Introduction
Business management is the act of unifying people to accomplish desired goals and objectives of a business. To create a successful brand, creative strategies and a business plan are essential to provide efficient services. Thus, it encompasses planning, organizing, directing, and controlling a business to accomplish its goals of the business (Storey, 2016). According to Hatten, (2011), small business management involves managing employees, finances, suppliers, responsibility for paperwork, and customer service to ensure benefit to the business. Moreover, Understanding the challenges and ways to overcome them or provide solutions ensures that all risk is minimized or avoided and thus smooth run of the business. Also, effective management of a small business requires certain skills in interaction with others to build a foundation for company growth while ensuring a smooth flow of cash in the business (Blackburn, Hart & Wainwright, 2013). This essay expounds on crucial aspects of business management, business plans, and strategies essential in management.
Description of the business
Melah’s clothing line deals with delivering and making new fashionable cloth items that offer quality clothes. It deals with the manufacturing, branding, and alterations of clothes in the fashion industry. According to (Scarborough, 2016), running a clothing business requires a business plan to design, brand, and produce while ensuring customer satisfaction and smooth business management. It offers services in branding the most creative and important fashion goals, photoshoots, textile designing, mood boards, and label designing. It also acts as a supplier to small branches of boutiques while offering online shopping to provide more customer satisfaction. Hatten (2011) states that coming up with a unique product and service that satisfies a need, and solves a problem while designing original clothing will ensure it stands out from competitors. Also, the business offers accessories that match up with the brandings while offering training and consulting services to others. This service ensures that the cloth line runs efficiently with minimal risk and thus effective management of the business.
Nature of the business
The business is new to the market thus it requires a startup plan, research, and an understanding of the environment among others. Since it is new it poses some challenges when embarking on starting up a new business. To effectively manage, these challenges must be identified and provide solutions. According to Schaper et al.,(2010), keeping up with the market, planning, cashflow management, problem-solving, time management, and finding the right people are some of the challenges faced by new businesses. Meeting these challenges will create a standout in the market while generating a profit and creating a good brand name. when launching a new business, as manager research is effective in keeping up with the current market trends while maintaining loyal customers in the business. Lopez et al., (2012) state that having an in-depth of what the customer wants or needs, how they behave and their market approaches will help keep up with current trends.
Furthermore, a new business will pose a challenge to cash flow and financial management. cash constraints, according to Hatten,(2011), can be the biggest factor limiting growth and thus trading can be fatal. To successfully manage the challenge, good stock control, making the best use of finances, and planning helps anticipate financing needs and arrange suitable funding such as investors to ensure a smooth run on the business. Moreover, the lack of rights systems poses a challenge for new businesses. Employee details, customer interactions, financial records, and other business records require the right systems. Sampaio, Thomas, and Font, (2012) state that start-up money may not be enough to acquire the right systems posing a challenge to the business. Although, to make a business grow it is essential to put the right infrastructure in place to drive improvements and thus effective operations in the business.
Business plan
Revell, Stokes, and Chen, (2010) state that having a business plan is important as it creates a strategy for growth, determine future financial needs, reduces potential risks, and set important goals. The most important goals are to ensure the business maintains a profit thus the revenue earned should be more as compared to the expenses. moreover, achieving brand recognition in the market and increasing traffic to your business is also another objective of the business. This can be offered by creating a new product and testing new ideas about the trends to provide for the needs of the customer. Moreover, analyzing your target market is essential to the business plan. Conducting market research will ensure the creation of a business plan and approaches that according fit the target market. For example, a target market of the young will feel more open to new ideas on fashion, which can help them gain more ideas and easy to affect their buying behavior thus ensuring effective management and a smooth run-on business.
As we start up our business, engaging in a business plan will analyze the resources needed, the management team, the operation plan, and the services and products offered. Planning on the resources needed such as an e-commerce platform, influencers, and trade shows will ensure that competitive nature thus a unique value proposition on offering customer satisfaction. According to Mason and Brown,( 2013), creating a business plan with an operational plan and management teams will manage an understanding of the roles and responsibilities of each employee in the business while creating actionable steps that can meet the goals in your business plan. For example, planning on having an accountant to facilitate the finances will help in planning on carrying out the operation to achieve the objective. Defining goals with an operational plan will ensure support for revenue growth and achieve business goals together as a team (Storey,2016). A business plan for service and product offered ensures that the basic goals are met and the needs and penetration into the market are observed.
A business plan on the cash flow for the next five years allows long and short-term goals to be met while determining the actual revenue expected. According to Schaper et al., (2010), it will allow a managerial on how cash is used on varieties of activities in the business and ensure minimally is used in expenses thus generating more profit. A plan will create the estimated budget to be used on critical areas and the remaining can b used to align with other members of the team thus gaining clarity and refining your goals. Also, a business plan will look at the factors of how to benefit the community. for example, establishing a business plan will provide the essential skills needed in the business thus creating a job for the locals. moreover, it analyzes how city revenue can be increased on the taxes paid to increase community improvements. The advantage is that it will create brand awareness, establish a great reputation, and establish meaningful connections while growing your business (Longenecker et al., 2013).
Strategies used in the business
Pricing strategy (bowman’s clock)
Bowman’s clock-on pricing strategy analyzes how the business can position its products and services in the market based on the price or value of the product or the overall brand (Blackburn, Hart &Wainwright, 2013). having a pricing strategy is necessary to bring the value deserved to the products and services and remain competitive according to the rising market volume and price pressure. Thus, the bowman’s clock will allow to cover costs and generate profit without exceeding customer expectations on price. For example, at the hybrid point, a combination of low price and product differentiation will allow the provision of highly valuable products at a given price. According to Storey (2016), the use of the clock pricing strategy in a small business will offer a variety of points to examine the strategy and its effectiveness.
Furthermore, having a pricing strategy will allow for creating value on the products as sometimes cheap relates to shoddy. For example, in the cloth line business, with the upcoming fashion trends in the market, a cloth that tends to portray cheap prices will lose value portraying as poor-quality. although it poses a variety of advantages to a product offered, it can lead to risky high margins as it tends to focus on competitive marketplaces. To effectively manage the business, analyzing the most effective points of the clock’s pricing strategy will allow us to determine the most appropriate strategy (Revell, Stokes, and Chen,2010).
Marketing strategy
According to Hatten, (2011), having a market strategy in business management allows you to set out your business goals, and identify your customers and how to reach them. A marketing strategy will allow you to communicate directly to your audience and prevent wasted efforts to the wrong marketing strategy. For example, in cloth line business, the use of social media marketing will allow brand recognition while connecting and building a relationship with the target market. It will allow you to focus on your best sellers and promote your products to those interested. Moreover, recognizing your customers in the marketing strategy allows one to critically analyze the varieties of brand marketing while reducing the cost of customer acquisition. For example, identifying your target market by age such as young people, and having a mobile and technology presence will be a great strategy. As the world is digitalizing, the majority have an online presence and it will be efficient to market using this strategy as it will attract their attention and increase the competitiveness of your brand.
In addition, remarketing to your esteemed users and customers acts as an effective strategy (Lopez et al.,2012). It gives more brand exposure, better audience targeting, and higher conversion rates. this will encourage the consumers to take an interest while engaging them to make a buying decision. For example, in online retailing, when a consumer leaves a product on the cart, you can later remarket it through a different ad or email follow-ups to purchase it. this is a cost-effective method as you are reaching out to customers who had an interest in your products.
Growth strategy
There are a variety of strategies used in growth such as market penetration, market development, product development, and diversification. According to Blackburn, Hart, and Wainwright (2013), the strategies allow a small business to gain a competitive advantage, reach new customers, influence market prices and reduce external risks. In market penetration, increasing sales increase your market share thus this can be accomplished by a price decrease or modest product refinements. For example, identifying the need for a new product and launching it will drive out competitors and increase customer usage will allow penetration in the market thus dominating growth markets. Moreover, it will facilitate market development in areas with unexplored markets. Mason and Brown, (2013) state that this strategy is accomplished by different customer segments and intrusion into a foreign market.
Furthermore, product development can be used as a strategy in business by offering new products and services to increase customer turnover. According to Longenecker et al.,(2013), investing in research and development will enable the process of adding products to the existing market thus ensuring the growth of the business. For example, in the cloth line, adding accessories to the business will attract more customers and thus grow in business. Also, diversification being the riskiest strategy, introducing of new product in a new market will allow the growth of business in an entirely different perspective. For example, introducing perfumes in the cloth line industry will allow expansion of the business in Oher dynamics while lowering your risk by spreading money in different assets.
Conclusion
In conclusion, small business management requires a business plan and applicable strategies to ensure a smooth run of the business. Moreover, starting up a new business comes up with challenges such as keeping up with current market trends and time management. although effective solutions and a business plan can help avoid the challenges while providing a solution that arises. With this, a business plan is necessary to ensure the right target market is identified, goals are met, and management is effectively prepared on their roles and how operation plans may be carried out while benefiting the community by creating employment for locals. Also, strategies in a business will help to attain more customers, and reputation and reduce competitiveness in the business. In price strategy, identifying a point in the bowls clock allows an effective mode of price while maintaining the value of the product. Moreover, marketing strategy such as social media allows interaction with the target market while promoting business growth. The use of efficient strategies will give an upper hand to the business in the market.
References
Longenecker, J.G., Petty, J.W., Palich, L.E. and Hoy, F., 2013. Small business management. Cengage Learning. https://books.google.co.ke/books?hl=en&lr=&id=dZ90AgAAQBAJ&oi=fnd&pg=PT6&dq=small+business+management&ots=43nxUbhM13&sig=aIb1oakdyFWMBcQNeUeykHlsdPI&redir_esc=y#v=onepage&q=small%20business%20management&f=false
Blackburn, R.A., Hart, M. and Wainwright, T., 2013. Small business performance: business, strategy, and owner‐manager characteristics. Journal of small business and enterprise development. https://www.emerald.com/insight/content/doi/10.1108/14626001311298394/full/html?TB_iframe=true
Hatten, T.S., 2011. Small business management: Entrepreneurship and beyond. South-Western College. https://lib.hpu.edu.vn/handle/123456789/30165
Storey, D.J., 2016. Understanding the small business sector. Routledge. https://www.taylorfrancis.com/books/mono/10.4324/9781315544335/understanding-small-business-sector-david-storey
Schaper, M., Volery, T., Weber, P. and Lewis, K., 2010. Entrepreneurship and small business. John Wiley & Sons. https://espace.curtin.edu.au/handle/20.500.11937/12327
López Salazar, A., Contreras Soto, R. and Espinosa Mosqueda, R., 2012. The impact of financial decisions and strategy on small business competitiveness. Global Journal of business research, 6(2), pp.93-103. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1945906
Revell, A., Stokes, D., and Chen, H., 2010. Small businesses and the environment: turning over a new leaf? Business strategy and the environment, 19(5), pp.273-288. https://onlinelibrary.wiley.com/doi/abs/10.1002/bse.628
Scarborough, N.M., 2016. Essentials of entrepreneurship and small business management. Pearson. https://lib.hpu.edu.vn/handle/123456789/23886
Mason, C. and Brown, R., 2013. Creating a good public policy to support high-growth firms. Small business economics, 40(2), pp.211-225. https://link.springer.com/article/10.1007/s11187-011-9369-9
Sampaio, A.R., Thomas, R. and Font, X., 2012. Small business management and environmental engagement. Journal of Sustainable Tourism, 20(2), pp.179-193. https://www.tandfonline.com/doi/abs/10.1080/09669582.2011.602193
write