Caffe Finix: Small Business Enterprise Analysis and Recommendations

This report provides a comprehensive analysis of Caffe Finix, a small coffee shop located in the UK. The report begins with an introduction to small business enterprises and their role in economic growth, followed by a profile of Caffe Finix, including its strengths and weaknesses. A SWOT analysis is conducted to identify internal and external factors impacting the business. The report then examines comparative performance measures, including financial statements for 2016 and 2017, and explores methods to overcome weaknesses and maintain existing performance. Recommendations for new areas of business expansion are also provided. The assignment further assesses the business plan and objectives, suggests revisions, and develops an action plan. Finally, the report discusses the impact of changes on the business, plans for managed changes, and monitors the performance of improvements, concluding with a summary of key findings and recommendations. The report provides a detailed analysis of the business, focusing on its performance, challenges, and opportunities for growth.

SMALL BUSINESS
ENTERPRISES

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Profile of Caffe Finix and identify its strength and weaknesses...........................................1
1.2 Comparative measures of performance.................................................................................3
TASK 2 ........................................................................................................4
2.1 Justify the methods to overcome from weaknesses..............................................................4
2.2 Examine the ways of maintaining existing performance......................................................5
2.3 Recommendation for new areas of business expansion........................................................6
TASK 3............................................................................................................................................7
3.1 Assessment of business plan and objectives.........................................................................7
3.2 Revision of a business plan...................................................................................................8
3.3 Develop an action plan..........................................................................................................9
TASK 4..........................................................................................................................................10
4.1 Impact of changes on business ...........................................................................................10
4.2 Plan for managed changes...................................................................................................11
4.3 Monitor performance of improvements..............................................................................12
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
Small business enterprises plays a very vital role in growth and expansion of society.
They are established in market in order to provide something new and innovative to people for
increasing their profits and sales. Those start-ups which survives for long span of time are
capable to provide economic stability to their owners. Along with this, SME's are helpful in
creating job opportunities for the people for generating a steady source of income to the lower
section of society. Such entities are implemented with an aim of change the whole world by
supplying unique products to customers (A. Harris and P. Patten, 2014). Caffe Finix is the
chosen organisation in this present report; it is small coffee shop and situated in local area of UK.
The main aim of the company to become popular among customers by providing them good
quality of products. Apart from this, the report will be describe strength and weaknesses of small
business enterprises. There is given some methods in order to overcome with barriers. The report
will stated that owners have to prepare an effective business plans and objectives for achieving
their goals and objectives in a certain time schedule. Impact of proposed changes on firm's
functions and activities will be also dictates in this assignment.
TASK 1
1.1 Profile of Caffe Finix and identify its strength and weaknesses
In this competitive environment, several small business enterprises have achieved growth
and success in a short span of time. Caffe Finix is known as local SME that is famous between
localities of United Kingdom. It supplies finest quality of coffee products and further effective
services. Along with this, the business enterprise has variety of food products that is accessible in
attaining and retaining for long term. Basically, its is emphasis upon pricing strategy and follow
up all quality measure; this is the prime reason of its popularity in UK's local market. It serves
food items and various drinking beverages to the people of all areas so as to boost up sales and
make higher profits (Altman, Sabato and Wilson, 2010).
Apart from this, the owner of this entire association was started this business in very
limited amount but now it is become a successful and precious coffee shop in local areas of
United Kingdom. It is a first choice for coffee lovers who does not want to spend more money.
In addition, Caffe Finix is developed its overall interior in order to render an extraordinary
experience to people. Lightings and furniture that is used in the shop, is very precious and
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impressive. Whenever a customer enters within the shop, he or she is treated in well being
mannered by the staff members of the enterprise.
SWOT analysis of Caffe Finix
It is essential for the managers of small business entities to regularly analyse those
internal that will affect their entity in future. This can be done through SWOT analysis; it is
assistive in formulation of an active business strategy. Below mentioned SWOT analysis of
Caffe Finix: -
STRENGTH
 The firm is totally customer focused, so
that it provides qualitative and value
added products to its customers for
increasing sales.
 Low bureaucracy and informal working
environment.
 Innovativeness with an aim of giving
something new or novel to the society.
 Flexibility and adaptability to accept
environmental changes (Teece, 2010).
 High visible top management, therefore
all business operations can be managed
in a systematic manner. More responsiveness towards market
trends and needs.
WEAKNESSES
 Resource constraints.
 Lack of personal and technical skills
 Lower job security and market
standardisation.
 Less strategic thinking as well as
planning.
OPPORTUNITIES
 Supported by the government through
various subsidies and financial support.
 Brand expansion and diversification.
 Franchising and strategic alliances is
helpful in increasing sales revenue. Emerged with large business entities.
THREATS
 Environmental changes
 Rapidly increasing the number of
competitors.
 Political instability and strict laws.
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1.2 Comparative measures of performance
In order to get market expansions and advancement, it is essential for small business
entities to make a comparison between current and past years. This will be aids to management
as it can create effective business plans and policies. Furthermore, if business owners are capable
to analyse current and last year profits then will make effective business decisions that are laible
for providing benefits of competitive environment. In this context, entrepreneurs of Caffe Finix
can use variety of keys, such as- balance sheets, profit and loss statement and ratios etc.
Performance measurement of refereed business entity, is stated as under: -
For the year ended 30th April 2016 and 30th April 2017
Particulars Amount in £ (2016) Amount in £ (2017)
Sales 150000 200000
Cost of sales 90000 160000
Gross profit 60000 40000
Overheads 20000 15000
Net profit 40000 25000
Balance sheet as on 30th April 2016 and 30th April 2017.
Particulars Amount (2016) Amount (2017)
Fixed assets 70000 90000
Current assets
Stock 5000 10000
Debtors 15000 20000
Bank 3000 5000
Total assets 93000 125000
Current Liabilities
Creditors 40000 80000
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Bank overdraft 15000 25000
Long term debt 10000 15000
Deferred income tax 8000 5000
Total liabilities 93000 125000
With the proper analysation of balance sheet of Caffe Finix it has been summarise that
closing stock of firm was 93000 and 125000. It means that firm has gain more profit rather than
last years by making certain changes in its management policies. Apart from this, there are many
tools through which managers can measures the performance of staff members, such as – KPI,
management of objectives, finance governance, benchmarking, balance scorecard etc. These all
tools are adopted by the Caffe Finix so as to gain optimum level of production.
TASK 2
2.1 Justify the methods to overcome from weaknesses
Weaknesses plays a crucial role in small business entities they are responsible to decrease
its market growth and vitality. So that, it is very necessary task for managers to determine issues
or weaknesses that are being faced by them. Such barriers can also effect productivity and
performance level of SME's. It makes hindrance in organisational advancement. Above
mentioned some major weaknesses of Caffe Finix, i.e. low sources of income and resources
constraints etc. These falling components put an adverse effect on working activities. In this
regard, it has to use some adequate measures so as to overcome from all obstacles (Audretsch
and Link, 2012).
Hence, the firm can try quality assurance mechanisms that are concern with standard
quality of products which are offered by it. Along with this, business owners have to apply
certain strong procedure of production which can gives strength to their functions. The referred
SME's can use qualitative raw material for making delicious food items. It also need to provide
an impressive interior for attaining and retaining more people. Apart from this, the firm is facing
marketing issues therefore it needs to run small bays in order to get more customers. In addition,
SME's have to regulate diverse marketing campaigns that are helpful in promoting its products
and services. They must organise several workshops and seminars so as to interact with target
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customers and understand their needs and wants. This can extend brand equity of the firm and its
goods are recognised between more people.
Furthermore, managers have to provide training and development assistance to their
employees; through which they can manufacture new and innovative goods which gives
maximum customer satisfaction level. On the other hand, managers also have to devote their
communicate skills, then they can communicate with internal and external environment in an
effective manner (Bridge and O'Neill, 2012). Caffe Finix can recruit technical and well qualified
staff members who are able to gain high competitive advancement in short span of time.
Creation and execution of business strategy will be also accessible to get rid from all weaknesses
and challenges. Future management policies should be capable to achieve vision and mission of
the firm.
2.2 Examine the ways of maintaining existing performance
In order to enhancing or expanding itself in global environment, it is essential for small
business entities to maintain its current performance. There are many rivals which can affect
sales and profits of SME's in direct or indirect manner. In this regard, they have to use some
active management plans that are helpful to compete with external market forces. Below
mentioned some methods of remaining existing position of the firm in capital market: - Focused on marketing research – It is must for small business entities to emphasis more
and more on marketing research. Because it will aids them to keep in touch with
customers. By conducting a market research, managers of Caffe Finix can easily know
needs and wants of their potential customers. Hence, if a firm will be capable to
satisfying basic desires of its buyers, then it can easily extend its sales revenue (Burns,
2010). Free flow of communication – Effective communication will contribute in managing
healthy and positive relationship within a business organisation. On the other hand, it will
also assists employees as they can share new ideas and concepts in the context of
maximising financial financial value of the firm. If staff members will communicate with
each other then they can actively contribute in high production. Develop effective business strategies and plans – Entrepreneurs of such start ups have to
create as well as execute strong marketing and management strategies so as to retain
their current position in target market. An adequate business strategy will also provide
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several growth opportunities to business owners with which they can produce new and
innovative products in order to achieve vision and mission. Quality improvement – Producing value added and qualitative products, is one of the
important reason behind growth and vitality of a firm. It can help in getting higher level
of customers satisfaction. Buyers purchase only there where they will get more
qualitative and branded products (Burrows, 2015). Hence, it can be said that quality
improvement is also assistive in gaining higher competitive advantages.
 Find new customers – Every new business entity has to identify new customers for
increasing their sales. A firm's profits are only based upon if it has wide number of
consumers. Apart from this, Caffe Finix is required to manage friendly and positive
relations with their customers through the fulfilment of social responsibilities.
2.3 Recommendation for new areas of business expansion
Currently, the refereed coffee shop is situated in Stratford; but now its owners wants of
expand their business on further areas in order to gain more profits and sales. In this context,
they have to examine target as well as potential customers and recognise their expectations.
Afterwards, managers have to work upon those issues and challenges that will affect company's
productivity and market image in future (Williams and Schaefer, 2013). Below mentioned some
areas through which a small business entity can expand itself: - Strategic alliances – Strategic alliances can be refereed as an agreement in which two or
more firms are pursue to agree on achieving specific goals and objectives. Strategies
alliances can be done through in order to increase financial capabilities of a firm. It
allows two organisations as they worked for particular goals and objectives. The concept
of strategic alliance is adopted for short as well as long span time; it this each firm
maintains its autonomy while getting new opportunities (Chittithaworn and et. al., 2011). Location expenses – If an business want to explore itself at marketplace then it has to
open its branches on different places. Through which, more customers will get know
about the firm and its products. For example- Caffe Finix has to establish its other stores
in local streets of UK market so as to get the interest of potential customers. Franchising – It is also a very effective tools that can flourish a business organisation
into international level. In this, owners of SME's can privilege a license to another person
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so as to do business. Franchising is a form of business strategy with that manager of the
enterprise can distribute its products in different markets. It is also accessible in
extending brand name at global market in order to gain more competitive benefits.
 Organic growth – It is very common method through which small business entities can
expand themselves in target market. Organic growth is helpful in grow and diversify of a
firm in effective manner (Ebert and et. al., 2014). In today's economic environment,
where people are trying to giving value to their business entity, there is required
sustainable organic growth. Businesses have to measure their relationship with buyers,
due to rapidly changes in their perceptions. It also involves the recognisance of pricing
level, service level and further components that might be affected firm's economic
situation.
TASK 3
3.1 Assessment of business plan and objectives
It is compulsory for any commercial entity, to set certain goals and objectives. In order to
attain such aims in minimum time frame, managers have to develop meaningful management
strategies or policies on which all functions can be done. Formulation of effective business
strategy will contribute in successfully execution of working activities that are involved in
business plan. Foremost, the refereed company needs to prepare a strong business plan that gives
strength to all operation. A business plan is a written document which makes easier all tasks.
Additionally, if any company will not prepare such kind of planning then it might be suffered
from heavy losses. Below mentioned the business plan of Caffe Finix: -
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(Source: Business Plan, 2017)
 While making an business plan, it is essential for business owners to assess all of their
aims and objectives. It gives direction to working activities as they can complete in
proper way (Fassin, Van Rossem and Buelens, 2011).
 Afterwards, managers have to determine business opportunities. It involves, they need to
analyse market growth of the firm and its products. For example – is products have
enough capability to attain and retain customers. If not, then they requires some areas in
which a business could be expanded.
 In this stage, company have to manipulate a market research so as to know needs and
wants of potential buyers. Market research will be contribute in development of an
impressive future business strategy.
 At last, the plan should be regulated within organisation so as to manage all operations
for accomplishing business goals and objectives.
After creating a business plan, objectives should be set. Certain major aims and targets of Caffe
Finix is stated as under: -
 Become one of the finest coffee shop of local areas in UK in terms of quality.
 Increasing profits and sales by 20 – 30% by next year.
 Getting higher customer satisfaction
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Illustration 1: Business plan

 To identify the share of the company and implement measures in order to overcome from
weaknesses (Koellinger and Roy Thurik, 2012).
 To determine the impact of global recession on economic condition of the firm.
 To make some effective tools for spreading E-business
 To regulate cross border projects on internationalisation.
3.2 Revision of a business plan
It is compulsory for companies to make regular changes in their business plan for
smoothly running in competitive market. This could be done as per the need and demand of
situation. With the assistance of revision of business plan, decision makers can develop effective
management strategies that are emphasised upon new target market and customers. In this
context, it also can be suggested to managers as they have to tries to reduce their weaknesses and
come up new ideas in market. Revision helps in determining all hidden issues and barriers of the
firm which will diminish its market growth and vitality (Gunasekaran, Rai and Griffin, 2011).
There are given some key factors that are included in revision of a business: -
 Quality is major issue for refereed business. Thus, management need to hire well
qualified and skilled people who are capable to effective completion of working
activities.
 This revision also include pricing issues of the firm. The firm need to make changes in its
pricing strategy.
 Management need to keep proper data and past history of the firm, in order to take better
financial decisions.
All these keys are helpful in making an effective business plan. While revision of a
business plan, higher authorities needs to include certain SMART objectives.
 Specific – Higher authorities have to concentrate on various specific areas that are needed
to be improved. Quality of products must be treated as specific issue within Caffe Finix.
 Measurable – Completion of business activities in an adequate manner, entrepreneurs
have to regular focuses on measuring employees' performance. For this, company can try
diverse approaches from which workers are motivated to perform well.
 Attainable – Goals are made up in this way where they can easily achieved. In other
words, they should be based on any imagination or fantasy (Goss, 2015).
 Relevant – Business goals are related to achieve its vision and mission.
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 Time bound – Aims and objectives are made up short term period.
3.3 Develop an action plan
The core work of management is to develop or make strategies and policies so as to
complete all tasks in proper manner. For this purpose, entrepreneurs are formulated an action
plan for implementation of incorporate appropriate changes. In addition, if they found any
problem then they can take any action towards employees. While making a business plan,
managers have to conduct a market research and analysis environmental changes (Hilmersson,
2014). Afterwards, need to set priorities of all activities; it is helpful in easily achieving business
goals and objectives. Below mentioned some activities that must involves in an action plan: -
Aims Actions Priority Advantages Material
resources
Time
scale
Responsibility Monitoring
strategy
Higher
customers
satisfactio
n level
Regulate
market
research
Very
importa
nt
Increasing
the number
of customers
and sales or
profits of the
firm in a
certain time
framework.
Marketing
campaigns
and
advertisin
g
1
mont
h
Marketing and
customer
service
department.
Regular
examinatio
n of results.
CSR
activities
Fulfilment
of
corporate
social
responsibil
ity
Importa
nt
Helps in
increasing
market
image
among
society.
HR
departmen
t
2
mont
hs
Human
resource
manager
Taking
feedbacks
and
reviews.
10