Business Planning

Question 1

What is an organisation structure and why is it important?

Answer 1

It helps determine who reports to who, and who makes decisions about what.

An organisational structure defines how job titles /roles, and responsibilities are assigned within a company.

Question 2

What type of organisational structure does your firm have?

Answer 2

Team-Based structure
– Each team contains both leaders and workers.
– All teams work towards one common goal while performing their own specialist tasks.

Question 3

What are your firms short and long-term goals?

Answer 3

Short term:
Continue to provide a high level of service and achieve KPI’s (26% profit and 80% utilisation).

Build relationships with new clients to continue the growth and development of the business.

Long term:
Open more offices to become the leading building surveying consulatncy in the North.

Question 4

What is financial benchmarking?

Answer 4

Financial analysis to assess the company’s:
– Competitiveness
– Efficiency
– Productivity.
‘Benchmarking’ refers to the process of comparing the business practices and performance standards to other firms within the same industry.
Quality, time, and cost are the most common values that are measured.

Question 5

What are the 4 types of benchmarking?

Answer 5

• Internal
• External
• Performance
• Practice.

Question 6

What is a Business Plan?

Answer 6

A statement of the business’s goals and objectives.

The reasons why they are thought to be attainable and the plan for reaching the goals.

Question 7

What’s the difference between a goal and an objective?

Answer 7

• Goals: Achievable outcome typically broad and long term.
• Objective: Defines specific measurable actions to achieve the overall goal.

Question 8

How do companies write a business plan?

Answer 8

Analyse the market to identify business opportunities and success factors.

Outlining the development of goals and objectives with their associated strategies and actions.

Question 9

What should a business plan include?

Answer 9

• Executive summary.
• Description of the business.
• Marketing strategies.
• Management team and personnel.
• Operations.
• Financial forecasts.
• Setting corporate objectives.

Question 10

How do you think an up to date business plan can help an organisation in the current economic climate?

Answer 10

• to seek funding;
• to gain new instructions, new clients, new customers;
• to help focus on key priorities;
• to allow the organisation to respond to change;
• for budgetting; and
• for setting targets for staff

Question 11

What is your firms business plan?

Answer 11

Vision: To become the North’s leading independent building consultancy.

Goals: Expansion of the team and offices and growth within certain sectors for example sustainability and modern technology.

Question 12

What is a SWOT analysis?

Answer 12

A SWOT analysis can be used to analyse the internal strengths and weaknesses and external threats and opportunities of a company.

Question 13

What is a PEST analysis?

Answer 13

Analysis of Market Conditions (Remember Estate Agents are PEST’S)

These factors are:
- Political.
- Economic
- Social.
- Technological.

Question 14

What are Porter’s five forces?

Answer 14

They are used to analyse the competitiveness of an industry and the barriers to entry.

These typically include:
- Substitute products.
- Bargaining power of suppliers.
- Bargaining power of customers.
- Rivalry amongst existing firms.

Question 15

How do you contribute to your company’s goals?

Answer 15

– Maintain excellence in my work.
– Sharing knowledge within integrated teams.
– Keeping up with new technologies.
– Upskilling new and junior team members.

Question 16

What are your firms Terms of Business?

Answer 16

The Engagement Letter & the T&C’s form the contract between our Firm and the Client.

The terms of business include:
- General Obligations to the client outlining the agreed service.
- The Client’s General Obligations (payment terms).
- Additional Service terms /additional fees if the work scope varies.
- Complaints handling procedures.

Question 17

Would you be able to interpret & understand an annual account?

Answer 17

At a high level I would but I would seek further advice from my firms internal Accountant if necessary.

Question 18

What is contained within an appointment document?

Answer 18

– Scope of service
– Payment terms
– Complaints Handling Procedure
– Insurances and limit on liability
– Limitations

Question 19

Does your firm produce an annual account?

Answer 19

Yes; this is submitted to Companies House in accordance with the Companies Act 2006.

Question 20

What is the purpose of a business plan?

Answer 20

• Create a strategy for growth
• Determine future financial needs

Question 21

What is a sole trader?

Answer 21

A Self employed person running their own business as an individual. There is no separate legal identity to the owner. The sole trader is liable for the business’s debt.

Question 22

What is a LLP?

Answer 22

A limited liability partnership. This requires 2 or more members. Each member pays tax on their share of profits and is liable for their responsibilities within the partnership.

Question 23

What is a limited company?

Answer 23

General form of incorporation that limits the liability undertaken by shareholders.

The liability of a company’s members is limited to their stake in the company.

Question 24

What is the difference between LLP and Ltd?

Answer 24

Ltd company can be non-profit/charity.

LLP is always profit making.

LLP must have a minimum of 2 partners,

Ltd pays Corp tax
LLP doesn’t as they are classed as self employed.

Question 25

What would you need to set up as a company?

Answer 25

• Public liability insurance.
• Professional indemnity insurance.
• buildings insurance (if required).
• Employer liability cover (if required).
• Registration with companies house.
• Suitable policies in place such as complaints handling procedures.
• Register with RICS for regulation.

Question 26

How often might you update a business plan?

Answer 26

Business plans should be reviewed and possibly updated at least once a year, especially for younger companies.

Question 27

What are the different types of business plan?

Answer 27

Start up plan – how the business will operate long term

Growth Plan – financial, marketing and operations

Scenario Plan – for companies in rapidly changing industry

Question 28

Do you have a profit target and how is this determined?

Answer 28

Yes, this is 26%.

This is determined to help achieve the financial goals of the business.

Question 29

What are the financial goals for the company?

Answer 29

The Building Surveying team has a goal to achieve £1million this financial year.

Question 30

What is an organsational structure?

Answer 30

This is a framework to allow employees to understand:
- Job responsibilities
- Who to report to
- How to interact with the relevant teams

Question 31

What are financial ratios?

Answer 31

Values taken from financial statements to give information to analyse a company’s relevant finances into ratios.

This can be used to compare company finances with competitors.

Question 32

What is working capital?

Answer 32

The difference between a company’s curent assets and current liabilities.

That can be converted into cash within a year.

Question 33

Name some types of business plan?

Answer 33

• Strategic Plan: Focused on mid /long term goals.
• Departmental: Focuses on a specific team or department within a company.
• Corporate: Defines strategies on how employees will meet the goals of a business.
• Operational: How the business will achieve the goals usually throughout the year.

Question 34

What are stocks?

Answer 34

Share in the ownership of a company.

Question 35

What is the difference between debtors and creditors?

Answer 35

Creditors: People the firm owe money to for goods /services.

Debtors: Owe money to the firm.

Question 36

What is business forecasting?

Answer 36

Prediction of future outcomes.

Based on past and present data.

This can include market conditions and historical trends.

Question 37

Describe corporate planning?

Answer 37

Strategies for meeting business goals and achieving objectives.

Question 38

How does business planning contribute to the success of a company?

Answer 38

Facilitates decision making by setting a time frame for achieving goals.

Measure performance against goals and whos responsible.

Question 39

What is Return on Investment?

Answer 39

RoI is the ratio between income and investment.