Starting A Small Business

Lesson Structure

There are 12 lessons in this course:

1. Introduction to Small Business
   • Types of business and communication, types of language, office equipment.
2. The Business World
   • Consultancy services, law and business, the landscape industry, business letters, communication systems.
3. Your alternatives - different types of ventures
   • Buying and starting a business.
4. Marketing
   • What is involved in marketing, advertising, selling, communication.
5. Planning
   • Organising and planning to ensure the success of the business.
6. Basic Bookkeeping
   • Financial statements, balance sheet, profit and loss statement,insurance.
7. Sales Methods
   • Selling, sales method, telephone canvassing.
8. Budgeting
   • Assets and liabilities.
9. Developing a 12 month business plan
   • Protection, planning and production.
10. Implementing a business plan
    • Communication with employees, planning the development of the business.
11. Reviewing progress in a new business
    • Research, evaluate and decide on business plan updates.
12. Improving profitability
    • Increase profit and reduce expenditure.

Each lesson culminates in an assignment which is submitted to the school, marked by the school's tutors and returned to you with any relevant suggestions, comments, and if necessary, extra reading.

Aims

• Discuss the nature of small business and the skills required to run one successfully.
• Explain the legal requirements, restrictions and the costs of running a small business.
• Describe the different aspects and considerations associated with starting a new or buying an existing business.
• Explain the marketing process.
• Explain the importance of planning in the running of a successful business.
• Explain the importance of record keeping and the principles of bookkeeping.
• Determine sales and promotions strategies in small business.
• Explain the importance of budgets.
• Develop a business plan.
• Implement a business plan.
• Identify factors that affect profitability.

Extract from Course Notes

What is meant by ‘small business”? Small is a relative term and it begs the question: ‘compared to what?’

While there is no universally accepted definition of a small business, a number of measurements can be used to determine whether a business is small, medium or large.

The most common measurements are:

• number of employees
• turnover (the volume of sales either in money terms or quantity over a set period of time)
• asset value (the total worth of all assets owned by the business)

These measurements are all based on some statistical calculation and expressed as a number.

Because of this they are referred to as quantitative measurements

Other definitions are based on qualitative descriptions, that is, the way in which the business is organised, owned, managed and operated. It is based on personal observation and a description of the business.

A comprehensive definition of small business usually relies on a combination of both quantitative measurements and qualitative descriptions.

Studies have revealed that the average person uses the term ‘small business’ to refer to an owner-managed business that may employ a few people.

Small businesses are the main source of most inventions and innovations. An invention is the development of something new. Innovation occurs when something already established is improved upon. Many successful businesses are built on these two forces, especially on innovation. Research and development (R&D), however, can be rather costly. Small business faced with having to undertake R&D often finds difficulty is obtaining adequate finance. Traditional sources of finance, especially banks, perceive this type of finance request as high risk. One possible source of finance for R&D is venture capital. Venture capital is money that is invested in small and sometimes struggling businesses that have the potential to become very successful. The investors take an equity position in the business (own part of it) and provide supplementary finance. When venture capital is used in the initial feasibility stage, that is, when determining whether a potential idea can lead to a profitable product and business, it is referred to as seed capital.

Success of Small Business

All small business owners start off optimistically, believing that their business venture will lead to financial success and security. Many may have read some multitude of books available about being successful in small business. These books usually highlight five common ‘keys’ to small business success.

1. Entrepreneurial abilities. The people in small business are crucial to the success of the enterprise. Attitudes and personalities of owners will vary enormously. Some will have drive and enthusiasm, many will have set targets and some will take big risks. Some will thrive on the challenge of a potential failure, enjoying the process of solving problems. The majority will be highly motivated and optimistic.

2. Access to information. As a bare minimum the small business operator must have information regarding profitability, the quality of products and services and the performance of employees. Accurate and up to date information will allow the small business owner to make the best decisions.

3. Flexibility. The small size of the business allows the owner to adapt quickly to changes in the external environment. Because there are fewer levels of management, decisions can be made quickly. In addition, the close contact between owners and customers allows the establishment of personal relationships, helping owners to respond quickly to their customer’s changing tastes and preferences.

4. Focus on market niche. Small businesses can concentrate their efforts on a few key customers or a specific segment of the market. This provides the opportunity for the small business to become more specialised and able to deliver a high level of service.

5. Reputation. Because the small business is servicing a narrow market niche, it can develop enviable reputations for quality and service.

These five ‘keys’ above have been identified as major success factors.

More Information:

Books by our Principal available through our bookshop:

Profitable Farming  click here

Starting a Nursery, Garden or Landscape Business  click here

CAREERS ADVICE FOR SMALL BUSINESS (see our Career Web Site -click here)

Small Business Opportunity -Franchise or Lisencing ACS courses as an affiliate or lisencee. Open to investors, established schools and start up operations, who can commit to appropriate investment of time and money, and ethiccs. See our standard conditions (contract), and requirements at http://www.acs.edu.au/affiliates/default.aspx