Part A - Business overview and sustainability

This section provides the judging panel with a general overview of your business, its environment and sustainability.

Part A should be no more than 500 words.

1. Business overview

a) Summary - provide an overview of your business, including the number of years in business, number of staff, vision, growth rate, markets targeted, key leadership and management practices adopted and current market challenges.
b) Business development - outline your approach to developing your business strategies, plans and implementation programs and how these are communicated to all staff.
c) People - how do you encourage people to make contributions to the business and how do you develop all the people in the business to reach their full potential?
d) Processes and practices - outline what you do to ensure that the major activities and processes in your business are running effectively and efficiently including food safety, triple bottom line and risk management.

2. Business sustainability

Sound and sustainable businesses effectively plan and control their affairs across a wide range of management priorities. In today’s environment there are a range of indicators, both financial and non–financial that drive sustainability.

Option 1) Business sustainability can be shown by providing a written statement indicating your financial stability from an accountant.

Option 2) Financial ratios measure ongoing sustainability and can be indicated through completion of the following questions.

a) Liquidity - reflects the ability of the business to meet its short-term obligations (current liabilities) with the liquid resources (current assets) you have.

Current Ratio = Current Assets $ / Current Liabilities $

A business should normally have sufficient current assets (for example stock, work in progress, debtors and cash) to cover current liabilities (such as creditors and other payables). 

b) Solvency - reflects ongoing or longer term sustainability. Gearing is a measure of the ratio of the funds that your business has borrowed (eg loans, overdraft, hire purchase) to the total capital of the business (owners or shareholders capital and reserves).

Gearing = Total Borrowing $ / Total Capital $

Gearing is important in assessing how much the business uses debt finance to fund its operation.

c) Profitability - maintaining and trying to increase your gross profit margin is of vital importance. The Gross Profit Margin is one of the important ratios, which points to how your business is performing. It reflects what remains from sales after expenditure for the cost of goods sold.

Gross Profit Margin (%) = Sales Revenue - Cost of Goods Sold x 100 / Sales Revenue

The Gross Profit Margin is a measure of a business’ manufacturing and efficiency before other overheads like selling, distribution, administration and finance expenses are taken into account.