Managing Finance
HND in Finance
Unit: Managing financial resource and Decisions
Assignment: A Pizza Hut Franchise
Compiled by: Binh Truong, MSc.
Scenario
A Pizza Hut Franchise
After some years working in the tertiary sector including spells as a manager for a restaurant and as General Manager for a 5 star Sheraton hotel you have decided that it is time to start your own business.
After looking around at the opportunities available you have de cided that a franchise of a fast food restaurant is a suitable business for you to operate. You know how the franchise system works and have seen other colleagues successfully start up their own franchises from some of the major operators in this sector.
You have, after considerable research in your local area, decided that a nearby shopping centre – Gunwharf Quay - has potential as an outlet for a further fast food operator and that a “Pizza Hut” franchise placed in the centre would meet customers´ needs.
You have contacted the corporate headquarters of the “Pizza Hut” chain – an American pizza business- and now know what sort of start up costs you are looking at and have realised that you will require some sort of financing in order to purchase the franchise and lease and equip suitable premises.
The projected start-up costs are:
Initial Cost of Pizza Hut Franchise – £13000*
Training course costs – £1200
Deposit and initial lease payment for premises – £12000
Estimated costs of equipping premises – £7500
Sundry costs – £5000
The balance in your savings account is £9500
* Pizza Hut also charges a payment out of your pre-tax profits of 12% for the continued use of the franchise, to be paid at the end of each financial year.
You will produce an individual written report for this assignment. The report should be approximately 1500 words and presented in a formal report style.
1
Assessment 1:
Sources of Finance
This task addresses LO1 – 1.1, 1.2, 1.3/ LO2 -2.1
Produce a report that can be used
Unit: Managing financial resource and Decisions
Assignment: A Pizza Hut Franchise
Compiled by: Binh Truong, MSc.
Scenario
A Pizza Hut Franchise
After some years working in the tertiary sector including spells as a manager for a restaurant and as General Manager for a 5 star Sheraton hotel you have decided that it is time to start your own business.
After looking around at the opportunities available you have de cided that a franchise of a fast food restaurant is a suitable business for you to operate. You know how the franchise system works and have seen other colleagues successfully start up their own franchises from some of the major operators in this sector.
You have, after considerable research in your local area, decided that a nearby shopping centre – Gunwharf Quay - has potential as an outlet for a further fast food operator and that a “Pizza Hut” franchise placed in the centre would meet customers´ needs.
You have contacted the corporate headquarters of the “Pizza Hut” chain – an American pizza business- and now know what sort of start up costs you are looking at and have realised that you will require some sort of financing in order to purchase the franchise and lease and equip suitable premises.
The projected start-up costs are:
Initial Cost of Pizza Hut Franchise – £13000*
Training course costs – £1200
Deposit and initial lease payment for premises – £12000
Estimated costs of equipping premises – £7500
Sundry costs – £5000
The balance in your savings account is £9500
* Pizza Hut also charges a payment out of your pre-tax profits of 12% for the continued use of the franchise, to be paid at the end of each financial year.
You will produce an individual written report for this assignment. The report should be approximately 1500 words and presented in a formal report style.
1
Assessment 1:
Sources of Finance
This task addresses LO1 – 1.1, 1.2, 1.3/ LO2 -2.1
Produce a report that can be used