Small Business Management Strategies

This assignment delves into various management strategies crucial for the success of small businesses. It emphasizes financial analysis techniques such as break-even analysis and highlights the importance of understanding financial statements. The document also discusses risk management in small business contexts, drawing upon examples like anomaly detection and IT security best practices.

Developing Entrepreneur
Skills

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Consideration need to address when planning and allocating resources to achieve objective
................................................................................................................................................1
TASK 2............................................................................................................................................2
P2 Various process of customer relationship management....................................................2
P3 Developing of a business transitionally along with its benefits and drawbacks...............3
TASK 3............................................................................................................................................5
P4 Annual itemised monthly cash flow forecast showing fixed and variable costs against
income....................................................................................................................................5
P5 Break – even analysis........................................................................................................7
P6 Key financial statement in relation to their contribution to the successful management..9
TASK 4..........................................................................................................................................10
P7 Implications of legislation and regulations on small business........................................10
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................12

INTRODUCTION
For the purpose of starting a venture, this is fundamental to contain some certain abilities
and skills which underpin these skills. This also essential to improve entrepreneurial abilities
while performing a proper job role (Cojoacă, 2017). Company's financial position is one
fundamental concept that can aid to develop stakeholders satiating as well as it deliver helps
There are several issues that influence business as well as this is fundamental to overcome from
those problem. Manager of organisation is liable for for managing activities and operations. The
report is associated with SoHo Coffee organisation that is located in London which was formed
in 1999. It deliver several drinks, beverages, coffee and healthy snacks. This assignment will
discuss business plan along with allocation of resources, process of consumer relationship
management, break-even analysis, employment laws and cash-flows statement etc.
TASK 1
P1 Consideration need to address when planning and allocating resources to achieve objective
Numerous policies and activities are undertaken for creating a proper business
environment. As the small scale organisation need to develop a proper plans through which they
can create proper vision and activities to sustain within the marketplace. SoHo Coffee Company
is located in London small scale organisation that offer variety of services and products to wide
range of target audience. These sort of enterprise contain limited financial resources in regard of
spending on the limited resources to innovate and adopting techniques at the same time offering
great quality of food. Key purpose of forming such sort of cage is to deliver wide range of
services and products as well as create a unique recognition within the consumers. Resource
availability is complex that can make the commodities production procedure more complicated
and difficult (Durst, Yip and Lee, 2015). Hence, this is essential for such enterprises to design
proper business plan in regard of attaining their set targets and achieve them within certain
period of time. Distinct elements are considered under it discussed as below:
Vision, objectives and goals: This is fundamental for business enterprises such as SOHO
Coffee Company to determine their accurate task, objectives and business operations within
certain period of time. Furthermore, entire work-group need to accomplish entire work within
certain disciplined manner on the grounds of which they can attain their set objectives. The
company is aiming over providing best coffee within the London Streets to become leading
coffee company in context of its service quality.
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Professional Development: SOHO Coffee Company need to coordinate proper events
and development session by which they can conveniently direct entire worker group for
providing more productive and innovative services. Modern mechanisms can also be adopted at
the time of operations and performance of task (El-Rafei, and et. al, 2017). Hence, employee's
professional skills allow them to interact with their visitor in more disciplined manner in order to
satiate their consumer.
Financial Resources: It is essential to manage large financial amount for SOHO Coffee
Company in regard of executing the future projects and proper fluctuation of activities. Hence,
the entire management should be portrayed in their position of market in a manner so that
investor can influence their worker in regard of investing their capital for business growth. It can
help the organisation to create awareness of their manufactures and organisation structure which
can easily help in satisfying their financial position and consumer requirements in the extrinsic
marketplace.
Hence, SOHO Coffee Company need to outlines entire mentioned elements that can
enable their optimum resources utilisation as well as increase their productivity and efficiency of
business.
TASK 2
P2 Various process of customer relationship management
Consumer are paramount components for any business company. In case of SME, major
focus of such companies are to earn benefits which is linked to the social satisfaction. SoHo
Coffee Company deliver edible products to the community so this is fundamental for them to
understand the interest of society in regard of making modifications and develop products
accordingly. Consumer relationship management is also one suitable methods which has ability
to manage consumer expectation and renovate the policies and strategies of organisation. By this,
the management technique of SoHo Coffee Company can communicate with the consumer
understanding their views (Javaid and Iqbal, 2017). In CRM, through accumulating data and
response of consumer, organisation can expand and create unique recognition through deliver
according commodities. Manager of SoHo Coffee Company can adopt numerous activities and
techniques such as SMS, Telephonic interview etc. to gather the information that can deliver new
information to employee as well. In regard of expanding the business, this is essential to review
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the consumer demands before launching a new products by SoHo Coffee Company. Consumer
relationship management assist enterprise in creating more better connection among the
company and their clients or consumer which can help in achieving business objectives.
Consumer Value Assessment: Different consumer types differ their demands and
requirements from the organisation (Ludmila and Stanislava, 2015). It is fundamental to carry
out proper innovative services and new products within certain period of time by analysing
response of consumer. Undertaking the feedback is not only and enough techniques as this is
required for company to perform actions (Ali and Babiker, 2017). It deliver opportunities to
make proper relations with consumer creating familiarity with brands. The assessment can assist
to aware and inform brand value among the community. Thus, this is essential to create proper
inspiration to structure policies that are more efficient for the organisation.
Road and Event Show: Events and trade shows are assisting and effective methods t
communicate and understand public in regard of creating service awareness and brand
promotion. It convey brand equity and value among the social elements. But, it is expensive and
complicated procedure which become hectic in absence of required number of people. There are
opportunities to people to response their feedback at such shows instantly. Hence, these sort of
shows or events are able enough to create brand awareness and create interest among worker
along with portray a better recognition among the community or local people.
Social Network: Social media is emerging and most effective medium of managing CRM
by performing it as business practice. This is the methods which is often general these days as
well as can assist people in numerous manner. In this case, the company need to evaluate more
activities and practices in regard of achieving business objectives (Small business benefits from
internationalisation, 2010). Through using social media analytical techniques and tools that can
assist in recognising their influence.
Discussion and Chat Forums: Discussion and chat forms are two different surfaces that
direct to interact of between concerned teams and parties. Chatting can be referred as private
channels by which one can aware where elaborating include mass people number in order to
focusing to resolve an issue.
P3 Developing of a business transitionally along with its benefits and drawbacks
Business development transactionally refer to the business expansion over the limitation
of a country. SoHo Coffee Company is small enterprise therefore, this is relatively complex to
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expand their operations of business globally. This can be recognised as one largest trend in
market as people tend to like the coffee and other foods products which is creating enlargement
of organisation and entire industry. A business organisation that is considered to be transactional
being out their operations in several regions undertaking different strategies and coordination.
Such companies depend on the benefits of coast that are attained along with assisting imputes
from the sales and local markets that are driven along with appropriate techniques or tactics of
marketing to reach better outcome of organisation.
This can be observed that internationalisation is one of most likely techniques and more
suitable manner by which prosperity can be achieved with attaining business operations
sustainability (Nowotarski and Paslawski, 2015). This can be termed as an approaches by which
the contemporary competitiveness of market can be assisted and availed. SoHo Coffee Company
is small coffee house which is carrying out their operations in more confined market therefore,
this has become more complicated to compete with other small and large cafe houses within
organisation. The cause for which the business should operated and deploy internationally is that
through expanding the global business position, they can gain more financial revenues along
with enhance their recognition of organisation creating itself as a brand. This is required for
government to emphasise over the information awareness association with the business
enterprise which can help in carrying out the financial mechanisms support. SoHo Coffee
Company is popular for their coffee quality along with its services that can develop and achieve
success within street of London.
Here are discussed some of the benefits and limitation which is mentioned as below:
Benefits Independence: Sales increment by transnationally is more independent within the other
activities development i.e. beneficial. Efficiency: These activities are independent as well as are able to assist in achievement
of work efficiency and modifying the policies and plans of company in more significant
manner.
Limitation: Time Consuming Procedure: It is one of the best approach as this can help in making
benefits and sales increment, but it consumes more time to achieve the level of growth.
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 Financial Instability: Financial can be referred as blood of organisation which is
essential for operating numerous activities (O’Connor and Kelly, 2017). This is
fundamental for business to develop activities accordingly.
Hence, through using transnational procedure and approach of internationalisation, SoHo
Coffee Company can achieve their business objectives and attain wide range of consumer along
with meeting some criteria of market.
TASK 3
P4 Annual itemised monthly cash flow forecast showing fixed and variable costs against income
Numerous modes and means exists through which assistance, an organisation can
increase their financial values and monetary asset due to i6ts requirement to perform activities of
business. With proper financial support to the company, the company can perform their practices
in more significant manner. Here are mentioned some of the financial resources which can be
used by SOHO Coffee Company in regard of managing financial asset that are discussed as
below:
Bank Loan: This can be identified as the suitable and more essential source of finance
that can be complied by enterprise in regard of applying suitable money amount (Parkin, Fielder
and Ashby, 2016). This source is more assisting for the enterprise which can help in creating
better position of firm indirectly or directly. Beside this, distinct documentation techniques also
are undertaken by manager to secure and safeguard the amount given to the receiver.
Government Grants and Subsidies: Numerous different legal activities that deliver
proper financial capital or amount to the organisation such as government grands and subsidies.
Entire mentioned tactics are fundamental for organisation to outline while performing activities
or another functions in more suitable manner. Furthermore, this can help in enlargement of sales
as well as benefits. In this, state provide some financial benefits and discount in the loans for
operating business.
Equity Finance: This is recognised as interesting procedure of enlarging the
organisation;s funds through the help of shares and selling asset of organisation. This is not
considered as same from financing of debt as this is majorly associated to the landed capital
through company. In this, the company can carry out the public offerings. In this, entire listed
shares comes under BSR and NSE.
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Cash Flow, Balance, Sheet and P& of SoHo Coffer Company
Year 2017 (In £) 2018 (In £)
Fixed assets 120 220
Inventory 30 45
Bank 30 40
Debtors 80 50
Total 260 355
Creditors 110 170
Bank overdraft 80 60
Total 190 230
Working capital 70 125
Loss and Profits account at the end of year
2017 2018
Sales 40 50
Gross profit 20 25
Cost of sales 20 25
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Overheads 8 9
Net profit 28 34
Statement of Cash flow
Cash budget of an entire year
Quarter 1 Quarter 2 Quarter 3 Quarter 4 Year
Initial cash balance 26000 34380 33060 31160 29010
Initial cash receipts 12300 1800 1200 1200 14000
Total cash available 38300 36180 34260 32360 30410
Cash distributed
Direct material 1500 1050 1100 1400 1600
Direct labour 1000 620 600 600 750
Overhead 800 650 650 750 650
Selling and distribution 620 800 750 600 750
Total cost utilized 3920 3120 3100 3350 3750
Cash surplus/ deficit 34380 33060 31160 29010 26660
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P5 Break – even analysis
Break-even analysis can be termed as the condition where the entire business revenues
combine with total expenses of organisation. This can be defined as condition in which the
benefits matched with the debts or losses, in the words of layman. It a sort of tool which is
broadly used in business for ascertaining and measuring the performance of finance. This
techniques is included as integral business part as this can assist the cost determination that will
include amount and prices of goods that are to be solved to match enterprise's expenses (3
Essential Financial Statements for Your Small Business, 2014). Through the help of this tools,
the company can make evaluation of their revenues beside of sales which can help in
understanding the annual and monthly basis records of enterprise. Henceforth, this is a
fundamental methods through which an organisation can enable their reach at aggregate
condition. SoHo Coffee Company will develop some methods and schemes that can deliver
maximised profitability of company. In this, revenues and sales of enterprise are automatically
modified.
Illustration 1: Break – even analysis
Source 1: Break – even analysis, 2018
Along with it, this is more essential for the referred organisation to forecast their
production and sales as well (Winarno and Wijijayanti, 2018). This is necessary procedure to use
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for increasing growth rates and achieving success. Through employing the break-even analysis,
organisation can conveniently identify their overall benefits or margin. Hence, the tactic is
fundamental for the company to develop their goodwill and performance at marketplace.
For example:
Variable Cost: Rs. 6 per unit
Selling Cost: Rs. 20 per unit
Fixed Cost: Rs. 18000
Hence, break even element for referred states will be:
BEP = Fixed Cost / Construction margin per unit
= 18000 / (20-6)
= Rs. 1285.714
Implementation of Break-even Point on different situation:
To evaluate and identify the company's profitability: each company existing in the
commercial sector has their own objective to gain revenues and better market position (Chauma,
2017). Hence, in case of presence of such objectives, the company can attain their target within
certain period of time. Henceforth, the administration often hold the responsibility to create more
efficient plans and decision in regard of decreasing the operations cost which can make positive
influence on the profitability.
To price commodities: This is fundamental for the company to create an authentic and
adequate information in regard of break-even point so that they can easily lead their worker to
work in more appropriate manner which can aid the company to attain specific components
where they can neither losses and earn benefits.
This is fundamentally needed for the company to properly analyse the variable of organisation
along with their determined services and products, This can assist in achieving strong market
position and competing their competitors.
P6 Key financial statement in relation to their contribution to the successful management
Each company need to form their financial statement that create proper understanding of
accurate financial position of organisation that can lead to emergence of organisation's entire
expenditure and revenues of business (Stanciu, 2015). Beside this, the management team need to
evaluate entire documents of finance build from accumulated information and data which helps
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in aligning business resources in SOHO Coffee Company. Here are discussed major types of
financial statements:
Balance Sheet: One paramount document of financial statement associated with
organisation's overview of financial activities. The balance sheet equation is owner's
equity+liabilities= Assets. It has its major two types i.e. liabilities and Asset.
Loss ad Profit Statement: Another name that is provided to P/L account is termed as
income statement. This can assist in projecting expenses and sales in for certain duration mostly
a year.
Cash Flow Statement: This can help in emphasising on cash/income that has been
generated through business in certain time period. It is often adopted through business which is
often classified into three categories such as operating, investing and financial activities.
Hence, this is fundamental for SOHO coffee company to outline entire elements in regard
of functioning the business purposely and smoothly to earn benefits and reaching market share at
international market.
TASK 4
P7 Implications of legislation and regulations on small business
Each company need to adhere with distinct legislations whether the company is large,
medium or small. If organisation will not comply proper legislations and legal aspects of
business, they might have to face penalties. Therefore, this is essential for to comply the laws
and legislation by SoHo Coffee Company which is mentioned as below:
Health and Safety Act, 1974: In order to safeguard their lives and provide proper
security in terms of office safety as well as medical issues, organisation provide facilities to
worker for the purpose. Due to the employee safety ignorance, the protection will be weakened
by worker leading higher turnover and productivity of cost (Stanciu, 2015). Due to the employee
safety ignorance, the protection will be weakened by worker leading higher turnover and
productivity of cost.
Data Protection Act: The legal aspects bounds a company to keep records and
information of their clients, consumer and worker which are confidential for the purpose of their
security and safety. SOHO Coffee Company need to implement the information and data to
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entire workplace in more adequate manner reducing the hacking changes and confidentiality
leakage.
CONCLUSION
This can affirm from above discussed notions that small business enterprises need to
plans and allocate their resources appropriately to achieve the objectives of business. Consumer
are paramount components for any business company. In case of SME, major focus of such
companies are to earn benefits which is linked to the social satisfaction. Business development
transactionally refer to the business expansion over the limitation of a country. Numerous modes
and means exists through which assistance, an organisation can increase their financial values
and monetary asset. Break-even analysis help in understanding the annual and monthly basis
records of enterprise. Each company need to form their financial statement that create proper
understanding of accurate financial position of organisation.
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REFERENCES
Books and Journals
Ali, N. S. H. M. and Babiker, S. M. E., 2017. Performance Evaluation of Multi-core Systems
using SPEC CPU2006 Benchmark.
Chauma, C. N., 2017.The application of project management tools and techniques in ICT SME
projects in Western Cape (Doctoral dissertation, Cape Peninsula University of
Technology).
Cojoacă, E. Ş. D., 2017. Interoperability of SME Databases from the Project Management Point
of View. Informatica Economica. 21(4). pp.15-28.
Durst, S., Yip, J. and Lee, R. W., 2015. SME Succession Planning and Knowledge Loss
Assessment. Knowledge Management for Competitive Advantage During Economic
Crisis, pp.282-298.
El-Rafei, S. M. and et. Al, 2017. Detecting anomalous process behavior. U.S. Patent 9,633,198.
Javaid, M. I. and Iqbal, M. M. W., 2017, April. A comprehensive people, process and technology
(PPT) application model for Information Systems (IS) risk management in
small/medium enterprises (SME). In Communication Technologies (ComTech), 2017
International Conference on (pp. 78-90). IEEE.
Ludmila, S. and Stanislava, G., 2015. The Application of Business Network Approach for Small
and Medium Enterprises (SME) with regard to their Buying Behavior. Journal of
Competitiveness. 7 (3). pp.62-74.
Nowotarski, P. and Paslawski, J., 2015. Barriers in running construction SME–case study on
introduction of agile methodology to electrical subcontractor. Procedia Engineering.
122. pp.47-56.
O’Connor, C. and Kelly, S., 2017. Facilitating knowledge management through filtered big data:
SME competitiveness in an agri-food sector. Journal of Knowledge Management.
21(1). pp.156-179.
Parkin, S., Fielder, A. and Ashby, A., 2016, October. Pragmatic Security: Modelling IT Security
Management Responsibilities for SME Archetypes. In Proceedings of the 8th ACM
CCS International Workshop on Managing Insider Security Threats (pp. 69-80). ACM.
Skolud, B. and et. al., 2016, October. Integration of Manufacturing Functions for SME. Holonic-
Based Approach. In International Joint Conference SOCO’16-CISIS’16-ICEUTE’16
(pp. 464-473). Springer, Cham.
Stanciu, R. D., 2015. Performance Management-A Strategic Tool. FAIMA Business &
Management Journal. 3(2). p.5.
Winarno, A. and Wijijayanti, T., 2018. DOES entrepreneurial literacy correlate to the small-
medium enterprises performance in batu east java?. academy of entrepreneurship
journal. 24(1).
Online
Small business benefits from internationalisation. 2010. [Online]. Available through:
<http://www.thejournal.co.uk/business/business-news/small-business-benefits-from-
internationalisation-4449700>.
3 Essential Financial Statements for Your Small Business. 2014. [Online]. Available through:
<https://www.sba.gov/blogs/3-essential-financial-statements-your-small-business>.
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