Speaker a Business start-up: Penguin Park

A tourist attraction with real penguins of all types in their natural habitat. Monorail yourself into the frozen world of the Antarctic and observe Emperor and King Penguins. Exhilarating rides like The Penguin Splash, carousels, side-shows, hands-on blue penguins and panoramic cinema form part of a breathtaking itinerary.

Initial investment: 30,000,000 euros

Projected income: 15,000,000 euros p.a.

Projected expenditure: 8,000,000 euros p.a.

Jobs: 100 Breakeven: five years

Speaker b The Olive Shop (established 2000)

A chain of stores where everything you can make from olives and olive trees can be found: oil, olives, scented oil, soap, cakes, sauces, preserves, furniture, accessories. Possibility of further expansion by franchising stores. The third outlet is about to open.

Investment: 100,000 euros per wholly-owned outlet

Jobs: three per outlet plus 20 in HQ

Return on investment: current net profit 15 per cent p.a.

Speaker c Business start-up: Sweet Sleepers

A store full of products to help you and your dear ones to sleep better. Bed linen, beds, pillows, herbal dispensers, anti-snoring devices and remedies are just a few of our star products.

Initial investment: 100,000 euros

Projected turnover: 500,000 euros p.a.

Running costs: 225,000 euros p.a.

Jobs: two (shop), three (IT/office)

Return on investment: 15-25 per cent p.a.

Plans to expand on-line and via franchise

Speaker d Business start-up: Ingredients.Com

An on-line database giving subscribers precise data on what they are eating: genetically modified products, additives, what’s in the vegetable oil, the food chain. Essential for people with allergies. Links to suppliers.

Initial investment: 100,000 euros

Running costs: 1,000,000 euros p.a. Jobs: 30

Expected website hits per day: 50,000+

Projected turnover: 1.2m euros (year 1)

Return on investment 50-100 per cent p.a.

2. You have decided to approach a venture capitalist to raise finance for one of the ventures in Exercise 1. Write the covering letter to accompany a detailed business plan.

Before you start, organise your thoughts. A potential business partner will be looking for clear, well-thought-out ideas.

With your neighbour, briefly discuss:

• whether or not to include all the points mentioned in the box below

• if there are other points that should be mentioned

— mention your previous experience

— mention your qualifications and skills

— outline the project

— refer to the business plan

— refer to the profitability of the venture

— refer to your personal attributes

— request an appointment to discuss the matter

— state why you have chosen to approach this particular venture capitalist

Now discuss how to organise the content:

• How are you going to begin? (Are you going to refer to the project? refer to why you have chosen to approach the reader? refer to someone who has made a recommendation? etc)

• What else are you going to say in the opening?

• What is the best order to list points in the body of the letter?

• How are you going to end the letter?

Write the letter. How long did it take you?

Role play 2. Choosing a Bank Account

A potential client (Student A) wants to deposit a good sum of money with a bank. Having read Lombard Bank’s leaflet he/she decides to meet with a representative of the bank (Student B) to discuss where to invest the money.

1. Work in pairs (Student A and Student B). Student A should look at the information below, and Student B at the information on page 28.

2. When you have completed the role play you will be asked to explain how you decided to invest the money.

Student A

You wish to deposit £30,000 with a bank and have been advised that the Lombard Bank provides very favourable conditions to investors. You have obtained a leaflet about their services, but you require further details before deciding in which account(s) to invest your money. You have therefore arranged to meet a representative of the bank (Student B) who will answer any enquiries that you have. Your saving requirements are as follows:

• You wish to set aside a sum of money for your three children, to be divided amongst them on their eighteenth birthdays. Their present ages are 10, 12 and 14.

• You would also like to set aside an amount for use in emergencies, for example to carry out any unexpected repairs to your house, to pay medical bills etc.

Total = £30,000

Decide what your priorities are: investing long term or short term. Study the leaflet carefully and draw up a list of questions that you will need to ask. The following guidelines show the sort of information you should obtain.

• Minimum/Maximum opening deposits

• Interest rates

• Dates of interest payments

• Restrictions on withdrawing money

Lombard Bank