Managing a Small Hospitality Business

This report provides tips and strategies for managing and running a small hospitality business. It covers topics such as planning and resource allocation, customer relationship management, developing transnational business, and complying with laws and regulations. The report offers expert advice and recommendations for small business owners and entrepreneurs.

Managing and
Running a Small
Business

Table of Contents
INTRODUCTION ..........................................................................................................................4
TASK 1............................................................................................................................................4
P1 What are the main things which need to be address by the small and social enterprises,
when they are planning and allocating for resources in order to achieve the goals. ..................4
M1 Apply tools in order to plan and allocate the resources in relation to organisation.............7
M2 Discuss the significance of allocating the resources in order to attain the objective:..........7
D1 Critically analyse the application of appropriate resources in order achievement of the
business objectives: -...................................................................................................................7
TASK 2............................................................................................................................................7
P2 Explain and evaluate different process of customer relationship for a small business or
social enterprise...........................................................................................................................7
P3 Improvement of local enterprise to a transnational Business.................................................9
M3 Evaluate the elements of customers relationship management process in order to attain the
goals...........................................................................................................................................10
M4 Evaluate the transitional operations by utilizing the stage model of internationalisation...10
D2. Give recommendations to overcome from the challenges of developing transnational
operations. .................................................................................................................................11
TASK 3..........................................................................................................................................11
P4 Make an yearly itemised monthly cash flow forecast display fixed and variable costs set
against income...........................................................................................................................11
P5 Discuss how break-even analysis could be implemented in organisation...........................13
P6 How key financial statements contributes to the success of the firm. .................................15
D3 Bydoing critical evaluation make a right cash flow forecast and break-even analysis how
these financial statement contribute to the success of the firm. ................................................18
TASK 4..........................................................................................................................................19
P7 Discuss key laws and rules which impact on the small businesses......................................19
M6. In relation to an organisation discuss the implications of key laws and rules....................20

D4 Discuss the key legislation that has an impact on small businesses....................................20
Conclusion ....................................................................................................................................20
REFERENCES..............................................................................................................................22

INTRODUCTION
Small businesses and start-up plays a very important role in improving or enhancing the
economic condition of the nation that is why these are considered as the base line of the nation
economy. These business enterprises are considered as an integral part of the United Kingdom as
they assist in maintaining the economic growth rate of the nation (Steingold and Steingold,
2021). That's why different types of initiatives as well as policies are formulate by the
government of the nation in order to support the small businesses and start-up. The following
report is based on AMD consulting group which was founded in 2019 and the company office
are located in London. The respective company deals in different types of services like customer
acquisition, lead generation, engagement of customers and many more. The following report is
going to discuss about, how the small and social enterprises plans and allocate all their resource
in order to achieve achieve their goals. This report also covers the customer relationship
management process with its benefits and challenges for the small business and social
enterprises. Afterword, this report develops a cash flow forecast, break even analysis and budget
and examine the key financial statement. In this end this report discuss the implications of
regulation on the small businesses and social enterprises.
TASK 1
P1 What are the main things which need to be address by the small and social enterprises,
when they are planning and allocating for resources in order to achieve the goals.
As per the present scenario, it is being determined that small business or social
enterprises plays a very important role contributing in the growth of the economy. These
enterprises are considered as a significant part of economy as they contribute around 47 % in the
Gross Domestic Product of United Kingdom (Engelhardt and Möller, 2021). But still these
enterprises don't get the right direction which directly impact on their performance. It is very
important, to give the right direction to them so that they can easily expand their operations and
contributes more towards the economy. According to the research it has been identified that
these small scale businesses are basically privately owned enterprises in which there is no
inclusion of state authorities. They have private owners who possess limited or unlimited
liability.

These business enterprises not only assist in improving the productivity or growth of the
nation but also helps to shape the economy of the UK. As business environment is very dynamic
in nature that is reason that different types of problems and complexities has faced by them. It is
very essential for the organisation to develop the different types of strategies and take the
different pro corrective actions which assist them in overcome from the different challenges and
attain all the targets effectively. The main considerations which assist the small business or
social enterprises in overcoming form the upcoming challenges has been discussed below: -
Planning: - planning is being considered as one of the most vital and primary function which is
done by the management of the company. Basically they make the blue print of all the functions
that will be performed in future. This written document is considered as the most significant
element which management have to taken into consideration while running the small business or
social enterprises (Costin, O'Brien and Slattery, 2018). If the company management wants to
attain a successful position in the market then they need proper planning which assist them in
achieving all their set objectives in effective manner. It is very important for the management of
the firm to do the proper and effective planning in order to achieve the targets. How planning
assist in attaining the set target has been discussed below: -
 Right direction as well as the correct information of the pre-determined goals is given
by the effectual planning. With the help of this planning the management as well as the
employees of the organisation effectively understand their roles and responsibilities.
 As every entrepreneur knows that the business environment is very dynamic in nature. If
flexible planning is made by the company, then they can effectively face the upcoming
uncertainties.
 If proper planning is done by the company, then this give right direction to the employees
which assist them in achieving all the goals of the organisation which are set by the
higher authorities.
 Proper planning also assists in increasing the productivity of the employees because with
the help of effective planning goals as well roles of the employee has effectively defined
to them.

Resource allocation:
If the resource requirements of the small business or social enterprise are fulfilled, then
they can do all their functions in a very effective manner. Resource may be raw material,
employees, land and building, plant and machinery, money and many more. These resources
play a very important role in achieving the set goals of the company, because without these
resources the management of the company cannot perform their business functions properly
(Winkler, 2022). For example, like without money the small business can't be able to purchase
the land and building or raw material and without workers they are not be able to produce a
single. So, it is very important for the management of the small business enterprises that they
have to take care of the allocation of resources. How the proper allocation of resources assists in
achieving the organisational objectives has been discussed below: -
 The success of the firm is to totally depend on the effective allocation of resources. If
their is availability of raw material and other resources then small business can not stop
their working which result in that they continuously work on their goals.
 If proper allocation of all the available resources are done by the company properly then
they can do all their business functions in proper manner.
 If raw material are available in adequate manner then workers of the organisation don't sit
ideal which result in increasing their productivity.
Other important considerations:
The above two consideration which have discussed is very important for the
sustainability of business in the dynamic business environment and competitive market. Their
are many other things which need to be considered by the management of the company in order
to achieve successful position in the market and attain all their objectives (Schubert, 2022).
These are nature of the business, size of the business, government rules and regulation, corporate
social responsibility and many more.
The above discussion state that, planning as well as effective allocation of resources is
very important. It is very essential for the management of the organisation to considered these
consideration in order to achieve the set targets. Inside planning and resource allocation there are
certain more factors which need to be keep in mind by the company management. Planning

should be flexible and strategically so that they can easily handle the uncertainties and in
resource allocation they have to focus on time and cost so that they can achieve the objective of
the company. It is very necessary for the small businesses to focus on these things.
M1 Apply tools in order to plan and allocate the resources in relation to organisation
It is being suggested to the small businesses or social enterprise that for effective
planning and proper allocation of resources they can adopt work breakdown structure (WBS).
This assist them in achieving all their set target in productive manner. Planning must be
strategies good and relevant to the future activities.
M2 Discuss the significance of allocating the resources in order to attain the objective:
If small business and social enterprise wants sustainable growth of their business in the
competitive and dynamic market then it is very important for them to do the resource allocation
and planning in proper manner. This assist them in achieving the intended organisational goals in
effective way.
D1 Critically analyse the application of appropriate resources in order achievement of the
business objectives: -
Proper allocation of resources are being considered as the most important things on
which management of the company need to be focused for successfully achieved the business
goals (Tobing and et. al., 2019). If all the resources are allocated in proper manner then this
result in effective functioning of all the business activities.
TASK 2
P2 Explain and evaluate different process of customer relationship for a small business or
social enterprise.
The relation between organization and consumer is interlinked with the proper and
effective marketing skills. an organization should always focused on after sale services which
can able to build more loyalty of the customer towards the firm. The business enterprises should
always provide there product and services in effective or efficient way that can always being an
advantage in comparison of present competitors to their potential customer base. the main
objective of the operational management department of an organisation is to build a transparency
communication with the customers which can help them for the long sustainability in the

respective organizations. there are various procedure adopted by small business enterprises
which can help them to build a strong relationship with there buyers. Some of these strategies are
as followed:
 Understanding Customer Needs: The most important task of an organization is to
understand there customers basic needs and what are there expectations from the
organization. If an organisation is providing the quality product which will full fill the
basic needs then only the customer will approach the p[articular company. this is one of
the mean factor that makes a potential customers to purchase product and services from
that organization.
Service Management: The main motive of the manager is to get the feedback from there
customers after the customers purchase goods and services of a particular organization
(Chaudhuri, Sasidharan and Raj, 2020). The goods and service management department helps an
organization to enhance there relationship with there customer.
 Improve Communication with Customers: the main focus of the small scale
organization is to build the strong communication and relationship with there potential
customers. The one who operates this organization should always provide the complete
information related to their organization to the buyers and their customers. This helps an
organization to increase there productivity and profitability. Nowadays the rapid growth
of social media platform can lead a organisation to capture new customers base
segmentations.
 Regular Feedback:- Feedback is a tool that helps in analysing the improvement that an
organization need to change in there goods and services. The products of an organization
can be relevant to there customers to satisfy there wants and needs. Consumer get in
touch with those firms that have a time to go through with the feedback. feedback helps
in putting new things and up-gradation of the product according to the customer
preferences.
Drive Innovation to Attract the Customers: Innovation of new product is a tool that helps an
organization in attracting the existence as well as the new customers. And it also helps in

increasing the sales of the company (Russell, Westby and Watt, 2020). An innovative product is
an up-gradation of old one. Focus play an important role for the manager in running the the
creativity element in their goods contribution to lkinked the customers.
The following are methods to hold effective consumer dealings with consumer and succeed
them exactly to carry on maturation and productivity.
P3 Improvement of local enterprise to a transnational Business.
The main purpose of small enterprises is in target international market for the future
growth and profitability. Transactional business stand for the converting the small business at
international level for the operational business extend. In the working of organisation efficiency
and effectiveness is maintain through its applications of transactional business. In the global with
other nation it helps in connecting and ensure investment in foreign assets. In the following ways
small business can develop transnational business which is mentioned below:
 Exporting: It is the direct selling of products to the global market . It is the easiest way
through which is used by some business on global level. It requires the exportation that
supply the goods into the international market.
Advantages:
 It helps in supply maximum earnings and future development potential for tiny business.
 Besides this, it act as moderate of enlargement and a style to move in the worldwide
market.
Disadvantages:
1.the main disadvantage is to cultural diversification to understandability of world-wide
market.
2.It definite quantity's is time, finance and potential which a mid range business cant
drop.
Foreign Direct Investment: It affect the finance funds of small range business finances
in an enterprise of planetary market. Also, it involves acquisition of foreign business
assets which will help in the gross sales and taxation enhancement. It is a direct
investment into a small businesses by an individual or the organization either buying the
company or by contracting action in existing company.
Advantages:
1.Rousing of profitable capital of the administration.

2.Enhanced income and maturation potential for little businesses.
Disadvantages:
1.Hazard of fund for the lower and medium enterprises due to large investments.
2. Dubiety of judicial position prevalent to the FDI country.
Joint Venture: The collaboration between the small organization and the large one as a
tie up agreement between them. This can reduce the risk of losses and increment in the
profit by the companies (Berry and Berry, 2018). it develop mature the opportunities for
local enterprises. Also, the issues and return will be divided by both firms and they will
work like are force in complex global environment.
Advantages:
1.It develop an approach to top worldwide market with bendable dispersion networks.
2.It will raise the susceptibility of the firm with possible root.
Disadvantages:
1.The program has ill-defined verifiable which tackle the maturation expectation of the
firm move into the combined function.
2.due to to the various changes in the work style of the both the company, there is a
chances of conflicts between them.
Hence, the various ways of processing a multinational enterprise which have some
benefit that raise the development possibility. Also there is participation of several situation that
generates hindrance in productiveness.
M3 Evaluate the elements of customers relationship management process in order to attain
the goals.
Customer relationship management is critical in order to achieve the company's goals
properly. With their customers in mind, it helps he management to connect them and improve
their sales goals. This is done by grouping customers according to various aspects that make it
easier for the company to understand their needs accordingly.
M4 Evaluate the transitional operations by utilizing the stage model of internationalisation.
The model of internationalization in the relation of small industries describes how to build,
maintain and expand relationships with international network participants. This will strengthen
the power and benefits of SMEs around the world. It also creates a single global network of

various organizations with different culture. It also helps to harness the resources that deal with
the fundamentals of the activities of foreign companies.
D2. Give recommendations to overcome from the challenges of developing transnational
operations.
Multinational corporations face a variety of challenges, including background differences
and various political conditions. These encounters can be faced by gaining a deeper knowledge
of customer needs and seizing the opportunity to increase their business globally. By developing
real relationships with local partners in the global market assists in overcoming the risks of local
rivalry. Efficient supply chain management can be ensured by accepting effective planning and
strategies to sustain the growth of the global work environment.
TASK 3
P4 Make an yearly itemised monthly cash flow forecast display fixed and variable costs set
against income.
Focusing on cash flow forecasts is essential to keep a company's financial structure, as it
helps in keeping the financial considerations and identify fixed and variable cost specifications
and accountability(Yusof and Nor, 2018). The part of fixed and variable costs, determines the
complete cost structure because they can be combined to analysed the overall cost. The forecast
of cash flow can be interpretate in effectual way in order to help small organizations to plan in
the context of revenue. Cash forecasts maintain small businesses, monitor exact expenses, and
enable companies to maintain a cost structure and maintain the organization's whole financial
position. There are many sources used to predict cash flow shown has been discussed below: -
 Equity Financing – Equity finance allows businesses to better identify and focus on the
flow of costs within their organization. Smaller administrations can raised the capital by
issuing their share in the market. When the small organizations went wrong, it turned out
that they didn't sell the stock because the cost of the stock included low market value.
Through equity finance, companies can also properly determine costs and maintain cash
flow forecasts.

 Project payment timing – It is also believed to be an important source of information to
help predict vehicle cash flow. With the help of the project's payment schedule, the
organisation can properly determine its cash flow forecast. Project payment times
analyses the overall cost structure and deadlines. This is useful for predicting and
analysing the situations.
 Planning, budgeting & forecasting – this technique assists the managers in effectively
recognize the entire set-up of their budget system. Good planning and budget structure
can help the management of the company in predict cash flow.
 Time series data & information –Time-series data helps the management of the
organisation in understanding their company's needs and allows the company to better
meet their task needs within fix time periods(Kuratko, Fisher and Audretsch, 2021). With
the help of time series data and related information, the company's finance manager
forecasts cash flow and performs cash flow analysis appropriately. For the financial
budget system, it may be useful to set a specific production plan to take into account the
execution of all functions.
Forecasted Cash flow Statement

From the table above, the cash flow of a corporation that can receive excess is considered to be
6392 in the next period, the total variable cost is analysed as 63735, and the TFC (total fixed
cost) is as follows, it is considered to be 24000. The projected gross profit of the company is
94145.

P5 Discuss how break-even analysis could be implemented in organisation
Break even analysis
Break-even analysis helps in determine the number of production-related units that need
to be traded to cover both costs of production i.e., fixed and variable. This examination is
considered a tool useful for analysing safety margins. This analysis is also beneficial abroad to
consider stock and trade opinions to keep corporate budgets for various projects. Break-even
analysis is a good term used to determine the relationships that occur between specific factors
such as profit, cost of profit, and expense. This analysis considers the profit status when the
manufacturing cost and the generated revenue are equal. This analysis,assist in understanding
particular criteria such as interrelationships and linear costs. Next factor is turnover and non-
linear costs. It can be said that the organisation uses this operation to enable the firm to
effectively use geographic methods. In the case of the AMD Consulting Group, their managers
are in the process of applying algebraic techniques to maintain objectives, reduce complexity,
and make decisions about specific time periods in which they can effectively handle business
situations. The following is an explanation of how to analyse the break-even point.
TFC = Total fixed cost
Qb= TFC/ (P-AVC)
P = Price
AVC = Variable cost per unit

The AMD Consulting Group wants to grow its organisation and the firm must bear fixed
costs in order to adequately cover the costs. Through this analysis, companies can determine the
whole spending and try to improve it.
P6 How key financial statements contributes to the success of the firm.
Financial statements
These are basically the written documents which communicates the different operations
and functions of the company and also shows their performance in the competitive market. These
statements comprises of different types of statements such as balance sheet, cash flow statement,
profit and loss account, income statement.

Based on the above statement, AMD Consulting Group's gross profit is considered to be
3500, total sales are considered to be 15000, and cost of sales is examined to be generalized to
11500. The company's NP (net income) based on the income statement is determined as 1240,
indicating a solid financial position for the organization. Based on the balance sheet, the cash is
3500 and the organisation total assets are 19400. The company has internal liabilities including
9240 and total liabilities of 10160 and total cash possess by AMD Advisory Group is 3500.
Based on the above analysis, the company has a clear view of the effective profits of a particular
financial position.
D3 Bydoing critical evaluation make a right cash flow forecast and break-even analysis
how these financial statement contribute to the success of the firm.
TFC = Total fixed cost
P= Price
AVC = Average variable cost
Qb = TFC\ (P- AVC)
Detailed understanding,
AVC= 9
TFC= 40000
P= 18

Hence, Break even point in this case,
= 40000\ (18-9)
= 4444.45
TASK 4
P7 Discuss key laws and rules which impact on the small businesses
To maintain the legal requirements within the firm, it is essential to comply with the relevant
important laws and regulations that can enhance the efficiency of SMEs. There are certain
important laws and regulations applicable by the company in connection with the AMD
Consulting Group, which are described below.
 Employment Law 1996 - In regarding of this law, it can be said that the most of this
refer to employment relationships that comprise several specific elements such as
compensation, free time, employment contracts, research and training, childbirth,
paternity, and flexible working hours(Attaran and Woods 2018). The AMD Consulting
Group uses this law to help support all legal considerations within the organization.
 Health and safety 1974: - This is a very important act that can maintain the company's
health and safety considerations. AMD Consulting Group managers have considered this
step to provide employees a safe working environment and work without burden.
 Data protection act, 1998 - This is also considered to be the most proper legal act that
may help in maintaining the overall privacy protocol and maintain some degree of
privacy for organisational data. The AMD Consulting Group has properly used this law
to ensure that managers comply with all privacy ideologies and keep sensitive data
relevant to their workers and employers safe.
 Record keeping act: Under this law, firm directly maintain appropriate records and
maintain proper all activities. In the case of AMD Consulting Group, the management of
the organisation can provide reasonable security to decrease the effect of illegal activity
in the company. Company stakeholders believe this law and share appropriate data with
others(Depken and Zeman, 2018).

 Consumer protection act , 1987 - The main motive behind this law is to allow customer
to claim damages if a defective product in any case causes personal injury to them.
M6. In relation to an organisation discuss the implications of key laws and rules
Organizations are bounded by different types of government act and policies which make
rules for economic welfare law for internships to protect the rights of individuals residing in the
same economic zone to assess the rights of consumer, competition, and labour law (Pedroza-
Gutiérrez, 2019). This Automatically create rules to remove consumer manipulation and unequal
treatment
D4 Discuss the key legislation that has an impact on small businesses.
The Consumer Law of 2015 instructs the relevance of providing services that meet customer
expectations. This will improve customer satisfaction, reduce conflicts and help in growing the
business market. On the other hand, the Competition Law of 1998 and the Labour Law of 1996
regulate customers and workers by regulating equivalent and fair treatment between customers
and employees without being greedy for more profits (Jollans, 2020).
Conclusion
From the above report it can conclude that the success of SMEs is an organization's primary
concern and may help maintain effective corporate operations all across the globe. This report
concludes a company's financial position and calculates a cash flow statement to predict cash
flow. Separately, break-even analysis is also calculated to ensure that there are no wins or losses.
This report also concluded a financial statement consideration and prepares an income statement
and cash flow statement. Afterword this report concludes the key legislation and suitable
regulations that help in maintaining the structure of SMEs.

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