Part 1

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Health Audit
● Is your health good?

● Will it allow you to work for long hours, often

under stress?

● Poor health can prevent you from carrying out

the duties which are essential to the running
of a business

2
Time Audit
Do you have any commitments which are
time consuming such as:
● Aged parents
● Children
● Disabled relatives
● Other employment

3
Personal Finance Audit 1
Examine the following in detail:
● Your current assets
● Your current debts
● Current debts of dependents
● Your regular annual income (if any)

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Personal Finance Audit 2
Examine the following in detail:
● Cash in bank
● Your regular financial obligations
● Other financial commitments which are
irregular

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Personal Finance Audit 3

● Are you prepared to offer your house as

security for a bank loan?
● Have you investigated the different financial
organizations which are likely to provide you
with financial backing
● Which government sponsored organizations in
your region provide start up capital for new
businesses?

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Things to note

• When used as a proposal for starting a new

business, the business plan is essentially a
statement of your intentions
• It should focus on your professional
knowledge and skills
• It is essential to impress your target audience
• Presentation will create the first impression of
your professional competence

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Things to note

• Business plans take a lot of effort to research

and prepare
• They also contain a lot of confidential
information, so be careful to whom you show
them
• Only show them to those people who are
going to assist you. Operate on the Need to
Know Basis

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Things to note

• Lack of confidence is one of the main

obstacles that young designers have to
overcome when setting out in business
• Many competent people shy off because they
do not believe that they are capable of
succeeding in business
• An optimistic attitude is essential to succeed
in business. It will help you through times of
adversity

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Factors to beware of related to premises (a)
• Long leases. Your circumstances could change over
time. You could find yourself liable for the total sum of
the lease for the agreed period, if you wanted to vacate
your premises
• Frequent rent review clauses. If these are too frequent,
the landlord/landlady will have many opportunities to
increase your rent and you will have to comply
• Break clauses. Be sure you understand the conditions
under which you can vacate or be vacated from your
premises

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Factors to beware of related to
premises (b)

• Fully insured and repairing leases. Be sure you

understand the conditions under which you
lease. If in doubt, consult your solicitor. Be sure
you understand what you are signing. If in
doubt, ask your solicitor
• Remember, there is no such thing as a
standard contract. Everything is negotiable, so
if you think you can get a better deal that
initially offered, try bargaining
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Helpful things, which cost nothing
when making decisions about
premises

• Obtain a free report detailing crime rates for

each building you have short listed

• Obtain as much grant funding as possible

from United Kingdom and European Union
sources to help offset your initial costs

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1. Title Page

• Presentation must be of high quality

• Provides the potential investor with a first
impression of the design competence of the
creator of the plan
• Financial investors tend to regard designers
who submit shoddy business plans as people
likely to have a shoddy attitude towards
customers

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2. Table of Contents

• Must be included in a business plan

• Should provide a clear indication of the
location of each of the components that make
up the plan
• Pages must be numbered to correspond to the
table of contents

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3. Introduction

• A paragraph or two stating why you intend

starting up in business
• Also, it should briefly outline your plans for the
business in the immediate future

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4. Name of Proposed Business
• What are you going to call your business?
• Be sure not to use a name that is already
being used in your intended trading area
• Check the names of the local design
companies in the yellow pages
• When registering your company in real life, a
patent attorney or a solicitor would have a
search made to ensure that the name you
intended using was not already in use

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5. Kind of Design Service You Intend
Offering
• A brief description of the kind of design service you
intend to make available in the marketplace
• Make sure there is sufficient demand for this
service/product
• You should have a clear idea of the potential
market for your service/product in your intended
trading area
• Also, you must have a good knowledge of your
direct and indirect competitors

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Part 2

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6. Direct and Indirect Competition
 Direct competitors are those who specialise in
providing a service or product in your intended
market, which is equivalent or similar to what you
intend offering
 Indirect competitors are those who offer such
services or products as side lines in your intended
market

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7. Premises
• Type of premises you intend using for your proposed
business
• Size, location and proximity to your intended market
• Rent or leasing costs, rates and any other
associated costs such as electricity, cleaning, etc

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8. Furniture and Basic Equipment
• Basic equipment you will need
• Don’t go for the cheapest, buy the best you
can afford
• Go for quality that will last, provide comfort
and create the right impression with clients

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9. Computer Equipment

• What computer and ancillary equipment will

you need to compete effectively?
• It must incorporate industry standard software
• Provide reasons for your choices in your plan
• List the equipment and software and
summarize the cost
• Cost of additional training on equipment or
software?

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10. Internet Charges

Costs associated with

• Purchasing a domain name (www.etc)
• Creating a company website
• Extending the website to offer the chance for
potential customers to buy online
• Using suppliers websites to procure online

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11. Transport

• What type of transport do you intend using?

• Weigh up the advantages and disadvantages
of each alternative
• Work out a mileage charge
• Don’t forget to charge for your time travelling
at your hourly cost rate

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12. Insurance Costs (a)

● Employers liability insurance, if you are going to

employ people
● Public liability insurance
● Product liability insurance
● Professional indemnity insurance
● Vehicle insurance
● Premises insurance

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13. Insurance Costs (b)
● Stock, fixtures and fittings
● Plant and machinery insurance if the business will
have plant and machinery
● Employment protection insurance (disputes with
employees)
● Consequential loss insurance (losses in revenue due
to fires, accidents, etc.)
● Personal health and life insurance

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14. Hourly Cost Rate

• Calculate the basic unit for charging design

jobs and preparing estimates for inclusion in
quotations
• Incorporate direct and indirect overheads,
direct and indirect expenses and direct and
indirect materials
• Hourly cost rates should be reviewed every six
months, or at the longest, each year

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15. Summary of Costs

• Include all costs incurred in the running of

your business

• This is the summary of the totals of all of the

sections

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16. Startup Capital

• How much capital do you intend investing in

your proposed business venture?
• How much do you intend borrowing?
• Don’t forget to include some reserve capital
to carry you over the flat spots in the first two
years of trading. This will enable you to gain
a foothold in the marketplace

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17. Breakeven Point (a)

• This is the point reached when a business is

doing enough trading to just cover its
overheads. It is neither making nor losing
money
• After this, the businesses could either
become profitable or become loss
accumulating

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18. Breakeven Point (b)

• The simplest way to estimate a breakeven

point is to plot total costs over a twenty four
month period, against total income over the
same period
• The vertical to the x-axis from the
intersection of the two plotted lines will
provide the breakeven point

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