Note: Sample below may appear distorted but all corresponding word document files contain proper formattingExcerpt from Essay:
The owner of a small business in today's world is troubled by so many problems as well as is encountered by many opportunities on a daily basis. When one has to run a company, no matter how big or small it might be, one needs to have the ability of looking outside the business for the solutions of the problems, for better ideas and for the best practices for the growth, expansion and success of the business. Nonetheless, some of the ideas that are given in the text books or the best practices for that matter should be studied carefully and critically before applying them to one's own business (Zahorsky, 2013).
This paper is based on an interview that I conducted with a 38-year-old lady who started her own small business back in the year 2011. She lives in Lahore, Pakistan and designs and makes ladies dresses on order. Since there is a trend of wearing clothes with heavy embroidery on them in the region where she lives, she has been able to make a decent amount of profit. It cannot be said that her business is flourishing, but it won't be wrong to say that it is a progressing at a reasonable pace. Since it has not been long since she has started the business, we cannot really say whether or not she was a total success or a total failure. She has set a small workshop at her house, where she helps her workers design and stitch clothes. In this paper, we shall analyze the good and bad practices that she adopted for her small business and see what she did well and what she shouldn't have done according to the theories of business.
Defining Small Businesses
The definition of a small business is a difficult task and often controversial as well. A variety of terms come under this term and has been used by many writers who have explained how these firms work. Some of the writers have defined this term as a business that is operated and owned independently and the one that does not dominate the field of operation that it falls in (D'Almoise&Muldowney, 1988). On the other hand, other interested parties that include the researchers have made use of particular criteria to operationalize the small business as the one that includes many feature including value of assets, value added, annual sales as well as the number of employees. This category is, however, mostly delimited by the number of employees and annual sales. According to the standard definition of a small business, it should not be making annual sales of more than 20 million dollars and should have no more than 500 employees. Therefore, according to this theory, the business run by this lady is a small business. It cannot be considered a micro-business, even though the number of people employed in this business are way too less, because a micro-business is the one that is operated and owned by only one single person. Without the workers that she has employed, her business will not function. Therefore, the theories and practices of small business would apply to this business.
First and foremost strategy for making a small business work is to make sure that the resources are being used where they are best utilized and where they will produce the maximum profit (Attolini, 2012). Precision is very important in making a small business successful. Of course, experience and practice is what teachers a person how to deal with things, but in a small business, one does not have a lot of margin to lose the resources that have been invested. Therefore, one has to think and analyze things very critically before starting a small business and when it comes to the investment of the resources. Since this lady had to start the business because she was facing some financial troubles, she started to start the workshop in her own house. She did not even construct a separate place for the workshop, but rather transformed her drawing room for this purpose. This saved her a good deal of resources. Firstly, she did not have to rent or buy a workshop where she could make her workers do their tasks. Secondly, it saved her the time and fuel that would otherwise be used if the workshop was at some other place where she would have to travel to supervise every single day. The financial resources that she saved here, she used these to buy the latest embroidery machines. This was a good practice adopted by her, the best use of limited resources.
It is important for the owners and operators of a small business to make sure that they satisfy their clients by delivering them the best services on the right time. It was very smart of this lady to start her business with taking limited amount of orders so that she is able to earn a name for herself. Moreover, when the dress would be done half way through, she would ask the customer to come and see if they like the embroidery or not. If they liked it, she continued with it, if they did not like it, she stopped it there and then and started it all over again just how the customer wanted it to be. This helped establish a trust relationship between herself and her customer so that they would come back to her again. Customer satisfaction has always been considered a key in success of any business, be it small or big (Kuah, 2002).
Nothing makes a business more profitable and a bigger success than reasonable prices of the goods. When she started her business, she kept her profit margin very less. However, she made sure that she does not compromise the quality of the dresses that she was making in quest for low cost. She discovered the retail markets in the city where she would get the latest variety in very reasonable rates that she passed on to her customers.
Needless, nothing in this world is perfect. No small business as well as no large scale business of free of flaws. The thing that matters the most is that these flaws should not be more than the strengths and good strategies of any company or firm so that the business does not go in loss. Just as in any other business, there were some flaws in the business that was run by this lady. First of all, she did not do much about the advertising campaign of her small firm. She only got a few hundred brochures printed in a city with a population of 80 million people. She did not make use of the social media, like Facebook to advertise her dress designing and embroidery. If she had spent a little more on advertising, she would have been able to attract a lot more customers than she did.
Whenever a customer orders something, he or she always wants to see what the order would like when it is done. For this, it is important for any firm or company to have samples of what they have to offer. To cut the initial cost of the business and to make sure that she keeps within her financial limits, she did not make any samples before starting this business. Some of the customers that came in did not have any idea what they can order because they were not provided with any sample. This was a major flaw in her business.
Another thing that is important for not only starting, but also expanding and establishing a business is the devising a concrete business plan. She did not come up with a solid business plan and just thought that she would go with a flow. According to the theories of business management, it is not advisable to take such risks. This is because when businesses are started without any plans, they almost always end up in losses. Even if the owner manages to take the business to a certain level, he or she does not know where she has to head the business now when that certain level is achieved. Moreover, when the owner and the operator looks out for sponsors and agents, they want to know what the operator plans to do with the business in the future. If they are not satisfied with a proper business plan, they will most likely not support and extend their sponsorship to that particular firm.
Even though it has not been long since the beginning of this business, we can still make an idea about the good and bad practices that have been adopted by this lady. As for the good practices, they need to be kept and should be converted into the best practices, and as for the bad ones, she needs to work on them so that her business can do well in the market. Moreover, she also needs to keep a keen eye on…[continue]
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