Italy

• In the school year 2005-2006 we have In the school year 2005-2006 we have worked in a small enterprise.worked in a small enterprise.

• During a brainstorming activity we During a brainstorming activity we produced some ideas.produced some ideas.

• We started asking ourselves some We started asking ourselves some questions:questions:

Introduction to the project

1. What do we mean by business idea?

2. What type of business we would like to set up in Termoli?

3. What type of product should we trade?

RESULTS:RESULTS:

We needed to set up the most advantageous We needed to set up the most advantageous type of business being creative and type of business being creative and commercialising an attractive and competitive commercialising an attractive and competitive product.product.

Italy

•We decided that our best customers were the students in our school: by word of mouth they could encourage their relatives and friends to buy our product!!!!

We started gathering a lot of information:•Internet,•exploring Termoli and the surroundings.•We prepared a suitable questionnaire for our target.

•We needed to know what product could be the best for our business idea.•Xmas time was approaching so this was the questionnaire we submitted to our schoolmates.

QUESTIONNAIRE

1.      What do you consider nice and useful as a Xmas present?(tick your best choice – no more than 3)

table-clock potpourri bracelet necklace soap mobile phone container

2. Who would you buy it for? (tick your best choice – no more than 3)

myself my best friend my parents my relatives my boy/girl friend

3. How much are you ready to pay?

€ ………

4. Do you usually buy presents for Xmas?

YES NO

•The information we gathered were very positive as for question n. 4, since almost all the students interviewed said they wanted to buy presents for Xmas, for all the groups of people mentioned in question n. 2.

•The answer in question n.1 didn’t clearly establish a precise item, being selected almost all of them, but the amount of money, they were ready to pay – not more than € 5 – pointed out that we had to choose the most affordable and the cheapest, that is, potpourri.

Structure of the organization

After attending a workshop on different types of business and on management and organization, held by our teachers we were able to come to the decision to set up a mini-cooperative.

Why a mini- cooperative?Due to a small initial capital the most suitable form was a cooperative. We called it “mini” because the number of partners was ten.

•The “mini” cooperative does not need a huge amount of capital.•In the “mini” cooperative each partner contributes a small amount of money.•The mini cooperative has limited liability.

TASKS

S E C R E TA R YR icc ite lli F ran cesca

S TR A TE G IC P L A N N IN GC atte rin o L u ig i

P U B L IC R E L A TIO NR ivera A n ton e la S o led ad

L E G A L S E R V IC ER ivera A n ton e la S o led ad

P U R C H A S IN G D E P A R TE M E N TG ad a le ta C ris tin a

M A R K E TIN G A N D S A L E SC ap u rso F ran cesca

F IN A N C E A N D A C C O U TIN GD ilo ren zo A n ton e lla G ian tom aso L u c ia

M A N A G IN G D IR E C TO RC atte rin o L u ig i

During a general meeting every partner submitted his/her own CV explaining his/her strong points to fill the position in the company.

Everyone agreed to accept the positions requested realising that they fitted the person with the post.

TASKSet up an effective team

2. Define the tasks of the departments of the mini cooperative MANAGING DIRECTOR (Catterino Luigi) :The main function is to coordinate all the departments (purchasing, marketing,...etc.) so that the business can achieve the economic objectives.

SECRETARY (Francesca Riccitelli):This is an employee who helps the director, dealing with correspondence, arranging meeting, writing reports.

PUBLIC RELATIONS (Rivera Antonela):An employee who provides information to the public presenting a good image of the business.

STRATEGIC PLANNING: (Catterino Luigi) :this department is strictly connected to the managing department.

LEGAL SERVICE : (Rivera Antonela)in this department they take care of all the aspects related to national/international laws and regulations.

PURCHASING DEPARTMENT: (Gadaleta Cristina) :in this department the people in charge take care of raw materials needed for the manufacturing of the product.

FINANCE AND ACCOUNTING DEPARTMENTS: (Giantomaso Lucia e Dilorenzo Antonella):is closely involved in the planning process.It is responsible for raising the finance and for the management accounts of the business.It also oversees the payment of wages and the handling of cash. It has also to provide a financing balance.

The research we developed was:• What customers want,•How much they are prepared to pay,•When to launch the product (the approaching Xmas was a “time resource”.

MARKETING AND SALES DEPARTMENT: (Capurso Francesca) :this department is involved in finding out costumers’ needs at the right price. They also take care of publicity, advertisment and the right name for the company.

Preparation for work

TASKDefine your company name and logo 

The team effectuated a brainstorming to find out a suitable name and logo.The final decision of the group was for the following name:

F.A.L.C. ShopIt is the acronym of the initials of the partners’ names ( 2 Francesca, 2 Antonella, 1 Luigi, 1 Lucia, 1 Cristina).

•  Address of the business The team worked at the premises of the Liceo Tecnico Economico “G. Boccardi” in Via De Gasperi, 30 in Termoli.

The meetings took place in the computer lab on the ground floor.• Mission sentence

“We want to work together, to be competitive and to obtain

the largest share of the local market”

TASKDevelopment of a sales plan

The market research showed that most of the students and families were willing to buy our product. Taking into account the school population and families we hoped to sell about 400 pieces. This number would have guaranteed a complete placement of our product.  

 The product was formed by three elements:

1. A transparent and attractive fabric bag2. Potpourri in 4 different essences (rose, orange, sandal, jasmine)3. A card with a short Christmas-season message

After interviewing some local traders we found out that the total cost of the product was € 0.81 per each item.

PRODUCT

1 Bag € 0.50

1 Part of pot-pourri(€ 2.50 / 8)

€ 0.30

1 Card for message(€ 5.00 / 400)

€ 0.0125

TOTAL € 0.81

TOTAL COST TO BUY RAW MATERIALS

€ 0.81 X 400 € 324.00

Definition of the selling price.

The market research pointed out that we had to keep our prices low and competitive.We wished to earn at least 50% on each item. In this way we would have been able to continue our enterprise with another product and expand our business in the near future.

INCOME SALES

€ 2,00 x 400 € 800,00

FINANCIAL SOURCES

 

Each student bought five shares at € 5,00 per each share.Our two teachers bought 7 x 2 = 14 shares.The total starting capital was € 595,00. The financial need would have been completely covered.

PARTNERS AMOUNT

The students€ 25.00 x 7

€ 175.00

The two teachers€ 35.00 x 2

€ 70.00

The school management

€ 350.00

   

TOTAL € 595,00

BREAK-EVEN-POINT 

It is the point where the total income (variable and fixed costs) are equal to the total costs (running costs).

•The output of units is equal to the units sold (no units left).

MONEY

OUTPUT OF UNITS

Break-even-point:

2x = € 80.00 + 0.81x

X = € 67.23

(euro) 2006

PRODUCTS

pot-pourri bags

number of items sold 400

direct cost per unit (pot-pourri bag) 0,50€

direct cost per unit (pot-pourri) 0,21€

direct cost per unit (labour) 0,10€

total direct cost per unit 0,81€

price per unit 2,00€

FIXING THE SELLING PRICE

OPERATING REVENUE

(euro)

2006

Products

pot-pourri bags 800,00€

TOTALE 800,00€

TOTAL REVENUE 800,00€

(euro) 2006

DIRECT COSTProductsPot-pourrI bags 324,00€

TOTALE 324,00€

TOTAL DIRECT COST 324,00€

INDIRECT COSTpersonneltenancyINPSINAILtelephone chargeswater supplyChamber of Commerceenel (electricity supply)gas supplywastefiscal advicefire-preventiontrainingretirement allowancedepreciationadvertisement 80,00€ maintenancestationery

TOTAL INDIRECT COST 80,00€

TOTAL COST 404,00€

E-WORK MINI-COOPERATIVE 2006 - structure of costs

(euro) 2006

Products 800,00€ 100,0%

Net sales income 800,00€ 100%

Products 324,00€ 40,5%

Direct total cost 324,00€ 40,5%

OPERATING RESULTS 476,00€ 59,5%

Total indirect cost 80,00€ 10,0%

Operating results 396,00€ 49,5%

Financing charges -€ 0,0%

Profit before taxes 396,00€ 49,5%

IRPEG (37%) 0,0%

IRAP (4,25%) 0,0%

NET PROFIT 396,00€ 49,5%

E-WORK MINI-COOPERATIVE 2006 - profit and loss account

SWOT ANALYSIS

THREATS

There are many shops and street markets in the Termolisian area, selling similar cheap products

OPPORTUNITIES

•We can differentiate the products

•We can raise our capital

WEAK POINTS

•Due to legal factors we can’t sell the product to the market outside the school.

•We are selling a single product.

STRONG POINTS

•Our target is represented by students, their families and teachers.

•The product is cheap and everybody can buy it.

•We can make the final product.

•The approaching Xmas is a “time resource”

• How beautiful would it be if we could study all the subjects in this way!!!

CONCLUSIONS

•This experience has been very positive for us, it has shown how to do things.

•Now we feel we have acquired more awareness for the environment where we live as well as for the competences we own.

•We have learnt that when we start a business we have to find out the right ‘path’ taking advantage of all the opportunities we have, in order to obtain the information we need, when we need it.

•We have had the feeling that we have learnt a lot with enthusiasm, because we have had a strong motivation: to reach our goal!•In addition to this, we have used the English language more than usual.