For an individual, it is required to manage all the resources appropriately at the time of running a small business. The scenario of this report is based on an exact statement of managing all the required activities in order to successfully running a small business with the help of strategic planning practices.
• Determine a planning process for the resources allocation for Rowlinson Knitwear in order to attain its target objectives.
• Critically analyze benefits as well as challenges of conducting transnational operation and state requirement of implementing customer relationship management procedure in Rowlinson Knitwear.
• Discuss and interpret some financial statement as Budget, break-even analysis and cash flow forecast.
• Explain requirement of an implementing legislation and regulation within a small firm.
Small business enterprises are considered as those businesses that are run or regulated by a single owner and they have a small share at market areas (Bridge and O'Neill, 2012). With the help of company’s turnover and employees who are working one can make out the classification of such kind of enterprise. Company that is taken in this assignment is Rowlinson Knitwear, it is small business enterprise that works and offers both cooperate and school wear and this is a U.K. based company. The report will throw light on consideration that will be required for planning and allocation of resources for small enterprise so that they can attain their goals and objectives. Apart from this, various processes for evaluating customer relations are mentioned in this assignment. Further, an annual itemized monthly cash flow for evaluating and forecast fixed and variable cost is included in this. Along with this, break-even price that can be applied according to various companies are mentioned in this report. Lastly, key legislations that can have implications on small business enterprise are detailed in this.
P1 Main considerations of small business while planning to achieve business objectives
Although organization that come under this are small but they play an important role in the development of any country’s economy. They help by providing new job opportunities to people of the country along with this they perform their task according to the needs and wants of customers. Small business majorly works at small level but there are some factors that can affect the performance in negative and a positive manner. Therefore, it is important that company knows all the factors and process through which they can attain their goals and objectives. As the organization, Rowlinson Knitwear works at small level so they find it difficult to deliver or offer clothes directly to customers and the reason behind this is inadequate resources available to them. Therefore, to perform this activity in an effective manner it is important that company have a proper relation with its distributors and suppliers. This will help them in distributing their products to different areas as well (Brown, 2013). Henceforth, for increasing its sales and profitability it is important that they manufacture goods that are best in quality as well as at low price. For this, there are some of the factors that company must consider while doing any future actions. Further these are explained below in order to understand it in a better manner:
Financial resources: Adequate amount of funds are very important and it must be considered first if an organization wants to manufacture or formulate any kind of strategies. Therefore, if a company has ample amount of cash than it enable them in execute the business operations in an effective manner and as a result the outcomes will be better. Whereas if the firm doesn’t have sufficient amount than they will find difficulty in doing any kind of activity such as promotion regarding their company, making appropriate strategies and many more. In context with, Rowlinson Knitwear they are considering all the factors that is necessary for analyzing financial report like cash flow statement, balance sheet etc., thus, it will provide managers an overview whether the organization is capable of taking or starting any kind of new activity. Henceforth, through this, they can formulate best and appropriate business plans for its company (Burns, 2016).
Vision, objectives and goals: Vision is set according to the capabilities that company have basically, it is set for five years or beyond. It gives an insight in what position they see themselves after some years. Therefore, it is important task of managers to put or set a desired goals and objectives so that they can have an idea about where the company is going whether they are moving in right direction or not. In case of Rowlinson Knitwear, their main aim or objective is to provide best quality products at reasonable price to its customers so as to retain their loyalty for a longer period of time. Thus, for increasing production process they are using appropriate tools that are giving them effective results.
Workers and their skills: Workers play a prominent role in an organization as they are the one who help the company in accomplishing their targets in speculated time frame. Managers also play a vital role as they assign the task according to the capabilities of workers. For this, it is important that they hire eligible candidates who can help the organization in attaining the goals with limited sources as well. Therefore, it will enable the company in executing their plans effectively according to the business operations. Along with this, to enhance the performance and capabilities of employees company can implement different programs which workers can avail for improving their skills and knowledge. Thus, all the above mentioned points can use be use by Rowlinson Knitwear while accomplishing their set targets and objectives (Congregado, Golpe and van Stel, 2014).
P2 Different process for customer relationship management
Customer relationship management of an organization is used by any company in order to establish a good relation with its customers. By doing this firm can get competitive advancement and this will enable them in attaining long term benefits. In context with Rowlinson Knitwear, for analyzing their future strategies they are considering the activities that are performed in the past and it is helping them in understanding the behavior or nature of consumer towards their products (Crane and Matten, 2016). Therefore, by doing this firm is having a better understanding about the choices and preferences of the consumers. For getting proper information company has conducted surveys and taken feedbacks and reviews from its customers. Thus, it is helping them in getting adequate information which they can consider while making any kind of changes in their product. Further it can be understood by the points that are explained below:
Analysis of customer’s portfolio: This is considered as the first step through which it gives an idea about customer’s base and through this company can identify the ways by which they can use for gaining more profit.
Customer intimacy: It is determines as the second step through which organization can get to know about and become familiar about customer’s base. Therefore, this assists the organization in developing a better relationship between consumers and firms. With the every single step of interaction enterprise gets to know more about customers. Thus, developing a better customer’s base will help company in storing relevant data which company can further optimize in their business operations.
Network development: In order to manufacture and deliver the products in a right manner it is essential that they develop a proper network with other individuals. This includes connection with suppliers, investors, supplier and internal partners (Drucker, 2012).
Value proposition development: If a company wants to increase its sales that it is necessary that they target certain areas from where they can get maximum benefits. After this, the step of value proposition development comes and this helps the company in knowing the value of products in front of the customers.
Customer life cycle management: Under this, the entire journey of management from the identifying the target customers and then maintaining a better relation with them goes on. Therefore, this cycle is important in context with developing a good customer’s base. Thus, it should be given much attention and importance.
Henceforth, Rowlinson Knitwear is considering all the points and this is helping them in developing a good relationship with its customers as a result sales and profitability is increasing.
P3 Development of a small business enterprise transnationally along with its benefits and drawbacks
Transactional sales are considered as a strategy that assists the organization in focusing on the ways through which company can increase its sales without creating a long term relationship with customers. This is mainly used by those firms whose main motive is to gain maximum amount of profits by producing more and more products (Durst and Wilhelm, 2012). This assists the organization in evaluating and analyzing its profits and sales and it also gives information about the sales company has done within the national boundaries. It is crucial for Rowlinson Knitwear to make appropriate strategies according to the current market situation so they can sustain in the market for a longer period of time as it will help them in enhancing their brand image in front of its customers. Along with this, company can expand its business in different locations and it will gradually improve its sales and profitability. Therefore, some of the benefits and drawbacks are explained below in order to understand it in a better manner:
- Independence: For expanding business operations managers should be given independence in making strategies accordingly so that market value and share of the company can be increased (Hammer, 2015).
- Efficiency: Small firms that run their business at local level can implement different kind of processes for increasing its sales and profitability.
- Financial risk: There is a equal chance of financial risk while expanding the business in an effective manner as they don’t have ample resources in order to operate its business at higher level.
- Lengthy: Generating more amount of money so as to expand its business can take quite a long period so, for attaining maximum profits company can incorporated innovative ideas and thoughts.
There are ample methods which small business enterprise can use, so that they can grow. Beneath are few of them :-
- Import and export : This will help small business enterprises in increasing their sales and profits by selling the products offered by them in different nations. This also help them in gaining extra profits which they can attain by selling by some international products in their organisation.
- Opening new branches : This help in making a good base in different nations, so that small business enterprise can increase the popularity and can sell products in nations where they are not able to sell them.
- Franchises : This will help them in making their branches in different nations, where they can get money for giving the rights of their branch to specific person. In this, it is not needed by organisation to manage their staff at that branch.
- Agents : These are the people which use to sell the products in different part of nation along with in different nations. For doing this work, they use charge some specific cost, which is decided by both of the parties.