Business Planning Edexcel Unit 5

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EdexcelGCEBusiness tudies907 )Unit 5: Business lanningAdvancedWednesday1June2008 MorningTime: hour30minutes

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Materials required for examination Items included with question papersC""t."n

Instructions to CandidatesIn the boxes above, write your centrenumber,candidatenumber,your surnameand initials, and yoursignature.Check that you have the correct questionpaper.Answer the question.Write your answers n the spaces rovided n this questionpaper.Do not usepencil.Use blue or black ink.Show all the steps n any calculationsand state he units.Do not return the context with the question paper.Information for CandidatesThere s 1 question n this questionpaper.The total mark for this paper s 84.There are12 pages n this questionpaper.Any blank pagesare ndicated.There are up to 4 marks for the quality of written communication.Calculatorsmay be used.Dictionaries may not be used n this examination.Advice to Candidates

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You must ensure hat your answers o parts of the questionsare clearly numbered.

This publication may be reproduced only in accordance withEdexcel Limited cop yright policy.02008 Edexcel Limited.

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Youare advisedto spend at leost I5 minutesreading the ollowing information, then answer tltequestionwhich ollows.

THE OLD VICARAGEACTIVITY CENTRE.EDUCAIION, FLIN, CHALLENGES ANDMEMORIES - WE PROVIDE THEM ALL!'For 2l years his family-run centrehas specialisedn providitrgawide range of adventurousactivities,from one hour to oneweek,for beginners o the experienced, or nine months of the year.Based n 30 acres,surrounded y stunning scenery n the Shropshirecountryside,he Old VicarageActivity Centre OVAC)only takes a limited numberof bookingsat any one ime, and offers sole useof facilities for residentialparties.This policy ensures nrivalledpersonalattention o detail andtheundivided attentionof its staff to guararteea safeexperienceor all guests.t is, therefore,no surprisethat theOVACboastsa tradition of endorsement y the British CanoeUnion, the AdventureActivitiesLicensingAuthority and he British MountaineeringCouncil.TheOVAChashaditionally catered or a vast rangeofvisitors, from eleven-year-old oy Scoutgroupswith a passion or canoeingand archery to middle-agedbusiness eoplewho wish to simply engagein teambuilding andproblemsolving activities. n the last 12 months he OVAChaswelcomedgroupsfrom NatWestBank plc, WestBromwich Building Society (seeAppendix 1) and newly-qualifiedmedicalstaff from the ocal RegionalHealthAuthority. The Centrehasworkedhard o extend ts rangeof activities o include climbing, abseiling,cavingand,most ecently,paintball. ndeed he managementis concemed hat the OVAC is in dangerof having to operateat fuIl capacity n order to cope withthe growing demand.To avert this problem,the owners Brian and JaneDavies, are considering woexpansion pportunities.Option A - Extend current site by the purchaseand developmentof Ginny FarmTo develop neighbouring arrn land at a cost of 130000 to house stables or horse riding, a l0-acrequadbiking track and a lasergun shooting aage.Thequadbikes would cost a further f16000 for 20bikes; he aserequipment nother I 0 000 and he horse iding wouldbe a concession rrangement ithmanagerStephanie ddiesof the ocal riding school CounhyTreks', nvolving no further outlay. It hasbeenestimated hat net cash-flowswould increase y an average ff,8 000peryear(seeAppendix2) ifthis optionwas chosen.Furthermore,his developmentwould enable he OVAC to meet hechallengesof the recentUK Govemment'smanifestoon outdooreducationseeAppendix 3).Option B - Developan overseas entre in NepalTo developanotler site in the Sukute egion of Nepal. This option would be a joint venturebetweenthe OVAC senior nstructor,Anthony, eldest son of Brian and Jane,andprospectivebusinesspartnerGerry Moffatt. Anthony and Gerry visited Sukute 18 months ago and discoveredan outward boundstyle activity cenhe,ownedby EquatorExpeditions,which is now up for saleat a costof approximatelyf,20000*. Gerry has calculated hat a further f,10000 would be needed or equipmentsuch as canoes,climbing hamesses nd opes.What makes his optionparticularlyathactive s that t would enablestafffrom the Shropshire entrea changeof scene, rovideopportunitiesor professionaldevelopmentn amore challengingenvironmentseeAppendix 4), ard it would be operationalall yearround.* givencurrnt exchange ate ofl : 140Nepal Rupees

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APPENDIX 1FACSIMILE

To: Brian Davies At: OVAC, StottesdonFax: 01746718575 Phone:01746718436From: RukhsanaBegum Position: Human ResourcesManagerFax: 0l2l 358 5991 Phone:0l2l 358 5992Date: 8th June2007Re: Visit on 28th May and Future BookingMany thanks or an absolutely antasticweekend.The activitiesyou providedwere certainlyquite achallengeanda really effectiveway of supportingour Induction Programmeor new staff. Needless osay, would like to provisionallybook for next season, referably29th- 3 st May. I realiseyou mayalreadybe booked,so would appreciatefyou could et me know as soonaspossibleso hat I canmakealtemativearaxrgements,f necessary.

APPENDIX 2Predictednet cash-flows orOVAC Ginny Farm Development,Shropshre, 2007 20 | 6*Year 1:Year 2:Year 3:Year 4:Year5:Year 6:Year 7:Year8:Year9:Year 10:

f6 000f.6400f6 900f7 500f8 200f8 800f9 300f9 500f9 000f8 400

* preparedby Juliet Bain, Senior Partner, Ernst & Young plc

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APPENDIX 3

Tuesday 8November2006

This moming, at the Natural History Museum, he EducationSecretary, lan Johnson,will launch aGovemmentMa.nifesto or Leaming Outside he Classroom."This is a significant step," says StephenBrown, who chairs the nationalpanel representing ocalauthority outdoor educationadvisers. We haveknownthe valueof theseexperiencesor manyyears,but, finally, tle govemmenthas made he case."According o theAssociationof Headsof OutdoorEducationCentres Ahoec),a sigrrificantnumberofcentresare under hreat of closureor review. "At the moment,22 centresare facing cuts n proyision,cuts n budgets,or proposalso close," saysKevin Jackson, hoec's chair. "Wewelcome he Manifestoaad stronglysupport heprinciplesbehindoutdoor eamiirg,butwe will need he specialistskills of thestaff n these entres."TheGovernment'sManifesto akes heform of a seriesof pledges,with local authoritiesand educationorganisationsbeing invited to sign up as evidenceof their commitnent. There's the promiseof aresidential experience or every state-school upil, alongsidea progftmme to promoteand supportout-of-classroomearning.

APPENDIX 4Extractfrom StaffAppraisal Record, he Old VicarageActivity CentreDate:Employee:2007-g CPD* Needs:Line Manager:

2TthAugust2007Nicki AyresBritish MountaineeringouncilLevel 3 Qualification eveI2British CanoeUnion nstructorBill Brown,Senior evel 4 Instructo.r* CPD= ContinuingProfessionalDevelopmentActionsProoosed1. Increase he numberof working hours rom 2l perweek o 40 from 3rd September 0072. Extend he season ad opportunities o work with largergroups;suggested ukuteCenhe n Nepal3. UpdateEmergencyMedical TechnicianCertificate hrough 2-day :aining event n Oxford

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v-Leaveblankl . With referenceto the information given and your own ideas, evaluate the two optionsavailable o Brian and JaneDaviesAND constructa businessplan that would ensure hesuccessfulmplementationof ONE of the options.

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Q1(Total80 marks)

Quality of Written Communication:4 marksTOTAL FOR PAPER: 84 MARKSEND

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Business Planning Edexcel Unit 5

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