2.4 Applying this to Bike-a-lot

Activity 3

Timing: Allow about 10 minutes

Let’s take the case of Bike-a-lot [Tip: hold Ctrl and click a link to open it in a new tab. (Hide tip)] . (To open the case study in a new tab on a PC, hold down the Ctrl key when clicking.) Based on these ten points where do you think the potential failures are for the owner Nicky?

Comment

Nicky decided to start Bike-a-lot with a partner to spend more time on the hobby of riding motor cycles. There is a danger that this passion could turn sour and the hobby becomes a chore.

Having a partner in the business means that there is potential for different priorities and levels of effort.

The bike school must be located where people want to ride, can get to and not too close to other bike schools. The customer base is not that large that two schools close together could be supported.

Because the partners had to take out a substantial loan, they had to present a robust business case to the bank, this gave some confidence that the business was viable.

The Bike-a-lot website is one of its strengths. Hosted and run by a local IT company the website is easy to navigate and allows for online booking with all payments taken in advance.

Nicky has to plan carefully. People avoid learning to ride motor cycles in the winter months, so there will be times of very low income in December, January and February. Contingencies need to be in place for these periods. Perhaps the business could focus on selling bikes and equipment or carrying out winter services when owners are less likely to use their motor cycles.

3 Risk assessment