Sources of Finance: A Business Problem!

Scenario “vets2you”, the brain-child of Veterinary Surgeon Anna Wood is a new start-up business offering a unique approach to veterinary care in East Dorset. The USP of the business, is that it is a mobile veterinary service that conducts client consultations in the comfort of the pets own home. This means less stress and anxiety for both the pet and the owner, and eliminates the need to travel with a pet to a traditional veterinary clinic, the need to sit in a waiting area, and exposure to infection and contagious illnesses. The service appeals to a range of clients, including those who have no private transportation of their own, as public transport is generally unwilling to transport animals. The service also appeals to the elderly, the wealthy who like the convenience, working families who are ‘cash-rich’ but ‘time-poor’, as well as those who have particularly large animals or a number of animals, including private households, breeders, rescue/adoption centres, and trainers.

Current Situation ‘vets2you’ is hoping to start trading February 2011, and is currently finalising details for the operation of the company. Premises have been secured, that are being converted into a dedicated surgery with a reception and retail room, a preparation room with kennelling, an operating theatre, and an isolation suite. The company has also ordered a company vehicle which is to be sign-written and converted internally to accommodate a number of cages, and also routine medical equipment. The company has also placed orders for the equipment that is needed to conduct routine procedures including an anaesthetic machine, x-ray machine, dentistry equipment, and blood testing equipment. Other aspects of the business that are currently being developed include the company website, contracts with medical suppliers, and corporate branding including stationary and clothing.

The Problem! ‘vets2you’ are confident that there is a place in the market for their unique approach to veterinary care, and that there are customers ready and willing to pay for this service. The systems and facilities are being developed ready for the February launch of the business, however there is one minor problem…. All of this needs to be paid for! This is where you come in…… ‘vets2you’ have asked you to advise them on the sources of finance that are potentially available to them, and to advise them on which source of finance they should try to secure taking into consideration the benefits and drawbacks of each.

Extra information The company needs £20,000 to fund the initial start-up The company want to pay back the start-up loan as quickly as they can, as they wish to expand the company by employing another veterinary surgeon, vet nurses and buying extra equipment, including a second company vehicle. ‘vets2you’ are hoping that the pay-back period will be between 3 and 5 years.

Your Task over2you….. What should they do? You are to prepare a presentation that you will deliver to the owners of ‘vets2you’ outlining your findings and recommendations. You must also produce a written report to support the presentation, that you will give to the owners of vets2you to read following your presentation to them GOOD LUCK!