Managing and Running a Small Business Report: Oakman Inns Analysis

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This report provides a comprehensive analysis of managing and running a small business, using Oakman Inns & Restaurants Ltd. as a case study. It explores key considerations for business planning, including funding options like angel investment and venture capital, and the development of vision and mission statements. The report evaluates resource allocation, focusing on managing tangible and human capital. It also details customer relationship management (CRM) processes, discussing how CRM systems integrate customer data to improve business interactions. Furthermore, the report examines the benefits and drawbacks of business expansion, provides insights into break-even analysis, and interprets financial statements. Finally, it addresses the regulations and key legislation impacting small businesses, offering a complete overview of the challenges and opportunities in the sector.
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LO1
Main considerations of small business which they need to address while doing planning and for allocating the business resources
for achieving the
objectives

Business planning

This is the critical activity for the business operations of Oakman Inns & Resturants. The plan will help the company to achieve their business

objectives. The owner should identify what type of business they are doing (
Considerations when starting a small business, 2017). By identifying this
they are able think about the funding options available to them. The funding options for the company are as follows –

Angle Investment
– These are the individuals who show keen interest for making investment as they have surplus cash. These investors expect 30%
equity in return. They have capability to take high risk in order to expect higher returns.

Venture Capital
– These types of investors invest their money in small business only if they find that the company has huge potential ( Amir, Anggraeni
and Yani, 2020
). The Venture capitalist only invests in the business where they find an acquisition or IPO. They invest in the company in exchange of
equity. Thus, it is generally not suitable for small business.

Business Accelerators and Incubators
– The business can take help of these incubators & accelerators for assessing the funding, as this provides
funding to the startup business. They also provide financial assistance to the business and provide training and shelter tool to the business. Incubators

mainly assist the business and accelerators helps to run the business.

Once the funding options are being chosen then the company has to think about the vision and mission statement and has to define a business

purpose. Oakman Inns vision is to create the environment which is perfect for their customers and client to enjoy drink and food whilst through catching

up their family, friends and neighbors. Then the company has to think about Unique selling propositions. Oakman can provide food delivery to their

customers in just 20 min time. This
will assist the firm to achieve competitive advantage. Then the company has to think about effective marketing
strategy through which they can attract large number of customers towards their business. Oakman Inns and Restaurants can do social media

advertisement for increasing their customer’s base.

Allocation of resources

Resource allocation refer as a process of managing and assigning the assets in a way through which its supports the organizational goals. Resource

allocation includes managing tangible assets like cooking equipments in Oakman Inns & restaurants Ltd. The company is focusing on managing their

human capital. The company should allocate their resources by balancing their competitive priorities and needs. They should determine effective course

of actions for maximizing the effective use of resources and for gaining the best return on their investments (
Diaz-Briquets, 2019). The resources that are
limited in number if not allocate in proper manner than chances of completion of employees tasks in the company will get delayed. The company has to

INTRODUCTION

Managing a small business is ambition for some of
the people. The business idea could be anything from a
coffee shop to a vehicle repair workshop. The report is based
on Oakman Inns & restaurants Ltd. It is founded in the year
2007. The firm is specialist in restaurant, rooms, and bar,
wood fired pizzas oven, Josper oven and pub. The
headquarters of the company are situated in Tring,
Hertfordshire in UK. The report will discuss about the main
considerations which a small business needs for addressing
the allocation of the resources and planning for achieving the
organizational objectives.

Furthermore, report will evaluate various processes of
customer’s relationship management for the small or social
enterprise. Then, the study will determine how a small
business can develop transnationally and will also evaluate
its drawbacks and benefits. The report will produce monthly
cash flow for forecasting variable and fixed costs. It will
explain how break even analysis can be applied to company’s
situation. Moreover, it will interpret financial statements for
the organization in context of how they contribute in success
of organization. Lastly, it will discuss the regulations and key
legislation that have impact on small business.

Furthermore, report will evaluate various processes of customer’s
relationship management for the social or small enterprise. Then,
the study will determine how a small business can develop
transnational and will also evaluate its drawbacks and benefits. The
report will produce monthly cash flow for forecasting variable and
fixed costs. It will explain how break even analysis can be applied
to company’s situation. Moreover, it will interpret financial
statements for the organization in context of how they contribute in
success of organization. Lastly, it will discuss the regulations and
key legislation that have impact on small business.

UNIT 46: MANAGING AND RUNNING A SMALL BUSINESS
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identify what type of resources they need in their restaurants. They need to gather information related to resource availability.
LO2

Evaluate and
describe the various processes of customer relationship management for a small firm.
Customer Relationship Management (CRM) refers to methods and tools that aim to integrate all past and past business and customer communications

with the aim of improving customer relationships with that business (Trevino and Nelson, 2016). In other words, the purpose of CRM is to gather

enough information about the customer and use it sufficiently to increase good customer communication with Oakman Inns and restaurants, thereby

increasing the company's sales. CRM systems work collaboratively; data collection across all categories of customer marketing, sales, and service

relationships, provides a complete picture, allowing Oakman Inns owners and restaurant owners to make informed decisions.

CRM is a way to manage Oakman Inns interactions with the restaurant and reunite with existing potential customers. It uses data analysis on customer

and corporate history to improve business relationships with customers, especially focusing on customer retention and ultimately continuing sales

growth. One important feature of the CRM approach is a CRM system that integrates information from many different social networks, including

Oakman website, phone, email, live chat, advertising materials and more recently, social media. By using the CRM method and the systems used to run

it effectively, businesses learn more about their audiences and how to meet their needs.

CRM is a combination of Oakman Inns' practices, strategies and technologies used to leverage products to manage and analyze customer

communications and data in all customer areas, with the aim of improving customer service relationships and assisting customer retention and sales

continuity (Burns, 2016). CRM systems that integrate customer data across all different channels, or customer contact points, can include the Oakman

Inns website and restaurant by phone, live chat, direct email, promotional materials and social media. CRM systems can also provide customer-focused

staff with detailed customer information, purchase history, purchase preferences and concerns.

Explain how a small business can develop its business differently and write down its difficulties and benefits.

Benefits -

Attracting New Customers
- The first business benefit to Oakman Inns and Free is the ability to attract and retain new customers. If you add new
products to your portfolio or enter new markets, you can bring customer markets that have never been opened. Reaching these new clients with an

extension is one thing, but getting involved in building long-term relationships is important. Growing a loyal customer base is the best way to earn a

consistent profit and grow over time.

Economic Scale -
As you grow your business, you often spread the risk of doing business and reduce the power of one product or one bad decision that
hurt your business (Yan and Yan, 2016). Working in multiple markets or product areas allows companies to spread the cost of doing business in the

market or to multiple customers. This reduces the cost of doing business with each customer, which enhances the ability to make a profit by adding new

customers. It also offers economic benefits equal to Oakman Inns and Resort.

Problems -

Huge Financial Needs -
What’s confusing about business growth is that when a company like Oakman Inns and Turkey invests and other resources to
grow the business, it has less money available on other business items (S Storey, 2016). This makes it very important to think about market growth

opportunities before making money. Think of the potential return on investment from each product or market you may be developing before investing in

it as you go. Extensions often mean debt consideration. Your credit obligations can be controlled as long as the sale is consistent and cash flow is timely.

Limited Extensions -
Another risk to business growth is that you can distribute resources with your very sensible company. Often, Oakman Inns leaders
and restaurants think they should expand if things go well. However, involvement in multiple markets or products can cause a company to increase its

capacity to the point that it is not working well anywhere. Business expansion makes sense only if your company has enough people and resources to

cover this new relevant space (Soundararajan, Spence and Rees, 2018). Business owners and senior executives can feel the effects of a growing business.
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Interpretation of key financial statements for the firm in relation to how each of them contributes for successful management in the company
Financial statements are described as follows -

Balance sheet
- It helps to indicate the financial position of the company. It provides information related to company's assets, shareholders equity and
liabilities. In this the assets must be equal to liabilities and equity. This is helpful for running successfully management in Oakman Inns and Restaurants

LO3

Present the annual income statement, showing the fixed and variable costs set aside for the organization's finances.

STEP 1: Estimate how much you will spend over time.

Look at your sales over the last two to three years and use it as a basis for your calculation. Keep in mind that not all advertising methods will fit you so it is important to think about
things that could affect your income over a period of time (Burn and Dewhurst, 2016). Next, they estimate the amount of money you expect to receive in a given time. Be sure to
check out new product launches, new market entry plans, or develop customer strategies.

STEP 2: Know the compensation you will receive

This is important for illegal reporting because it informs you that you will have enough money per week or month to cover your expenses. Remember unlike a retail business where
you do not get your money's worth on time. It is therefore important to pay close attention to your payment terms so that you can accurately predict your earnings and put them
against your exit.

STEP 3: Predict how much you will spend soon

The next column on your income status should include all of your expenses (Ghasia, Mamukoya and Otike, 2017). This category needs clarification as we will determine if you will
have shortages in the coming months. Do your best to calculate the cost and make a list of your daily expenses.

STEP 4: Put all the details together

Now that you have calculated your income and expenses, it is time to put the numbers together and build your own cash flow. To get started, write down your bank balance. Enter all
your deposits and delete all transactional transactions for the period you want to specify. The final amount is what you are expected to have in the bank at the end of the term.

Explain how breaks- even analysis could be applied to an organizational
situation.

Break-even analysis is a type of financial tool which can help the Oakman Inns
and Restaurants for determining in which stage the company’s products and
services will give maximum profits. This refers as financial calculation which
is helpful to determine the number of service or product which an enterprise
should sale in order to cover its expenses such as fixed costs. It covers the
following costs -

Fixed costs - It is known as overhead costs. It doesn’t change by the sales
which are made by the company (Psychogios and Prouska, 2019). It includes
insurance, rent, utilities, bills, wages and salaries.

Variable costs – This costs is based on the sales that are done by the company.
It includes additional labour from contractors and payment processing fees.

Average price – It is the average amount that is charged for the products and
services of the company.

Assumptions
of the Breakeven point analysis -
Average price per sale
- This is the price you get for per unit of sales.
Provide sales discounts and special offers. Get this number for your sales

status. For Oakman Inns and restaurants, it generates revenue per unit for

one dollar and includes your cost as a percentage of the dollar. The most

common questions about this inclusion are related to measuring many

different products on the same scale. Analysis requires one number, and if

you build your sales figure first, then you will have this number.

Average cost per unit
- This is the rising cost, or separate cost, of each
sale list for Oakman Inns and restaurants. When you buy things by

reselling, this is what you pay, on average, for the goods you sell. When

you sell a service, this is what you charge, for every dollar of money or

units of service delivered, to deliver that service. If you use a sales status

table designed for units to build and mixed business types, you can quote

unit costs in the sales status table.

Monthly set expenditure
- To some extent, the leave rate means a set
cost as a continuous expense even if you break it. Instead, we recommend

that you use your scheduled expenses, including payment and general

expenses.
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Ltd. Assets are the things which company owns and describes the company's value. Assets includes physical property of a business includes plants,
inventories and equipments. This also includes intangible things which are the patents and trademarks. Liabilities refer as an amount of the money which

the business owes from others. It includes the borrowed money from the bank or creditors and use of building on rent etc (
Cole, 2018). Shareholders
equity is net worth of the company. This money belongs to shareholders and owners of the company.

Cash flow statement
- This statement is made for concluding total inflows and outflows of the cash. Cash flow report provides clarity whether the
business have generated cash or not. This statement portrays how the firm spends its cash. The cash flow statement is divided in three activities that are

investing, financial and operating
activities. Cash flow statement is important because it informs the business cash flow position (Cash flow importance,
2019). For running the successful business Oakman Inns and Restaurants Ltd should have sufficient amount of cash available for running their business

smoothly. The business needs cash for paying their day to day expenses, purchasing new equipments or for paying the bank loan.

Income statement
- It provides information on company’s revenues and expenses. It provides detail about operating activities of the firm. It tells about
direct, indirect
and capital expenses of the firm which it incurred. It indicates the revenue which the company has earned. It includes the costs of Oakman
Inns that is salaries, research and development and administrative expenses. The indirect expenses are subtracted from the gross profits of the company

for identifying the operating income.
LO4
Regulations and legislations that has implications on small business
Small business has to obey the legal regulatory requirements. This includes to do record keeping, health and safety, tax and employment, insurance and
to take data protection measures. The various laws which are followed by Oakman Inns and Restaurants Ltd are as follows -
Health and Safety Law - This law is enforced on 1974. This act set general obligations for the employers towards their employees (Steingold and
Steingold, 2019). This obliged firm to take necessary steps related to the employees safety. Oakman Inns and Restaurants have to take safety measures
for the chefs, workers and employees who are working in their restaurants, pubs and bars. They have to ensure safe working environment in their
restaurants and dining lounges. Safety related measures should be ensured which are first aid box, fire extinguisher etc.
Employment Rights Act - The employment law is enforced on 1996. This law states that Employer should clarify the main terms of the employee
contract in writing and should provided this to employee within the two months from the starting of their employment. The small business has to
ensure that employees should know their terms and conditions of the contract (Turner and Endres, 2017). This act also protects the employees from
unfair dismissal.
Equality Act 2010 - This act is make for providing the legal framework to protects the right of the individuals. This act ensures that everyone should
provide equal opportunity. This law ensures that nobody will be getting discriminated on based of their religion, age, race, culture or belief. This act
helps to protect employees or individuals from the harassment at the workplace. Thus, Oakman Inns and Restaurants Ltd has to ensure that no one get
discriminated in their company.
CONCLUSION
It has been summarized from the above study that the owners of small business should focus on managing the effective resources for achieving
the business objectives. It has been evaluated that small business needs to consider about their business planning and allocation of the resources. It has
been determined that Oakman Inns & Restaurants have various funding options available through which there business can grow. Customer
relationship management is important for small business to retain their customers and for increasing their customer’s base. It has been concluded that
financial statements are necessary to be prepare by the firms to run their business smoothly. Financial statement contributes successful management in
the company. It has been summarized that there are various legislations and regulations which impacts the small business working.

LO4

Regulations and legislations that has implications on small business

Small business has to obey the legal regulatory requirements. This includes to do record keeping, health and safety, tax and employment, insurance and
to take data protection measures. The various laws which are followed by Oakman Inns and Restaurants Ltd are as follows -

Health and Safety Law - This law is enforced on 1974. This act set general obligations for the employers towards their employees (Steingold and
Steingold, 2019). This obliged firm to take necessary steps related to the employees safety. Oakman Inns and Restaurants have to take safety measures
for the chefs, workers and employees who are working in their restaurants, pubs and bars. They have to ensure safe working environment in their
restaurants and dining lounges. Safety related measures should be ensured which are first aid box, fire extinguisher etc.

Employment Rights Act - The employment law is enforced on 1996. This law states that Employer should clarify the main terms of the employee
contract in writing and should provided this to employee within the two months from the starting of their employment. The small business has to
ensure that employees should know their terms and conditions of the contract (Turner and Endres, 2017). This act also protects the employees from
unfair dismissal.

Equality Act 2010 - This act is make for providing the legal framework to protects the right of the individuals. This act ensures that everyone should
provide equal opportunity. This law ensures that nobody will be getting discriminated on based of their religion, age, race, culture or belief. This act
helps to protect employees or individuals from the harassment at the workplace. Thus, Oakman Inns and Restaurants Ltd has to ensure that no one get
discriminated in their company.

CONCLUSION

It has been summarized from the above study that the owners of small business should focus on managing the effective resources for achieving
the business objectives. It has been evaluated that small business needs to consider about their business planning and allocation of the resources. It has
been determined that Oakman Inns & Restaurants have various funding options available through which there business can grow. Customer
relationship management is important for small business to retain their customers and for increasing their customer’s base. It has been concluded that
financial statements are necessary to be prepare by the firms to run their business smoothly. Financial statement contributes successful management in
the company. It has been summarized that there are various legislations and regulations which impacts the small business working.
REFERENCES
REFERENCES
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