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Entrepreneurship, Innovation & Dynamic Capitalism Essay
Executive Summary
Enhancing the use of technological program was initiated to improve the efficiency in business achievement through the use of table computers. For instance, the use of iPad, iPhone iPod, and other mobile applications has revolutionized the technological development.
Through the program, all mobile users are expected to be technologically literate by the time the users finish the eighth grade. For instance, the finance management “tablet” devices to be designed will incorporate the use of information technology.
The program also includes skills development where 25% of the funds are allocated to train the workers who are manufacturing “tablet” devices. Only state of the art manufacturers and agencies are eligible for the grant and loans to improve on the production of such technologically driven products.
With the information received from the potential investors, the partners intend to invest in an area with a high potential venture and business that has relatively high returns, immediately after graduation. This is because at that time, the mind is still fresh and capable of maximizing the market dynamics.
The company intends to create a number of employment opportunities for those who are in business and other fresh graduates. As a new venture into the business, the proprietor felt that the technologically driven products had a future in the competitive market due to increasing preference for such products. Since the business is capital intensive, a number of investors are expected to take part in carrying out the business activities.
Introduction
The Management of Finance unit includes the review, monitoring and implementation strategies, which are workable. It also involves the daily finance management of various business operations. Apart from the mobile users, the “tablet” devices are also suitable for both the departments in large organizations as well as micro-businesses. It provides users with the necessary financial and technical expertise that are valuable to the management of everyday business operations in workplaces, schools and home.
The finance management “tablet” devices, for example, will equip the mobile users with the knowledge of multimedia software, which is known as Great Plains (GP). The software is used in the finance and non-finance industry to manage sales of various companies. Sales managers used it to capture the details of their clients, and to reconcile the individual customer’s account.
Discussion
The people to be involved in planning for the business should represent the interest of all investors. Among those expected to be in the committee include the investment experts and school administrators. The business experts would be useful since they help in determining the content of the “tablet” devices. Members of the state and local business agencies should also be included so that they can evaluate the suitability of the program.
Partners should also be represented because they will need to help the mobile sellers. Also expected in the committee are experts in the technological field. Their expertise will be helpful when designing and selecting the suitable programs that would steer the organization to success.
The programs designed, should be flexible enough to allow full inclusion and equity of the prospected partners with special needs. The inclusion of diverse groups in the investment will ensure that it exploits the opportunities available in the market. The various contributions made, should be taken into consideration when implementing the business programs.
The main people who will benefit from the program are the mobile users. Enhancing business through technology is a program that is expected to increase and enhance the technological knowledge of the mobile users. Technology is not expected to replace the normal method of learning new skills, but to supplement it.
The company would find ways to make sure that the mobile users are equipped with all the necessary skills to use the features of the phone, thus make it user friendly. The “tablet” device manufacturers will also benefit because of postulated increase in sales, especially if they are used properly, thus the program can be of great importance to them. These “tablet” device manufacturers will have access to the other “tablet” device manufacturers and partners thus enabling easy sharing of information.
As a “tablet” devices designer, the company would get the chance to build something new that will be based on the needs of the mobile users, hence boost sales of the product and helps in the development of the business.
Though the program is intended to start displaying the smart phones, there are already mobile users who do not have the basic knowledge and so every step will have an introduction to technology so that mobile users can get a good foundation. Besides, the mobile users will then progress slowly as they add their knowledge.
The technological field is large and it keeps on changing hence one cannot exhaust it fully. Choosing between the desired and the actual needs is a challenge that any “tablet” devices designer has to face and overcome. The “tablet” devices will not be exhaustive to the mobile users and they should find it fun enough to do since it is practically impossible to live without the basic knowledge of technology in the modern world and it is therefore necessary to equip the mobile users early.
There are many benefits of learning technology at this level. First, the mobile users get a chance to advance their interest in the phones with specific features that they need. By learning how to use technology efficiently, the mobile users get a chance to enhance their knowledge by using the internet enabled phones. They can look for additional information regarding the various topics that they find interesting in their daily business and social interaction.
Secondly, it prepares the mobile users who desire to have a career in the technological field, a chance to have an early start. When the users are through with their business, they will not have to start from the beginning but they will widen their scope and invent new ideas. The other benefit is that “tablet” device manufacturers will get a chance to share knowledge with each other and get a better chance of researching on various businesses.
In addition, the “tablet” device manufacturers can find better ways of doing business and delivering the expected services. This will enhance their knowledge and improve their work efficiency considerably. Furthermore, the tutors will also find it easier to prepare reports, lesson plans and other records. The “tablet” device manufacturers will have direct access to the partnership with the company and this will give them a chance to discuss the outcome and claim from the mobile users.
According to the company, the mobile users are expected to use technology related terms that he or she has learnt. Importantly, the mobile users should know how to work with several software applications, know how to use computer peripherals such as printers and describe the characteristics of input, processing and output.
At this stage, the mobile users should know how to use local area networks, wide area networks and the internet to enhance its use, thus it is the responsibility of the company to device the most appropriate means of marketing.
The mobile users would also be expected to have the knowledge to operate the system, software applications, communication tools and network components of the mobiles. He/she should know to use the various storage devices, know the difference between analog and digital technology and be proficient in the use of the input devices. As a new company, the management would spend more time training the users on the features of the mobile.
Proforma Income Statement
| Item | Year I ($) |
| Sales | 4,705,000 |
| Cost of goods sold | 1,751,000 |
| Gross profit | 2,954,000 |
| Expenses | |
| Wages and salaries | 1,920,000 |
| Rent | – |
| Water | 20,000 |
| Telephone | 35,000 |
| Electricity | 22,000 |
| Advertising | 20,000 |
| Stationary | 42,000 |
| Postage | 4,500 |
| Transport | 200,000 |
| Depreciation | 10,000 |
| Interest | 40,000 |
| Repairs and Maintenance | 21,000 |
| Total Expenses | 2,334,500 |
| Net Profit before tax | 619,500 |
| Provision for tax | 238,000 |
| Net Profit after tax | 381,000 |
Proforma Cash Flow Statement for the Company
| Receipts (Inflows) |
Jan $ |
Feb $ |
Mar $ |
Apr $ |
May $ |
Jun $ |
Jul $ |
Aug $ |
Sep $ |
Oct $ |
Nov $ |
Dec $ |
Total $ |
| Balance B/F | – | 10,500 | 36,000 | 46,500 | 82,000 | 147,500 | 125,500 | 208,000 | 390,500 | 641,000 | 758,000 | 977,000 | 3,423,000 |
| Cash Sales | 100,000 | 200,000 | 250,000 | 300,000 | 310,000 | 290,000 | 320,000 | 350,000 | 310,000 | 360,000 | 350,000 | 120,000 | 3,260,000 |
| Credit Sales | 100,000 | 80,000 | 80,000 | 40,000 | 50,000 | 30,000 | 100,000 | 150,000 | 200,000 | 170,000 | 195,000 | 250 | 1,445,000 |
| Capital Introduced | 120,000 | 50,000 | 10,000 | – | – | – | – | – | – | – | – | – | 180,000 |
| Other Income | 60,000 | 80,000 | 60,000 | 60,000 | 70,000 | 60,000 | 80,000 | 60,000 | 80,000 | 40,000 | 60,000 | 100,000 | 810,000 |
| Total Receipts (A) | 370,000 | 420,500 | 436,500 | 446,500 | 512,000 | 527,500 | 625,000 | 768,000 | 980,500 | 1,211,000 | 1,363,000 | 1,447,000 | 5,799,500 |
| Payments(Outflows) | |||||||||||||
| Cash Purchases | 161,000 | 150,000 | 150,000 | 100,000 | 100,000 | 150,000 | 130,000 | 150,000 | 100,000 | 180,000 | 150,000 | 90,000 | 1,611,000 |
| Credit Purchases | – | – | 10,000 | 30,000 | 30,000 | 20,000 | 50,000 | – | – | – | – | – | 140,000 |
| Salaries/Wages | 160,000 | 160,000 | 160,000 | 160,000 | 160,000 | 160,000 | 160,000 | 160,000 | 160,000 | 160,000 | 160,000 | 160,000 | 1,920,000 |
| Rents/Rates/Water | 4,000 | 10,000 | 10,000 | 11,000 | 11,000 | 15,000 | 12,000 | 13,000 | 15,000 | 10,000 | 15,000 | 20,000 | 1,146,000 |
| Property Tax | 1,000 | 1,000 | 1,000 | 1,000 | 1,000 | 1,000 | 1,000 | 1,000 | 1,000 | 1,000 | 1,000 | 1,000 | 12,000 |
| Electricity/Advertisement | 3,000 | 4,000 | 3,500 | 4,000 | 4,000 | 4,000 | 3,000 | 4,000 | 3,500 | 3,000 | 3,000 | 3,000 | 42,000 |
| Maintenance/Repair | – | – | – | – | – | 3,000 | 3,000 | 3,000 | 4,000 | 3,000 | 5,000 | – | 21,000 |
| Insurance | 500 | 500 | 500 | 500 | 500 | 500 | 500 | 500 | 500 | 500 | 500 | 500 | 6,000 |
| Leasing Payments | – | – | – | – | – | – | – | – | – | – | – | – | – |
| Drawings | – | – | – | – | – | – | – | – | – | – | – | – | – |
| Interest Charges | 3,000 | 2,000 | 4,000 | 3,000 | 3,000 | 4,000 | 4,500 | 4,000 | 3,000 | 3,500 | 4,000 | 2,000 | 40,000 |
| Capital Expenditure | 3,000 | 5,000 | 4,000 | 3,000 | 3,000 | – | – | 3,000 | 5,000 | – | 5,000 | 7,000 | 38,000 |
| Telephone | 2,000 | 3,000 | 2,000 | 3,500 | 3,500 | 3,500 | 4,000 | 2,500 | 3,000 | 3,000 | 4,000 | 2,000 | 35,000 |
| Postage | – | 500 | 500 | 500 | 500 | 500 | 500 | 500 | 500 | – | 500 | – | 4,500 |
| Stationery/Printing | 2,000 | 4,000 | 5,000 | 4,000 | 4,000 | 3,500 | 4,000 | 3,000 | 4,000 | 4,000 | 3,000 | 2,000 | 42,500 |
| Transportation | 10,000 | 15,000 | 15,000 | 15,000 | 15,000 | 20,000 | 20,000 | 15,000 | 20,000 | 25,000 | 20,000 | 10,000 | 200,000 |
| Vehicle Running Cost | – | – | – | – | – | – | – | – | – | – | – | – | – |
| V.A.T Payable | 20,000 | 20,000 | 25,000 | 20,000 | 20,000 | 18,000 | 20,000 | 18,000 | 20,000 | 20,000 | 15,000 | 10,000 | 226,000 |
| Total Payments (B) | 369,500 | 384,000 | 390,500 | 364,500 | 364,500 | 402,000 | 517,000 | 377,500 | 339,500 | 453,000 | 386,000 | 307,500 | 4,555,500 |
| Net Cash Outflows (A-B) | 10,500 | 36,500 | 46,500 | 82,000 | 147,500 | 125,500 | 208,000 | 390,500 | 641,500 | 758,000 | 977,000 | 1,140,000 | |
| Net Cash Flows | 10,500 | 47,000 | 93,500 | 175,500 | 323,000 | 448,500 | 656,500 | 1,047,000 | 1,688,000 | 2,446 | 3,423,000 | 4,563 |
If the firm projected the operating cash flows for the fist five years as shown,
| Year | 0 | 1 | 2 | 3 | 4 | 5 |
| Initial Investment | $1M | |||||
| Cash Flow | 50K | 150K | 300K | 500K | ||
| Terminal Value | $5m |
Then,
Cost of the Capital
The annual cost of capital would be 50K and each business partner will contribute a percentage of the total.
Net Present Value
Note: the Net present value is calculated at 12 percent for the period of five years. Therefore, the entire business is acceptable because the NPV is greater than zero.
Equity Shares of the Co-founders
Since the co-founders are confident at 75 percent,
Their equity share for the return of $1M would be calculated as follows
Conclusion
In sum, the “tablet” device manufacturers will have to evaluate the mobile users differently so that she or he can determine the success of the Finance management program that the company uses in doing business, especially using the Great Plain system. Evaluations will be done differently starting from the elementary level to the secondary level. At the elementary level, asking the pupils simple questions regarding what they have learnt will determine whether the “tablet” device manufacturers has been successful in getting her objectives. At the higher levels, the “tablet” device manufacturers will need to evaluate the mobile users in a more comprehensive manner.
