Investment Appraisal

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Table of Contents
Background of chosen business3
Selling price analysis3
Budgeted income Statement for 5 years3
Sales budget for 5 years3
Purchase budget3
Wages Budget3
Other expenses3
Net Present Value Statement3
Recommendation3
Personal Learning Experience3

Background of chosen business
For the purpose of investment appraisal assignment we have chosen a fancy furniture business in which we have selected three items which we are going to sell in our business. As UK is the market where people use to decorate their home by antiques and fancy products our three selling items includes fancy mirror, Sofa/chair and centre table. In this investment proposal we do have to import these selling items for the reason of approval of business proposal. The product which we going to sell are mostly made up of wood work and the best place we can found for this is Malaysia. As Malaysia has one the highest export figures in its raw and furnished wooden items, our survey shows that the technical advancement in Malaysia in term of manufacturing is one of the finest. Due to limitations on theoretical aspects we have not given the details of the partners from whom we are going to purchase our product but the important aspect is that the shipment placed from Malaysia is on the basis of finished product but they require assembly which is core to our business as we are going to sell these product as easy to assemble basis and in our shop the product are assembled for the reason of display only. The existence of made to assemble furniture is common in all-around UK as people are more comfortable with it due to mobility issues. The reason of choosing only these three items for sale is that we are targeting the areas in the home which are TV lounge, reception and common sitting rooms. Consumers of these products can find these products attractive because they are light in weight, easy to move and clean. As these products are made up of wooden but the finishing colours and polish we are using on it give it some fanciness. To obtain finance from bank we have to make the proposal of five years business activities and returns, and the proposal have to so attractive and based on the real factors so the bank can find it easy to assess our so called financial aspect feasibility report. Future in this proposal assignment we can see all the estimated and budgeted figures which are analysed and reported in all five year bases.

Selling price analysis
For the reason of selling price to be marketable we have made several analyses by comparing products which are similar to our product. For this purpose we used the web based analysis by comparing prices in retail market seller these seller are Argos, B&Q, Harvey’s Furniture and home base. These retailer which we have chosen are can be seen as one the market leader in selling furniture as we are not in competition with these organisation cause we are focusing on three particular items not all the categories in furniture. For setting up the selling price we have done market survey which is the part of research for this assignment. We made a survey form in which we have presented pictures and specifications of our product and a part of it consist of specific questionnaire. These survey forms are then taken in to market like high street and mall’s where we ask several prospective customers to give their reviews by filling these survey forms. Example of questions found in survey forms are:

Questions | Options|
Are the fancy products founds attractive?| Yes/May be/No/Strongly Disagree| Suggested price range for each product?| Product 1 __ / Product 2 __ /Product 3 __| Suggestions for any design change?| |

Any environmental suggestions can be consider?| |

Budgeted income Statement for 5 years
The income statement we have generated is a result of the working we have done in this assignment as the reason of this assignment is to gain knowledge on...
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