Golf. Great in the summer, but perhaps less appealing on a wet winter's day.

That's the idea behind the Golf Caf�, a new business which aims to provide all-weather golf facilities.

It's the brainchild of Patrick Ord, an electrician from Chesterfield.

He and two friends are keen golfers, but they are often prevented from playing by unpredictable weather.

What they want is somewhere they can play 18 holes whatever the conditions.

Financial gamble

This problem gave them the idea for a new business, an indoor golf centre which uses computer simulators to give golfers a full game without having to brave the elements.

It's an unusual concept.

Working Lunch's Charles Pamment takes a swing

And financially a bit of a gamble.

But the three friends are convinced it's a winning idea.

And they're investing around �80,000 of their own money into getting the project off the ground.

Over the next 12 months we'll be following them to see if they're right.

Hurdles

One of the biggest hurdles was finding the right location.

They've found a disused garage and stores complex right in the centre of Chesterfield.

It's basically a ruin, but it's central, and it's right next door to the Royal Mail's Chesterfield headquarters, a factor they reckon will assure them a regular lunchtime clientele.

But finding the right site is only the start.

"After all the preparation work we've done, getting the keys to the premises felt like we'd just climbed Kilimanjaro.

"But then you catch your breath and see Everest looming behind it," says Patrick.

Pressure

And with their grand opening just weeks away the pressure is on.

The premises needs a lot of work.

But they're saving money by doing the refurbishment themselves.

The building work will not be costing them as much as it might.

But the simulators are.

The computers are the group's largest financial outlay; each one costs about �35,000, but they are essential for the success of the business.

They need to look as realistic as possible.

The team have funded them through a finance company.

The total investment for the simulators is �115,000.

Basically the simulators are giant computer screens which look like fairways and include the usual course hazards such as bunkers and water features.

The idea is that customers whack their golf balls against the screens, simulating a real game.

The site will also have a putting green, a machine to analyse a golfer's swing, and a caf� bar.

Plus there'll be advice available on improving your game.

Finance

Unlike many new businesses the team behind the Golf Caf� haven't had to go cap-in-hand to their bank to arrange start-up finance.

They've raised �80,000 themselves, though they have had to negotiate overdraft facilities for the first few months.

All three members of the business know a lot about construction and golf, but almost nothing about marketing.

And that's where Heather Bradford from Business Link comes in.

She's been advising the group on marketing, business planning, and how to make sure there's demand for such a venture.

She's also advised them on what sort of business to start.

Limited or unlimited?

In their case they've chosen to form a limited company, which is right for them but isn't for everyone.

"Many people think that they must set up as a limited company, but this is in fact not always the best option for them.

"As a sole trader they are taxed on profit as opposed to what they take as wages," says Heather.

"As a limited company they are seen as being employees of that company and are therefore taxed on the money they take from it.

"In fact they also have to pay employers national insurance on the money they take."

Many start-up businesses also feel that forming a limited company will give them financial protection if things go wrong.

But as Heather explains this isn't always the case.

"Most banks and leaseholders will still require a personal guarantee for any loans or leases the company takes out, so it does not always offer them the financial protection that they want.

"Pat is a good example of this as he and his partners have been required by the leaseholder of the property that they are leasing to give a personal guarantee."

Gamble

So the business is a gamble for Pat and his friends.

To make it less risky they've done extensive market research.

"They've done their homework," says Heather.

"Among other things, we approached members of the Chesterfield Chamber of Commerce and asked them whether they'd consider using such a venue for their company golf days.

"We've had great feedback, everyone was very interested."

Confidence

This has given the Golf Caf� company the confidence to get cracking.

The centre should open before the end of October, just in time to take advantage of what they hope will be a wet and miserable winter.

But one question remains.

What will become of the business in the summer?

Will their customers desert them in favour of the real fairways?

Pat's confident he can keep his customers all year round.

We'll keep you posted on whether he's right.

---

Student Guide

---

Pat and his friends have come up with a great idea.

They love golf and want to play it all the time - even on those nasty winter days - but does everyone else want to join them?

A caf� where you can play golf against a simulator, practice your putting and get help to play better sounds like heaven for any golf lover.

Will they all pop in for a round?

Starting a business can be a risky affair so it's important to do your homework before you begin.

This team has been helped by an adviser from Business Link, an organisation which works with businesses to help them to be more effective.

Just think...

Make a list of all the things you think that Pat and his friends should check out before they go ahead.

Limiting the risk

As starting a business is risky, it's important to work hard to reduce this risk.

Careful planning and thought helps.

Here are some of the things that can be done.

Limiting liability

The Golf Caf� team chose to set up a private limited company for their business.

This means that the people who run it have "limited liability".

They are only liable for the money they have put into the business.

If a sole trader runs into financial difficulties, the individual is responsible for all the debts.

If it's really bad, they may have to sell their homes to pay them off.

People who lend money to new businesses often ask for personal guarantees because they know that many start-ups fail.

Pat and his friends have had to do this to cover the lease on the building they are renting.

Just think...

What sort of businesses might find limited liability important?

Researching the market

The team needed to know if people would come to their caf� so they went to the Chamber of Commerce, an organisation which represents businesses in the area.

Pat thought the caf� seemed like a great place for company outings and local business people agreed.

If it became a regular venue, they would be well on the way to success.

Just think...

What else do you think the team might have done to research the market for their caf�?

If you were setting up a sandwich shop, what market research would you carry out?

Choosing the right place

Pat and his friends have chosen a location where they think there will be lots of customers.

The Royal Mail headquarters has many staff who might like a round of golf at lunch time.

As this is a time of day that might be quiet, the location will help to keep business flowing in.

Just think... What other locations might be good for a golf caf�? If you were setting up a sandwich shop, where would you put it?

Getting the figures right

The Golf Caf� team have been working on the figures with their Business Link advisor.

They have worked out the predicted profit and thought through the cash flow forecast.

The figures are looking good, providing the planned number of customers come through the door.

Just think...

Make a list of the costs of running the Golf Caf�. Where will the revenue come from to cover these costs?

What risks do they face on the financial front?

Draw up a table with two columns.

Label one 'success' and the other 'failure'.

Fill up both columns with all the reasons you can think of.

What do you think will happen?

Keep watching Working Lunch and you can see whether your predictions are right.

For advice on starting a new business, click on the links below.

If you're under 30 there is the Prince's Trust (0800 842 842) or Shell LiveWire (0800 842 842)

The DTI's website is very useful. As well as lots of useful links, if you are unemployed you can find out about New Deal grants and the Jobcentre Plus programme, which can help you start a business.

To find your local business adviser:

In England, Business Link (0845 600 9006)

Scotland's Small Business Gateway (0845 609 6611)

Wales (08457 96 97 98)

Northern Ireland

Other links:

National Business Angels

National Federation of Enterprise Agencies

Chambers of Commerce

---