Managing and Running a Small Business: Unit 29 Report on Qubic Hotel

This report provides a comprehensive analysis of managing and running a small business, focusing on the case study of Qubic Hotel. It delves into various aspects, including resource planning, customer relationship management (CRM) processes, and the importance of a good employer. The report explores the practical application of a monthly cash flow forecast, break-even analysis, and key financial statements to effectively manage business operations. It also examines key legislation and regulations impacting small and medium-sized enterprises (SMEs). The report emphasizes the significance of these factors in achieving business objectives, ensuring financial stability, and fostering sustainable growth within the competitive market landscape. The report provides valuable insights into the challenges and opportunities faced by small businesses in the hospitality sector.

UNIT 29 Managing and
Running a Small Business

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1. Consideration of small business and implement planning and allocating of resources . .1
P2. Process of customer relationship management in small business....................................3
P3 Explain and evaluate different processes of customer relationship management for small
business enterprise..................................................................................................................4
TASK 3............................................................................................................................................5
P4 Produce a monthly cash flow forecast showing fixed and variable cost set against income
of an organisation...................................................................................................................5
P5 Break-even analysis...........................................................................................................7
P6 Key financial statements and its implementation in the organisation...............................9
TASK 4..........................................................................................................................................11
P7 Key legislation and regulations that implement on small enterprise in successful way. 11
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................14

INTRODUCTION
Management and running of a small scale business is a big challenge that is faced by the
SME's and are handled with extensive care and skill. The entrepreneur or the management of the
business entity will look after the effective rise in capability to effectively handle the business
activities followed by the firm (Schaper and et.al., 2014). Other than this, various factors and
elements are been taken in consideration by an enterprise in order to generate a decent amount of
profit and handle the business operations and actions in a very effective manner.
For the report, Qubic Hotel is been selected. This is small sector business, which deals
and works in hospitality sector. The report will focus upon the various sort of considerations that
are been taken by cited business organisation to effectively manage and run its business
operations. Besides this, the effective customer relationship management is been taken in
consideration. Along with it, a monthly cash flow forecast is been presented by the firm to
analyse fixed and variable cost as compare to income of the firm. Other than this, the application
of break even analysis and interpretation of different financial statements for an organisation are
been analysed and how it contributes in successful management of the business (Crane and
Matten, 2016). Apart from this, the key legislation and regulations having an implication on a
SME are been taken in consideration.
TASK 1
P1. Consideration of small business and implement planning and allocating of resources
A wide range of factors are been develop to increase effective results in enterprise that
will help in good rise in effective handling of functions that support an effective management
and execution of business operations and activities (Westrenius and Barnes, 2015). The cited
hospitality enterprise will look after the effective handling of business operations. The factors
that includes in consideration by the business organisation are:
 Resource planning: this involves the management of operations and thus will help in the
effective utilization of the available resources and assets that are been possessed by the
business organisation. The effective assessment of the resources will help in good
execution of the business operations and thus will support a good growth and
development of the firm. The proper utilization and management of the resource
allocation which will help in production of high quality product and services for
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customer. Other than this, it will help in increase in knowledge and skills as per the
requirement in job specification (Steingold, 2017.).
 Being a good employer: the management of Qubic Hotel will see through the effective
assessment of the skills and knowledge in the organisation that assists to fulfilling the
purpose of the business organisation at different stages. The firm will look after the
development of a good business environment and organisational culture that will support
a effective increase in handling capacity of cited hospitality enterprise. Besides this, they
will also manage the HR policies and execute the recruitment and retention of employees
within the firm, improve their performance and facilitate a good team building at the
hospitality firm. This will help in development of effective organisational structure.
 Outsourcing, networks and external advisors: the firm will look after the better rise in
the capability and effective relations with the external advisors and people in networks
within the firm. Other than this, the outsources, which provide a good help to the
organisation for carrying out their business operations will be effectively considered by
the firm. They will provide the essential help to the organisation like legal support which
are relevant and effective for and SME or social enterprise like Qubic hotel. Other than
this, they help in promoting a better equality and diversity within a business entity
(Schaper and et.al., 2014).
 Business Plan: effective planning of business is very necessary for the organisation
which assists to increases effectiveness in organisation to manage its operations. It will
help in effective setting of visions, goals and objectives. Other than this, it helps in
assessment of available resources and assets that will help in good handling of business
activities by the firm. Other than this, it will help in risk reduction and gaining a
sustainability in market.
Other than this, different factors like stake holders, investors and distributors or support
staff is been taken in consideration by the organisation that will help in suitable management of
the organisation. Other than this, the customers needs and requirements, technical and legal
obligations, macro and micro environmental factors are been taken in consideration by the firm
that will supports good handling of business activities by the firm. These factors lay a direct or
indirect impact on the business activities followed by Qubic hotel (Hatten, 2015.). These factors
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or elements that are been taken in effective consideration by cited hospitality enterprise will
facilitate a good management of business operations and activities by the firm.
This will include the significant usage of capital and human resource which will help in
suitable planning of the operations which will help in achieving the set business objectives and
goals which is been set by business enterprise. Also developing a positive business plan and
other attributes that is necessary to fulfil the business objectives.
P2. Process of customer relationship management in small business
In the businesses, there are different activities and measurement has been taken in
consideration by the firm that helps in development of business operations and thus facilitates a
good handling of business activities that are been followed by the firm (Abad, 2017). A good
relationship with the buyers or customers of the cited organisation will help in suitable rise in
effectiveness of the firm that will facilitate a good management of hospitality organisation. On
the SME level, the firm will see through the effective management of business operations which
will support an effective rise in functionality and operational efficiency of cited business entity.
Some major processes that are been followed within the firm for building a good customer
relationship management is as follows:
 Building good customer relationship: this is the first step of the execution of business
activities that increases effectiveness in the business. To build a good relation with the
buyers or its consumers, the firm will follow the assessment of the different measures that
will help in improving the insight of the cited business entity about the needs and
requirements of their customers and develop innovative products and services to fulfil
their demands.
 Developing a good communication channel: the effective development of a good
communication channel will help in good rise in improving the interaction between the
cited hospitality firm and its buyers. The rise in communication will develop a good
bonding between the firm and its consumers and help in execution of business operations
related to Qbic hotel. Besides this, it will help in meeting targeted aims and objectives of
business enterprise (Goffee and Scase, 2015.).
 Giving the customers an effective platform: the firm has to see through the providing
of a good platform in respect to handle and operate activities in a very effective manner.
The organisation can use social media or telecommunication as the medium for the firm
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to communicate that will help in good rise in the compatibility and handling of business
operations which will support a good handling of activities and operations and thus will
lead to the rise in effectiveness of the business enterprise.
 Trans national sales: the firm will follow the option of carrying out of the sales that will
support a good rise in catering of international customers and thus will handle the
operation and business activities developed by the organisation in a very effective
manner. This will also improve the scope of the firm to handle the business operations in
a very effective way. Other than this, on the customer side, it will help in gaining good
access to products and services that possess high quality thus will support a good revenue
generation for the enterprise. The handling of the business functions like import or
export, or operating a new branch or franchise will that will posses certain challenges and
benefit factors for the organisation. This will contribute to the effective planning of the
customer relationship management process of a small or social enterprise performing
transnational business operations.
Other than this, it will help in meeting the needs and demands of the organisation that
will support a good rise in handling of business operations and thus will support a better increase
in productivity and profitability of the firm (Burns 2016). Rise in meeting of operations which
lead to effective increase in handling of needs and demands of the customers and thus facilitate a
good understanding between the business firm and its customer base. Other than this, it
facilitates a good rise in buyers and stake holders contentment level. This will support an
increase in the trust level of consumers towards the cited business entity or a social enterprise. It
also improves the trade relation of the organisation.
P3 Explain and evaluate different processes of customer relationship management for small
business enterprise
Customer relationship management consist more important role in small business
enterprise. This is because, in the hospitality businesses, it contains several operations and
functions that develop to gain more profitability and effectiveness in positive context. There are
different processes to determine customer relationship management that are as follows: Data collection: Data collection from internal and external database need to organised in
right way to easily access and analysis it as well.
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 Interaction with customers: Furthermore, interaction with customers undertaken to
collaborate with them in successful manner. Analysis each interaction: It gives insight about appropriate results that are undertaken
which is related with customer relationship management in small business enterprise.
 Improvement for next interaction: In this context, it will ensure that continuous
improvement of the business process develop in systematic way.
TASK 3
P4 Produce a monthly cash flow forecast showing fixed and variable cost set against income of
an organisation.
The effective assessment of the monthly cash flow forecast will help the organisation to
handle the business operations and manage the operations of and SME's or social enterprise in an
organisation. The monthly cash flow of an organisation is as follows:
In respect to interpret the above graph, it can be said that business operations and meeting
of the business operations will help in good rise in compatibility and thus support a good rise in
business operations that supports an effective assessment of financial resources available within
the firm and get access to various changes that are required to be made in order to handle the
conditions related to financial crisis for the firm (Newbert, 2015.).
The forecast will involve the assessment of both fixed and variable costs that are been
assessed and utilized by the firm. The fixed costs such as rent, equipments and maintenance etc
will help the SME to meet the operational requirements of the organisation in a very effective
way. The fixed cost or expenses are not related to the production and business functions directly
but are required to be managed in a very effective way in order to carry out the business
operations that will support a positive increase in efficiency of cited business firm. It does not
change and remain static. On the other hand, the variable costs is related with the businesses and
thus, get altered with the change in operational processes. The expenses related to labour,
machinery and transportation are covered within it.
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The effective assessment of these factors on monthly basis will help the organisation to
handle the business operations and achieving the targeted goals and operations in a very
effective way in order to generate a good amount of revenue.
Monthly cash flow statement
Month: Pre-
Start
1 2 3 4 5 6 7 8 9 10 11 12 Total
s
Receipts
finance 10,000 10,00
0
sale of fixed
assets
2,00
0 2,000
sales 3,000 6,000 8,00
0 8,000 8,000 8,00
0
8,00
0
8,00
0
8,00
0 800 8,00
0 15,000 15,0
00
103,8
00
others 0
0
Total
Receipts 13,000 6,000 8,00
0 8,000 8,000 8,00
0
10,0
00
8,00
0
8,00
0 800 8,00
0 15,000 15,0
00
115,8
00
Payments
0
direct cost 0
stock 2,000 2,00
0 3,000 3,500 3,50
0
3,50
0
3,50
0
3,50
0
3,50
0
8,00
0 8,000 8,00
0
52,00
0
direct
labour 1,500 1,50
0 1,500 1,500 1,50
0
1,50
0
1,50
0
1,50
0
1,50
0
1,50
0 3,000 3,00
0
21,00
0
fixed assets 2,000 1,50
0 3,500
employee
cost 1,000 1,00
0 1,000 1,000 1,00
0
1,00
0
1,00
0
1,00
0
1,00
0
1,00
0 2,000 2,00
0
14,00
0
national
insurance
(rent and
rates)
100 100 100 100 100 100 100 100 100 100 200 200 1,400
premises 300 300 300 300 300 300 300 300 300 300 300 300 3,600
power 150 150 150 150 150 150 150 150 150 150 150 150 1,800
telephone [phone] 100 100 100 100 100 100 100 1,200
insurance 250 250
postages
and carriage 50 50 50 50 50 50 50 50 50 50 50 50 600
interest and
bank
charges
50 0 50 50 50 200
stationary 100 20 20 20 20 20 20 20 20 20 20 20 320
equipment 1,500 1,500
motor
expenses 200 200 200 200 200 200 200 200 200 200 200 200 2,400
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accountancy
fees 100 100 100 100 100 100 100 100 100 100 100 100 1,200
legal/
proessional
fees
3,000 3,000
drawing 2,00
0 2,000
0
0
0
0
Total
Payments 0 12,35
0
5,52
0 6,570 7,020 8,52
0
7,07
0
7,02
0
7,02
0
7,07
0
11,5
20 14,120 16,1
70
109,9
70
Cashflow
Surplus/Defi
cit (-)
13,000 -6,350 2,48
0 1,430 980 -520 2,93
0 980 980
-
6,27
0
-
3,52
0
880
-
1,17
0
5,830
Opening
Cash
Balance
0 13,00
0
6,65
0 9,130 10,56
0
11,5
40
11,0
20
13,9
50
14,9
30
15,9
10
9,64
0 6,120 7,00
0
Closing
Cash
Balance
13,000 6,650 9,13
0
10,56
0
11,54
0
11,0
20
13,9
50
14,9
30
15,9
10
9,64
0
6,12
0 7,000 5,83
0
P5 Break-even analysis
The break even situation is the condition for a business entity especially for a SME or a
social enterprise. It is a situation when the company is in negligible or nor profit or loss. It is
been used by management accountants it helps the firm to carry out the effective planning of the
fixed costs(which are not considered that contain for volume of production) or the variable costs
(which changes with change in production output). It helps in the description of the various sort
of operations and thus facilitates and good rise in the compatibility of a business firm. It helps in
the identification of sales volume, sales value and production capacity of in the organisation
which increase targeted goals and objectives in positive way (Spence, 2016.). It is been depicted
in form of a graph between the cost implemented and the production or output gained. The point
on the graphical representation where no profit or loss occurs is known as break even point. At
this point, the sales and revenue are been static and don't have any rise or decrease.
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It basically consists of two major cost elements known as fixed and variable costs. Fixed
cost in the enterprise considered expenses that are directly related with production by business
firm. It means that even if the production is on high output, the fixed cost will remain static.
Although, it can be altered with the modification in business operations like investment in a
business activity. It helps in handling the more complex business operations and activities. Some
major examples of fixed cost is rent, depreciation, research and development, marketing and
administrative cost (Le Roy and Czakon, 2016.).
On the other hand, the variable cost may vary with directly with the level of production.
They are the payment related expenses that may change in price. For example, raw material,
direct labour, fuel and revenue related cost. The variable cost is basically direct or indirect in
nature. It involves the calculation of the total expense and the profit generated by carrying out of
production process effectively within the firm. The expenses like machine hour, maintenance and
labour cost along with the wages and purchasing of raw material that assists to increase
operations in enterprise that are more effective.
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Illustration 1: Break even analysis
Source: Introduction to Break-even Analysis, 2018

The break even analysis is very beneficial for a business entity, big or small, to manage
its business operations and activities that will help the business organisation to carry out the
operations and the activities that will support to develop creativity and operation capability also
increases and it is facilitates and good rise in effective handling of the business operations that
help in meeting of the targeted functions in systematic way to decision making and setting up of
cost of products and services that are been developed and offered by the business entity to its
customer's.
Some major ways it impacts a firm is as follows:
 Identifying the production volume: the identification of the limit of units that are to be
produced by the firm will lead to facilitate a good utilization of resources and gain a good
control of the enterprise over the production capacity. This will also help in prevention of
loss (Trevino and Nelson, 2016).
 Planing the target profit: the break even analysis will help the management to identify
the capability of organisation and thus will help in good rise in the capability of the
organisation. The good planning will al;so help the effective execution of the business
operations that are been taken by the firm and thus will support the achievement of the
targets easily.
 Setting up of price: the analysis will help the retail entity to identify the threshold limit
and it assists to handle production process and it develops positive results in the firm that
placer an effective pricing of its products and services, in order to generate higher volume
of revenue and profit (Villamizar and et.al., 2016).
 Scheduling of inventories: the break-even point also help in the effective planning and
scheduling of inventories that will help in good rise in the compatibility of the
organisation to carry out the operation's and business activities in order to gain a market
sustainability and generate a good amount of revenue. It also helps in restocking the cash
flow of the firm in the market.
P6 Key financial statements and its implementation in the organisation
Various sort of financial statements are been taken in consideration by a business
enterprise that supports a good rise in handling of business operations and thus will support an
effective rise in carrying out of wide range of business operations that will support a better
increase in management effectiveness of the firm. These statements will help in good handling of
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the wide range of business activities and thus will help in good rise in the compatibility and thus
facilitate a better growth and development of the firm (Pakroo, 2018. ). The effective assessment
of the financial statements will help in effective increase in the efficiency of the firm that will
help in good rise in compatibility and effective rise in functionality of the firm. Besides this, the
financial assessment of the ratios will help in effective assessment of the operations that supports
the effective rise in compatibility of a firm. The rise in the compatibility which will support a
good rise in effectiveness and handling of business operations that will support an effective
handling of wide range of business operations and thus facilitates a good rise in operational
compatibility of the business enterprise.
The assessment of the financial statements within a firm are as follows:
From the ratio this can be interpreted that the effective handling of the operation will
support an effective increase in the functionality. On the basis of the ratios that are been
provided, this can be said that the effective management of the financial resources within a firm
has increased to a greater extent. The Net profit margin of the firm has decreased by 0.02 %
while return on equity has decreased by 0.79% in two years. On the other hand, the liquidity
ratio of the organisation has also seen slight decrease of 0.01 %. However, the efficiency ratio of
the firm has improved as compared to previous years to 21.41%. These showcases the effective
rise in the compatibility and ability of the organisation to meet the needs and requirements in a
very effective manner. Besides this, the capital structure ratio has been nominal with gearing
ration seeing a decrease of 0.05 % and Dividend cover ratio having a rise of 2.33 percent which
showcases the financial performance of the organisation in the past economic year.
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