IB Business Management SL 6.1.5 Business plan Question Bank

Hair \& Beauty (H\&B)
Bettina runs a successful hairdressing salon called Hair \& Beauty (H\&B). She offers a range of services such as haircutting, colouring, and beauty treatments such as body massages. H\&B's popularity is mainly based on Bettina's expertise, networks and personality. Many local celebrities rely on her sense of style; as a consequence, $H \& B$ 's customer base is growing rapidly.
Bettina currently has 12 employees. They are paid good salaries plus commission, but Bettina is very controlling and demanding. Morale and job satisfaction are falling; absenteeism and staff turnover are high. Some workers have expressed concerns about not spending enough time with their families. As a result, Bettina is reluctantly planning to introduce a flexitime workscheme.
Her younger brother Gavin wants to open a $H \& B$ franchise in a small city nearby where several hairdressing salons already operate. None, however, is perceived as stylish and high quality. Bettina will be responsible for training the new employees. She will also pay for the advertising costs. In return, Gavin will pay Bettina an annual fee of 10 % of his sales revenue and maintain $H \& B \leq s$ ' high standards and quality.
Gavin's personal savings are insufficient to meet the start-up costs of the new salon. He will ask for a bank loan. He has already prepared a business plan for his bank manager.

Analyse the importance of Gavin's business plan when seeking finance from his bank manager.