Your job is to write a business plan that answers ALL the four “action plan” questions below.
Brodie’s professional considerations:
Brodie is a surfboard builder. He is currently doing all the stages of production, from the first cut of the foam, to the final stroke of the resin
to laminate the board. Since Brodie is an experienced shaper, it takes him about 2 weeks to shape and laminate a board so that it is ready to ride.
(few hours on shaping and up to two weeks on the lamination and curing.) Brodie has a number of costs to consider when he is making and selling his
boards.
⦁ Basic costs: surfboard blank: $75
⦁ Rent on the space $100/month
⦁ Resin: $15/per board
⦁ Fiber glass cloth $21/per board
⦁ Hours of labor 12 hours/board
Plan 1- Human Capital Considering the information provided in instructions, the best plans will include: – A definition of human capital as it
applies to Brodie’s business – How many workers Brodie should employ, if any – What tasks workers should perform – How many workers would be *too
many* – Supporting statements that show the student utilized available resources in the course – Citations/sources for quoted and/or paraphrased
content.Maximum mark 25
Part One- answer this questions in your plan for Brodie:
How could Brodie invest in human capital (human resources) to grow his business?
Options Brodie has:
⦁ The local laminating shop told Brodie that they would laminate his boards for $150 a board. (The average cost per board is $170).
⦁ There are several people who have asked if Brodie needs any help around the shop shaping, sanding, sweeping etc… They are willing to work for $10
an hour.
⦁ There are two other surfboard shapers in Brodie’s town
⦁ Brodie is a great surfboard shaper. He can shape a board pretty quickly and deliver a good product. He feels that he is a bit slow at glassing
though. He spends about an extra 2 hours per board than many of the other laminators that he knows.
Plan 2- Capital Goods Considering the information provided in instructions, the best plans will include: – A definition of capital as it applies to
Brodie’s business. – Capital goods that Brodie’s business requires. – Strategies he might use to obtain capital goods that will increase his profit.
Brodie must have – Supporting statements that show the student utilized available resources in the course – Citations/sources for quoted and/or
paraphrased content.Maximum mark 25
Part Two- answer this question in your plan for Brodie:
How can Brodie help his business grow by investing in capital (goods) ?
A complete response will include a definition of capital, specific examples of Brodie’s capital, and HOW he should specifically use and invest in
each good to help his business grow.
Some points to consider about Brodie’s physical capital:
⦁ The town that Brodie lives in has just passed a law that lifted the tax on the use of the foam that he uses to makes his boards.
⦁ With the rising of oil prices, the cost of his foam and his resin (oil based products) has been rising over the last several months.
Plan 3- Determining supply Considering the information provided in instructions, the best plans will include: – Explanation of demand, supply, and
marginal benefit as they apply to Brodie’s business. – Advice for Brodie on how to use a production schedule (Chart 5.6) to maximize efficiency in
production and avoid diminishing returns. – Supporting statements that show the student utilized available resources in the course –
Citations/sources for quoted and/or paraphrased content.Maximum mark 25
Part Three- respond to this in your plan for Brodie:
Explain the factors that will affect how many surfboards Brodie should produce (supply).
⦁ This is where you show Brodie how the laws of supply and demand work.
⦁ Use chart 5.6 in Chapter 5 of your textbook again (also in Part 2) to see how businesses work toward profit maximization and use marginal analysis.
⦁ You should also discuss how the concepts of marginal cost and diminishing returns apply to Brodie.
Plan 4- Incentives for growth Considering the information provided in instructions, the best plans will include: – Types of monetary and/or non-
monetary incentives that might be used to grow Brodie’s business – Incentives for all participants in the circular flow: Brodie, consumers,
employees, and the community/local government – Supporting statements that show the student utilized available resources in the course –
Citations/sources for quoted and/or paraphrased content.Maximum mark 25
Part Four- answer this in your plan for Brodie:
What are the incentives that Brodie should consider while trying to build his business?
Include possible incentives for the local government, the customers, his staff, and himself. There are monetary and non-monetary incentives, so
consider both.
Sources related to incentives:
⦁ When entrepreneurs succeed in their business ventures, more goods and services are available for consumption. Successful business ventures also
increase the employment opportunities available to people within an economy. As you have seen, there are many risks involved in starting your own
business. While there are various business structures available, you can never avoid all possible risks when creating your own business.
⦁ There are many incentives that entrepreneurs consider when assuming the risks involved in creating their own business. A business owner may be
motivated by the incentive of a sense of satisfaction involved in provided a certain good or service to the community. Often times, entrepreneurs
enjoy the sense of being their own boss and some of the potential and hard earned freedoms that come along with that responsibility.
⦁ The expectation of a profit is a common incentive for many entrepreneurs. They believe that they can offer a good or service that will make them
⦁ The town that Brodie lives in has just passed a law that lifted the tax on the use of the foam that he uses to makes his boards.
⦁ With the rising of oil prices, the cost of his foam and his resin (oil based products) has been rising over the last several months
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