Factors to Consider for Small Business, Customer Relationship Management, International Business Expansion, Break Even Analysis, Financial Statements, and Legislations Affecting Small Business

This report discusses the factors that small businesses need to consider when choosing resources, customer relationship management, ways to expand a business internationally, break even analysis, interpretation of financial statements, and different types of legislations that affect small businesses. The report uses Marshfield Bakery as an example and provides calculations and interpretations of financial statements. It also discusses the advantages and disadvantages of different customer relationship management areas and ways to expand a business internationally. Finally, it covers different types of legislations that affect small businesses.

Unit 29

Table of Contents
INTRODUCTION .............................................................................................................................3
Factors hat a small business need to consider when choosing the resources................................4
Customer relationship management and their advantage and disadvantage with each area........5
Different ways to expand a business internationally with joint venture, internet and Franchise..6
Break even analysis and how it could be applied to a business....................................................7
Interpretation of financial statements and their uses to improve the running of business...........8
Different types of legislations that effect a small business ..........................................................8
CONCLUSION .................................................................................................................................9
REFERENCES.................................................................................................................................10

INTRODUCTION
Business's is a process of making money by the production and selling or buying of goods .
It is an organisation entity engaged in the industrial, commercial and other professional activities.
Its range can be from large to small size. It define the activities and efforts of an individual to
produce and sell of goods and services. There are various types of business's range such as limited
liability companies, corporations, sole proprietorships and the partnerships. A business require
some business plans before the operation begin. A good plan is formal document, which outline
the organisational goals and objectives. It also include the strategies and different ways to
accomplish their motive to succeed the business. In business the determination of legal structure is
another essential factor which need to consider. The business chosen in this report is Marshfield
Bakery situated in the Dyrham, Chippenham SN14 8HZ, UK. It which manufacturers the cakes,
biscuits, snack bars and other seasonal goods. this report will include the different factor, which
the business need to consider, relationship management, various ways to expand the business,
break even analysis, financial statements to improve the business and affect of different
legislations (Akpan, 2021).
Factors hat a small business need to consider when choosing the resources
 Funds availability- At the time of choosing right resources, a small business need to
consider that how much funds they have to allocate these resources. Because without funds
a business can not arrange the essential resources. Marshfield Bakery should determine
that it have adequate funds to select the right resources for their business. They should
capable to arrange the fund so that they can get necessary resource for their organisation.
Importance- It is helpful to meet future uncertainty in the organisation (Bauer and et. al., 2020).
It is used to determine innovation in the resources and easy availability of resources.
 Competitors- A business should uses that types of resources which are not available very
easily to their competitors. They should uses some unique and different resources to attract
the customers. Marshfield Bakery should use such types of resources, which are very rare

and can provide something different to their customers, which they can not get form their
competitors.
Importance- Minimize the risk of competition.
Helpful in increasing profit margin.
 Policies- The employees or labours also a resources for the organisation. For this, a
business should consider all the policies and regulations related to the employees and
workers. The Marshfield Bakery should consider all the policies related to their staff or
employees such as law regarding the minimum wages of employees, health and security
act related to the workers. Etc.
Importance- It provide stability in the business (Byrd and Dove, 2021).
Helpful to manage the legal risk related to the employees.
 Sustainability- When choosing the right resources for the business, then they should
consider the sustainability of their resource. They should not use the unsustainable
resources. Marshfield Bakery should use those resource, which is sustainable and capable
to meet the customer's expectation to satisfy their needs. These resources should be
according to the requirements of their customers.
Importance- It reduce the energy related costs.
Attract new customers and increase sales
 Equipment- The organisation should use such type of equipments which make it easy to
access the resource successful. Marshfield bakery have good types of equipment which are
helps them to use the resources in a efficient way.
Importance- Easy availability of resources.
It is less time consuming (Cosenz and Bivona, 20210).
Customer relationship management and their advantage and disadvantage with each area
It is those principles, guidelines and practices that are followed by an organisation at the
time of interacting with their customers. Often, it is used to refer to the technology companies and
systems which help manage the external interactions with their customers. It could help the
salesperson automate their sales performance and the managers to track performance of their
teams. CRM covers the direct contact with the customers, such as service related operations,

analysis of the consumer pattern, forecasting and behaviour from the prospective of a company.
There are many areas within customer research management which are given below:
 Customer satisfaction studies- It this, a business can determine that how much the
customer is satisfied with the company's product and services. It is an informal method of
conversation with their staff.
Advantage- It allow the company to compare the data over time and the benchmark survey data
across the previous year to determine the changes.
Disadvantage- The customer burnout may result in the low response rates, despite the company's
reputation to proving the excellent services.
 Brand testing- In this, it is helpful to determine that how their customers feel about their
brand and the products. The company using surveys designed to assess the empotinal
response to their product and the brand names.
Advantage- It helps the business to the risk of full scale launch and also reduced their cost
(Morrell, 2021).
Disadvantage- The company do not cover the full target are, due to this it can not give an
appropriate information to the company.
 Social media monitoring- It become a common component of many business to market
their product and used by them to customer research management. it is used to run the
survey and test concept.
Advantage- It helps the company to keep an eye on the brand advocates, who they want to
interact with.
Disadvantage- It is often noisy and the overcrowded place. So it become difficult for the
company to identify necessary information
The Marshfield Bakery uses social media monitoring for the customer research management,
because it give customer feedback and also share the customer services experiences to make any
complaints. It also helps to sort through the noise and lets only to the important message through.

Different ways to expand a business internationally with joint venture, internet and Franchise.
Internet- It is a global network of the millions of computer and the other electronic
devices. It is used by the organisation to expand their business by communicating the important
business's information and the documents.
Benefits
 It has automated system and the resource sharing
 It reducing market cost because it has low cost marketing channels for business purpose
 It is excellent tool to increase the business's visibilities, and also has potential to access a
global market.
Drawbacks
 It reduce the physical interaction that individuals have face to face .
 It has the potential to lower the profit margin (Motuhake, 2021).
 Customers share their negative feedback on the internet, which show negative reviews
about a company
Joint venture- It is the common way to combining resources and the expertise of the the
otherwise unrelated companies. It involve two or more parties pooling their resources to achieve
their goals.
Benefits
 In this, both the parties shares the cost and risk
 The potential of the business will virtually be limitless.
 It allows both sides to access resources of each others
Drawbacks
 There is lack of clear communication because of different companies and different goals.
 It restrict the participation in outsides activities and limit the external opportunities.
 It is highly depend on the research, so it require a lot of planning and necessary research.
Franchise- It is a legal or commercial relationship between owner of the business and the person
who is going to start a branch of that business.
Benefits-
 It is helpful to promote the multi- unit expansion.

 It also expand the economies scale by expanding the business.
 It create new revenue stream and business will be benefit from royalties paid.
Drawbacks-
 The franchise recruitment can be less efficient and slower that the employee recruitment.
 It can be risky to share confidential information with the franchisees.
 The franchisees may have different goal to the franchisor ( Petersmann and et. al., 2020).
The Marshfield bakery should use franchise to expand internationally. It is an innovative growth
strategies for the business. It will accelerate the growth of Marshfield bakery and fast track market
penetration. This strategy clearly understand the basis of their success. If the Marshfield bakery
adopt this method then it will help in generate revenue by the production on a large scale and
increase their bran value.
Break even analysis and how it could be applied to a business.
It is that point, where the total revenue and total cost are equal. It is used to identifies the
numbers of units or revenue needed to cover the total cost. It is a financial tool that helps the
company to identifies that stage at which the company will be profitable. It is also useful to study
the relationship between the fixed cost, variable cost and revenue.
Applied on the Marshfield bakery with calculation
Break even Point = Fixed Cost / (Selling Price per unit - Variable Cost per unit)
For example, it is selling brownie of Sales price per unit = 500
variable Cost per unit = 200
Fixed Cost = 300000
So BEP ( in units) = 300000 / (500 – 200) = 1000 units
It means the point of 1000 units at which the firm will neither earn profit nor will suffer a loss.
 It help to identify the profitability point
 It ensure a proper price of a product and services.
 It give information which need to implement the best strategies moving ahead.

Interpretation of financial statements and their uses to improve the running of business.
Financial statements are the written records that helps to convey business activities and
financial performance of the company. These are often audited by the government agencies, firms,
accounts and other etc. to make sure the accuracy and for financing and investing purpose. The
financial statements include three main things, there are Balance sheet, Income statement and the
Cash flow statement. The financial analysts and investors relay on these financial statements to
analyse a company's performance and make the predictions about future direction of the company
( Salvato, and et. al.,2020).
Financial statements of Marshfield bakery
Balance Sheet

Income Statement:

Cash Flow Statement:

Interpretation:
Balance Sheet helps in measuring the financial performance of the company. The above figure in
depicts the monetary position of the Marshfield bakery. The bakery is in the liquidity position as it
is 81261 at the end of the year 2020. The company's goodwill is also huge which is 258182. the

ratio of the current assets to the current liabilities is approximately 1.5 which is not bad, but the
organisation needs to improve this by increasing the current assets.
The income statement shows the expenses, profits, losses and incomes of the Marshfield bakery.
The profit of the year 2020 is 103517 which is more than the last year.
Cash Flow statement tell about the outflows and inflows of cash in the term of operating,
investing and financing activities. The net cash flow is positive which means the inflow of cash is
more than the outflow. It means that the company is doing well.
The company is performing good but can improve it current assets so that the liabilities can be
balanced and will increase the liquid position of the company. Comparing to the net profit of the
last year, the profitability of the Marshfield bakery has increased.
Financial statements helps the business to improve its running
Balance sheet- It provide the information the what the business is worth from the book value
perspective ( Tilt and et. al.,2020).
Income statement- It provide a detail on the revenues earned by a company and the expenses
involve in its operation activities.
Cash flow statement- It is helpful in to provide a view of overall liquidity of a company by
showing their cash transactions activities.
Different types of legislations that effect a small business
Legislation is that process in which the government implement some laws and rules to
protect the citizens within the society. It determines the rights and responsibilities of a person and
also authorities the whom the legislation applies. It is the process of preparing and enacting of the
laws by the local, state and national legislature. It involve the participation by the executive and
concurrence by the executive is required for the effective legislation.
 Employment act 1996- The Conservative government passed this law to codify the
existing law on individual rights in the UK labour law. The areas covered by this act are
redundancy payment, dismissal, Sunday working, protection of wages, zero hour contract,
flexible working and the terminations of employment. Marshfield Bakery follow this act
and promote equality in their business. They make sure to available the suitable facilities
for the employees with disabilities. It also ban the sexual and the other harassment.

 Data protection act 1998- This act is designed by parliament to protect the data stored on
the computers and in some organised paper filing system. It developed to protect peoples
and lays down the rules about how the data about peoples can be used. In context of
Marshfield Bakery, their system does not store any information and does not process the
data for the intention of data protection act. So it doe not have any effect on that business.
 Company law 2006- It govern the company law in UK. It forms the primary source of the
UK company law. This act codifies some existing common low principles, such as related
to the director's duties with some changes. The Marshfield Bakery complies with that act,
the directors and owner of this bakery should follow this at the time of decision making to
avoid their legal consequences (Xu and et. al., 2022).
CONCLUSION
From the above report it is concluded that, business has a global presence and there are
various factor which effect them externally or internally. In this report the organisation chosen is
Marshfield bakery which offer cakes, biscuits and snacks. There are some factors which need to
be consider at the time of choosing resources. This report explain the customer relationship
management and their area such as brand testing, customers feedbacks etc. it has various was to
expand their business and internet is the best way for this. There is a break even analysis, which
applied on the organisation to analysis the profit and revenue points. The financial statement helps
the company to improve their running business and to know about their financial position with the
help of balance sheet, income statement and cash flow statement. The government implement
some legislation related to the employees that are employment act 1996, data protection act 1998
and company act 2006 which are followed by the chosen organisation to avoid any legal case.
Hence, it is find out that a business should consider all the factors which can effect their business
in a positive or negative way to run their business.

REFERENCES
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