major limitations likely to prevent you from achieving the business objectives.