Entrepreneurship and Small Business - PDF

SETTING UP A SMALL
BUSINESS

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
Industry...................................................................................................................................1
Location..................................................................................................................................1
Target customer......................................................................................................................1
Business model.......................................................................................................................1
Name of business....................................................................................................................2
Visual Identity of business.....................................................................................................2
Values to promote business....................................................................................................3
REFERENCES................................................................................................................................3
TASK 2............................................................................................................................................4
Primary research for setting up business................................................................................4
Secondary research for setting up business............................................................................4
Quantitative and qualitative research for setting up new business.........................................4
REFERENCES................................................................................................................................5
TASK 3............................................................................................................................................6
Ethical dilemma which faced in setting up new business......................................................6
REFERENCES................................................................................................................................7
TASK 4............................................................................................................................................8
Explanation of equality and diversity law for appointing applicant in business....................8
Rights for new employees in entity........................................................................................8
REFERENCES................................................................................................................................9
TASK 5..........................................................................................................................................10
Assets, liabilities and expenses of organisation...................................................................10
Account of business entity....................................................................................................10
Methods for avoiding cash flow problems...........................................................................11
REFERENCES..............................................................................................................................11
CONCLUSION..............................................................................................................................13

INTRODUCTION
This assessment provides an explanation for setting up business in marketplace. In this
report a Lemado hair salon has been chosen to present factors which needs to be analysed before
setting up business in market place. Further, explanation of primary research, secondary
research, qualitative and quantitative research is explained its importance before starting business
activities. Lastly, in this report accounts have been generated which provides cash surplus of an
entity.
TASK 1
Industry
This industry is developed in business of beauty salon. As observed from the beauty hair
salon market of UK, this is the fastest growing industry in UK (Bell, Bryman and Harley, 2018).
Nowadays, consumers are influencing with social media trend which was nowadays trending in
evaluation concept of grooming and beauty both in male and females. Therefore, idea of setting
business in beauty salon among customers of UK is generated.
Location
To reach customers easily in salon, decided location of setting beauty hair salon is in
main areas of cities of London. Location like Whiteleys mall will be decided in favour of
customers so that they will easily accessible by car, and by public transportation. In making sure
that client feel safe in salon, it is also decided to fit brightening lights in and outside salon. The
location is chosen to keep in mind safety to client because, working customers who does not
have time in the day time will feel safe in reaching to salon.
Target customer
Target group of saloons will be females because nowadays, beauty is the thing which is
more important for girls and women's around the world. Women's are the target customers
because they are the one who mostly spend countless hours in getting their hair cut, teased and
sprayed. They want the best service of makeover with countless touches of colours on cheeks
and lips which helps them to look attractive (Burns, 2016).
Business model
For earning profit is business, revenue model is selected for the operations of business.
This model is a framework for generating revenues in organisation. This model emphasis on
1

developing information related to revenue source which needs to pursue, value to offer among
customers and prices of providing services to customers. Therefore, it is the model which helps
in making money for an entity.
Name of business
“Lemado Hair salon” is selected as name of business, because salon has employees which
are specialist in cutting and styling of hair. Objective of providing this name is to attract
customers where they will able to take suggestion from our hair specialist regarding special hair
cuttings (Sekaran and Bougie, 2016). This is why tag line is selected as “Let Them Do”.
Visual Identity of business
“Lemado Hair salon” has specialist which provide effective and stylish hair cutting to
customers. This service is opened to dedicate full and effective services to customers and to
satisfy them by rendering excellent service with quality of products in salon. This business also
provides comfortable and enjoyable furniture where customers will feel relax and satisfied with
acceptable price and valuable relationship to them. Services which offered by institution are
firstly stylish haircuts, relaxers, perms, colours, shampoo, conditioning, curling, reconstructing,
weaving and waving. The logo which will be presented for business operations of Lemado
beauty and hair saloon is as follows-
2

Values to promote business
To operate business in main areas of cities, social, environmental, equality and
diversified values will be considered effectively. Business functions are operated with protecting
environment of society. Natural products will be in use so that it does not harm customers values.
Major care will be given to customers who are allergic with chemical, herbal products will be in
use for allergic customers. Every customer of business will consider equal therefore, equal
treatment will provide to them in salon.
Natural equipment’s and resources will be in use in protecting environment of society.
Hairs which cuts will get reused by making wig so that it will provide to people who are in need
of it. Chemical products which used in salon will be used with proper protection so that it does
not harm customers as well as employees. Diversified products will offer so that need of every
customer get fulfilled (Eriksson and Kovalainen, 2015).
REFERENCES
Books and Journals
Bell, E., Bryman, A. and Harley, B., 2018. Business research methods. Oxford university press.
Burns, P., 2016. Entrepreneurship and small business. Palgrave Macmillan Limited
Sekaran, U. and Bougie, R., 2016. Research methods for business: A skill building approach.
John Wiley & Sons.
Eriksson, P. and Kovalainen, A., 2015. Qualitative methods in business research: A practical
guide to social research. Sage.
3

TASK 2
Primary research for setting up business
For setting up business in market of UK, effective primary research will be conducted by
personally visiting customers in malls and engaged areas of cities. Opinion will be taken by
customers of areas with Questionnaires and by programs and events in public areas. They are the
source by which high information will be developed in setting up efficient business. By
discussing with other businesses of area and by taking their ideas, effective business gets started
area of cities.
Reason behind conducting this primary research, will be seeking help in setting efficient
business with premium facilities to customers (Hair and et.al., 2015). Primary research will help
in identifying the problem areas of business, needs of customers and services which need to
develop in providing excellent services to customers.
Secondary research for setting up business
Secondary market research will help in developing effective business in accordance with
the expectations of customers. This type of secondary research collects information from outside
world that is agencies, industry, trade association, labour, media etc. Research will generally
obtain from published pamphlets, newsletters, trade publications, magazines and from
newspaper.
Secondary market research will develop to achieve background view of market. This will
help in analysing success of already established salons services of that areas with purchasing
habit of customers.
Quantitative and qualitative research for setting up new business
Qualitative research helps in knowing methodology which provides information related
to expectations of customers from beauty salons of business market. This type of research
conducted by asking questions either one on-one to group of peoples of business market.
Quantitative research measures numbers and descriptive analysis (Easterby-Smith,
Thorpe and Jackson, 2015). It will help in analysing statistical trend of business in market. With
this analysis accurate information will be generated by new organisation. With the quantitative
research, Lemado salon will able to solve problem through outcomes which is generated with
descriptive analysis of statistics such as mean, mode and medium. Proper survey and
questionnaires will majorly help in developing new set up of business.
4

Qualitative and quantitative research in important because it helps in uncovering
customers real thoughts and feelings with identification of blockages in service and sales
performance. It also helps in gaining quality of customers feedbacks to start business in new
market. With this research, new business will set up in accordance with real improvements in
market.
REFERENCES
Books and Journals
Hair Jr, J.F and et.al., 2015. Essentials of business research methods. Routledge.
Easterby-Smith, M., Thorpe, R. and Jackson, P.R., 2015. Management and business research.
Sage.
5

TASK 3
Ethical dilemma which faced in setting up new business
Case Overview
According to given case study, company which offering promotion in popular website at
discounted rate will not be accepted by Lemado salon because of not proper working ethical
culture in organisation which offered promotion at discounted rate. For developing new business
in market, it is important to work with proper ethical policies which helps in building good
image of company. Dilemmas arise in company because of various sources of attitude, it may be
because of failure of personal character of individuals in company, social values and anything
which affect behaviour of individuals.
This case will be supported as case study of BBC organisation, where employees are
facing lot of misbehaviour with higher authorities. Employees are leaving company because of
discrimination, bullying and harassment by the management of organisation (Shang, Kuzmenko
and Uryasev, 2018). This unethical dilemma in company majorly affected business operations
and company has to bear loss with their business function functions. Also, company loose with
overall image in business market get diminished and nobody wants to appoint in that company.
After the appointment of new CEO in BBC, many changes have taken place in favour of
providing safe working place to customers.
It is very important to work with firm that manage work under ethical work culture so
that employees get motivated in developing operations of business in market area. Ethics at
workplace is important in developing productivity and team work in organisation which develop
motivational skill among employees in producing services of organisation (Lewellen and
Lewellen, 2016). Employees work in team which provides fast completion of work in efficient
manner.
Decision with justification
According to case study, lemado hair and beauty salon will not accept the offer of
company which offering promotion because it will directly affect employee turnover of salon. If
employee turnover will not be effective then, newly established salon will not able to develop
goodwill in business market.
6

Work with proper ethics helps in earning respect and strong image from people of
society. Ethics in work culture helps in fulfilling corporate social responsibility by reducing
waste discharge of services. It also helps in earning more customers in business. Conduct of
ethics in workplace is important because it encourages a culture which helps in making decision
for company which based on ethics. Ethics at workplace helps in protecting fundamental rights
in organisation which means protection against immoral behaviour in organisation. It also helps
in protecting assets of company where all the employees work with honesty which create
motivated environment at workplace. Stakeholders of business organisation will also get affected
with unethical practises of company where they will stop investing for business operations which
overall will affect profitability of company. Wrongdoing ethical practises and poor decision
making hurt stakeholders and which lead to affect profitability of company.
Therefore, for opening or setting new business in marketplace, it is necessary to develop
effective ethical practises in working environment of organisation. If there would be a proper
ethical work culture then both customers and employee remain satisfied with company which
overall creates good image of business in marketplace.
REFERENCES
Books and Journals
Lewellen, J. and Lewellen, K., 2016. Investment and cash flow: New evidence. Journal of
Financial and Quantitative Analysis. 51(4). pp.1135-1164.
Shang, D., Kuzmenko, V. and Uryasev, S., 2018. Cash flow matching with risks controlled by
buffered probability of exceedance and conditional value-at-risk. Annals of Operations
Research. 260(1-2). pp.501-514.
7

TASK 4
Explanation of equality and diversity law for appointing applicant in business
Zero-hours Contract:
Zero-hour contract is a contract which means that employers will only hire staff with
their own accordance of working. There is no guarantee towards working in organisation. But
this does not mean that they will not get effective rights in their working. There must be a proper
rules and regulations where there will no discrimination at work regarding age, gender, sex,
disability, etc. Employees who are working under contract of zero-hour has a statutory
employment right and there will no exceptions in this right.
To Comply with Equality and Diversity:
Equality act is a positive approach which provides right in working at workplace. Positive
approach of diversity will allow business entity in selecting the best person for getting work done
and which is completely free from any bias in its working skills. Diversity at workplace means
that company, is welcoming individuals of different background actively and making effective
efforts to developing positive work culture in organisation.
Working place which has both equality and diversity act are more effective in providing
the best services to customers with proper quality of products. Therefore, with merger of equality
and diversity law, effective staff will get appointed with contract of zero-hour in entity.
Therefore, in this contract, employers conditions towards employee will not change but with the
help of equality and diversity act proper rights will be provided to employees at workplace like
every other employees.
To get the best and effective work, it is compulsory to develop effective rules and
regulations which protects rights of the customers in marketplace. Therefore, for developing
effective business operations of “Lemado hair salon” two members will be selected for work in
zero-hour contracts. For doing process of fair recruitment, equality law and diversity law must
develop in business (Engsner, Lindensjö and Lindskog, 2018).
Rights for new employees in entity
Following are the rights which are applied to employees and workers with zero-hours
contract employees act: -
8

 Business organisation needs to provide minimum wage rate to employees.
 There must be full protection from unlawful deductions from wages which paid to them
by organisation.
 Protection from any discrimination in working culture of organisation which both for
full-time employment and part- time employment (Ravalier and et.al., 2018).
 Business entity must have to provide minimum amount of wages for paid holidays.
 Employees have proper right where they will not work more than 48 hours in an average
per week.
Rights of zero-hour contract which only for employees not workers are as follows-
 Employees must have right to get payment of the sick leaves.
 Employees will have right in getting payment of maternity leaves.
 Employees also have the right to get minimum notice period if their employment is
ending in organisation.
REFERENCES
Books and Journals
Engsner, H., Lindensjö, K. and Lindskog, F., 2018. The value of a liability cash flow in discrete
time subject to capital requirements. arXiv preprint arXiv:1808.03328.
Ravalier, J and et.al., 2018. Zero‐hour contracts and stress in UK domiciliary care
workers. Health & social care in the community.
9

TASK 5
Assets, liabilities and expenses of organisation
Assets can be defined as something which helps in providing future economic benefit in
success of the company. Cash, inventory, accounts receivables etc. are considered as examples of
assets of business entity (Xu, 2018). Liabilities are considered as the obligation of company
which either paid with money or by performing services of organisation.
Revenue is considered as money which is earned by entity with business operations of
organisation. Expenses are the one which incurred by company for developing effective business
operations of organisation. Salaries, wage, cost of goods sold etc. are the examples of business
expenses. Gains are the one which is earned by an entity with its business operations.
Assets Liabilities Expenses
Land and building Accounts payable salaries
Chairs and mirrors Loan wages
Shampoo bowls Insurance electricity
Dryers capital taxes
straightener provisions Advertising and marketing cost
curler Income tax payable Miscellaneous expenses
Pedicure chairs
Nail polish Racks
Hair spa machine
comb
scissors
Account of business entity
Income statement of Lemado hair and beauty salon for the year ended 31 march
Particulars Amount (£)
Cash inflows
10

Opening cash inflow 20000
Sales revenue 250000
Other income 10000
Total cash inflows 271000
Cash outflows
Salaries and wages 45000
electricity 15000
taxes 20000
Advertising and marketing cost 30000
Miscellaneous expenses 25000
Total cash outflows 93250
Cash deficit/ surplus or closing cash balance 136000
Methods for avoiding cash flow problems
For avoiding cash flow problems, there are various ways which are as follows-
Set clear payment due dates: By reducing late payment limit among client and by
developing clear payment due dates will help organisation in preventing problems related to cash
flow (Faulds, 2018). By developing payment term easy, company will able to reduce problems of
cash flow.
Capture opportunities: In workload situation, company just have to adopt that
opportunities and try to capture profit as much as possible which overall helps in avoiding cash
flow problems of organisation.
11

Functioning through invoices: By doing payment with invoices helps in avoiding
problems of cash flow in organisation. Invoice avoid risk of fraudulent activities which create
chances of secret profit generation in organisation.
REFERENCES
Books and Journals
Xu, K., 2018. The Analysis on Employment Rights of “Zero-Hours Contracts” Workers in the
UK. World Journal of Social Science Research. 5(1). p.16.
Online
Faulds, C., 2018. How to prevent Cash Flow Problems. [ONLINE]. Available through
<https://articles.bplans.com/how-to-prevent-cash-flow-problems/>
12

CONCLUSION
From the above report it is summarised that before setting up any business in any area of
marketplace it is necessary to conduct a proper research and analysis of factors which needs to
develop in organisation. Therefore, in this report explanation is provided on the research which
needs to develop before setting up any business in market.
13

.
14