This is a paper that is focusing on the Local flower shop business modeling development. The paper also requires preparing a budget and a cash flow forecast in the assignment.
The Local flower shop business modeling development
TASK 1a. Business Modeling
Select a business you are aware of—it need not be one you have been directly involved in, but it needs to be in the area of retailing, manufacturing, or services and not financial services. An example might be your employer or business, a local shop, a garage, or a hairdresser.
Please use: A Local Flower Shop with one owner and one part-time employee (US15 per hour,40 hours per week). Open 7 days a week making an average of US1500 per day and overhead cost of US3000 per Month
We would like you to build a simple cost model for this business, using tools from this course such as break-even analysis. It is not necessary to model every product, you only need to build the model based on averages for the main two or three activities that the business carries out.
Three of the main activites (can alternate them freely)
Flower partitions to weddings, birthdays and special parties
B2C retail (green plants, herbs, pots, soil etc.)
Flower workshops (10 participants workshops around 3 hours in how to create flower bouquets) Average charge US100 per participants and the shop have 3 of these per week
Please Note: This is an imaginative exercise and also you can make up both the products and the financial data. If you think things through carefully you might be surprised at what you have to go on—for example, floor areas, customer footfalls, and local population statistics (small city of 1 mio people)
TASK 1b. Secondly, from this model, prepare a budget for the business for the next 24 months. You do not need to model the balance sheet, just the income statement.
Please use one of above forecasting models
Please Note: You are not to produce a balance sheet forecast for this exercise.
TASK 1c. Finally, we would like you to create a cash flow forecast for your model.
Summary for TASK 1a, b & c.
You should include all of your modeling and also calculations in a single (multi-page) spreadsheet, annotated with explanatory comments.
