MM32220: SMALL BUSINESS MANAGEMENT AND ENTREPRENEURSHIP
BUSINESS MANAGEMENT代写 Staring a new business can be challenging for many people particularly those who are oblivious of the resources that are required…
Entrepreneurs can bring together the resources required to start a new venture. What are the most important roles and functions required in starting a business? BUSINESS MANAGEMENT代写
Staring a new business can be challenging for many people particularly those who are oblivious of the resources that are required to start a new business. On the other hand, there are people called entrepreneurs who successfully start a new business every year. They spend a significant time collecting the resources that are entailed to start a new business. They spend a considerate amount of time raising capital, conducting marketing research and eventually they come up with a realistic and rational business plan. They prepare meticulously which ameliorate their chances of success enormously. They begin with taking the account of the resources that are required which make them ready to meet the upcoming challenges. They begin with a business plan and make sure it is clear and accurate, not too restrictive and not too broad.
A good business plan must have three criteria it is simple, accurate, and useful. It begins with defining the goals, it then determines objectives to reach those goals, then resources are evaluated and crucial decisions are made, then they pay heed to feasibility and financial viability. The mission, vision, goals, objectives, strategies and tasks are all defined in the business plan. They consider five areas in their business plan which are industry, production or operations, marketing, personnel and financing. Absolute goals are then defined under each of these five areas for the business to be successful. Business plan is a comprehensive plan which is also a first role to play by an entrepreneur. Business plan has several components which can also be referred to as the functions of business plan. Following are the components of business plan.
- Mission statement
- Company background
- Product description
- Marketing plan
- Competitor analysis
- SWOT analysis
- Financial planning
All these functions of a business plan are important to start a new business. BUSINESS MANAGEMENT代写
The entrepreneur then forms a team of diverse skills and established areas of expertise. The team then work together by meeting regularly, organizing the activities, developing the idea and then carrying out research on the market and existing competitors. The team together brainstorm and utilize their communication skills effectively. They listen to everyone’s ideas. They consider the individual idea, make a list, rule out the irrational suggestions, create a shortlist and discuss it in detail and eventually they opt for the best option. The team of entrepreneurs makes sure that the notions they have chosen are credible, innovative, are supported by the evidence and analysis, are these ideas able to foster a brand and are the ideas plausible for their project.
The prospects they have to consider before starting a business are market potential, competitive advantage, required funding and other long-term prospects. The team of entrepreneurs evaluate the ideas and found the alternatives a Plan B, keeping a note of all the meetings. Then work is allocated equally. The management is carefully chosen to keep in view who they are what are their achievements? What are their aspirations and skills? The management then forms an organizational structure where responsibilities are allocated. In sales and marketing the size of the market, existing prospects, market share and barriers to entry are discussed. Before starting a new business target customers are identified and their loyalty and dependence are measured. The strengths and weaknesses of competitors are identified by the entrepreneurs.
They then form marketing strategies after considering the future developments and vulnerabilities.
The marketing strategies answer the basic questions of what and how? In marketing strategies, a team of entrepreneurs decides that how they are going to differentiate their product from their competitors. In marketing strategies, they demonstrate the market need, the knowledge of the market, competitors and customers. In production and operations process capacity is determined. An entrepreneur describes the process of making a product, its sensitivity and required capital. They also determine whether the resources are sufficient or not. While governing the production and operations the entrepreneurs ensure the adequacy and capacity of plant and machinery, and labor. Collecting the financial information is also a substantial role to perform before starting a new business by an entrepreneur. BUSINESS MANAGEMENT代写
While analyzing the financial information the entrepreneur analyzes the past results make assumptions, predicts profit and loss, analyze cash flow as well as a balance sheet. They conduct sensitive analysis, one of the most important functions of financial analysis. Some other key functions of financial analysis are break even, ratio analysis, calculations, and stating any economic assumptions.
Profit and loss are predicted by an entrepreneur by calculating the revenues, the material they are going to use in production, the wages of the employees, cost of distribution, overheads and director remunerations. Overheads include rent, rates electricity and other utility bills, maintenance, fixed overheads, interest payments, advertising and depreciation cost. Moreover, the balance sheet is formed by the entrepreneur and his team to record the daily accounts.
The balance sheet involves net current assets, net assets, share capital and retained loss and profit.
The problems entrepreneur might face while starting a new business are lack of profound strategies, financial assumptions, and specific management expertise. The following factors, roles and functions ensure the successful start of the new business such as highly experienced and efficient management, team highly pertinent and diversified skill set, a sustainable business model with a competitive edge, opportunities for business expansion, extraction of value through trade, flotation and sale and highlighted risks along with strategies to rule them out. The entrepreneur has to make sure if the business is attractive to the potential stakeholders including customers, investors and employees (New Business Development Project).
Managing finance is one of the most imperative functions performed by an entrepreneur and his team for the successful start of a small business. They have to ensure that they will have sufficient cash flow during the initial stage of the business to meet their fixed cost such as paying the utility bills and rent etc. They have to ensure that they will have sufficient profits to support their growth at the initial level. They have to ensure that they will be able to maintain a positive balance sheet. All these calculations and predictions help an entrepreneur to start a small business (Fuller-Love).
Entrepreneurial marketing strategies are often based on a low or non-existent budget. Identify some of the approaches to marketing in a new business and discuss why developing a brand may be important. BUSINESS MANAGEMENT代写
Marketing strategies of new small businesses are always innovation-oriented. They are based on bottom-up strategies. The marketing strategies encourage interactive marketing and information gathering through informal networking. Shaw and Collinson (2001) have characterized entrepreneurial marketing by quick response to market changes, ability to forecast the upcoming changes in the customer needs and informal market research. Informal market research is done by collecting useful information regarding the customer requirement regularly. This information is collected not only from their customers but also from their suppliers, competitors and professional business advisors.
Meanwhile, as businesses grow they encounter several marketing issues. As the new business expand the owner of the business start pursuing more formal strategies than informal strategies. During the initial development stages of the small businesses, they probably rely more on the small group of customers depending upon the type of business. Thus, relying on a small group of customers make them vulnerable as they are likely to face overwhelmingly detrimental effects if their small customer base is lots.
Thereby, the marketing approach for new businesses should avoid relying on a small customer base.
Stroke (2000) stated that entrepreneurs often over-rely on limited customers, they have limited marketing skills, they mostly depict unplanned and variable marketing efforts, they also rely on intuitive customer needs rather than conducting comprehensive marketing research, they do not target customers instead their customers are self-selected, moreover, they do not consider the aspects of the marketing mix. Entrepreneurs’ marketing strategy focuses on sales and promotion, developing the customer relationships, prices and destabilizing the competition which stirs financial issues. Entrepreneurs when starting a new business they rely on informal marketing techniques which is a low-budget technique such as mouth recommendation. They prefer to foster a new product or a service rather than finding new customers.
Some key marketing strategies of new businesses are BUSINESS MANAGEMENT代写
- Innovation oriented: The entrepreneur focuses on creating a new product and then finds a customer for it. For instance, Dyson. This approach is usually considered high cost due to lack of proper experience. The demand for such innovative products is also unpredictable. The competition for innovative products is always unknown. Product loyalty is also unpredictable in the case of innovative products in new businesses.
- Bottom-Up: entrepreneur develops limited customer base. For instance, any local restaurant or takeaway. In the bottom-up marketing approach, an entrepreneur relies on his gut feeling rather than formal market research. As the customer base is small so the customer focuses on meeting their needs. This strategy is always cost-effective as it is flexible in nature and entails fewer resources. As the entrepreneur keeps on satisfying the needs of his customers the chances of success increases for a business. This approach is difficult to sustain in the long term as it is reactive rather than proactive.
- Word of Mouth: They starkly rely on the recommendations by others. This marketing approach is effective enough to have a substantial influence on customer’s behavior. It is another low-cost approach that enables the entrepreneur to expand the business gradually. However, opting for this approach makes it difficult for an entrepreneur to curb the message. In this approach, entrepreneurs meet their customers individually and try to build a strong relationship. Those customers further spread the message through word of mouth to other customers. It involves personal recommendations.
- Niche market: They Identify a small market where large firms do not enter. Entrepreneurs use this approach to identify a loophole in the market and then create barriers to entry by fostering customer loyalty.
- Product Life Cycle: They relentlessly focus on developing new products and services despite the fact that their new products may have a limited market. This approach is based on the different stages in the product’s life. The first stage is an introductory stage, then comes to take off stage or growth, which is proceeded by maturity and slow down, then come product extension, in the end, there is product decline.
- Diversification: They perpetually focus on diversification by developing new products and services. They also believe in market diversification.
Developing a brand is important in a new business as a brand is an essential way to represents your business. BUSINESS MANAGEMENT代写
It posits the promise new businesses made to the customer. Brand helps an entrepreneur to create clarity and help them to stay focused perpetually. Moreover, while making an individual interaction with the customer, a brand helps an entrepreneur to connect with their customers emotionally. Developing is important to create business value. A brand is a business identity. For instance, Innocent smoothies developed a brand because the company realized that they are responsible to reflect innocence in their business. So, the brand builds credibility and identity in the market for new business. A brand is a business name that tells people who you are, what you do and how you do. Furthermore, in order to create a successful brand, new businesses have to maintain the quality which will allow them to justify their high prices initially. Brand makes it difficult for the competitors to copy the product. Brand makes the customer think about the product again and again. It stays in the customer’s mind for a while. Brand makes it easier for new businesses to launch more products or services (Strategy Marketing Agency, n.d.). Brand brings an advantage for an entrepreneur as he has to spend less time on promotion once the brand is established. This creating a brand is one of the most crucial marketing strategies. New businesses greatly rely on branding along with other marketing approaches discussed above. Branding could also be low cost depends upon the services an entrepreneur likes to avail. Brand is a way to communicate to their customers, it imparts the values of the business and builds a strong connection in the market with the customers (Fuller-Love, Marketing in a small business). Branding being an essential part of the business is beneficial in a long term. Branding as a marketing strategy is being widely used by new businesses across the world.
Fuller-Love, N. (n.d.). Managing the Finances.
Fuller-Love, N. (n.d.). Marketing in a small business.
Strategy Marketing Agency . (n.d.). WHY IS BRANDING IMPORTANT? Retrieved from https://strategynewmedia.com/why-is-branding-important/#:~:text=Your%20brand%20represents%20you%20and,brand%20provides%20your%20business%20value.