Small Business Enterprise Caffe Finix

Added on - 22 Jul 2020

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Small BusinessEnterprise
TABLE OF CONTENTSINTRODUCTION...........................................................................................................................1TASK 1referd...................................................................................................................................11.1 Small business indemnifying its strengths and weaknesses..................................................11.2 Analysis of the business using comparative measures of performance................................3TASK 2............................................................................................................................................42.1 Appropriate actions to overcome the weakness....................................................................42.2 Ways in which existing performance could be maintained and strengthened......................52.3 New areas in which business can expand.............................................................................5TASK 3............................................................................................................................................63.1 Existing business objectives and plans.................................................................................63.2 Revision of business plan for necessary changes..................................................................73.2 Plan for implementing changes.............................................................................................8TASK 4...........................................................................................................................................94.1 Impact of change on business and its personnel...................................................................94.2 Management of changes......................................................................................................104.3 Improvements in business performance..............................................................................11CONCLUSION..............................................................................................................................11REFERENCES..............................................................................................................................13
INTRODUCTIONSmall business enterprise become plays an important role in the growth of an economy.Government provides various types of resources which help in encouraging the businessactivities of these firms. Small business enterprise reduces unemployment in the country byproviding various job opportunities to a large number of local people. It also increases theirliving standard. This enterprise conducts business activities by providing high support to largenumber of business enterprises (Harris and Patten, 2014). Present report is based on Caffe Finixwhich is a small coffee shop that offers and provides breakfast and tea in order to fulfilcustomers’ needs and wants on daily basis. In this report, there will be discussion on thestrengths and weaknesses of company. Different efforts to overcome the weaknesses andrecommendations for same will also be defined here. Along with this, expansion of smallbusiness enterprise in new sector will be discussed in this report.TASK 11.1 Profile of Caffe Finix with identifying its strengths and weaknessesBefore starting a new business, it is more important to define its aim and objectives of. Inthis organizational objectives can be short term and long term. Understanding of business natureis also important to achieve success. Caffe Finix is a small business enterprise which offers fooditems to fulfil daily needs of its customers. It is built in 1600 square feet area in the city (Al-Dajani and Marlow, 2010). In order to understand the strengths and weaknesses of business,SWOT analysis will prove to be highly effective and beneficial tool for the organization:SWOT analysis:It is an important tool to measure the performance of company and helps in taking thebest decision by defining and focusing on main issues of business. This tool helps in making thestrategic plan with identifying its strengths, weaknesses, opportunities and threats. Swot analysisof coffee shop is as follows:Strengths:Strengths define unique qualities of business which are totally different fromothers. With the help of strengths, company achieves aggressive and the best positionthan their competitors (Altman, Sabato and Wilson, 2010). Loyal customers are the3
biggest strength of Caffe Finix as well as they are having high financial amount to runtheir business in an effective manner. Its product folio is also one of the major strengthsof firm. There are some other strengths of Caffe Finix as well which are as follows:Firmoffers and provides top and fresh quality of products to its customers.Effective location .Loyalty of customersHigh range of product line High goodwill I delivering high quality of productsWeaknesses:It mainly stands for limitation of an enterprise. It defines negative factors of thefirm like lack of resource, weak product cycle, etc. There are some weaknesses of CaffeFinix which are as follows:Rent is very high of this coffee shop.Less popularity of theirbrand in the market.Quality of products is low as compared to its competitors.Opportunities:It is an effective process which defines favourable condition of business which helps thefirm in taking more advantages of particular situation (Battisti and Perry, 2011). In order to holdthe opportunities in this process, organization should have all the resources which are required inexpanding business in the market. There are some points which define the opportunities of CaffeFinix shop like:Organization can start franchising business at the international level.Firm can achieve more profits by investing in developing countries.As a coffee shop the market expand in rapidly in UK so that firm can invest in this toincrease their business at international level which helps in increasing its goodwill.Threats:It defines fear and trouble which affect the business organization in a negativeway. The owner of business tries to minimize the threats by making efforts (Bellucci,Borisov and Zazzaro, 2010). Threats affect the overall performance of company. Thereare some threats of this firm which are as follows:Having large number of competitors inthe marketplace.They introduce substitute products at less cost.Political instabilityChange in policies and government4
1.2 Analysis of the business using comparative measures of performanceOverall business performance helps in understanding the status of company. It is essentialfor every business organization to measure and calculate total ROI in business activities whichaffect its performance (Blackburn, Hart and Wainwright, 2013). Comparison measurement isdone by the competitive to define their products. There are some main areas in which firm canperform their best than its challenger:Finance:It is an important element for every type of business organisation. It isnecessary to the business in order to complete their tasks and run activities in an effectivemanner. It is more important to measure and calculate the return on investment inbusiness process such as break even analysis, asset’s valuation and many factors whichdefine the measurement of business. Return on investment is an important part oforganization which defined the way in which finance should be invested in theseactivities which are set by the owner of business.Sales:It is also an important function which defines the actual status of business.Measurement of sales define the success of business in marketplace. Caffe Finix tries toincrease their sales volume by delivering high quality of products to its customers andgetting higher satisfaction by them. It also sets low price of their products so that largenumber of customers would get attracted to use its products and increase sales ofcompany effectually.Marketing:Marketing plays the most important role for all types of businesses whichdefine selling and buying of products. It assists in increasing the sales volume ofcompany. Firm should use effective marketing tools to increase the awareness ofcustomers with regard to their offered products (Blenker and et. al., 2012). The owner ofCaffe Finix does all the activities related to its services so that they can achievecompetitive advantage over its competitors.All these areas are effective for the organization to capture a large market share and for bettersatisfaction of customers’ needs which help in achieving competitive advantage.Comparative measure of performance :P&L account for year ended 30th April 2016 to 30th April 2017 are define in below:Particular2016£2017£5
Sales150200Cost of Sales100125Gross Profit5075Overheads2025Net. Profit3050Balance sheet of Caffe Finix for year ended beginning at 30th April 2016 to 30th April 2017Particular/ year2016£2017£Fixed assets1540Current assetsStock510Debtors105Bank75Total3760Creditors2040Bank overdraft1720Total3760Current ratio = current asset / current liability20162017Net profit margin = net profit/ net sales * 10050/150 *100 = 33.33Net margin = 55/300*100= 18.33Gross profit margin= gross profit/ net sales *10040/150*100= 26.67Gross margin = 50/300*100= 16.67Quick ratio = current asset – stock/ currentliabilities30000-8000/6000 = 3.67 timesQuick ratio = 80000-10000/40000= 1.75 timesCurrent ratio= 30000/6000= 5Current ratio= 80000/40000= 26
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