A Report on Starting a Small Business: Strategies and Analysis

This report provides a comprehensive analysis of starting a small business, covering essential elements such as defining aims and objectives, developing a time scale, and understanding the background of the topic. It includes a background search, detailing the importance of market research, business plan development, and funding sources. The report also explores marketing strategies, including competitive advantage, market segmentation, and market existence. Furthermore, it examines the impact of small businesses on businesses, employees, the environment, and society, while also addressing constraints such as finance, location, government approvals, and local resistance. The report concludes with a summary of key findings and recommendations for successfully starting and managing a small business.

How to Start a Small Business
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Table of contents
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
4. Aim..........................................................................................................................................3
5. Objectives................................................................................................................................3
6. How the objectives will be achieved.......................................................................................3
7. Time scale................................................................................................................................4
8. Brief background of the problem/topic....................................................................................5
9. Background Search..................................................................................................................5
10. Marketing strategy or market entry strategy..........................................................................6
11. Impact analysis......................................................................................................................7
12. Constraints.............................................................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................12
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INTRODUCTION
Small business is business which functions on small level and involves less capital, less
machinery and less labour (Julien, 2018).
The report will analyse aim and objectives to achieve them effectively and efficiently and
how objectives will be achieved will also be denoted. Time scale will be framed in a proper
manner. Brief background of problem will also be described along with examples which will
help in making report more clear and precise on significant terms. Literature review will be done
which will explain in detail by comparing other available information. Marketing strategy will be
described which will constitute market segmentation, market existence and competitive
advantage factors on scale. Impact analysis will be also done which will help in analyzing impact
of small business on employees, business, environment, society. Various constraints will be
determined and explained which were – arranging of finance, finding a location, government
approval, resistance from local business, resistance from local people.
MAIN BODY
4. Aim
Aim of this project is to develop strong understanding of how to start a small business and
different elements associated with small business.
5. Objectives
 To find and understand information about small business
 To gather information about how to start a small business
 To understand marketing and market entry strategies of small business
 To identify and understand impact of different factors on the business
6. How the objectives will be achieved
Objectives of this project will be achieved through identifying resources that are valid
and reliable and collecting information through these sources. It is important to gain information
from valid and reliable sources for reaching to appropriate and right conclusion (Aguinis and
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et.al., 2020). Once information have been collected from different sources, information will be
analyzed and evaluated for developing understanding about small business and how to start small
business. For this process of starting business will also be considered so that individual can
develop understanding of how to start small business. Later information about marketing and
market entry strategies will also be evaluated to gain understanding of practical implementation
and application of knowledge and understanding gained from the project. In order to achieve
objectives an important element is considering objectives in every step and considering time
limit associated with the objectives. For the purpose of achieving goals in a given time a
timeframe is very important. Time scale will be developed for this project and different activities
of this project and this will enable to achieve objectives of this project (Nwodo, Ozor and
Okekpa, 2017). Completion of different activities within given time will also help in
achievement of objectives efficiently.
7. Time scale
Description of Work Start and End Date
Task 1 Determination of project topic based on interest and
relevant search about topic. For this some initial
online research will be done and importance will also
be considered.
5/7/2021 - 10/7/2021
Task 2 Developing aim and objectives for the project. This
will be done to ensure that work in project is in line
with aim and objectives of project.
11/7/2021 – 13/7/2021
Task 3 Reviewing literature 14/7/2021 – 19/7/2021
Task 4 Completing research about different areas covered in
topic.
20/7/2021 – 23/7/2021
Task 5 Writing report on the basis of data gathered 23/7/2021 – 26/7/2021
Task 6 Creating final report 27/7/2021 – 27/7/2021
8. Brief background of the problem/topic
Small business can be defined as any privately owned business, partnership business that
is started through small investment in business capital and business also starts with limited
number of people involved in and associated with business. Countries also have definition for
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small businesses in their country. Starting a small business involves developing ideas for
business and establishing business. There are different requirements for that including
developing business plan and funding of business (Julien, 2018). This project will enable to
understand and get answer of question that is how to start a small business.
9. Background Search
According to Pakroo, (2018) Starting a small business is a complete process that involves
conducting market research and this is first phase and step of starting business. Businesses are
developed so that they can cater requirements of certain segment of customers and along with
interest and preference of one starting business also is considered. For example- individual
interested in starting cafe business will undertake market search for what kind of products are in
demand and what requirements can they cater. Market research also enables to know about
competitive advantage for the business. Market research involves analysing impact of different
environmental factors on business and impact that business is likely to have on environment.
Environmental factors involve external macro environment and micro environment. Competitor
analysis is also a part of market research.
Market research leads to writing a business plan, it is foundation of the business.
Business plan involves structure of business, how it is run and how business will be grown.
Business plan is very important basis through which individual can convince others to invest in
their business and work in a business. For example- writing business plan for cafe will involve
writing offerings, competitive advantage, how customers will be attracted, how business will
source required material. Business canvas model is also a way through which business plan can
be prepared and presented. As stated by Šebestová, (2020) a business plan based on market and
environmental research and analysis is effective because it is based on consideration of different
factors on business and its success.
Funding of business is another next big step in starting a small business. Funding
involves getting fund through which business can be started and its operations can be carried out.
Funding also fulfils capital requirement for the firm and there are different sources for funding
that business can consider. Funding for small business is done through bank load, personal
investment of owner, venture capitalists, government grants and funding and business incubators.
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Selecting location for business is another important decisions and question associated
with how to start a small business. Selection of location is not required for every type of
business. However, a business of café requires selecting location. Location needs to selected in a
way that provides easy access to target market and customers.
Selecting business structure is also included while starting a new business. This involves
selecting legal structure which influences business in terms of its registration, taxation and
personal liability of owner. Business structure should be with least risk for business.
Getting permissions is also important part of starting a business because this enables
owner to legally operate business that they are starting (Binsardi and et.al., 2020). Permission
need to be obtained from appropriate public authorities.
Starting of small business also requires considering additional elements and this involves
carrying out different business activities and functions. These functions involve marketing, HR
processes, management and other functions of business. Small businesses have limited scope and
investment and this is why it is very important that these activities are carried out in most
efficient way that generates high revenue on limited investment.
10. Marketing strategy or market entry strategy
Marketing strategy is defined as the business plan which helps in reaching the target
customers so that the products and services which the company or organization is referring is
taken into consideration of how the growth and development is scaled in effectiveness and
efficiency (Morgan and et.al., 2019). Marketing strategy contains value proposition of the
company, messaging of the brand, targeting customers. The detailed other elements for framing
the marketing strategy is described below –
Competitive Advantage – Competitive advantage is defined as factors which allow the
company to produce the services and products in better and reasonable manner. These factors of
company allow superior margins and more sales when they are compared to the market rivals.
Competitive advantage is the sustainable way of achieving the customers’ intentions and
fulfilling their needs and requirements by analyzing market structure (Papadas and et.al., 2019).
This also concludes that great value is offered to the customers so that benefits are provided to
them on higher scale of interest. Competitive advantage helps the company in making ways
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through which business can achieve scope and initiate the aspects of growth and development on
large scale.
Market Segmentation – Market segmentation strategy is organized on the scale of how
customers and business base is being combined for the scale of the products and services to be
placed. Market segmentation includes geographic, behavioural, and demographic factors on
which the market analysis is done for promoting and selling the products on large scale
(Camilleri, 2018). Market segmentation in organizational strategy is taken as the target
customers audience into groups and audience. Market segmentation helps the organization is
taking concerns of what are the tactics to be framed so that the company is able to make and
initiate progressive scale of producing the product and then selling into different regions through
segmentation.
Market Existence – Market existence is the main thing which helps the company to promote
and brand their products on large scale. Market existence for the company becomes important
which helps it in producing and taking concern of how and in what manner the products and
services are to be placed in an appropriate manner possible (Kanagal, 2017). For products and
services to be placed market existence creates ways in which customers can reach the product
and the services of the company in an effective and efficient way possible. Thus, market
existence helps the company or the organization in analyzing what are marketing trends which
are revolving in the market effectively and efficiently.
11. Impact analysis
Small business impacts the business, employees, environment and the society on large
scale. This is analyzed through the business in which the company is operating upon and
providing the services and products to the customers (Kalogiannidis, 2020). This helps the
company in initiating the ways through which the impact of small business can be described on
the business, employees, environment and the society and it influences them which is explained
as –
Impact on Business – Small business impact the other businesses in various ways as through the
systems and patterns which are being considered important for them and for the business. There
are different other perspectives in the small businesses which are to be considered by keeping in
mind the very essential and important aspects in which the company is making the business on
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such large scale and is planning to expand. The products and services in the small business
hampers the very existence of the company and on that basis the company’s work is being
analyzed which helps in comparing and creating the value of the product and services in the
market (Bartik and et.al., 2020). There are factors which impact the small business like this
pandemic or COVID – 19 crises which has made difficult the business and up scaling of it so that
the small businesses seek growth on large scale and expand in market. Thus, impact of small
business on the other business and itself is analyzed on how it creates its market presence
effectively and efficiently in a significant manner possible in these tough times.
Impact on Employees – Impact of small business on employees defines that how the employees
are being treated in the company and are they actually contributing to the company or the
organization for its betterment and growth along with its development in different stages of
running the business and to expand it on large scale. This also helps in analysing the basis of
how employees work in the company and whether they perform effectively and efficiently
indulging in the small business (Sundram and et.al., 2020). Small businesses impact the
employees as how they perform and the los scalability hampers their performance which makes
them more involved in the process of how effectively and efficiently they can contribute to the
company. There are various reasons which on how the small businesses impact the employees
which is based on the financial terms of how the company is contributing towards how and in
what ways the employees’ performance are being evaluated on that scale. small business have
the risk of having less than 10 employees which directly puts stoppage to how effectively and
efficiently the business is being taken into consideration.
Impact on Environment – Small business impact the environment which makes it more
difficult to contribute for the benefits of environment. There is more energy consumption in
small businesses which hampers and disturbs the environment. Along with this, the global
pollution also adds to the little trouble to the environment in case of small scale (Nigh, 2017).
There is lot more wastage of energy and water which harms the environment as small businesses
utilizes most of the sources which are required in less quantity but wastage of it disturbs the
business and through this the main aim and the objectives of how to save the environment are
lost in the due course. Environment is impacted on large scale in small businesses which makes
the survival of the business in the market as it harms on exponential basis. There is lot more
wastage of how the small business considers the wastage to not be on scale of creating more
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difficulties which hampers and disturbs their business on large scale. The growth aspects due to
the environmental changes which are seen negative create difficulties in an insignificant manner.
Impact on Society – Small business impacts the society in various forms which includes the
local community where the business is set up. Therefore, small businesses not just impact the
society but also influence the local community so that the business is improved on large scale
and there are individuals who help the business in its promotion at every progressive level. Small
businesses have big impact on the society which depends on the products and services which the
business provides the customers within and the members of the society. The local and national
level impact is there of small businesses which disturbs the cycle of how the things are taken and
proceeded further for how the business is taking initiatives and creating process in which the
local community is taken care of on large scale and society views and perceptions are being
considered for creating progressive and valuable products so that they are able to reach society
and this is how the small business impact the society and its systems along with formation of
different rules and regulations which are being framed effectively.
12. Constraints
There are various barriers or restrictions which are there in the formation of small
business and these consist of the factors like –
Arranging of Finance – While initiating small business the first and foremost thing which is
considered is the arrangement of finance which is the barrier for business to start. There should
be enough finance so that business is able to grow and develop on scale of how finance is
managed (Caviggioli and et.al., 2019). Finance is a factor which is considered as important for
fact that all aspects of small business start from knowing how and in what manner business will
scale up.
Finding a Location – This is very important step which is the major barrier in the small
business. Finding a location is very difficult and hard step which has to be considered important.
While setting up a small business, location is the factor which has to be analyzed and evaluated
so that the reach of the customers is easy for selling the products and services and the place
where the business is being set up is not much costly which concerns the area majorly. Location
is the barrier which enrols in setting up the business in an effective and productive manner.
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Government Approval – Government approval is the third major step in the process of starting
the small business which can be the major constraint or barrier in setting up the business.
Government approval is very necessary as some legal terms and regulations are to be followed
while setting up a small business (Hyun, 2021). While starting the small business, it is to be
ensured that all the legal rules and regulations are properly followed and is approved by
government through paperwork and some legal formalities in a proper and significant manner.
Thus, small business also has this constraint of filing up the formalities.
Resistance from Local Business – Resistance from local business also hampers the small
businesses which are being created and this is the main reason why this has created barrier or
constraint. In this perspective or aspect, the local business restraints how the small businesses
work and through this the efficiency and productivity is hampered. Local business and small
businesses have very less margin and they are then compared to the scale on which they are
working. This is the main thing which is seen as how the businesses impact and affect the small
business through the local business on insignificant terms.
Resistance from Local People – Local people also hamper small businesses and this becomes
the major constraint for them as the competition comes at very near stage. The main problem
arises as there is very less scale of margin between products and services and the local people are
buying them on diversity (Lee, 2018). Local people are restrained and have barriers which create
small business to influence them on such large scale. This is main thing which is being hampered
for people as they are restricted in not buying and promoting the products and services of the
small business which is being formed.
CONCLUSION
Thus it is concluded from the above report that aim and objectives were framed to achieve
them effectively and efficiently and how the objectives were achieved was also denoted. Time
scale was being framed in a proper manner. Brief background of the problem was also described
along with the examples which helped in making the report more clear and precise on significant
terms. Literature review was also done which was explained in detail by comparing other
available information. Marketing strategy was being described which constituted market
segmentation, market existence and competitive advantage factors on scale. Impact analysis was
also done which helped in analyzing the impact of small business on employees, business,
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environment, society. Various constraints were also determined and explained which were –
arranging of finance, finding a location, government approval, resistance from local business,
resistance from local people. Therefore, all these aspects and factors were mentioned on
description basis.
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REFERENCES
Books and journals
Julien, P.A. ed., 2018. The state of the art in small business and entrepreneurship. Routledge.
Aguinis, H and et.al., 2020. “An A is an A”: The new bottom line for valuing academic
research. Academy of Management Perspectives. 34(1). pp.135-154.
Nwodo, O.S., Ozor, J.O. and Okekpa, U.E., 2017. Savings Behavior among Small Scale
Business Owners in Nigeria (A Case Study of Enugu Metropolis). International Journal
of Academic Research in Business and Social Sciences. 7(10). pp.2222-6990.
Julien, P.A. ed., 2018. The state of the art in small business and entrepreneurship. Routledge.
Pakroo, P., 2018. The small business start-up kit for California. Nolo.
Šebestová, J. ed., 2020. Developing Entrepreneurial Competencies for Start-ups and Small
Business. IGI Global.
Binsardi, B and et.al., 2020. Managerial Skills and Small Business Start-ups in the Rural Food
Sector’.
Morgan, N.A. and et.al., 2019. Research in marketing strategy. Journal of the Academy of
Marketing Science.47(1).pp.4-29.
Papadas, K.K. and et.al., 2019. The interplay of strategic and internal green marketing
orientation on competitive advantage. Journal of Business Research.104.pp.632-643.
Camilleri, M.A., 2018. Market segmentation, targeting and positioning. In Travel marketing,
tourism economics and the airline product (pp. 69-83). Springer, Cham.
Kanagal, N.B., 2017. Development of market orientation for marketing strategy
formulation. International Journal of Marketing Studies.9(4).pp.54-66.
Kalogiannidis, S., 2020. Covid Impact on Small Business. International Journal of Social
Science and Economics Invention.6(12).pp.387-391.
Bartik, A.W. and et.al., 2020. The impact of COVID-19 on small business outcomes and
expectations. Proceedings of the National Academy of Sciences.117(30).pp.17656-
17666.
Sundram, S. and et.al., 2020. The Impact of Knowledge Management on The Performance of
Employees: The Case of Small Medium Enterprises. Productivity
Management.25.pp.554-567.
Nigh, S., 2017. The managerial impact on small business global supply chain.
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Caviggioli, F. and et.al., 2019. A bibliometric analysis of the research dealing with the impact of
additive manufacturing on industry, business and society. International journal of
production economics.208.pp.254-268.
Hyun, H.D., 2021. A Model of Financial Constraint on Investment. Available at SSRN 3825989.
Lee, Y.S., 2018. Government guaranteed small business loans and regional growth. Journal of
Business Venturing.33(1).pp.70-83.
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