FBOM Factsheet: Managing and Running a Small Hospitality Business

This report, presented as FBOM Factsheets, provides a comprehensive overview of key aspects in managing a small hospitality business. The first section focuses on resource planning and allocation, emphasizing the identification of project scope, resource requirements, human resources and skills, the creation of a resource allocation plan, and the importance of organizational structure. The second section delves into customer relationship management (CRM), detailing strategies such as brand awareness generation, lead acquisition, lead conversion, superior service provision, and transnational development. It also discusses the benefits and drawbacks of transnational operation, including pricing strategies and market analysis. The final section covers financial planning, specifically the creation and interpretation of an annual itemized monthly cash flow forecast, including fixed and variable costs, as well as the application of break-even analysis to determine business profitability and financial performance. The report uses examples and financial data to illustrate these concepts, providing practical insights for small business owners and managers.

FBOM
FACTSHEET 1
INTRODUCTION
Managing and running a small business requires employers to perform several functions as it starts from establishing goals and
project scope to retaining customers. This present report is going to show some areas which is important for manager to consider
while making plan about allocating resources. For an effective planning of resources allocation small and social enterprises
require following some functions and steps. Further, it will show importance of customer relationship management as how it can
help companies in accomplishing their pre-determined goals and also satisfying customers’ needs. Lastly, it will discuss
importance of estimating cash flow in order to know profit margin as well as break-even analysis which help companies in
knowing requirement of selling total number of products for earning profit.
Main Considerations a small business and social enterprises require addressing while planning and allocating resources
Small and social enterprises run business activities for improving living standard of people and fostering their family by bringing
innovation within company. Starting up a new business and making planning as well as allocating resources is not an easy task as
there are several areas which need to be considered for accomplishing goals such as:
Identifying project scope: It is one of the main step in which small and social enterprises require identifying the main scope of
their project as why they are making planning and allocating resources. On the basis of project scope further steps are being
proceed.
Requirement of resources: For allocating resources it is important to have look on available resources and requirement of
additional resources which are vital for completing all tasks. Some equipment’s like laptop, stationery, financial resources, HR
and others.
HR and skills: Among all resources skills and HR play an important role as in this step of planning process, small and social
enterprises require identifying the best way of selection and recruitment process. This selection of recruitment strategy can help
them out in making a pool of skilled workforce and allocating tasks as well as resources to each employee as per their
qualification and experience.
Resource allocation plan: This plan includes all important information’s including both human and non-human resources. Under
each individual, responsibilities of people, skills as well as expected date of completion project can be included. Allocation of
resources to each member depend upon their experience, qualification as well as tasks which they need to complete.
Organizational structure: It is also another important step which makes employee able to know as in which manner they are
expected to complete work. It maintains discipline at workplace and also make them able to communicate with colleagues in a
particular way as per the organizational structure. An effective organizational structure also allows employers in reducing errors
because all employee work as per the specific system which improves workplace environmental.
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FBOM
FACTSHEET 2
Customer relationship management refers a way in which companies try to build and maintain a strong relation with their
customers by improving their experience. Managing customers' relation is one of the main key of business success. A good
customer relationship allow customers to retain with the company which improves brand and profitability of an organisation.
Some ways and processes by which small and social enterprises can build and maintain CRM include:
Generating brand awareness: For attracting people it is important for companies to make them aware about features and
effectiveness of products and services of brand. Until, people do not have knowledge about products and their effectiveness
they do not prefer to shop from an unknown brand. So, for this step, social and small business require performing marketing
functions and generating brand awareness.
Acquiring leads: After making aware to people about effectiveness of products and services company require to encourage
them to get engaged with brand by asking them to share their E-mails for knowing offers and others. For this step, company
requires focusing on E-mail and communicating with customers and influencing them.
Converting leads into customers: After encouraging them and making them able to stay connected with company, small and
social enterprises require converting all those leads into customers by providing them special offers, discounts on products.
Communication is the main key of success in which company requires deciding of selecting the best tool and platform via
which they can interact with their customers. When company interact and provide special offers then customers become agree
to buy products.
Providing superior services: After making agreed to customers and converting leads into customers, companies
require retaining them with them for the long run. By providing qualitative and superior features of products and services to
customers then it makes them able to stay with the company. It is also important for social and small enterprises to provide
unique features of products at affordable and fair price.
Staying connected with customers on continuous basis and keeping them updated about new arrivals, features,
discounts can make them feel valued which improve their relation.
Different processes of customer relation management for small and social enterprises
REFERENCES
 Abad, V., 2017. Case Study: Managing Business Growth from the Bottom Up. The Economics of Therapy: Caring
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 for Clients, Colleagues, Commissioners and Cash-Flow in the Creative Arts Therapies, p.180.
 Grubesic, T.H., Nelson, J.R. and Wei, R., 2019. A strategic planning approach for protecting environmentally
sensitive coastlines from oil spills: Allocating response resources on a limited budget. Marine Policy, 108, p.103549.
 Lee, M., Hong, T., Koo, C. and Kim, C.J., 2018. A break-even analysis and impact analysis of residential solar
photovoltaic systems considering state solar incentives. Technological and Economic Development of
Economy, 24(2), pp.358-382.
 Njoroge, E.M., Muhoho, J. and Kibuine, M., 2019. Influence of customer relationship management system on
performance of deposit taking SACCOs in Nairobi County. International Academic Journal of Human Resource and
Business Administration, 3(6), pp.179-202.
 Razen, M., Huber, J. and Kirchler, M., 2017. Cash inflow and trading horizon in asset markets. European Economic
Review, 92, pp.359-384.
 Washio, K., Ishigai, S. and Monbu, K., Dentsu Inc, 2018. Customer relation management device and method. U.S.
Patent Application 15/771,717.
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Ways as how social business can develop transnationally along with benefits and drawbacks
Transnational approach is considered one of the best strategy or personalized approach in which company sell and market their products and services with their target audience in mind. Going beyond
national boundaries can be defined as transnationally and when social and small enteritis’s plan about developing this transnationally they require identifying target market and extending scope of their
project.
One of the best way of developing transnationally in to improve market strategy as marketing functions and strategy allow companies to reach customers and promoting products. Selection of the best
and appropriate mode of communication by which they can interact with customers is the main key of developing transnationally and expanding business as well as attracting customers to the great
extent.
Other main key and way of developing transnationally by social and small enterprises is pricing strategy as when companies provide unique features of products to large extent of people at affordable
and lower prices then customers are more likely to buy products. Company can make use of penetration pricing strategy.
Advantages
There are several benefits of developing transnationally as transnational entrepreneur can discover and enact cross national opportunities. It is one of the best way and process of establishing social
field. It makes entrepreneur flexible or increasing ability to adapt changing situations. They can better explain uses of resources and social networks as well. Unfair advantage among transnational
companies is also common.
Limitations
Companies who develop transnationally and expand business generally employ fewer employees. Some companies do not provide effective working conditions due to increase production and other
investment cost. Profits go overseas rather than local. By ignoring local laws, companies’ local laws
Companies who develop transnationally and expand business generally employ fewer employees. Some companies do not provide effective working conditions due to increase production and other
investment cost. Profits go overseas rather than local. By ignoring local laws, companies local laws.

FBOM
FACTSHEET 3
Particulars January February March April May June July August September October November December
Cash inflows
Opening cash
inflow 7000 8300 10682 13145.88 15691.45 18318.43 21026.48 23815.16 26683.94 29632.19 32659.19 35764.11
Sales revenue 10000 10200 10404 10612 10824 11041 11261.62 11486.86 11717 11951 12190 12434
Other income 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000
Total cash inflows 19000 20500 23086 25757.96 28515.77 31359.24 34288.11 37302.02 40400.53 43583.12 46849.14 50197.85
Cash outflows
Material 2500 1530 1560.6 1591.812 1623.648 1656.121 1689.244 1723.029 1757.489 1792.639 1828.492 1865.061
Lab our 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000
Other expenses 2200 2288 2380 2475 2574 2677 2783.702 2895 3011 3131 3257 3387
Administration
expenses 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000
Total cash
outflows 10700 9818 9940.12 10066.51 10197.34 10332.76 10472.95 10618.08 10768.34 10923.92 11085.03 11251.86
Cash deficit /
surplus or closing
cash balance 8300 10682 13146 15691 18318 21026 23815.16 26684 29632 32659 35764 38946
.Break-Even analysis
Particulars Formula Figures
Selling price per unit 10
Variable cost per unit 6
Contribution per unit
Selling price per unit - variable
cost per unit 4
Fixed cost 20000
BEP (in units) Fixed cost / contribution per unit 5000
BEP (in value or monetary terms)
BEP (in units) * selling price per
unit 50000
Producing an annual itemized monthly cash flow forecast with fixed and variable costs
It is necessary for organisation to produce cash flow and other financial statement. This is to be forecast so that it is easy to find out what are actual income and expenses occurred
during a particular time period. Besides, it gives insight on what are fixed and variable cost incurred in it. Alongside, there are many other financial statements that is required for
organisation. These all enable in analysing financial performance in effective way. Thus, they budget is specified as below
.
How break event analysis is applied to organization
A break even analysis is a point through which it is analysed that at what stage business becomes profitable. Alongside, the calculation is useful in finding out how many products has to be sold in order to
cover expenses incurred. Analysis is applied in all situation where it is necessary to find out what estimated time is needed to earn and profit. Furthermore, a break even analysis informs about bare
minimum performance of business must meet to avoid losing money. It also helps to understand at which point generate profits so that production goals are formed accordingly. This analysis is useful to
determine ways to speed up company break even point, such as reducing overall fixed costs, reducing the variable costs per unit, improving the sales mix, etc.
Thus, it is applied when a company wants to enter in new market. In this forecast is done to determine that at what stage business will be profitable in that market. So, accordingly strategies are
developed. Besides that, if organization wants to expand in various market then break even analysis is useful. It helps in giving insight about time required to gain profits in those markets. Then, on basis of
strategy is developed. Similarly, there are many other situations as well on which this concept is applied. In addition, when product price has to be reduced then also it is done. For that forecasted data and
info is gathered and then analysed.
Interpretation of financial statements for an organization in relation to successful
management
From the above cash flow and break even analysis it can be interpreted that cash flow can help
social and small organisation in estimating about total expenses and income as it makes them
able to create profit margin.
From the above estimated cash flow data it can be said that cash inflow is increasing
each month by some amount which is affecting to monthly revenue. Along with monthly cash
inflow and increment in it, it is increasing total monthly revenue. Cash outflow is also
increasing to some extent because each month company find requirement of investing amount
in all resources for expanding business and generating revenue. But overall it can be said that
cash outflow is less than cash inflow which is good for the company. When cash inflow or
income of cash is more than cash outflow then it shows profit and for this company requires
identifying all those areas in which it can reduce investment for earning more money and
increasing profit margin as well. Each month, company find growth and it is a good indication
for company.
In the context of break-even analysis it can be said that it is one of the best strategy
which shows actual point of profitability and loss to company. With a proper calculation with
this company can also identify that how many products it requires selling in order to gain
estimated profit. For this there is requirement of identifying variable as well as constant cost
and selling price per unit. So, from the above it can be said that by knowing total number of
products which company require selling more for earning estimated money company can
increase profit.

Fact sheet 4
Key legislations and regulations that have implications on small and social enterprises
Key legislation and implications play an important role as it allows social and small businesses to tun their business
activities in an effective manner and also prevent themselves against lawsuit. Business environment is changing in the
nature and changes in some elements can affect performance of company. There is requirement for social and small
enteritises to implement some regulations such as: employment law, safety related regulations, corporate and security
laws and others.
Employment law: Employment law is a vital for protecting against lawsuit. As per the fair labour standard act,
company can prescribe standard of wages and overtime pay. As per this law, employees have right to get minimum
wage and discussed overtime pay and if they do not get then they can file a case against company. So, it can be said
that by implementing and following this company can prevent itself and employees against violation of rights.
Workplace safety and health: Employee do not prefer to work with companies who do not have proper workplace
safety acts and unsafe working environment. By implementing this act, company can prevent employees and itself
against injury and serious hazards. It can help companies out in increasing staff retention rate.
Anti-discrimination act: This legislation also plays an important role as per this act, employer can encourage to all
employees to improve their relation with colleagues by respecting each other values. It prevents employees against
discrimination on the basis of culture, race, gender and make them feel valued. Companies also require providing
equal and fair opportunities to all their employees and it is beneficial for both employees and employers. It makes
employees feel valued and motivated and allow employees to stay their employees and also improving workplace
environment.
So, from the above discussed laws it can be said that if social and small companies follow all rules of these
legislations then it can prevent them against law-suit and employees cannot take undue advantage of laws. Company
can also improve productivity by maintaining workplace safety and also allowing employees to respect values of each
others.
CONCLUSION
From the above presentation it has been summarized that marketing played a vital
role in attracting customers and making them aware about features of products
and services which company wants to sell them. It has shown some areas which
required to be focused while planning and allocating resources like selecting
strategy of recruitment, requirement of resources and others. Further, it has shown
importance of managing customers relationship along with ways in order to
accomplish goals, increase profitability and brand as well. This study has also
discussed importance of producing financial data including cash flow, break-even
analysis and others. Lastly, this report has shown key legislations which are
required to be implemented and impacts which they have on performance of
company.