Business Planning Flashcards
What tools does your company use to ensure you are making a profit?
- Timesheets
- Resource planners
- Fee/cost reconciliation tools
- Project reviews
- Yearly performance reviews
- Team meetings
What is benchmarking on a construction project?
Estimated performance (often cost) of project is compared to other similar projects - highlights areas of design not offering good value for money or if contractor’s price is in line with wider market
Issues relating to staff turnover?
- Expensive and time consuming to hire and train new staff
- Turnover can impact team dynamics, productivity and continuity
- Can lead to poor external reputation
- Can lose clients
What is an investment appraisal?
Assesses whether a business or project would be worthwhile investment in terms of:
1. Rate of return
2. Payback period
3. Net present value
How do you contribute to your company’s goals?
- Sharing knowledge within my team
- Keeping up to date with new technologies and systems
- Delivering and exceeding responsibilities
- Understanding personal / project objectives
- Bringing in new business
- Focus on safety
- Upskilling new and junior team members
What is a joint venture?
JV = business arrangement where 2+ parties pool resources to accomplish specific task (.e. new project, business activity)
- Each participant is responsible for profits, losses, costs associated. Venture is own entity separate from participants’ other business interests
What is a working capital?
- Amount available to company for day-to-day use
- Company ability to meet current liabilities
- Current assets - current liabilities
What is a Client Account Planning session?
- Review of current workload, resources and fees
- Involves identification of key client personnel who have influence over job opportunities and identification of who firm should look to build relationships with
- Review of pipeline opportunities with that client also undertaken
Does your firm produce an annual account?
- Yes, statement of turnover, gross profit, net profit
- Submitted to Companies House in accordance with Companies Act
Would you be able to interpret and understand an annual account?
At a high level to determine basic ratios, however I would seek advice from internal accountants if and when necessary
What do you need to consider when setting up your own practice?
- Making sure I comply with RICS Rules and behaviours set out for firms
- Register business, apply to HMRC
- Set up company (+ client) bank accounts
- Obtain apt PI, run off cover
- Director and officer liability
- Building insurance
What is a PESTLE analysis?
Political, Economic, Social, Technological, Legal, Environmental factors influencing market conditions
- Way of understanding and reviewing how external forces may impact business
What is a SWOT analysis?
Strengths, weaknesses, opportunities threats (related to project / business venture)
- Can be used as basis for business strategy
Objective of Porter’s 5 Forces model?
Identifies competitive forces that shape every industry, determining industry’s strengths and weaknesses and barriers to entry
1. Supplier power
2. Buyer power
3. Threat of substitutes
4. Threat of new entrants
5. Competitive rivalry
Examples of fee earning and non fee earning staff?
- Fee earning i.e. QS, PM, architect
- Non fee earning i.e. business infrastructure, admin, IT technicians
