MANAGE SMALL BUSINESS FINANCE

Running head: MANAGE SMALL BUSINESS FINANCE
MANAGE SMALL BUSINESS FINANCE
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MANAGE SMALL BUSINESS FINANCE
1. Start-up capital is needed to fund capital investment and business expansion production until
the business reaches a break-even point. If there is a lack of capital, over half of all business
fail within the first two years of operation (Rebelo, Silva and Santos 2017). If the business
owner fails to estimate the capital needed to run their businesses, then the business is deemed
to fail due to lack of funds.
Capital requirements are
Purpose Amount Date required
Capital Investment- $ 100,000 01 January 2019
Acquiring Land $ 200,000
Raw Material $ 100,000
Contractor Cost $ 75,000
Construction and
Infrastructure cost
$ 250,000
2. The financial option which are available for the construction building business is the
financial backer, like any bank or any investor who provide financial support to any business
for completing business (Möller and Halinen 2017). That is also needed with agreed terms
and conditions set by them with huge interest rates charged for repayment of the actual loan
amount with interest or the invested amount.

MANAGE SMALL BUSINESS FINANCE
3. The financial backer required clean credit proof which derived from business credit history
where it repayment debt on time been validated and checking financial track record and
business performance record (Trevino and Nelson 2016). Backer check full planning report
and uncertainties.
4. Know the profit structure and funding of the business, offer non-negotiable terms, show true
and fair values and know the market structure.
5. Sales are essential for any business to survive, and increasing sales are needed for any
business to grow. Of course, it isn’t sales at any price. Following marketing ideas can be
implemented to ensure consistent sales growth and to monitor their effectiveness:
Strategy Monitoring Method
Develop a consistent sales message A clear and consistent message
Value of solution being sold
Communicate the value and differentiation of
the products and services
Targeting the Right buyer A clear understanding of the type of buyer
Execution of clear and repeatable processes Refining the processes to ensure the
consistency across the sales team.
Equip front line managers to monitor Manager monitoring sales reps’ efforts
Evaluating each member with regular training
and coaching classes.

MANAGE SMALL BUSINESS FINANCE
Using skill/will model
Ensuring digital communicating reps Clear technology
Using social media platforms
Allowing team members to communicate
across worldwide
Increasing visibility with the prospects
6. Based on the competitive market strategy, setting the price charges.
7. As per the assumptions, the expenses for the equity funding is $100000, land purchase is
$250000, operating expenses is $40050, raw material is $100000 and construction and
infrastructure is $250000.
8. The items for cost of sales are wages, raw material cost, construction and infrastructure cost.
9. Fixed cost are rents and rates, wages, equipment lease and bank interest, fees and charges.
10. Fixed cost is ensured based with the given rates and time period (Exler, Mendling and
Taudes 2019). It has to be long term basis.
11. The cash flow statement shows that the company generating a good amount of cash at the
end of the year which shows $ 954,170.90 and the beginning cash amounted to $ 78,000.
Huge inflows of cash in the given year consistently during each month.
12. Increase stock of material will reduce the operating profit and reduced stock material
will increase the operating activities. To control increase the stock can adopt the reduce
variability method, improving forecast method, reduce order size, reduce manufacturing
overheads, reduce the time for the supplier.