Small Business Management Strategies

This assignment delves into the crucial aspects of managing a small business. It examines effective strategies in areas like employee relations, succession planning, brand authenticity, crisis management, inventory control, buying behavior, performance management, safety management systems, and cloud manufacturing for SMEs. Additionally, it highlights the importance of customer relationship management (CRM) and break-even analysis for small business success.

MANAGING
AND
RUNNING A SMALL-
MEDIUM ENTERPRISE

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Discuss the main considerations a small business or social enterprise needs to address
when planning and allocating resources to achieve business objectives................................1
TASK 2............................................................................................................................................3
P2 Explain and evaluate different processes of customer relationship management for a small
business or social enterprise...................................................................................................3
TASK 3............................................................................................................................................4
P3 Produce an annual itemised monthly cash flow forecast showing fixed and variable costs
set against income for a specific organisation........................................................................4
P4 Explain how break- even analysis could be applied to an organisational situation..........5
TASK 4............................................................................................................................................8
P5 Discuss key legislation and regulations that have implications on small businesses or social
enterprises...............................................................................................................................8
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
SME stands for small and medium enterprise which refers to convenient term for
segmenting businesses and other firms. This kind of firm can be described as a concept of small
and medium enterprises based on number of workers they have. They have several benefits such
as they may create unique status and importance in five-year plans correct from its beginning.
This report is based on Crawford healthcare which is the supplier of dermatology and wound
care products which may cover a broad range of skin conditions. It is focussed or dedicated to
develop and prove innovative treatment solutions (Baker, 2014). It provides care and repair
skin, support body to maintain best natural defence system. This assignment covers various
topics like necessary factors to make effective planning and allocate resources available in
company. It will focus on the customer relationship management and cash flow forecast along
with break-even analysis. Key legislations and regulations for small businesses will be discussed
here as well.
TASK 1
P1 Discuss the main considerations a small business or social enterprise needs to address when
planning and allocating resources to achieve business objectives
Every have essential target to allocate available resources to their staff member as per
their field of expertise. This aspect is considered to prepare several blue print plans which are
necessary to conduct different kinds of activities as well as procedures to attain better outcomes
on regular basis. Crawford healthcare has to build effective and efficient planning to allocate
resources more properly. It will help to expand qualities and features of skin care products. This
will facilitate to render better services to attract new clients as well as support to retain the
current ones. It is related to health care so firm have to implement anything by evaluating it in
appropriate manner (Dobra, 2012).
There are various kinds of resources which an enterprise have such as employees, place
of work, capital, machinery and may other things which are necessary to organise several
processes of manufacturing. It also involves information which may help to work on specific
projects along with their condition on availability as well. Crawford healthcare have to collect
proper information about their resources and equipment along with purchased raw material. The
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Crawford healthcare has to first estimate all these sources including several factors which are as
follows:
Expert judgement: - This term render to bring various experts as per their field of
expertise so that they will render their views about allocation planning along with its
opportunities as well as threats. It is necessary to take suggestions from experts in different field
so that an appropriate plan of action can be created along with allocation of resources to gain
maximum outputs properly. Moreover, it will facilitate to manage overall available sources and
staff members in proper way to conduct different operational activities for generating better
outcomes which facilitates to fulfil desired targets of business. This will help Crawford
healthcare to grab those strong points to attain benefits and put efforts to reduce negative
impacts. It is essential to know about correct opinions to allocate available resources in an
appropriate manner for achieving the profits.
Alternative analysis: - It can be defined as to consider certain different options for
correctly assigning resources. This term is also involve varying the number of sources along with
those which are utilising currently. Meanwhile, it is necessary to analyse secondary options also
which can be utilised in case of some critical problems generated so that to reduce the same other
alternative option can be used to facilitate further operations properly. This factor can be
determined for better choice which helps to attain effective as well as efficient planning.
Sometimes, there's more than single method to accomplish an alternative or activity analysis
supports decide among possibilities (Doherty and Norton, 2013).
Published estimating data: - It may be explained as something which project managers
in a lot of industries use to render support them to figure out amount of resources needed. It is
analysed by using several sources such as books, journals, articles and periodicals. This will help
to collect, analyse and publish data from other's projects. Moreover, previous data is essentially
analysed because it provide help to make further planning with present resources and manpower
in order to complete actual requirements of desired goals of business.
Project management software: - This term can be described as that various kinds of
software and techniques are used in organisation to conduct their several activities. For example
Microsoft Project will often have various characteristics. These may be designed to support task
managers to estimate resource requirements as well as constraints. It will facilitate to find the
best combination of assignments for project itself. Additionally, it is necessary to observe and
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analyse more suitable software to mange particular project so that it can be complete in an
appropriate manner along with generating better results to achieve satisfaction of client
successfully.
Bottom up estimating: - It may refer to break down of complex procedures into
segments and performing out resources allocation for each one (Durst, Yip and Lee, 2015). Thus,
process of estimating sources on an individual basis as per need and cost for adding these up
together for total figuring. The bottom up calculation is an appropriate means of estimating,
rendered the measurements at schedule activity stage are accurate. Moreover, it will take
considerable amount of time to do bottom-up estimating because every process must be
assessed and calculated appropriately. It is well understood that smaller and more detailed the
activity then greater will be accuracy as well as cost of this technique. Major task can be
converted into small various activities which provide support to allocate huge project between
staff members so that it can be completed perfectly with better outputs.
TASK 2
P2 Explain and evaluate different processes of customer relationship management for a small
business or social enterprise
Customer relationship management can be defined as those methods or techniques which
may provide support to manage this aspect in an organised manner. It is a broadly recognised
and widely implemented strategy for managing firm's interactions with their clients as well as
sales prospects. This factor may involve utilising various technologies to organise, automate and
synchronize business procedures like principally sales activities (Easterby-Smith, Thorpe and
Jackson, 2012). But it also includes several more activities such as marketing, customer service
and technical support. The Crawford healthcare can adopt various processes of customer
relationship management which are as follows:
Customer service: - This activity is an important role in which firm represents front
office functions that interact with the clients. It can be explained those business processes which
allows the company to sell skincare products or services. It may facilitate to communicate with
consumers due to marketing and dealing with after sales service needs of desired clients. This
kind of every interaction with customer is recorded and stored within CRM software where it can
be retrieved by other workers if required.
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Sales force automation: - It is very obvious that sales department of each enterprise is
generally looking for sales opportunities with current and new consumers. The function of sales
force automation of CRM software allows marketing teams to record contact with clients. This
means can render sales force with high efficiencies as there little chance for duplication effort. It
also includes that capabilities of staff members outside of marketing team to have access to this
data to make sure that they have most recent records of contact knowledge (Eggers and et. al.,
2013).
(Source: Customer Relationship Management, 2018)
Campaign Management:- This term refers to a sales team approach prospective clients
on hope of winning new business. It can be take such technique and is often focused in
campaign, where group of particular consumers are segmented based on set of criteria. Those
people are able to receive targeted marketing materials and generally special pricing to terms are
offered as an incentive. There are CRM software which is used to record details about campaign,
client response and analysis performed as part of it.
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Illustration 1: Customer Relationship Management

Purpose of CRM:- The concept of customer relationship management provide support to
Crawford Healthcare for utilising technologies and human resource more effectively as well as
efficiently. It may results to gain insight into behaviour of clients and value of those people but
also those for marketing, customer service and technical support.
 Render services and goods as per actual needs and demands of people (El-Rafei and et.
al., 2017).
 It helps in offering better client products.
 Cross selling of products in more effective manner.
 It will provide help to sales staff close deals faster.
 Provide support in retaining current clients as well attract one ones.
 Prepare several call centres more efficient.
 It may helps to simplify marketing and sales processes.
CRM involves for small businesses:
 Process of CRM helps in determining ad target their best clients, create quality sales
leads, plan and apply marketing events with specific objectives (Harris and McCaffer,
2013).
 It may helps to form individualised relations with customers and render largest level of
service to most profitable people.
 It facilitates to know about the exact need, wants, demands, preferences and taste of
clients to provide proper service to gain their satisfaction as well.
TASK 3
P3Explain how a small business can develop transnationally and determine the benefits and
drawbacks.
Transactional operation comprises of primary process under which the Crawford
healthcare needs to undertake its activities effectively in order to achieve success. The business
can expand it's operation by different ways such as by by opening branches, franchising and
licensing etc. the branches can be opened by analysing the market that will help the Crawford
healthcare to attract and influence customers at greater extend. The Crawford healthcare can
take help of various methods in order to expand some of them can be elaborated below-
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Licensing, it is from of business agreement under which two companies are involved
which comprise of one company giving permission to another permission related to use of patent
and copyright in exchange of money. The advantage under this form is that the business that it
enable the expansion into foreign markets and the major disadvantage associated with it is
prohibits the originating from from exploring the assets existing in foreign market. The methods
will help the Crawford healthcare as it does require little or no direct investment.
Franchising,is a from of business by which owner of a particular product or service can
obtain distribution through various affiliated dealers. In order to franchisee the business the
Crawford healthcare firstly needs to analyse the market the advantage associated with this firm is
that it eliminate people who are unsuitable fro job and the disadvantage is that the high amount
of initial investment. Under this if the franchisees behave in a wrong and dishonest manner the
Crawford healthcare will be facing losses.
Strategic alliance, it is the process under which people forms an agreement between two
or more parties which aims at setting the agreement that comprise on achieving common
objectives while they still tends to remain independent organizations. Advantage of the strategy
is that company does not tends to loose their identify in the marketplace. Whereas the
disadvantage is that strategy revels the aim and objective of company in front of other parties.
This method can be helpful fro the Crawford healthcare as collaboration with other firms will
facilitates business growth.
P4 Produce an annual itemised monthly cash flow forecast showing fixed and variable costs set
against income for a specific organisation
Balance Sheet
Year 2016 (value in £) 2017 (value in £)
Fixed assets 150 200
Stock 25 30
Debtors 60 45
Bank 15 25
Total 250 300
Creditors 150 200
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Bank overdraft 100 100
Total 250 300
Profit and Loss Account of year 2016
2016 2017
Sales 15 25
Cost of sales 20 15
Gross profit 35 40
Overheads 5 5
Net. profit 30 35
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8

Cash flow Statement
Cash
distribut
ed
Jan Feb March April May
June July
Aug
ust
Sept
embe
r Oct. Nov. Dec
Cash
distribut
ed
Variable
cost
Direct
material 1500 1250 1250 1300 1450 1580 1650 1458 1589 1685 1985 1785 1500
Direct
labour 1250 750 500 500 1350 1400 1435 1445 1474 1458 1568 1589 1250
Overhead 1000 500 500 700 2700 2850 2950 2987 2250 1850 1650 1250 1000
Fixed
cost
Selling
and
distributi
on
750 750 750 800 850
950 850 650 720 715 785 795
750
Total
cost use 4500 3250 3000 3300 6350 6780 6885 6540 6033 5708 5988 5419 4500
Cash
surplus/
deficit
28000 26250 24250 21950 18020
13190 8355 3915 32 -3426
-
7114
-
10580
28000
P5 Explain how break- even analysis could be applied to an organisational situation
Break even analysis:- It can be defined as relation between cost volume and profits at
different levels of activity with an emphasis placed on break even point. This term can be
described as that stage of any business in which they receives neither loss nor profit as well. That
time when the total capital received from sales is equal to total money spent to manufacture
products or items for sale.

(Source: Break Even Analysis, 2016)
Formula of break Even:- It should be measured by dividing fixed cost of any Crawford
Healthcare by its margin. This margin can b e calculated by subtracting total variable cost from
its total net sales amount. It will reflects percentage of firm's revenue which will remains after all
pays of business expenses. Then total variable cost are measured by adding business total cost of
goods sold to its selling expenses. It is necessary to determine break even point are located into
regular income statement which is also referred as earning evidence of profit and loss. The
formula of break even point can be expressed as:
Break even point = fixed cost/contribution per unit
Contribution per unit = Selling price per unit- variable cost per unit
Break even point:- It can be described as that point in which sales of volume at which
total revenue is equal to total cost. It contains stage of no profit and no loss then Crawford Health
care will be in its break even having sales equal to total costs. This point may refers to that level
of outcomes which evenly costs and revenues and hence the name. This may expressed as:
Sales revenue of creak even point = fixed cost + variable cost
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Illustration 2: Break Even Analysis

Fixed cost:- This may involve all kind of fixed factors and are independent of outputs.
Such expenses exist or arise even at zero level of outcomes and only found in short period. These
are called supplementary cost and needed to calculate contribution per unit (Herbane, 2013).
Variable cost:- It refers to varying in cost with level of output and expense of variable
factors. These cost become zero at zero level of output and are seen ion short and long periods.
This can be also known as prime costs.
Advantages of break even charts in firm
 These are helpful in observing and analysing as the idea and problem is presented at
glance.
 It become supportive to management for making managerial decision because it learn
about relation of cost, volume and variable cost at different stages outcomes. And those
which can apply changes in selling price on profits can be depicted clearly by such
presentations (Mohan and Chitale, 2016).
 It is useful to forecasting costs or profits in respect to planning and growth.
 It can be referred as an important managerial tool for control of cost as it shoes relative
necessities of fixed cost.
 It can also determine profits at various levels along with break even of company.
 It provides opportunity to study about effectiveness as well as efficiencies of an business
in comparative manner.
Disadvantages of Break even charts
 It is based upon number of assumptions which may not fulfil the expectations of
circumstances. For example, fixed cost do not remain same after certain stage of activity.
Variable cost do not always vary in direct proportion to modifications in volume of
outcomes because of laws of diminishing and improving returns. Selling price do not
remain same forever and fir various stages of outputs regarding competition and changes
in general price level.
 These chars are able to render only cost-volume benefit relation but avoid other necessary
considerations like amount of capital investment, marketing issues government policies
and so on (Skarpová and Grosová, 2015).
 It does not suggest any technique or actions to management as effective tool of
managerial decisions.
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 Moreover, these charts presents only static view of problem or issues under consideration
as well.
Uses of break even analysis
 This may render help to determine sales volume in more appropriate manner.
 Firms are able to forecast profits of estimates of revenue and cost are available.
 This may support in appraising several effects of changes on volume of sales and cost of
manufacturing.
 It can assists in making choice of products and determining product mix.
 This will highlights the impacts of improving as well as decrease in fixed and variable
costs.
 It is important to studies all possible effects of high fixed expenditure and low variable
costs.
 It will prepare intra firms profitability comparisons and helps in planning of cash
requirements for companies more effectively as well as efficiently.
It is important to calculate break even point and conduct its analysis is necessary aspect.
This will helps in determine the forthcoming cost and volume by support of break even charts.
Every organisation have to prepare break even presentation and analyse it properly so that they
become able to decide future aspects for attaining better productivity as well as profitability of
Crawford Healthcare.
P6 Interpret key financial statements for an organisation in relation to how they contribute to the
successful management of the organisation
Every organisation is required to maintain financial statements that helps them
understanding their financial position and for instance any fluctuation arises that whole
revenue and expenditure of business. In order to allocate the resource the financial document
needs to be analysed in effective manner.
Trading Account: it is an investment account that deals with cash and securities and
other holding. It is also known as day trader's primary account.
Balance sheet: It is statement that depict the financial stability of an firm by stating
owner's equity, liabilities and assets of a particular point of time. It also comprises of evaluation
of the cash flow movement in the business. It is an essential document as it depicts the true
financial position of the Bunsen. Under balance sheet total of asset and liabilities firm having has
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been shown. Which is further analysed by various individuals such as investor in order to decide
whether they have to invest in the business or not.
Interpretation- As per above balance sheet of Crawford healthcare, there is increase in fixed
asset, inventory and bank, gets improved in 2018 as compared to 2017. But there is decrease in
debtors from 60 £ to 45£. On the other hand in liability side creditors gets accumulated from
£150 to £200. This balance sheet does not show great financial place of establishment. In 2017 as
well as 2018.
Profit and loss accounts:- It is an account that represent net loss or profits by depicting net
income and profits in the credit sides and expenses on the debit side.
Interpretation- Profit and Loss account display profit and loss position of organisation.
According to statement this statement gross profit for year 2017 as well as 2018 is £35 and £40
respectively. There is growth in profit of 2018 as compared to 2017. At the same time, net profit
gets improved in 2018 by £5. This shows that business is able to maintain their expenses.
Cash flow statements:- It provide details about movement in the from of inflow and outflow of
cash in business. Moreover it allows them to enhance overall effectiveness and efficiency of
management. The main advantage of maintaining cash flow in the business is that it allows
business to have money on hands so that they can pay of their expenses.
Therefore, the business is require to asses these document in order to know about their
financial position and take decision as per their position in the market.
TASK 4
P7 Discuss key legislation and regulations that have implications on small businesses or social
enterprises
There are various kind of legal rules and legislations which are necessarily followed by
each and every small-medium enterprise. It is important for properly managing and running
such type of businesses successfully. It is essential for Crawford Healthcare to accept as well as
follow all legal norms and regulations to carrying out their manufacturing activities in
appropriate manner without any threat or issue.
Healthcare:- It is important to take care of health issues of people while providing them
any product or service. It may have numerous provisions related to health care reform continue
to affect small business owners and their staff members. If it is not needed that owners does not
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render health insurance to their employees. Although, reporting and enforcement of employer
shared applicable large status and make sure that proper tracking of employee hours (Stanciu,
2015).
Defence of marriage act (DOMA) :- This act may described as such norms in which it
expands federal definition of marriage to include same gender spouses. It has significant effect
on such laws which may involves payroll taxes and health insurance along with employment
laws like Family Medical Leave Act (FMLA). It states that affected workers are become eligible
to pay for same benefits such as health insurance premiums and FSA/Section 125 participation
on pre-tax basis for federal issues.
Immigration and E-verify:- This term can be defined as immigration reforms very
much remains on radar. It highlights of proposed legislation which are having interest of
business include mandatory E-verify needs for all staff members and potential release in new
version of employment eligibility verification form.
IRS priorities:- This rule states that legal authorities have to start hearing about to
determine of severance pay should be taxable or exempt from FICA tax. It they make norms
against it then related agencies have to process retroactive refund claims submitted by employers
and employees. It has also provide information that its intent to more closely examine taxation of
tips and service as hospitality and restaurant industries.
Retirement policy:- It refers that legal policy maker are considering several items which
could lead to changes for business which may offer retirement plans to their employees as
benefits fir future. Owner of firms have to keep an eye on possible attempt to amend retirement
statements to render lifetime income illustrations. It may involve projected monthly income
stream based on pre determined variables such as account balance, current contributions and
assumed interest rates.
Employment regulations:- it is important for organisations to make several kind of
strategies and norms so that they are able to take care of employee rights in order to provide
benefits to them. It will become more essential in case of misclassification of employees as
independent contractors, vigorous enforcement of minimum wages and overtime provisions
under Fair Labour Standards Act (Stolzer, Halford and Goglia, 2011). It will supportive and
strong element for an improvement to federal minimum wage and salary.
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Privacy and data security:- It is important to implement certain additional measures ion
state level strengthen security as well as privacy regulations. It is an important aspect in which it
is mentioned that there should be some of mandatory rules and laws to make sure security of
employees. This will never been essential for business of all sizes to protect various prospects of
personal, financial and health information of both customers as well as employees. It will help in
make sure that they are adequately protected against the growing threat of cyber fraud.
Mobile technology:- It becomes necessary to use several electrical devices such as
mobile phones to attain growth of business. It is important to adopt these wireless things in
respect of implementing current technologies to enhance productivity as well as profitability.
The firms need to provide phones and tablets for attaining and conducting several kind of tasks
or activities to complete various projects of an organisation. It is essential to make several
regulations and guidance to balance employer software, productivity and data security demands
with privacy, ownership and compensation rights of staff members (Yin and et. al., 2011).
Banking:- This term refers to response to well publicised regulatory challenges many
banks have recently experienced. Some of them are trying to adopt stricter policies around client
relationship. It will help to improve due diligence which may results in modifications to needs
imposed in small businesses or even availability of credit to other banking services. Several
firms are offering choice to workers which should make sure their card provides are well versed
in relevant and state regulations.
CONCLUSION
The above report had concluded that there are various kind of considerations which may
included when small and medium enterprise need to plan and organise anything as well. This
may help in allocating different resources in correct manner to attain goals and objectives if an
organisation. Customer relationship management is also help them to enhance the productivity as
well as profitability of firm. Annual cash in flow and break even calculation also provide support
to forecast cost and sales of any enterprise. There are many of legislations made legal authorities
which are needed to be followed by small and medium size enterprises.
REFERENCES
Books and Journals
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Baker, M. J., 2014. Marketing strategy and management. Palgrave Macmillan.
Dobra, A., 2012. VBA for Tracking Manufacturing Process in SME. In Applied Mechanics and
Materials (Vol. 186, pp. 176-181). Trans Tech Publications.
Doherty, L. and Norton, A., 2013. Making and measuring “good” HR practice in an SME: the
case of a Yorkshire bakery. Employee Relations. 36(2). pp.128-147.
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.
Easterby-Smith, M., Thorpe, R. and Jackson, P. R., 2012. Management research. Sage.
Eggers, F., and et. al., 2013. The impact of brand authenticity on brand trust and SME growth: A
CEO perspective. Journal of World Business. 48(3). pp.340-348.
El-Rafei, S. M., and et. al., 2017. Detecting anomalous process behavior. U.S. Patent 9,633,198.
Harris, F. and McCaffer, R., 2013. Modern construction management. John Wiley & Sons.
Herbane, B., 2013. Exploring crisis management in UK small‐and medium‐sized
enterprises. Journal of Contingencies and Crisis Management. 21(2). pp.82-95.
Mohan, A. K. and Chitale, R. H., 2016. Managing Influence of Inventory Bullwhip Effect on
Profit Maximization in Rural Retailing Using Monte Carlo Simulation. Journal of
Contemporary Management Research. 10(2). p.24.
Skarpová, L. and Grosová, S., 2015. The Application of Business Network Approach for Small
and Medium Enterprises (SME) with regard to their Buying Behavior. Journal of
Competitiveness. 7(3).
Stanciu, R. D., 2015. Performance Management-A Strategic Tool. FAIMA Business &
Management Journal. 3(2). p.5.
Stolzer, A. J., Halford, C. D. and Goglia, J. J. eds., 2011. Implementing safety management
systems in aviation. Ashgate Publishing, Ltd..
Yin, C., and et. al., 2011. Common key technology system of cloud manufacturing service
platform for small and medium enterprises. Computer Integrated Manufacturing
Systems. 17(3). pp.495-503.
Online
Customer Relationship Management. 2013. [online]. Available through:
<https://www.jagsheth.com/relationship-marketing/customer-relationship-management-
emerging-practice-process-and-discipline/>
Break Even Analysis. 2016. [Online]. Available through:
<https://toughnickel.com/business/Breakeven-analysis>
Customer Relationship Management. 2018. [Online]. Available through: <https://www.eway-
crm.com/what-is-crm/>
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