Setting up a hypothetical business in the field of education

Topics: Wales, Primary education, Welsh language Pages: 17 (3662 words) Published: February 16, 2014

Title:
Setting up a hypothetical business (Hybu Hyder) in the field of education

Word Count: 3,680 Words

An Introduction to Self-employment:

Self- employment means ‘starting and running a successful business or social enterprise’ (AGCAS, 2011). There are many reasons that people decide to start up their own business, including:

to sell their skills and/or expertise;
to prove an idea;
because they are their own boss;
to gain a sense of freedom;
because they relish the challenge;
as they can do something they are interested in;
because they want to generate a second income stream;
for a possibility to earn more money;
to work fewer hours;

As Percy Emmett states, ‘when you’re running your own business, you are in control. You decide what you work on’ (SJPE6004 Lecture Notes, 2013), thus, demonstrating that there are several benefits to self-employment. But how do we go from our ideas to the reality of setting up a business? Firstly, you must decide on a structure for your business; businesses operate under a selection of legal structures depending on:

the product/ service
types of customers
investment and funding
the number of people involved in the business

Your decision will have implications for tax, national insurance, accounts, record keeping and how management decisions are made. The following table outlines the features of each available business structure:

Structure      
For
Against
Sole trader
Low cost, easy to set up   
Full control retained   
Very little financial reporting
Full liability for debt
Pay more in tax
Lacks credibility in market
Partnership
 
The above, but with more heads   
More potential to raise finance      
The above, affecting all partners
Can be messy to wind up
Limited company   
Less personal financial exposure
Favourable tax regime
Ability to work for corporate clients   
Administrative and regulatory demands heavier
Annual accounts and financial reports must be placed in public domain Limited liability partnership (LLP)
Flexibility: can be incorporated in members' agreement
Advantages of limited company and partnership combined    Profit taxed as income
Partners must disclose income
LLP must start to trade within a year of registration – or be struck off

(Startups, date unknown).

Once a decision has been made on a business structure, a business plan is constructed and as a document which outlines all of the information needed for potential buyers and investors. It describes the business, its objectives, its strategies, the market it is in and its financial forecasts and therefore has many functions, from securing external funding to measuring success within your business. ‘It is essential to have a realistic, working business plan when you're starting up a business,’ says the Welsh Assembly Government (2012).

Hybu Hyder is the name of the authors hypothetical business, and within this paper, its business plan will be discussed thoroughly demonstrating a developed understanding of the implications that arise as well as tax and legal requirements.

1. Business Details:

b) Background and Rational

During her time as a student, Cara Harris, the director of Hybu Hyder visited several educational settings in and throughout Wales. It came to her attention that the National Eisteddfod competitions is an aspect of annual school life whereby teachers, students and parents (thus, the whole school community) dedicates much time and effort.

Aside from circumstances in which children were receiving peripatetic music lessons from external teachers, Cara noticed that in most primary schools, in order for practices and preparations for the competitions to take place, pupils were taken out of their academic lessons in order to undertake sessions including dancing, singing and recitation lead by their classroom teachers. This scenario is one which in my opinion should be re-thought as it:...
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