Set Assignments
Issued April 2011
OCR Level 3 Award and Certificate in Preparing for a Business Venture (QCF)
Scheme codes 09898, 09899
Please note:
The OCR assignments must be used to provide evidence for the above detailed qualifications.
The assignments contained within this booklet allow for completion of all of the required
assessment criteria. It is the centre’s responsibility to ensure that assignments are complete
before the candidate work is dispatched to the OCR-appointed Examiner-moderator.
Unit
Title
Unit 1
Attracting customers through marketing
Unit 2
Adhering to business legislation
Unit 3
Planning the financial management of a business venture
Unit 4
Understanding how to sell a product/service
Unit 5
Producing business plans for business ventures
In order to achieve the OCR Level 3 Award in Preparing for a Business Venture, candidates
must achieve 8 credits from any two of the units detailed.
In order to achieve the OCR Level 3 Certificate in Preparing for a Business Venture,
candidates must achieve 20 credits from all five of the units detailed.
These OCR-set assignments remain live for the life of these qualifications and must not be used as
candidate practice material.
ALL THESE MATERIALS MAY BE PHOTOCOPIED. Any photocopying must be done under the
terms of the Copyright Designs and Patents Act 1988 solely for the purpose of these assessments.
Candidates may complete these assignments electronically. However, centres/candidates must
not alter the task instructions in any way.
Ofqual accreditation numbers:
Award – 600/1094/0
Certificate – 600/1095/2
04-11
© OCR 2011
OCR Level 3 Award and Certificate in Starting a Business Venture
Contents
Page
Number(s)
TUTOR INFORMATION
Guidance For Tutors
Notes For Tutors
This section provides additional guidance and support to centre staff for each unit
task. It is not intended for use by candidates.
Unit 1
Unit 2
Unit 3
Unit 4
Unit 5
Attracting customers through marketing
Adhering to business legislation
Planning the financial management of a business venture
Understanding how to sell a product/service
Producing business plans for business ventures
3
4
6 – 22
6
11
14
18
20
CANDIDATE INFORMATION
(This section must be photocopied for each candidate)
General Information For Candidates
This section provides candidates with general information on completion of the
assignment in a question and answer format.
23
24
Tasks
This section contains all the tasks candidates must complete before submission
for assessment.
Unit 1
Unit 2
Unit 3
Unit 4
Unit 5
2
Attracting customers through marketing
Adhering to business legislation
Planning the financial management of a business venture
Understanding how to sell a product/service
Producing business plans for business ventures
25
55
70
95
108
Set Assignments – Issued April 2011
Set Assignments: Tutor Information
OCR Level 3 Award and Certificate in Preparing for a Business Venture (QCF)
Scheme codes 09898, 09899
© OCR 2011
OCR Level 3 Award and Certificate in Starting a Business Venture
Guidance For Centres
1
2
3
General
1.1
OCR-set assignments are available to download free to centres.
1.2
Centres must use these OCR-set assignments for formal assessment of their
candidates.
1.3
OCR-set assignments must NOT be used as practice material.
1.4
These assignments have been designed to meet the full assessment requirements of
these qualifications. Candidates will need to take part in a planned learning programme
that covers the underpinning knowledge, skills and understanding of the units.
Before carrying out the assignments
2.1
Candidates should be provided with a copy of the Candidate Information section of this
booklet.
2.2
Candidates may carry out preparations prior to undertaking the tasks; there is no time
limit for this.
When completing the assignments
3.1
Candidates should be allowed sufficient time to complete all of the tasks. The
recommended guided learning hours (glh) for each unit is provided in the Centre
Handbook. However, this may vary depending on the nature of the tasks and the ability
of individual candidates. It is suggested that evidence is produced in several sessions.
3.2
Each assessment criteria has a corresponding task for completion. It is important that
the key word eg ‘explain’ is addressed by the candidate. Failure to do so may result in
a pass being denied.
3.3
Each candidate must produce individual and authentic evidence for each task within
the unit assignments.
3.4
Centre staff may give support and guidance to candidates. This support and guidance
should focus on checking that candidates understand what is expected of them. It is
not acceptable for tutors to provide model answers or to work through answers in
detail.
3.5
Candidates may use information from any relevant source to help them with producing
evidence for the tasks.
3.6
The assignments have been provided electronically for candidates that wish to
complete them electronically. Where this is the case, centres should provide each
candidate with an electronic copy of the assignments. This can be on disk, CD or on +a
secure networked system. OCR requires only the hard copy prints of the work as
evidence.
Candidates/centres must not alter the wording of the tasks in any way.
4
After completing the tasks
4.1
4
Candidates’ evidence is assessed by the centre’s assessor against the qualification
specification contained in the units and tutor notes. For further information about
assessment please refer to the section on Assessment and Moderation in the Centre
Handbook.
Set Assignments – Issued April 2011
OCR Level 3 Award and Certificate in Starting a Business Venture
4.2
5
Assessors’ decisions should be quality assured across the centre through internal
moderation. For further information about internal moderation please refer to the
Centre Handbook.
Presentation of work
The candidates’ completed tasks should be submitted to the named OCR-appointed
examiner-moderator in the relevant unit or full Assessment Record Folder (ARF). Further
information regarding submission of work can be found in the Centre Handbook and the
Administrative Guide to Vocational Qualifications (A850).
6
Reworking the assignment
6.1
If candidates do not meet the minimum PASS requirements for the assessment criteria,
further work will be required.
6.2
Tutors may give feedback to candidates to support and guide them in producing
evidence to the required standard.
6.3
OCR does not return copies of candidate work. As such, it is recommended that
centres keep copies of all work until results are received.
Set Assignments – Issued April 2011
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OCR Level 3 Award and Certificate in Starting a Business Venture
Notes For Tutors
Before starting the set tasks candidates must create written evidence for their new business
venture in a way which would allow them to verbally present it to a potential customer or funder.
The information should be written so that it will take no more than three minutes to present.
The description should include:

The purpose of the business

Your business idea explaining whether it is a product or a service

How it would be set up

Where it will be located
A copy of this must be included with all units sent to the external assessor so that they understand
the context of the candidate’s answers. This means that if 3 units are sent at the same time only
one copy is required. If individual units are sent a copy must be included on each occasion.
Unit 1 – Attracting customers through marketing
Introduction to the tasks
The tasks have been designed to enable candidates to demonstrate their knowledge and
understanding of how to devise a marketing strategy and marketing plan together with suitable
promotional material.
In addition, these notes suggest extension tasks which you may wish the candidates to undertake
to enlarge their understanding.
Each assessment criteria has a corresponding task for completion.
Task 1: Understand how to carry out market research
Assessment criteria 1.1, 1.2 and 1.3 are assessed in this task.
The first two parts of this task are generic designed to ensure that candidates understand the
different types of market research available to businesses. The third part requires candidates to
explain in approximately 150 words, a variation of ten percent is allowable, how they would carry
out market research for thier business, while the final section askes them to explain in
approximately 100 words, a variation of twenty percent is allowable, how market research is used.
You may wish to extend their understanding by asking candidates to construct and carry out a
simple questionnaire or interview schedule relevant to their business.
A table for completion has been provided in the candidate section.
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Set Assignments – Issued April 2011
OCR Level 3 Award and Certificate in Starting a Business Venture
Task 2: Analyse a business in relation to its chosen market
Assessment criterion 2.1is assessed in this task
Candidates need to understand that the ability to be able to analyse their business in relation to its
market is an important tool in helping it succeed. To do so they must offer analysis in terms of:
Strengths, Weaknesses, Opportunities and Threats (SWOT); Political, Economic, Social,
Technological, Environmental and Political (PESTEL); market share; profitability; and unique
selling point (USP). It is important that candidates in undertaking their SWOT analysis clearly
demonstrate that they understand that S and W refer to internal factors of the business while O
and T refer to external factors.
Having completed all the analysis they must then explain in approximately 50 words, a variation of
twenty percent is allowable, how their business would fit into its market.
Tables for completion have been provided in the candidate section.
Task 3: Explain the market pricing of a good/service
Assessment criterion 3.1 is assessed in this task.
Candidates need to understand that a business may use a wide range of pricing strategies
depending on its market position and the economic climate. The emphasis throughout this task is
on the candidates’ own businesses. They must identify five different pricing strategies that their
business might adopt, explain the advantages and disadvantages of each and then explain which
one or more of these strategies they would adopt for their businesses. Finally, they must explain
why they would adopt this strategy or strategies. Where possible an example should be provided,
eg for cost-plus, to illustrate how this would operate in practice.
There is no prescriptive list, but some possible policies include: competitor pricing; cost plus
pricing; destroyer pricing; going-rate pricing; penetration pricing; price discrimination; price
skimming’ and psychological pricing.
A table for completion has been provided in the candidate section.
Task 4: State the objectives of your business
Assessment criterion 3.2 is assessed in this task.
SMART objectives are ones which are: specific, measurable, achievable, realistic and time
specific.
Candidates need to state clearly how their business objectives, for at least the first year of
operation, conform to the SMART criteria.
Tutors should make sure that their candidates fully understand what is meant by each element of
SMART. To do so tutors might wish to set a SMART objectives exercise relating to their
candidates’ individual circumstances before asking them to complete this task.
A table for completion has been provided in the candidate section.
Set Assignments – Issued April 2011
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OCR Level 3 Award and Certificate in Starting a Business Venture
Task 5: Produce a marketing strategy for achieving your business’s
objectives
Assessment criterion 3.3 is assessed in this task.
In the first part of this task, candidates should refer to the business objectives identified in Task 4.
And explain how their marketing strategy would help them achieve these objectives. Consideration
could be given to the analysis produced in Task 2
In the second part of the task, candidates must state the external and internal constraints that they
would take into account when deciding on their marketing strategy. In doing this they should make
use of their SWOT and PESTEL analysis from Task 2.
You may wish to extend their knowledge and understanding by first discussing with the candidates
what a marketing strategy is, what it would contain and what constraints businesses face in
deciding on the strategy.
Tables for completion have been provided in the candidate section.
Task 6: Identify and apply brand values to your business
Assessment criteria 4.1 and 4.2 are assessed in this task.
Candidates are required to: list a range of examples to illustrate brand values in practice; identify
four brand values for their business; and to apply these brand values to the marketing materials for
their business.
You may wish to extend their understanding by using the following ideas before they start this task
so that they fully comprehend what is meant by brand values:

Image: cool, technological, friendly

Service: knowledgeable, reliable and caring

Product: good quality, authentic

Relationships: generous, neighbourly, green, respectful, honest

Commercial: professional, organised, efficient, respectable.
Task 7: Explain how promotional techniques will be used to attract and
retain customers
Assessment criterion 5.1 is assessed in this task.
Businesses use a wide range of promotional techniques. While some will both attract and retain
existing customers others are more suited to one or other of these aims. Candidates are required
to first identify and explain methods to gain new customers for their business and then to explain in
approximately 200 words, a variation of ten percent is allowable, how promotional techniques
could be used to retain existing ones.
A table for completion has been provided in the candidate section.
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Set Assignments – Issued April 2011
OCR Level 3 Award and Certificate in Starting a Business Venture
Task 8: Design a logo for a specific business
Assessment criterion 5.2 is assessed in this task.
An effective logo is one which is simple, relevant, memorable, versatile and legal. Candidates must
explain what these mean and then design a logo for their enterprise. Where possible it should be
designed electronically.
Tutors may wish to extend the knowledge and understanding of candidates by discussing with
them the need for the logo to not infringe trademark protection and copyright. Where possible,
candidates could be asked to check for this. Another exercise would be to look at a range of
existing logos before starting the exercise to see whether candidates feel they are simple, relevant,
memorable and versatile.
Task 9: Produce marketing literature for your business and justify the
approach taken.
Assessment criteria 5.3 and 5.4 are assessed in this task.
Candidates must produce a piece of marketing literature for their business and then explain in
approximately 200 words, a variation of ten percent is allowable, why they have produced this
marketing material. In doing so they must ensure that it conforms to the AIDA principle: gets your
attention; triggers your interest; creates a desire to buy, and generates action. Where possible
the marketing literature should be designed electronically.
Tutors may wish to extend the knowledge and understanding of candidates by first looking at some
marketing literature and discussing whether it meets the AIDA principle.
Task 10: Create a marketing plan for your business, including a marketing
budget.
Assessment criterion 6.1 is assessed in this task.
Candidates are required to create a marketing plan and budget. They may tackle these in
whichever order they find most helpful. If they have completed Unit 3 then they should use the
appropriate figures developed there as the basis for the monthly marketing budget for their
business for the first year of operation. If not, then tutors should try to ensure that the figures are as
realistic as possible.
The marketing plan should be approximately 750 words, a variation of ten percent is allowable,
and include the following points:

Which method(s) you will use to market your business

Which method(s) you will use to market your product/service

The budget and how it will be allocated to your different marketing activities

Timescales for starting and completing the activities

Who your marketing is aimed at.
Candidates should use their market research, marketing strategy and SWOT analysis, taking into
account their budget.
A table for completion has been provided in the candidate section.
Set Assignments – Issued April 2011
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OCR Level 3 Award and Certificate in Starting a Business Venture
Task 11: Describe how to implement a marketing plan
Assessment criterion 7.1 is assessed in this task.
Candidates need to realise that it is important not only to have a marketing plan, but, also, to know
how to implement it. They must: state why their marketing plan needs to be able to respond to
changing circumstances; identify the order in which it would be implemented; and describe in
approximately 200 words, a variation of ten percent is allowable, how the plan can be used to
review and monitor progress.
Before candidates start this task tutors may wish to extend their knowledge and understanding by
discussing these issues so that they realise, for example, that the order in which the plan is
implemented is important as against random.
A table for completion has been provided in the candidate section.
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Set Assignments – Issued April 2011
OCR Level 3 Award and Certificate in Starting a Business Venture
Unit 2 – Adhering to legislation
Introduction to the tasks
The tasks have been designed to enable candidates to demonstrate their knowledge and
understanding of how to devise a marketing strategy and marketing plan together with suitable
promotional material.
In addition, these notes suggest extension tasks which you may wish the candidates to undertake
to enlarge their understanding.
Each assessment criteria has a corresponding task for completion.
Task 1: Analyse the main types of legal structure available to businesses
Assessment criterion 1.1 is assessed in this task.
This is a generic task. It is important before starting a business that candidates understand that
although there are a variety of structures available only some are likely to be appropriate.
Candidates are required to describe each structure and then to explain their advantages and
disadvantages.
A table for completion has been provided in the candidate section.
Task 2: Select and justify a legal structure for your business
Assessment criteria 2.1 and 2.2 are assessed in this task.
Tutors must ensure that candidates have selected an appropriate legal structure. The candidate
must then explain in approximately 100 words, a variation of twenty percent is allowable, why this
structure has been selected and the others rejected.
Set Assignments – Issued April 2011
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OCR Level 3 Award and Certificate in Starting a Business Venture
Task 3: Explain the purposes of the legislation in place to protect the
business, the business owners, the employees and the customers
Assessment criterion 3.1 is assessed in this task.
This is a generic task in that candidates need to realise that legislation exists to protect the rights of
owners, employees and customers in a variety of circumstances. Candidates, however, may use
legislation which relates directly to their proposed business. They are required to identify two main
areas of legislation designed to protect: the business; business owners; employees and customers
and to explain how the legislation offers protection.
Where appropriate, candidates should be encouraged to use a wide range of legislation.
Reference could be made to: consumer protection; contract law; copyright; disability; employment
law; health and safety; pensions; race and sex discriminations; etc.
A table for completion has been provided in the candidate section.
Task 4: Identify sources of advice on relevant legislation for: the business;
the business owners; the employees; and the customers and explain
how this legislation is applicable to your business
Assessment criteria 3.2 and 3.3 are assessed in this task.
Candidates are required to identify three different sources of advice for business, owners,
employees and customers and to describe the advice they would be able to give. Reference could
be made to a variety of sources such as: accountants; banks; Citizen Advice; Chambers of
Commerce; HMRC; solicitors; trade unions; etc. Candidates must then explain in approximately
200 words, a variation of ten percent is allowable, how the legislation they have referred to in the
table relates to their business.
Tutors may wish to extend the knowledge and understanding of candidates by either discussing
with them what sort of advice is available from a wide range of sources, including those above,
and/or bringing in a representative of one, or more , of the sources to talk about how they can help.
A table for completion has been provided in the candidate section.
Task 5: Identify the main types of insurance, and their features, required for
business and explain the elements of business which are protected
by insurance
Assessment criteria 4.1, 4.2 and 4.3 are assessed in this task.
Candidates need to understand that insurance is not an optional extra, but can help guard
businesses from the financial loss incurred by failing always to fully adhere to legislation. They
must first explain in approximately 30 words, a variation of twenty percent is allowable, why their
business would need insurance. They must then identify at least four main types of insurance their
business would need, state three main features of these insurances and explain how these would
protect their business.
In order to complete this task candidates should be encouraged, where possible, to use a wide
variety of materials such as websites, leaflets, articles and brochures to source their information.
A table for completion has been provided in the candidate section.
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Set Assignments – Issued April 2011
OCR Level 3 Award and Certificate in Starting a Business Venture
Task 6: State and describe the tax and record keeping obligations of your
business structure
Assessment criteria 5.1 and 5.2 are assessed in this task.
Candidates need to state two reasons why businesses have to register with HMRC. They must
then describe in approximately 75 words, a variation of twenty percent is allowable, the taxation
and record keeping requirements that arise from the type of structure chosen for their business.
Tutors may wish to extend the knowledge and understanding of candidates by looking at the types
of records which businesses, other than those chosen, have to keep.
Task 7: Explain the principles of VAT
Assessment criterion 5.3 is assessed in this task.
Even if a candidate’s business is to start on a small scale it is important that they are aware of how
VAT works including when they would have to start charging VAT. Candidates must describe what
is meant by VAT including current rates. They must then explain in approximately 100 words, a
variation of twenty percent is allowable, how VAT works in relation to their business including: what
is meant by value added; how tax is payable; zero rated; and exempted status. They, also, should
provide a numerical example. Tutors must ensure that this example is correct.
Tutors may wish to extend the knowledge and understanding of candidates by looking at other
taxes that their businesses could be liable to pay.
Task 8: Explain the operation of income tax
Assessment criteria 6.1, 6.2 and 6.3 are assessed in this task.
All candidates are likely to be liable to pay income tax either as an employee or because they
operate as a sole trader. Although this is largely a generic task the final part should be applied to
their business. In the first part they must explain how income tax is applied including the different
tax bands and personal allowances. They must go on to explain what self- assessment means,
who needs to complete a tax return, how to get a self-assessment tax form and how to get a tax
reference. Lastly, they should state and explain at least four expenses that they will be able to set
against tax.
You might wish to extend their understanding by asking them to estimate their potential income
from their business in its first year and use this to complete a self-assessment tax form which could
be a paper version or downloaded from the HMRC website
http://www.hmrc.gov.uk/sa/forms/content.htm
A table for completion has been provided in the candidate section.
Task 9: Explain the principles of National Insurance
Assessment criterion 6.4 is assessed in this task.
Candidates are required to state what is meant by, and who has to pay, National Insurance.
They must then explain, in approximately 50 words, a variation of twenty percent is allowable, how
National Insurance works.
Set Assignments – Issued April 2011
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OCR Level 3 Award and Certificate in Starting a Business Venture
Unit 3 – Financial management
Introduction to the tasks
The tasks have been designed to enable candidates to demonstrate their knowledge and
understanding of how to devise a marketing strategy and marketing plan together with suitable
promotional material.
In addition, these notes suggest extension tasks which you may wish the candidates to undertake
to enlarge their understanding.
Each assessment criteria has a corresponding task for completion.
Task 1: Compare the methods used to gather information for a financial plan
Assessment criterion 1.1 is assessed in this task.
There are many methods available to a business for it to collect information for a financial plan.
These include: primary research; secondary research; and expertise from banks, government
bodies; etc. Candidates must identify at least four methods of collecting information, explain the
advantages and disadvantages of these methods and why they would or would not use each
method in their business.
A table for completion has been provided in the candidate section.
Task 2: Define the unit of production for your business and estimate the
direct costs of a unit of production
Assessment criteria 2.1 and 2.2 are assessed in this task.
When defining the units in which sales volume will be measured, units must be chosen which are
appropriate to the business. A service, such as consultancy, training or car repair, may be
measured in time (hours charged). A commercial window cleaner might charge per square metre
of glass, whilst a domestic window cleaner might charge by the house. For a homogenous product,
such as pasta, weight might prove appropriate. For a specific product, such as wheelbarrows, the
units will be of the product itself (ie so many wheelbarrows).
Candidates must define units of production appropriate to your business and what is meant by
direct costs per unit of production. They must then apply these definitions to estimate the direct
costs of their business. Tutors must ensure that the costs used for the estimation are in fact direct
costs.
Tutors may wish to take this opportunity to discuss with candidates the difference between direct
and indirect costs as this will assist them with both this and the next task.
A table for completion has been provided in the candidate section.
14
Set Assignments – Issued April 2011
OCR Level 3 Award and Certificate in Starting a Business Venture
Task 3: Identify the items of capital equipment needed to start your
business, estimate the cost of this equipment and the total indirect
costs
Assessment criteria 2.3, 2.4 and 2.5 are assessed in this task.
Candidates must identify the capital equipment that would be needed to start their business,
estimate the cost of this and then calculate total indirect costs. As far as possible they should use
up-to-date figures. Tutors must ensure that candidates are referring to capital equipment and not
direct costs or running costs.
A table for completion has been provided in the candidate section.
Task 4: Propose and justify the market prices for your product(s)/service(s)
Assessment criteria 3.1 and 3.2 are assessed in this task.
Candidates must understand that the price(s) they choose for their product(s)/services(s) need to
be clearly thought through. Using the information from Tasks 2 and 3, they must estimate a
suitable market price(s) for the product(s)/service(s) and explain in approximately 75 words, a
variation of twenty percent is allowable, why this price(s) has been chosen.
Candidates who have completed Unit 1, ‘Attracting customers through marketing’, may wish to use
some of that information.
Tutors may wish to extend the knowledge and understanding of candidates by getting them to look
at the prices charged by their rivals and discussing their chosen price in the light of this
information. Tutors may also wish to advise candidates to calculate their estimated total cost using
Tasks 2 and 3.
Task 5: Create a break even analysis for your business
Assessment criterion 3.3 is assessed in this task.
Candidates need to create a break even analysis for their business using either an arithmetical
calculation or a break even chart. From this they must state the break even price and quantity.
Tutors must ensure that any calculation or chart is accurate.
Tutors may wish to advise candidates to estimate their total revenue for each unit of output.
Candidates’ knowledge and understanding could be extended by discussing what break even is,
why businesses would calculate it and the ways in which they could use it in their businesses.
Task 6: Produce a personal survival budget
Assessment criterion 4.1 is assessed in this task.
It is important for candidates to know how much money they need to spend on everyday living
when setting up their own business. This may vary depending on their circumstances eg family,
house, car, pets and/or support from parents, wife/husband/partner, etc. Candidates must
construct a list of their own monthly personal expenditure (expenditure other than business) and
calculate a total, as well as a total on an annual basis. The well-known approximation that there
are four weeks in a month must not be used.
Tutors may wish to extend candidates knowledge and understanding by asking them to explain
why they needed these items of expenditure; the likelihood of the income sources providing the
sums shown; and whether they expect to be able to survive.
Set Assignments – Issued April 2011
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OCR Level 3 Award and Certificate in Starting a Business Venture
A table for completion has been provided in the candidate section.
Task 7: Construct a cash flow forecast for your business and draw
conclusions from it
Assessment criteria 5.1 and 5.2 are assessed in this task.
Candidates should estimate income on a monthly basis, using the sales income from the Sales
Forecast table, and all estimated payments, making use of Task 3. They must then calculate their
monthly and annual cash flow (Total A – Total B) and the opening and closing bank balances.
Finally they must analyse, in approximately 75 words, a twenty percent variation is allowable, what
the cash flow tells them about their business.
A table for completion has been provided in the candidate section.
Task 8: Evaluate and justify the funding for your business
Assessment criteria 5.3 and 5.4 are assessed in this task.
Candidates are required to: identify sources of potential funding for their business and to compare
these before deciding which option(s) they would choose and explaining, in approximately 100
words, a twenty percent variation is allowable, why.
Tutors may wish to extend candidates knowledge and understanding by inviting, if appropriate, the
small business manager of a local bank to come and talk to them about starting their business.
This could be linked with tasks 10 and with Unit 5. Another possibility would be to have a
discussion with the candidates to explore the wide range of sources that are available. Again,
where appropriate, candidates should be encouraged to do wide research.
Task 9: Explain cash flow management
Assessment criterion 5.5 is assessed in this task.
Candidates should use their cash flow forecast, Task 7, to explain, in approximately 150 words, a
variation of ten percent is allowable, how to manage cash flow in their business.
Tutors may find it helpful to take Tasks 7, 8 and 9 together so that cash flow and funding are
considered at the same time so that candidates can realise that funding is not just for start-up
capital, but may be needed in other circumstances and that the sources may vary.
Task 10: How financial information is recorded in a business.
Assessment criteria 6.1and 6.2 are assessed in this task.
Candidates need to understand that keeping the correct financial information in a way that is both
accurate and informative is an important aspect of running a business. They have been provided
with some examples of financial records which need to be kept, but should add to these as
appropriate for a business. They must then explain why a business should keep these records
making reference to a range of reasons. Although this is a generic task candidates may apply it to
their business. Finally, they should explain, in approximately 150 words, a variation of ten percent
is allowable, the systems and processes used for financial transactions.
Tutors who have business experience may be able to discuss this with their candidates. In some
cases it may be appropriate to ask an external person to talk with the candidates.
A table for completion has been provided in the candidate section.
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Set Assignments – Issued April 2011
OCR Level 3 Award and Certificate in Starting a Business Venture
Task 11: Create a profit and loss account.
Assessment criterion 7.1 is assessed in this task.
Candidates are required to construct a Profit and Loss (P & L) Account for the first 12 months of
business. They should use the information identified in previous tasks.
Tutors may wish to extend the knowledge and understanding of candidates by discussing with
them before they start the task what the difference is between gross and net profit and why both
are important.
A table for completion has been provided in the candidate section.
Task 12: Create a balance sheet and draw conclusions from it.
Assessment criteria 8.1 and 8.2 are assessed in this task.
Candidates are required to construct a Balance Sheet which refers to the first 12 months of
business. Where possible they should use the information identified in previous tasks. They must
then analyse, in approximately 150 words, a variation of ten percent is allowable, what the
Balance Sheet shows about their business.
Tutors may wish to extend the knowledge and understanding of candidates by discussing with
them before they start the task what is meant by the main components of the Balance Sheet: fixed
and current assets; current liabilities; capital; and reserves.
A table for completion has been provided in the candidate section.
Task 13: Produce a draft financial plan for a business in the form of an
executive overview
Assessment criterion 9.1 is assessed in this task.
The candidate must produce a financial plan in the form of an executive overview. The plan must
seek to justify the investment. It must include the following points and should be approximately 500
words, a variation of ten percent is allowable:

Brief description of the business

Funding requirement

Proposed funding sources

Justification:
o
Annual turnover
o
Annual net profit
o
Annual cash flow
o
Prices required to break even
o
Prices of competitors.
This is an opportunity for the candidate to bring together information from the previous tasks.
Set Assignments – Issued April 2011
17
OCR Level 3 Award and Certificate in Starting a Business Venture
Unit 4 – Understand how to sell a product or service
Introduction to the tasks
The tasks have been designed to enable candidates to demonstrate their knowledge and
understanding of how to devise a marketing strategy and marketing plan together with suitable
promotional material.
In addition, these notes suggest extension tasks which you may wish the candidates to undertake
to enlarge their understanding.
Each assessment criteria has a corresponding task for completion.
Task 1: Explain how to set customer-focused goals and targets for sales and
how an action plan for goals and targets would be implemented
Assessment criteria 1.1, 1.2 and 1.3 are assessed in this task.
Candidates are required to explain in approximately 50 words each, a variation of twenty percent
is allowable, both how to set customer-focused sales goals and targets and from this to draw up an
action plan for goals and targets. They must then explain in approximately 100 words, a variation
of twenty percent is allowable, how this action plan could be carried out.
Tutors may wish to extend candidates’ knowledge and understanding by both suggesting that they
should try to identify at least three realistic customer-focused sales goals and relevant targets for
their business and by discussing with them the difference between goals and targets.
A table for completion has been provided in the candidate section.
Task 2: Explain the benefits of a product or service that will most appeal to
the target market
Assessment criterion 2.1 is assessed in this task.
Candidates need to be able to identify the benefits of their product or service which they think will
be most attractive for customers in order to maximise sales. Having done so they then must
explain in approximately 100 words, a variation of twenty percent is allowable, why they have
chosen to focus on these benefits.
Tutors may wish to extend candidates’ knowledge and understanding by getting them to place the
benefits in order of importance and then asking them to explain why they have chosen that order.
Task 3: Evaluate different methods available for selling a product/service
Assessment criterion 2.2 is assessed in this task.
Candidates are required to identify and explain the advantages and disadvantages of a range of
different selling methods. These could include: retailer/wholesaler; mail order; telesales; internet;
mobile kiosk; door to door; etc. This is a generic task. They must then select from this list the
method (s) they would use and justify, in approximately 100 words, a variation of twenty percent is
allowable, why they have chosen it.
18
Set Assignments – Issued April 2011
OCR Level 3 Award and Certificate in Starting a Business Venture
Tutors may wish to extend candidates’ knowledge and understanding by discussing with them a
whole range of possible selling methods before they start the task. At the end of the task
candidates could be asked to explain why they rejected the other identified methods.
A table for completion has been provided in the candidate section.
Task 4: Explain the process of converting potential into actual customers
Assessment criterion 3.1 is assessed in this task.
Candidates must show knowledge of what is meant by potential and actual customers and then
devise a strategy to ensure that those people displaying an initial interest in the candidate’s
product/service can be turned into actual customers. This must be explained in approximately 200
words, a variation of ten percent is allowable,
Their strategies will differ depending upon the type of business and the different sales methods
they intend to use eg if sales were through the internet the potential customer may be identified
through tracking of hits and followed-up via email or in the case of telesales a key part may focus
on tone of voice and follow-up calls. The explanation must be related to the candidate’s business.
Task 5: Plan sales communications with customers
Assessment criterion 3.2 is assessed in this task.
Candidates must produce a plan showing how they would try to communicate with at least two
customers. The methods used must be different. All evidence eg a letter or their script of a verbal
sales communication with a customer must be attached to their work.
Tutors may wish to extend candidates’ knowledge and understanding by providing them, before
they start, with samples of “good practise” verbal communication in a sales context. This could take
the form of listening to people, videos or DVDs or online materials. Tutors could, also, provide an
opportunity for candidates to role play one or both types of communication.
Task 6: Analyse techniques that maximise sales
Assessment criterion 3.3 is assessed in this task.
This is a generic task. Candidates must identify and analyse at least five different sales techniques
intended to maximise sales by considering their advantages and disadvantages.
Tutors may wish to extend candidates’ knowledge and understanding by discussing with them a
very wide range of techniques.
A table for completion has been provided in the candidate section.
Task 7: Explain how to respond positively to customer behaviours and how
to overcome possible customer objections to make a sale
Assessment criteria 3.4 and 3.5 are assessed in this task.
This is a generic task, but where appropriate candidates use examples from their business.
Candidates must identify and explain at least four different ways of responding in a positive
manner to a variety of customers. They must then identify and explain how to communicate
effectively to overcome at least four different customer objections.
Tutors must ensure that in both cases the identified elements are different.
Tables for completion have been provided in the candidate section.
Set Assignments – Issued April 2011
19
OCR Level 3 Award and Certificate in Starting a Business Venture
Unit 5 – Producing a business plan for business ventures
Introduction to the tasks
The tasks have been designed to enable candidates to demonstrate their knowledge and
understanding of how to devise a marketing strategy and marketing plan together with suitable
promotional material.
In addition, these notes suggest extension tasks which you may wish the candidates to undertake
to enlarge their understanding.
Each assessment criteria has a corresponding task for completion.
Task 1: Explain the purposes of a business plan and how reviewing the
outcome of projects can inform future performance
Assessment criteria 1.1 and 1.2 are assessed in this task.
Candidates need to understand that a Business Plan is not used to just start a business; it is the
key document in the running and growth of any business. It can be used for a variety of purposes,
and is important to any stakeholders in their business who may have different reasons for their
interest. They must explain five reasons why a business would want to draw up a business plan.
They must then go on to explain in approximately 200 words, a variation of ten percent is
allowable, how reviewing the outcome of projects can inform future performance.
Tutors may wish to extend candidates’ knowledge and understanding by ensuring that they
understand what is meant by a business plan and by discussing with them why they would want to
review the business plan at regular intervals.
A table for completion has been provided in the candidate section.
Task 2: Explain how external help can assist with planning
Assessment criterion 1.3 is assessed in this task.
This is a generic task although reference can be made where applicable to the candidates own
businesses. Candidates need to research the various sources of external help that are available for
businesses when drawing up the business plan and then identify and explain six of these. They
must then explain in approximately 300 words, a variation of ten percent is allowable, the
advantages of using a variety of external sources when drawing up the business plan.
Where individual research opportunities are limited, tutors may wish to extend their candidates’
knowledge and understanding by discussing with them before they start the wide range of external
sources that exist. It is important to guide candidates away from the family and friends approach
unless it can be shown that these have real expertise which would be appropriate.
Task 3: Produce a business plan
Assessment criterion 2.1 is assessed in this task.
Tutors need to stress to candidates that drawing up the business plan is one of the most important
steps in setting up their business, while the more care that is taken over it the greater the likelihood
that they will persuade people that their business is viable.
20
Set Assignments – Issued April 2011
OCR Level 3 Award and Certificate in Starting a Business Venture
Candidates must draw up a business plan for their business to include:

Marketing Plan

Operational Plan

Financial Plan
They must include any other information which a potential investor might want to know.
To do this, candidates should use, where appropriate, plans from other units.
While no length is specified, the plan must be as full as possible. The final version must be
attached to their work.
Task 4: Present the business plan to a potential investor
Assessment criterion 2.2 is assessed in this task.
The candidate’s business plan must be presented to a potential stakeholder. While it is hoped that
centres would be able to invite someone from outside such as the small business manager of a
bank, it is recognised that this is not always possible. In this case the tutor or another suitable
member of the centre can act as the stakeholder.
Candidates must select one of the purposes of a business plan, and the stakeholder it is aimed at
and then:

Prepare a short briefing note for the stakeholder which must clearly indicate who the
stakeholder represents eg a bank and why the candidate thinks they would be interested in
their plan.

Develop a five to ten minute presentation on this purpose

Prepare visual aids and/or handouts and/or presentation notes

Give the presentation to the identified stakeholder

At the end of the presentation, answer questions from the stakeholder
Each of these must to be completed to a satisfactory standard. The stakeholder should tick the
boxes provided in the candidate section of the unit/task and write a brief general comment. The
witness box, also in the candidate section, must be signed by the tutor and the candidate.
Presentation notes, copies of slides and the briefing notes must be provided to OCR as evidence.
Task 5: Describe how to monitor and review business risks
Assessment criterion 3.1 is assessed in this task.
Candidates must understand that all businesses are subject to risk that must be managed and
reflected in the business plan. It is important to monitor and review the risks that businesses face
and realise the need to adapt their business plans to reflect these changing risks.
Candidates must, therefore, identify whether risks are internal or external and explain these. They
must then describe, in approximately 300 words, a variation of ten percent is allowable, how they
will monitor and review the likely risks to their business they have identified, through, for example,
SWOT analysis, skills audits, analysis of competition, etc. A table has been provided to help
candidates with this task, but it does not replace the description.
Set Assignments – Issued April 2011
21
OCR Level 3 Award and Certificate in Starting a Business Venture
Tutors may wish to extend candidates’ knowledge and understanding by using the table provided
in the candidate section as a starting point for a discussion on monitoring and reviewing risks. In
addition a discussion could be based on why there is a need to analyse the level of risk involved.
Tables for completion have been provided in the candidate section.
Task 6: Describe how to update a business plan to reflect business risks
Assessment criterion 3.2 is assessed in this task.
Candidates are required to refer to their business plan, as set out in Task 3, indicating, by
whatever means they wish, those areas which have been updated and describing how they have
updated it. They may: use a table; produce continuous prose; make use of the changes/comment
facilities on their software system; or any other acceptable means, so long as it is clear. Tutors
must ensure that this is the case.
Tutors may wish to extend candidates’ knowledge and understanding by, where possible, inviting
an external source to talk to the candidates. It might be possible to combine this with the
stakeholder in Task 3 and with Unit 3.
22
Set Assignments – Issued April 2011
Set Assignments: Candidate Information
Issued April 2011
OCR Level 3 Award and Certificate in Preparing for a Business Venture (QCF)
Scheme codes 09898, 09899
© OCR 2011
General Information For Candidates
Q
Do I have to pass these assignments?
A
Yes. You must pass these assignments to achieve the relevant units or full qualification.
Q
What help will I get?
A
Your tutor will help you when completing the OCR set assignments and will make sure that
you know what resources/facilities you need and are allowed to use.
Q
What if I don’t understand something?
A
It is your responsibility to read the tasks carefully and make sure you understand what you
need to do and what you should hand in. If you are not sure, check with your tutor.
Q
Can I copy other people’s work?
A
No. The work that you produce must be your own work and you may be asked to sign a
declaration to say that the work is your own. You should never copy the work of other
candidates or allow others to copy your work.
Q
Can I work in a group?
A
Yes. However, if you work in a group at any stage you must still produce work that shows
your individual contribution and answers appropriate to your own business.
Q
How should I present my work?
A
You should present your work on the task sheets provided. In some cases additional written
evidence may be required. A witness statement may also be necessary; where this is the
case it has been provided in the task. If you are unsure, check with your tutor.
Q
When I have finished, what do I need to hand in?
A
You need to hand in the work that you have completed for each task. Do not include any
draft work or handouts unless these are asked for. When you hand in your work make sure
that it is titled and in the correct order for assessing.
Q
How will my work be assessed?
A
Your work will be marked by an assessor in your centre. The assessor will mark the work
using the assessment criteria in the qualification specification.
24
Set Assignments – Issued April 2011
Unit 1 – Attracting customers through marketing
Task 1: Understand how to carry out market research for business
Assessment criteria 1.1, 1.2 and 1.3 are assessed in this task.
It is important for businesses to carry out market research to find information about their market. To
do this they must understand that there is a variety of methods.
To complete this task you must:
 DISTINGUISH between primary and secondary research
 ANALYSE the advantages and disadvantages of different research methods
 EXPLAIN how to carry out market research for your business
 EXPLAIN how market research is used
1
Distinguish between primary and secondary research.
Primary research
Secondary research
Set Assignments – Issued April 2011
25
2
Analyse the advantages and disadvantages of different research methods
Complete the table.
METHOD
ADVANTAGES
DISADVANTAGES
Questionnaire
Formal Interview
Informal Interview
Consumer panel
Focus Group
Desk research
26
Set Assignments – Issued April 2011
3
EXPLAIN in approximately 150 words, how to carry out market research for your business.
4
EXPLAIN in approximately 100 words how market research is used.
Set Assignments – Issued April 2011
27
Task 2: Analyse a business in relation to its chosen market
Assessment criterion 2.1 is assessed in this task.
The ability to analyse your business in relation to its market is an important tool in helping it to
succeed.
To complete this task you must:
1
28
ANALYSE your business in its market including:

completing a SWOT analysis

completing a PESTEL analysis

market share

profitability

unique selling point (USP)
Set Assignments – Issued April 2011
Analyse your business using SWOT by completing the table below.
STRENGTHS
WEAKNESSES
OPPORTUNITIES
THREATS
Set Assignments – Issued April 2011
29
Analyse your business using PESTEL by completing the table below.
POLITICAL
ECONOMIC
SOCIAL
TECHNOLOGICAL
ENVIRONMENTAL
LEGAL
30
Set Assignments – Issued April 2011
Analyse your business in relation to Market Share, Profitability and USP by completing the table below.
EXPLAIN WHY THIS WOULD BE/WOULD NOT BE
IMPORTANT FOR YOUR BUSINESS
EXPLAIN HOW YOU WOULD ACHIEVE ANY YOU SAID
WERE IMPORTANT
MARKET SHARE:
PROFITABILITY:
USP:
Set Assignments – Issued April 2011
31
2
32
EXPLAIN in approximately 50 words how your business would fit into its market.
Set Assignments – Issued April 2011
Task 3: Explain the market pricing of a good/service
Assessment criterion 3.1 is assessed in this task.
Businesses may use a wide range of pricing strategies depending on their market position and the
economic climate.
To complete this task you must:

IDENTIFY FIVE different pricing strategies that your business might adopt

EXPLAIN the advantages and disadvantages of each pricing strategy

EXPLAIN which one or more of these strategies you would adopt for your business

EXPLAIN how this strategy(these strategies) work in writing and/or through an example
Complete the table on the next page.
Set Assignments – Issued April 2011
33
PRICING STRATEGIES
ADVANTAGES
DISADVANTAGES
1
2
3
4
5
34
Set Assignments – Issued April 2011
EXPLAIN which one or more of these policies you would adopt for your business.
State the strategy/strategies chosen.
Why would you adopt this strategy/these strategies?
Set Assignments – Issued April 2011
35
Task 4: State the objectives of your business
Assessment criterion 3.2 is assessed in this task.
To complete this task you must:

STATE your SMART business objectives for at least the first year of operation.
You must complete the table on the next page.
36
Set Assignments – Issued April 2011
OBJECTIVE
HOW IS IT SPECIFIC?
Set Assignments – Issued April 2011
HOW IS IT
MEASURABLE?
HOW IS IT
ACHIEVABLE?
HOW IS IT
REALISTIC?
HOW IS IT TIME
SPECIFIC?
37
Task 5: Produce a marketing strategy for achieving your business’s
objectives
Assessment criterion 3.3 is assessed in this task.
In order to achieve your business objectives it is necessary to produce a clear marketing strategy.
To complete this task you must:
1
EXPLAIN how your marketing strategy will help you achieve your business objectives
Complete the table below.
BUSINESS OBJECTIVE
38
EXPLAIN HOW YOUR MARKETING STRATEGY WILL
HELP TO ACHIEVE THIS
Set Assignments – Issued April 2011
2
When producing your marketing strategy, to achieve your businesses objectives you will
have considered various constraints.

IDENTIFY at least THREE INTERNAL and THREE EXTERNAL constraints that you
considered when drawing up your marketing strategy

EXPLAIN how you took these into account when drawing up the marketing strategy for
your business
Complete the table below.
INTERNAL
CONSTRAINTS
HOW YOU TOOK THESE INTO ACCOUNT
1
2
3
EXTERNAL
CONSTRAINTS
HOW YOU TOOK THESE INTO ACCOUNT
1
2
3
Set Assignments – Issued April 2011
39
Task 6: Identify and apply brand values to your business
Assessment criteria 4.1 and 4.2 are assessed in this task.
To complete this task you must:

LIST a range of examples to illustrate brand values in practice.

IDENTIFY FOUR brand values for your business

APPLY your brand values to the marketing materials for your business
LIST a range of examples to illustrate brand values in practice.
Complete the table below.
BRAND VALUE
40
BUSINESS(ES) YOU ASSOCIATE THIS WITH
Set Assignments – Issued April 2011
Complete the table below
IDENTIFY FOUR BRAND VALUES
FOR YOUR BUSINESS
Set Assignments – Issued April 2011
HOW WOULD YOU APPLY THESE TO MARKETING
MATERIALS FOR YOUR BUSINESS
41
Task 7: Explain how promotional techniques will be used to attract and
retain customers
Assessment criterion 5.1 is assessed in this task.
Businesses use a wide range of promotional techniques. While some will both attract and retain
existing customers others are more suited to one or other of these aims.
To complete this task you must:

EXPLAIN how at least FOUR promotional techniques that you would use in your business
could help you gain new customers

EXPLAIN how promotional techniques could be used to retain existing customers
Complete the table below.
TECHNIQUES
HOW WOULD THIS ENABLE YOU TO GAIN NEW
CUSTOMERS?
1
2
3
4
42
Set Assignments – Issued April 2011
EXPLAIN in approximately 200 words how promotional techniques could be used to retain
existing customers
Set Assignments – Issued April 2011
43
Task 8: Design a logo for a specific business
Assessment criterion 5.2 is assessed in this task.
To complete this task you must:

DESIGN a logo for your business

EXPLAIN how your logo is simple, relevant, memorable, versatile, legal
DESIGN a logo for your business.
You should produce the logo design electronically where possible. The logo should be no more
than 10 cm wide x 5 cm high in dimension, so that it could be added to all relevant documentation.
The logo must be attached to your work.
EXPLAIN how your logo is simple, relevant, memorable, versatile, legal
1
Simple because
2
Relevant because
3
Memorable because
4
Versatile because
5
Legal because
44
Set Assignments – Issued April 2011
Task 9: Produce marketing literature for your business and justify the
approach taken
Assessment criteria 5.3 and 5.4 are assessed in this task.
To complete this task you must:

PRODUCE a piece of marketing literature for your business

EXPLAIN why you have produced this marketing material.
PRODUCE a piece of marketing literature for your business.
It must take the form of an advertisement, leaflet or poster for your business. It should fulfil the
AIDA principle.
You should produce the item of material electronically where possible. The marketing literature
must be attached to your work.
EXPLAIN in approximately 200 words why you have produced this marketing material.
In your explanation you must show how it complies with the AIDA principle.
Set Assignments – Issued April 2011
45
46
Set Assignments – Issued April 2011
Task 10: Create a marketing plan for your business, including a marketing
budget
Assessment criterion 6.1 is assessed in this task.
You should consider this task as a whole rather than necessarily completing it in the order laid out
below. Although the budget will constrain what can appear in the marketing plan, equally the needs
of marketing will inform the way in which the budget is drawn up.
To complete this task you must:
1
DRAW UP a budget for your marketing plan for the first year
If you have completed Unit 3 Financial Management, you should use the appropriate figures
developed there as the basis for a monthly marketing budget for your business for the first
year of operation.
Complete the table on the next page.
Set Assignments – Issued April 2011
47
Columns 1-12 refer to months of the year.
MARKETING BUDGET
1
2
3
4
5
6
7
8
9
10
11
12
Total
Activity:
Total marketing costs
48
Set Assignments – Issued April 2011
2
PRODUCE a marketing plan for your first year. You must show that you UNDERSTAND that
a marketing plan should include reference to: objectives; costs; revenues and constraints
Your marketing plan should be approximately 750 words and include the following points:

Which method(s) you will use to market your business

Which method(s) you will use to market your product/service

The budget and how it will be allocated to your different marketing activities

Timescales for starting and completing the activities

Who your marketing is aimed at
Set Assignments – Issued April 2011
49
50
Set Assignments – Issued April 2011
Set Assignments – Issued April 2011
51
Task 11: Describe how to implement your marketing plan
Assessment criterion 7.1 is assessed in this task.
It is important not only to have a marketing plan, but also, to know how to implement it.
To complete this task you must:
1
52
STATE why your marketing plan needs to be able to respond to changing circumstances
Set Assignments – Issued April 2011
2
IDENTIFY the order in which you would action your marketing plan
You must use the marketing plan developed in Task 10.
Complete the table below
ACTIONS TO BE UNDERTAKEN FROM THE MARKETING
PLAN
Set Assignments – Issued April 2011
ORDER IN WHICH THEY
WILL OCCUR
53
3
54
DESCRIBE in approximately 200 words how the plan can be used to review and monitor
progress.
Set Assignments – Issued April 2011
Unit 2 – Adhering to business legislation
Task 1: Analyse the main types of legal structure available to businesses
Assessment criterion 1.1 is assessed in this task.
It is important before starting a business to understand that although there are a variety of
structures available only some are likely to be appropriate.
To complete this task you must:

DESCRIBE the characteristics of the main types of legal structures

EXPLAIN the advantages and disadvantages of each type
Complete the table on the next page.
Set Assignments – Issued April 2011
55
LEGAL STRUCTURE AND
DESCRIPTION
ADVANTAGES
DISADVANTAGES
Sole Trader is
Partnership is
Private Limited Company is
Public Limited Company is
Co-operative is
Not for profit company is
Franchise is
56
© OCR 2011
Task 2: Select and justify a legal structure for your business
Assessment criteria 2.1 and 2.2 are assessed in this task.
To complete this task you must:

CHOOSE an appropriate legal structure for your business

EXPLAIN why this structure has been selected and the others rejected.
Legal Structure:
EXPLAIN in approximately 100 words why this structure has been selected and the others
rejected.
Set Assignments – Issued April 2011
57
Task 3: Explain the purposes of the legislation in place to protect the
business, the business owners, the employees and the customers
Assessment criterion 3.1 is assessed in this task.
Legislation exists to protect the rights of owners, employees and customers in a variety of
circumstances.
To complete this task you must:

IDENTIFY TWO main areas of legislation designed to protect: the business; business
owners; employees and customers

EXPLAIN how each piece of legislation offers protection.
Complete the table on the next page.
58
Set Assignments – Issued April 2011
PROTECTING
The Business
LEGISLATION
EXPLAIN HOW IT PROTECTS
1
2
Business Owners
1
2
Employees
1
2
Customers
1
2
Set Assignments – Issued April 2011
59
Task 4: Identify sources of advice on relevant legislation for: the business;
the business owners; the employees; and the customers and explain
how this legislation is applicable to your business
Assessment criteria 3.2 and 3.3 are assessed in this task.
To complete this task you must:
1
IDENTIFY THREE different sources of advice for business, owners, employees and
customers and DESCRIBE the advice they would be able to give.
Complete the table on the next page
60
© OCR 2011
ADVICE FOR
Business
SOURCES
THE ADVICE THEY GIVE
1
2
3
Business Owners
1
2
3
Employees
1
2
3
Customers
1
2
3
Set Assignments – Issued April 2011
61
2
62
EXPLAIN in approximately 200 words how the legislation you have referred to in the table
relates to your business
© OCR 2011
Task 5: Identify the main types of insurance, and their features, required for
business and explain the elements of business which are protected
by insurance
Assessment criteria 4.1, 4.2 and 4.3 are assessed in this task.
To help guard businesses from the financial loss incurred by failing to always fully adhere to
legislation a business can take out insurance.
To complete this task you must:

EXPLAIN why your business would need insurance

IDENTIFY at least FOUR main types of insurance your business would need

STATE THREE main features of these insurances

EXPLAIN how these would protect your business.
EXPLAIN in approximately 30 words why your business would need insurance
Complete the table on the next page.
Set Assignments – Issued April 2011
63
TYPE OF INSURANCE
MAIN FEATURES OF THIS INSURANCE TYPE
THE ELEMENTS OF BUSINESS WHICH ARE
PROTECTED BY IT
1
2
3
1
2
3
1
2
3
1
2
3
64
© OCR 2011
Task 6: State and describe the tax and record keeping obligations of your
business structure
Assessment criteria 5.1 and 5.2 are assessed in this task.
To complete this task you must:

STATE TWO reasons why businesses have to register with HMRC

DESCRIBE the taxation and record keeping requirements that arise from the type of
structure chosen for your business
STATE TWO reasons why businesses have to register with HMRC
1
2
DESCRIBE in approximately 75 words the taxation and record keeping requirements that arise
from the type of structure chosen for your business.
Set Assignments – Issued April 2011
65
Task 7: Explain the principles of VAT
Assessment criterion 5.3 is assessed in this task.
VAT is the main indirect tax affecting businesses.
To complete this task you must:

DESCRIBE what is meant by VAT including current rates

EXPLAIN how VAT works in relation to a business
DESCRIBE what is meant by VAT including current rates.
EXPLAIN in approximately 100 words how VAT works in relation to your business including what
is meant by value added and how tax is payable, zero rated and exempted status
In explaining VAT you should provide a numerical example.
66
Set Assignments – Issued April 2011
Task 8: Explain the operation of income tax
Assessment criteria 6.1, 6.2 and 6.3 are assessed in this task.
All UK residents who have an income are assessed for income tax.
To complete this task you must:
1

EXPLAIN how income tax is applied

EXPLAIN what self assessment means, who needs to complete a tax return, how to get a
self assessment tax form and how to get a tax reference

STATE and EXPLAIN at least FOUR expenses that you will be able to set against tax
EXPLAIN how income tax is applied including the different tax bands and personal
allowances
(i)
What is meant by Income Tax?
(ii)
State the monetary values of the current tax bands.
(iii)
What are the current levels for Personal Allowance?
(iv)
Provide a numerical example of how your expected personal income would be taxed.
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2
EXPLAIN what self assessment means, who needs to complete a tax return, how to get a
self assessment tax form and how to get a tax reference.
Self-assessment
State TWO ways of obtaining a self-assessment tax form
1
2
How do you get a tax reference number?
3
STATE and EXPLAIN at least FOUR expenses that you will be able to set against tax.
Complete the table below.
EXPENSES
EXPLAIN WHY YOU WILL BE ABLE TO
SET IT AGAINST TAX
1
2
3
4
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Task 9: Explain the principles of National Insurance
Assessment criterion 6.4 is assessed in this task.
To complete this task you must:

STATE what is meant by National Insurance

STATE who has to pay National Insurance

EXPLAIN how National Insurance works
STATE what is meant by National Insurance
STATE who has to pay National Insurance
EXPLAIN in approximately 50 words how National Insurance works
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Unit 3 – Financial Management
Task 1: Compare the methods used to gather information for a financial plan
Assessment criterion 1.1 is assessed in this task.
There are many methods available to a business for it to collect information for a financial plan.
To complete this task you must:

IDENTIFY at least FOUR methods of collecting information

EXPLAIN the advantages and disadvantages of these methods

EXPLAIN why you would or would not use each method
Complete the table on the next page.
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METHOD
Set Assignments – Issued April 2011
ADVANTAGES
DISADVANTAGES
TICK()
IF YOU
WOULD
USE IT
EXPLAIN WHY YOU WOULD OR WOULD
NOT USE THE METHOD
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Task 2: Define the unit of production for your business and estimate the
direct costs of a unit of production
Assessment criteria 2.1 and 2.2 are assessed in this task.
When defining the units in which your sales volume will be measured, units must be chosen which
are appropriate to the business. A service, such as consultancy, training or car repair, may be
measured in time (hours charged). A commercial window cleaner might charge per square metre
of glass, whilst a domestic window cleaner might charge by the house. For a homogenous product,
such as pasta, weight might prove appropriate. For a specific product, such as wheelbarrows, the
units will be of the product itself (ie so many wheelbarrows).
To complete this task you must:

DEFINE units of production appropriate to your business

DEFINE direct costs per unit of production

APPLY these definitions to ESTIMATE the direct costs of your business
DEFINE units of production appropriate to your business.
DEFINE direct costs per unit of production.
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© OCR 2011
Complete the table below to detail the direct costs associated with production of YOUR
product/service (you may add more rows as required).
DIRECT COST ITEM
COST (£)
TOTAL DIRECT COST
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Task 3: Identify the items of capital equipment needed to start your
business, estimate the cost of this equipment and the total indirect
costs
Assessment criteria 2.3, 2.4 and 2.5 are assessed in this task.
To complete this task you must:

IDENTIFY the capital equipment that would be needed to start your business

ESTIMATE the cost of this equipment

CALCULATE the indirect costs of your business
Complete the table below (you may add more rows as required).
ITEMS OF CAPITAL EQUIPMENT AND WHY
NEEDED TO START YOUR BUSINESS
COST PER
UNIT (£)
QUANTITY
TOTAL
COST (£)
TOTAL INDIRECT COST:
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Task 4: Propose and justify the market prices for your product(s)/service(s)
Assessment criteria 3.1 and 3.2 are assessed in this task.
It is important that a business should understand why it is charging particular price(s)
To complete this task you must:

ESTIMATE a suitable market price for the product/service

EXPLAIN why this price has been chosen
ESTIMATE a suitable market price(s) for the product(s)/service(s) and EXPLAIN in approximately
75 words why this price(s) has been chosen.
Suitable price
Explanation
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Task 5: Create a break even analysis for your business
Assessment criterion 3.3 is assessed in this task.
To complete this task you must:
CALCULATE the break even position for your business.
This can be in the form of either an arithmetical calculation or a break even chart
The break even price and quantity for my sales would be
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Task 6: Produce a personal survival budget
Assessment criterion 4.1 is assessed in this task.
It is important to know how much money you need to spend on everyday living when setting up
your own business. This may vary depending on whether you have a family, house, car, pets etc or
whether you are being supported by parents, wife/husband/partner, etc.
To complete this task you must:

LIST your planned personal expenditure, on a monthly basis, during the first year of the
business

CREATE the budget as a monthly and annual total without assuming that there are four
weeks in a month
Complete the table on the next page.
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Personal survival item:
1
2
3
4
5
6
7
8
9
10
11
12
Total
Expenditure in the year
(= sub-total a)
Income from family/partner
Other income (please state)
Total income
(= sub-total b)
Total survival income
required from the venture
(= a-b)
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© OCR 2011
Task 7: Construct a cash flow forecast for your business and draw
conclusions from it
Assessment criteria 5.1 and 5.2 are assessed in this task.
An understanding of the importance of maintaining a positive cash flow is vital for the survival of a
business.
To complete this task you must:

CONSTRUCT a cash flow forecast for your business

ANALYSE what the cash flow shows about the business
CONSTRUCT a cash flow forecast for your business showing both the monthly and the annual
figures.
Complete the table on the next page.
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CASH FLOW FORECAST
1
2
3
4
5
6
7
8
9
10
11
12
Total
INCOME
Sales income
Grants
Loans received
Other
TOTAL RECEIPTS (A)
PAYMENTS
Direct Costs
Indirect Costs
Other
TOTAL PAYMENTS (B)
CASH FLOW (A-B = C)
OPENING BANK BALANCE (D)
CLOSING BANK BALANCE (C-D)
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ANALYSE, in approximately 75 words, what the cash flow shows about the business.
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Task 8: Evaluate and justify the funding for your business
Assessment criteria 5.3 and 5.4 are assessed in this task.
A business must realise that there are many sources of finance available, but only a few may be
relevant.
To complete this task you must:

IDENTIFY sources of potential funding for your business including

COMPARE the funding options

DECIDE on the best option/s for your business

EXPLAIN why you have made this choice
IDENTIFY at least FIVE sources of potential funding for your business.
1
2
3
4
5
COMPARE the funding options.
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Use this information to DECIDE on the best option/s for your business and be able to EXPLAIN, in
approximately 100 words why you have made this choice.
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Task 9: Explain cash flow management
Assessment criterion 5.5 is assessed in this task.
To complete this task you must:
EXPLAIN, in approximately 150 words, using illustrations from your cash flow forecast, how to
manage cash flow in your business.
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Task 10: How financial information is recorded in business
Assessment criteria 6.1and 6.2 are assessed in this task.
Keeping the correct financial information in a way that is both accurate and informative is an
important aspect of running a business.
To complete this task you must:

EXPLAIN the financial information that needs to be recorded in a business

EXPLAIN the systems and processes used for financial transactions
Complete the table below.
FINANCIAL RECORD
1
Value of sales:
2
Cost of wages/salaries:
3
Cost of other input (please specify)
4
Cost of other input (please specify)
5
Revenue received:
6
Revenue owing
7
Reserves:
8
Other (please specify)
9
Other (please specify)
10
Other (please specify)
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WHY A BUSINESS NEEDS TO KEEP THESE
RECORDS
85
EXPLAIN, in approximately 150 words, the systems and processes used for financial transactions
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Task 11: Create a profit and loss account
Assessment criterion 7.1 is assessed in this task.
The profit and loss account shows the profit, or loss, a business is making at a specific point in
time.
CONSTRUCT a profit and loss account on a monthly basis for the first 12 months of your business
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PROFIT AND LOSS ACCOUNT
1
2
3
4
5
6
7
Sales Revenue
Direct Costs
Gross Profit
Indirect Costs
Net Profit before tax
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8
9
10
11
12
Total
Task 12: Create a balance sheet and draw conclusions from it.
Assessment criteria 8.1 and 8.2 are assessed in this task.
The balance sheet is a summary at a specific point in time of a business’ assets, liabilities and
capital.
To complete this task you must:

CONSTRUCT a balance sheet

ANALYSE, in approximately 150 words, what the balance sheet shows about your business
CONSTRUCT a balance sheet.
You should discuss this with your tutor before proceeding.
Complete the balance sheet on the next page.
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89
Balance sheet for ___________________
£
FIXED ASSETS
Fixtures and fittings
Equipment
CURRENT ASSETS
Debtors
Cash in hand and at bank
TOTAL ASSETS
CURRENT LIABILITIES
Creditors falling due within 1 year
Bank overdraft
TOTAL CURRENT LIABILITIES
CURRENT ASSETS – CURRENT LIABILITIES
LONG-TERM LIABILITIES
TOTAL ASSETS – TOTAL LIABILITIES
CAPITAL AND RESERVES
Reserves
Profit and Loss Account
TOTAL CAPITAL AND RESERVES
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ANALYSE, in approximately 150 words, what the balance sheet shows about your business.
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91
Task 13: Produce a financial plan for a business in the form of an executive
overview
Assessment criterion 9.1 is assessed in this task.
To complete this task you must:

CREATE a draft financial plan of approximately 500 words.
In this plan you must:
92
o
provide a brief description of the business
o
detail funding requirements and proposed funding sources
o
justify: annual turnover; annual net profit; annual cash flow; prices required to break
even
o
prices of competitors
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Unit 4 – Understand how to sell a product or service
Task 1: Explain how to set customer-focused goals and targets for sales and
how an action plan for goals and targets would be implemented
Assessment criteria 1.1, 1.2 and 1.3 are assessed in this task.
In selling it is important to focus on your potential customers and how you will attract them.
To complete this task you must:

EXPLAIN how to set customer-focused sales goals

EXPLAIN how to set customer-focused targets

DRAW UP an action plan for sales goals and targets

EXPLAIN how this action plan could be carried out
EXPLAIN in approximately 50 words how to set customer-focused sales goals.
EXPLAIN in approximately 50 words how to set customer-focused sales targets.
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95
DRAW UP an action plan for sales goals and targets.
Complete the table below. (You may add more rows if required)
CUSTOMER-FOCUSED SALES
GOAL/TARGET
96
ACTIONS TO HELP MY BUSINESS ACHIEVE THIS
GOAL/TARGET
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EXPLAIN in approximately 100 words how this action plan should be carried out.
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97
Task 2: Explain the benefits of a product or service that will most appeal to
the target market
Assessment criterion 2.1 is assessed in this task.
In order to sell to your customers it is useful to be able to identify the benefits which you think will
most attract them so these can be emphasised.
To complete this task you must:

IDENTIFY those benefits of your product or service you would wish to bring to the attention
of your target market

EXPLAIN why you have chosen these aspects
IDENTIFY at least FOUR benefits of your product or service you would wish to bring to the
attention of your target market.
1
2
3
4
EXPLAIN in approximately 100 words why you have chosen these benefits
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Task 3: Evaluate different methods available for selling a product/service
Assessment criterion 2.2 is assessed in this task.
To complete this task you must:

IDENTIFY and EXPLAIN the advantages and disadvantages of a range of different selling
methods

CHOOSE which you would use and JUSTIFY this choice
IDENTIFY and EXPLAIN the advantages and disadvantages of a range of different selling
methods.
Complete the table on the next page.
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99
SELLING METHOD FOR YOUR
PRODUCT OR SERVICE
100
ADVANTAGES OF THIS METHOD
DISADVANTAGES OF THIS METHOD
© OCR 2011
CHOOSE which you would use for your business and JUSTIFY, in approximately 100 words, this
choice
Method(s) chosen:
Justification:
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Task 4: Explain the process of converting potential into actual customers
Assessment criterion 3.1 is assessed in this task.
To complete this task you must:

EXPLAIN the difference between potential and actual customers

EXPLAIN how you would convert potential into actual customers
EXPLAIN the difference between potential and actual customers.
EXPLAIN in approximately 200 words how you would convert potential into actual customers.
How you would do this will depend on the type of business you have and whether you are selling
one, or more than one, product or service.
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Task 5: Plan sales communications with customers
Assessment criterion 3.2 is assessed in this task.
It is important to focus on what the customer wants, not what the business can do, when
communicating with them.
To complete this task you must:

PRODUCE a communication plan that includes the following:
o
The types of customers to be targeted
o
How and when you will communicate with customers
o
All evidence eg a letter or your script of a verbal sales communication with a customer
must be attached to your work
Task 6: Analyse techniques that maximise sales
Assessment criterion 3.3 is assessed in this task.
To complete this task you must:

IDENTIFY and ANALYSE at least FOUR different sales techniques
Complete the table on the next page.
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SALES TECHNIQUE
ADVANTAGES
DISADVANTAGES
1
2
3
4
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105
Task 7: Responding positively to customers and overcoming objections
Assessment criteria 3.4 and 3.5 are assessed in this task.
To complete this task you must:

EXPLAIN how to respond in a positive manner to a variety of customer behaviours

EXPLAIN how to communicate effectively to overcome customer objections
IDENTIFY and EXPLAIN at least FOUR different ways of responding in a positive manner to a
variety of customer behaviours
Complete the table below. You may add additional rows if required.
IDENTIFY POSITIVE WAYS OF
RESPONDING TO CUSTOMER
BEHAVIOURS
EXPLAIN WHY THESE ARE POSITIVE
1
2
3
4
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IDENTIFY and EXPLAIN how to communicate effectively to overcome at least FOUR different customer objections.
Complete the table.
CUSTOMER OBJECTION
HOW YOU WOULD OVERCOME THIS
OBJECTION
EXPLAIN WHY THIS METHOD WOULD
EFFECTIVELY DEAL WITH THE OBJECTION
1
2
3
4
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Unit 5 – Producing business plans for business ventures
Task 1: Explain the purposes of a business plan and how reviewing the
outcome of projects can inform future performance
Assessment criteria 1.1 and 1.2 are assessed in this task.
A Business Plan is not used to just start a business; it is the key document in the running and
growth of any business. It can be used for a variety of purposes, and is important to any
stakeholders in your business who may have different reasons for their interest.
To complete this task you must:

EXPLAIN why a business would want to draw up a business plan

EXPLAIN how reviewing the outcome of projects can inform future performance
EXPLAIN why a business would want to draw up a business plan.
Reference must be made to different stakeholders.
Complete the table on the next page.
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REASONS FOR DRAWING UP
THE BUSINESS PLAN
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EXPLANATION
STAKEHOLDER
109
EXPLAIN in approximately 200 words how reviewing the outcome of projects can inform future
performance.
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Task 2: Explain how external help can assist with planning
Assessment criterion 1.3 is assessed in this task.
In drawing up your business plan it is advisable to seek help so that the plan is accurate and
contains all the necessary information.
To complete this task you must:

IDENTIFY SIX external sources available to assist in drafting a business plan

EXPLAIN the advantages of using external sources when drawing up the business plan
IDENTIFY SIX external sources available to assist in drafting a business plan
1
2
3
4
5
6
EXPLAIN in approximately 300 words the advantages of using a variety of external sources when
drawing up a business plan.
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Task 3: Produce a business plan
Assessment criterion 2.1 is assessed in this task.
Drawing up the business plan is one of the most important steps in setting up your business. The
more care taken over it the greater the likelihood that you will persuade people that your business
is viable.
To complete this task you must:

DRAW UP a business plan for your business
This must include the:
o
Marketing Plan
o
Operational Plan
o
Financial Plan
Attach the business plan to your work.
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Task 4: Present the business plan to a potential investor
Assessment criterion 2.2 is assessed in this task.
To complete this task you must:

PRESENT this plan to a potential investor so as to persuade them to invest.
You must:
1
Select one of the purposes of a business plan, and the stakeholder it is aimed at
2
Prepare a short briefing note for the stakeholder
3
Develop a five to ten minute presentation on this purpose
4
Prepare visual aids and/or handouts and/or presentation notes
5
Deliver your presentation to the identified stakeholder
6
At the end of the presentation, answer questions
Presentation notes, copies of slides and the briefing notes should be attached to this work as
evidence.
The briefing notes must EXPLAIN why you think that the stakeholder is interested in your plan.
Both you and your tutor must then complete the following witness statement:
This task has been successfully
completed on:
Signature of candidate:
Name of witness:
Signature of witness:
Status of witness:
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Set Assignments – Issued April 2011
Task 5: Describe how to monitor and review business risks
Assessment criterion 3.1 is assessed in this task.
All businesses are subject to risk that must be managed and reflected in the business plan. It is
important to monitor and review the risks that businesses face and to understand the need to adapt
your business plan to reflect these changing risks.
To complete this task you must:

IDENTIFY and EXPLAIN the risks your business is likely to face

IDENTIFY whether the risks are internal or external

DESCRIBE how to monitor and review these risks
Complete the table below. More rows may be added if required.
IDENTIFY RISKS
EXPLAIN WHY THESE ARE A RISK TO YOUR
BUSINESS
INTERNAL OR
EXTERNAL
1
2
3
4
5
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DESCRIBE, in approximately 300 words, how you will monitor and review the likely risks to your
business you have identified.
You may find it helpful to complete the following table, but this is only an aid to your description
and does not take its place.
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Attach all your work to this Task.
SECTION OF THE
BUSINESS PLAN TO BE
MONITORED
118
WHAT DATA NEEDS TO BE
RECORDED FOR
MONITORING?
HOW WILL THIS DATA BE
GATHERED?
HOW OFTEN WILL THIS
DATA BE MONITORED?
WHY WOULD THIS DATA
BE MONITORED?
© OCR 2011
Task 6: Describe how to update a business plan to reflect business risks
Assessment criterion 3.2 is assessed in this task.
To complete this task you must:

UPDATE the business plan in response to these risks

DESCRIBE the changes you made to your business plan
You must refer to your business plan, as set out in Task 3, indicating, by whatever means you
wish, those areas which have been updated and describing how you have done this.
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