Business Models and Small-Scale Enterprises

This assignment delves into the world of small-scale enterprises, exploring the significance of business models in their success. It examines various sources from academic journals and books, discussing topics such as SWOT analysis, network influence, and project portfolio management. The assignment also touches on entrepreneurship, innovation, and strategic planning, providing a comprehensive understanding of the complexities involved in running a small-scale enterprise.

Small Business Enterprise

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
TASK 1 ...........................................................................................................................................1
1.1 Small business enterprises with its strength and weaknesses ..............................................1
1.2 Business analysis with the help of using comparative measures. ........................................3
TASK 2............................................................................................................................................5
2.1 Appropriate actions in order to overcome weaknesses ........................................................5
2.2 Ways to analyse existing performance .................................................................................6
2.3 Recommending new areas to expand for Cafe Finix............................................................6
TASK 3 ...........................................................................................................................................7
3.1 Assessment of existing business objectives and plans..........................................................7
3.2 Revise business plans to incorporate changes.......................................................................8
3.3 Preparation of Action Plan....................................................................................................9
TASK 4..........................................................................................................................................10
4.1 Impact of proposed changes on business and its personnel................................................10
4.2 Managing changes in business............................................................................................11
4.3 Monitoring improvements in performance of business......................................................12
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................12

INTRODUCTION
Business enterprises are the essential key to economy of any country or society, small
business enterprises are a kind of organisation that employs a less number of employees or
workers and they are not having a high volume of sales and revenue. Small business enterprises
can be described as the organisations who have less capital invested and very least number of
employees who are helpful in providing support to improving strength and opportunities in
undeveloped areas. These type of business segments plays an essential role in creating more job
opportunities and create more wealth for communities and societies, so that they can easily make
their living more appropriate and suitable (Thornton, Ribeiro-Soriano and Urbano, 2011). In this
present report, an effective example of Cafe Finix has to be taken in respect to better
understanding of small business enterprises. Cafe Finix is a small coffee shop which establishes
its business activities in UK and it deals in high quality coffee products. In this project, a valid
and appropriate result has to be made through evaluating the strength and weaknesses of small
business enterprise. This report contains the study about comparative measures of performance,
various ways are also discussed through which an organisation can improve their existing
performance. Further an organisation has to work on revise their management plan on regular
basis, so that it is easy for firm to deal with required changes that are occurs at work place.
TASK 1
1.1 Small business enterprises with its strength and weaknesses
Small business enterprises are the essential component of any geographical area or
region, they are having very limited area for conducting their business activities, as they are
employs very small number of workers and employees in their firm. Cafe Finix is a local ann
small business enterprise in the country of United Kingdom, that provide variety of goods and
services to their buyers who are willing to taking advantage of their offered services and
products. They are mainly focused on providing high quality coffee and various other ancillary
services to customers. The basic purpose of company is to satisfying the needs and wants of
customers through providing high quality services in affordable prices (Storey, 2016). The
company is mainly focused on pricing strategy and quality measures so that it is easy for
company to attract large number of customer towards their offered services. The cited firm is
popular among public just because their high-quality products in reasonable prices.
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The owner of Cafe Finix has started his business activities with very limited funds and
resources. They offer breakfast, tea, coffee and various other fast food items. The particular
company is famous for its variety of coffee products and this cafe is mostly suited for family and
friends.
SWOT Analysis
SWOT analysis is the most effective term in business which helps in formulating various
ways through measuring the capacity of business. It is most effective method, which is used by
company to evaluating their strength, weaknesses, opportunities and threats. These are some
essential components which are helpful in establishing improvements in firm or its activities.
Strength:
It can be described as the power of firm, it helps in states various opportunities that are
available in business. The major strength of firm is their high-quality products which are offered
in very less price, and basic aim of firm is to fulfil the demand and needs of customers. This
provide significant support in order to reaching at competitive advantage at market place. Some
major strength of Cafe Finix are describes as under:
1. The company is mainly focused on producing high quality goods and services for their
customers.
2. High brand image at market place.
3. They are more flexible in nature, so that changes can easily adopted by firm.
Weaknesses:
These are the limitations for firm, it may affect business or its activities in negative
manner. Weaknesses are having bad impact on organisational growth and success. Some
weaknesses are described as under:
 Late delivery of goods and services.
 Lack of perfect assistance.
 High range of competition are available at market place.
 High product prices.
Opportunities:
This can be measured as the advantages for firm, it help in rendering competitive
advantage at market place, so that company can easily create their high brand image. Some
major opportunities are described as under:
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 High range of investment in UK in order to establishing high range of growth and
success.
 Merging business activities with large scale businesses.
Threats:
There are some factors which may directly or indirectly affect the company’s growth and
profit. These are some major obstacles which may impacted on firm’s development. Some
threats are described as under:
 Quick changes arise in government policies.
 Political instability that may affect on interest rate and taxes.
 High range of competition at market place.
1.2 Business analysis with the help of using comparative measures.
It is required for each business organisation is to make a fair comparison among their past
and present rate of performance. This helps in providing a proper guidance to business in order
to implement its activities in a right direction and a valid outcome has to be made through
formulating an effective plan and time schedule. These provide a significant support in attaining
their desired goals and objectives in given period of time (Schaper and et. al., 2014). In this,
various approaches are used that are essential in comparing ratios, balance sheets and various
other things. With the help of these approaches it is easy for a decision make to make an
effective decision in order to made some valid outcomes. The performance has to be measured
through applying various tools and techniques, some are described as under:
For the year ended 30 April 2014 and 30 April 2015
2014 2015
£ £
Sales 120,000 200,00
Overheads 10,000 15,000
Gross profit 40,000 50,000
Net profit 30,000 35,000
Cost of sales 80,000 150,000
BALANCE SHEET as at 30 APRIL 2014 and 30 APRIL 2015
2014 2015
Fixed assets 15,000 12,000
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Current assets
Stock 7,000 18,000
Debtors 12,000 36,000
Bank 1,000 0
20,000 54,000
Less Current liabilities
Creditors 6,000 15,000
Bank overdraft 0 10,000
6,000 25,000
Working capital 14,000 29,000
Net Assets 29,000 41,000
Financed by capital
Opening capital 22,000 29,000
Add net profit 30,000 35,000
52,000 64,000
Less drawings 23,000 23,000
Closing capital 29,000 41,000
With proper analysis of balance sheet of Cafe Finix in the year of 2014 and 2015, it is
concluded that in the year of 2014 closing stock of firm was near to 29,000 but at the time of
year ending in 2015 companies closing stock get increases by 41,000 which explains that
company is not generating high range of profit. Thus, extra amount of inventory will remain
unsold and this is not a good condition for firm.
a) Current ratio = current asset / current liability
2014 2015
CR = CA / CL = 20000/ 6000 = 54000/ 25000
= 3.33 times = 2.16 times
As according to current ratio analysis, in the year of 2014 firm using their ratio in order to
pay their debts is 3 times. Thus it represents their good condition to pay all of their debts through
applying their current ratio but on the other side through taking ratio of 2015 into account,
selected organisation is able to pay their debts twice which represent their loss situation. It is
comparatively bad position than the previous year.
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2) QUICK RATIO (ACID TEST) = current asset – inventory/current liabilities
2014 2015
Q r= CA– INVENTOR / CL
=20000– 7000/ 6000 =54000-18000/25000
= 2.17 = 1.44
Quick ratio is measured through identifying that how a company is operating their
business activities in order to attain their short-term problems that are related with finance. In the
year of 2015 company is using their quick ratios in order to pay off their short-term debts and
ratio.
TASK 2
2.1 Appropriate actions in order to overcome weaknesses
Issues and conflicts are unwanted, they can arise any time or in any situation. This is
essential for each organisation is to resolve their conflicts that are arises at work place and
directly of indirectly impacted on organisational growth and success. The major issue that are
faced by Cafe Finix is expensive rent, assurance of quality, high brand image of competitors,
changes in government policies, weak food sectors than competitors, innovative technologies etc.
these above-mentioned components are very much effective in nature and may negatively
impacted on company’s growth and success. In order to resolving issues company have to take
some significant steps such as for overcoming the issue of quality company adopt new and
innovative tools and techniques and apply high quality raw material for serving best products to
their potential buyers (Rae, 2010). The major obstacle is expensive rent, so company is focused
towards attracting large number of customers through running bays in front of restaurant, this
helps in generating high amount of profit, so expensive rent can easily bear by firm. As a small
business enterprise Cafe Finix is having less number of employees so it is not that easy for
company to adopt quick changes, this may cause serious issues for firm. For overcoming this
issue company is trying to expand their business activities through adding more staff members
and innovative tools and techniques. This is a best way to attain high competitive advantage at
market place and this also provide efficient help in rendering high range of competition to their
competitors.
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2.2 Ways to analyse existing performance
It is very necessary for every company to analyse performance of its workers and identify
strengths and weaknesses so that work is conducted in efficient manner. Cafe Finix or any other
restaurant should give opportunities to its employees to increase their strength and become more
expert in their work (Altman, Sabato and Wilson, 2010). If employees will gain expertise then it
will be beneficial for company itself because employees will use their knowledge to grow
company only. The different ways in which existing performance of company could be
maintained are: -
 By reviewing business performance on regular basis, this will be helpful n knowing
likings and disliking of customers. After knowing it improvement can be in initiated by
company (Petit, 2012).
 Developing and enhancing efficiency of business by using effective techniques.
 Understanding business strategies of competitors and analyse their market to know what
special are they offering to customers.
 Improvising business goals and objectives and changing the process and practices which
will be implemented in organisation.
 Making use of core strengths and competencies of business and applying them where
ever required.
Company's should always try to maintain its reputation in market by using latest
technologies to strengthen employees and to attract customers.
2.3 Recommending new areas to expand for Cafe Finix
Recommendations through which Cafe Finix can expand its business in new areas are: -
1. They need to increase their staff to plan about expanding their business and meet growth
requirements
2. There is need to develop a proper business plan of expansion and strategic development
so that all resources and objectives of business are applied effectively.
3. By introducing new dishes in menu and more appealing designer crockeries to attract
customers (Mensh and et. al., 2013).
4. New technologies like E-wallet or card payments should be introduced in cafe to provide
ease to customers in making payments. Also, in case when customers are short of cash
then card payment should be accepted for rest of the amount.
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5. They should try to become socially active in order to attract more customers because
Cafe's are generally filled with youngsters and if company wants to attract more people
then social networking sites are a very good option.
6. To maintain visibility, they should regularly promote their cafe using various types of
promotional activities.
7. Inside cafe, there should be reading corner for those customers who love to read and a
musical room also where customers can sit for long and listen to their favourite songs for
hours and relax with their friends.
Customer's feedback should be regularly taken to know that whether they are liking food and
environment or not.
TASK 3
3.1 Assessment of existing business objectives and plans
To improve performance of business, it is strongly advisable to have strategic plans on
point. If company has an action plan then they will be able to see those areas which needs
improvement in company and to make a good action plan, it is very necessary to do proper
research. Plan should be based on company's objectives and performances (Marston and et. al.,
201). Therefore, Cafe Finix should include these four elements in its strategy: -
1. Strategic Goals for Cafe Finix- In order to achieve total growth of company, quantitative
goals should be set so that it can be measured by company on daily basis through its sales
performances and customer responses. Goals should also clearly define the job
responsibilities of employees.
2. Objectives for Cafe Finix- Improvements in objectives should be done very specifically
by implementing of SMART objectives. Objectives are given below-
 Specific – Improve delivery services by cutting down waiting time of customers for
getting food.
 Measurable – Progress should be measured through time quotes and customer call backs
for checking satisfaction.
 Attainable – Giving only those deliveries to waiters which is in their reach.
 Realistic – by reducing waiting time, more orders can be taken by them.
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 Timely – Cafe will implement the process and train its staff about their performance and
noticing difference after 2 months.
3. Action Plan – Each employee's duty is to be included in its training procedure. Company
plans action strategies to run business in smooth way. Structure of company should be
clearly defined and division of work should be properly done so that strong
communication skills is maintained between departments (Malhotra and Temponi, 2010).
In a restaurant business, communication is very important otherwise customers will not
get their services on time.
4. Performance Measures for Cafe Finix – In order to survive in competitive environment,
performance of employees should be measured on daily basis. This is a very important
function because it tells that how close company has come to achieve its objectives and
employee's performance is also evaluated.
So, company can motivate its employees by implementing these policies. Depending upon
customer’s needs, new objectives must be set up by company. The applicability of plan is
effective only if outcomes meets expectations. Therefore, strategic planning is designed by
considering few measures that helps in knowing plans importance in organisation.
3.2 Revise business plans to incorporate changes
If company is preparing business plans without reviewing it regularly then it’s completely
wrong. To develop business and to incorporate any changes in them it is very necessary to
develop an understanding about business. It is very much necessary to measure the outcome that
have arrived by accomplishing goals and reviewing overall performance (Herbane, 2010). The
company can analyse its action plans and policies which helps in growth and development of
company.
Cafe Finix should review its long-term strategies because if cafe is not working up to the
mark and customers are not satisfied then appropriate changes can be made. It is not that
company should jump from one strategy to another, strategies are changed only when it is really
required. Specialisation of Cafe Finix is its coffee and new technology that they use inside their
Cafe. In this niche category, Cafe Finix is not working well. They should understand right time
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to review their plan which should include change in business environment and market
conditions, change in customer behaviour.
Before taking any major decisions, Cafe Finix should focus more on probable losses that
company might face in their business. By taking a bad investment measure, it many lead to total
failure for company. It should be made sure that there is enough funding with company to
implement its operations (Helms and Nixon, 2010). So, based on plans, marketing analysis
should be done. Sales forecasting must also be done by business properly so that strategies can
be applied in appropriate manner. So, by this organisation would be ready to face tough
competition in market. All the employees should be allocated their work as per their knowledge.
So, Cafe Finix should bring some changes in its process to attract more customers. These
changes will bring improvement in performance level and identify opportunities that are present
for them. By changing plans, strategies are also developed in an efficient manner. Company
should try to make loyal customers by performing work as per them.
3.3 Preparation of Action Plan
Reviewing its current position, Cafe Finix will need to implement certain changes to
remove its weaknesses and achieve its long term goals. It is very important for any restaurant
business to understand if there is any change in external and internal environment because it will
bring changes in action plan as well. The proposed changes can be like: -
 Expanding food offering by giving more options in menu card full of customers favourite
dishes,
 new brand opening inn various cities like London,
 Redesigning area inside restaurant and making it more comfortable and luxurious for
customers (Gronum, Verreynne and Kastelle, 2012).
 Making restaurant more accessible to customers by providing them 24 hrs. services and
home delivery of food as well,
 Giving special discounts to people who are visiting occasionally in Cafe
Cafe should prepare a well-planned portfolio which will include all information like
forecasting, analysis for determining clear view of its mission, vision and market positions. The
most important thing to implement is to set a time frame to complete tasks so that staff could get
time to adjust with changes that will happen in organisation. Cafe Finix should also maintai9n
performance records always for future reference.
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Objectives Prepared by- Date- 10/10/2017
no. Action steps Responsibility Start Date Completion
Date
Budget(€)
1 Forecast
income
Managers 10/10/17 10/10/18 €10000
2 Franchise Managers 15/07/19 25/01/20 €55,000
3 Expanded with
borrowed
contacts
Managers 23/01/15 24/12/15 €8000
Company should evaluate some techniques and methods so that required changes are known. So
that when changes are done company is able to gain its customers base again which they have
lost due to issues in work. It helps in implementing new actions like: -
 It helps in scanning whole environment in effective manner and customers choices and
preferences, behaviour, attitude are also evaluated.
 Development of current plans and policies is also required for understanding and
identifying techniques by using internal and external environmental factors.
TASK 4
4.1 Impact of proposed changes on business and its personnel
The changes which are proposed should be executed and also well maintained. The main
responsibility is with the management team to perform all steps effectively. It is important to
analyse basic functions and activities so that changes can be implemented in techniques and
technologies.
Impact on business
 Appropriate financial planning will help cafe in achieving its desirable success and
reaching its goals (Fassin, Van Rossem and Buelens, 2011). A well-planned plan will
bring much improvement in revenue generation of Cafe Finix.
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 Company should determine its recruitment needs and should give clear job description
and specification for vacant positions and print and electronic media are used to attract
people and with new staff productivity of workforce will also enhance.
◦ In cafe, additional services like gifts cards, loyalty cards, offering alternative modes
of payment. These types of services will bring more customers and it is not only food
that is attracting them. So, these types of services will improve daily business and
customer acquisition.
Impact on Personnel
 Employees need to change its marketing strategies and help in changing old and
introducing new techniques to increase profitability in company.
 It is very important to train employees properly so that activities must be
conducted in the way company wants (Demil and Lecocq, 2010).
All the proposed changes will leave a positive impact on Cafe that will help in bringing more
effectiveness and improve profit margin and add value to business as well.
4.2 Managing changes in business
After implementing plans in business organisation, it is very important to manage these
changes as well otherwise work will not be conducted properly. Management should see that all
activities are being done in proper manner and communication services is also improved some
changes that are required to be managed are: -
 Prioritize which change is important – Cafe Finix should prioritize that which actions
should be taken by them and which not. Like opening a new branch or introducing new
cuisine is very important in this business (Burns, 2010). So, activities like this should be
given more importance and funds are also arranged for these businesses very easily.
 Take opinions – Changes are uncertain so it is always beneficial to take advices from
experts. Cafe should try to take financial advices from bank or any trusted business. A
close watch in competitors is also required.
 Test the change – Changes should be implemented for trail period and after 6 months it
is measured and its flaws are identified which occurred during this process.
 Taking employees Feedback - Employees cannot change anything but their opinion
matters a lot. Their feedback can make entire process easy and then it can be
implemented and opinions are taken from owners (Buck, 2011).
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 Taking Customers Feedback – It is also very important to keep customers well
informed and take their opinions should also be considered very seriously. It helps
business in bringing changes easily and deciding that changes that are implemented will
be fruitful or not.
4.3 Monitoring improvements in performance of business
It is essential for business organisations to monitor all progress and improvements. It will
be helpful in achieving business objectives in effective as well as innovative manner. Along with
this, for this purpose managers can use different tools and techniques such as- 360-degree
feedbacks, management of objectives, key performance indicators. In order to get better
outcomes, managers need to provide training and development assistance to their staff members
so as to boost up their performance as well as productivity (Bridge and O'Neill, 2012). In
addition, such tools are also accessible in analyse their performance and make active business
decision. If a firm is capable to examine performance level of its subordinates so as to make
strong conclusion and decisions.
CONCLUSION
From the above report, it is concluded that small business enterprises have so much
potential to grow in market and if its strengths are properly utilized then it can definitely grow
and develop in market. If business is located in big city then there will be so many opportunities
available for them. They can easily grab customers using effective promotional techniques and
good services. Here, Cafe Finix is evaluating its internal and external environment so that they
can identify its strengths and weaknesses and its analysis is also done for measuring
performance. Companies should implement best communication services so as to increase
profitability and productivity of employees. So, small-business enterprises are very important for
commercial evolution of UK because they provide growth opportunities, employment
opportunities which will help in strengthening economy.
REFERENCES
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Battisti, M. and Perry, M., 2011. Walking the talk? Environmental responsibility from the perspective
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Blackburn, R. A., Hart, M. and Wainwright, T., 2013. Small business performance: business, strategy
and owner-manager characteristics. Journal of small business and enterprise
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Bridge, S. and O'Neill, K., 2012. Understanding enterprise: entrepreneurship and small business.
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under the Affordable Care Act. Health Affairs. 30(8). pp.1402-1410.
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Demil, B. and Lecocq, X., 2010. Business model evolution: in search of dynamic consistency. Long
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Fassin, Y., Van Rossem, A. and Buelens, M., 2011. Small-business owner-managers’ perceptions of
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Gronum, S., Verreynne, M. L. and Kastelle, T., 2012. The role of networks in small and medium‐sized
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Schaper, M. T., and et. al., 2014. Entrepreneurship and small business.
Storey, D. J., 2016. Understanding the small business sector. Routledge.
Thornton, P. H., Ribeiro-Soriano, D. and Urbano, D., 2011. Socio-cultural factors and entrepreneurial
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