The firm I am studying is a sole trader business - Sample Essay
Businesses owned by one person only, are called sole trader businesses. The firm I am studying is a sole trader business. It is called Fantasia. Mrs Locum is the owner of the business. This business deals in hairdressing. Sole owners can employ to people to work for them and some can grow and expand and therefore be quite large. Mrs Locum has three employees, one male, one female and one junior. It being a small business the owner can pay personal attention to the customers and people who work for her. The owner is also her own boss and can make quick decisions without having to get someone else’s agreement.
The amount of money the owner can spend on equipment and materials when establishing the business is limited to how much she can borrow or save. Sole owners have unlimited liability to which Mrs Locum has to oblige. It means that they are liable for all the debts and activities of the business, meaning that if the business fails, they might have to sell their personal possessions to repay the debts. Fantasia was first started at St Auburns, by Mrs Locum. It was started ten years ago and has been operational ever since. Aims of fantasia It is important for a firm to understand its aims.
Successful businesses know clearly what they want to do, simply meaning they have clear aims. Aims of Fantasia include the following: To survive-it is very important for a business to survive, which is one of the most important aims especially in its early days of operation when the business is just started. Fantasia feels that they have achieved this because they have been in business for at least ten years. To make a profit-which is what every business wants as they would be no point for Fantasia to exist if they did not make a profit.
They also feel that they have achieved this as they have been making profit which has been increasing over the years. * To provide good service to the people- they wish to provide value for money services to the people. This will give a good image of the business, which will make them keep their customers and attract new ones as customers will be satisfied with the services they are providing. This also gives them an advantage when they increase their prices as customers feel its worth it to spend a little more for the good quality services.
To be competitive-for a business to survive it has to be competitive otherwise, it will go out of business. Fantasia feel that this is another aim they have achieved as one of their competitors went out of business and has now closed down, which has attracted more customers to Fantasia. To improve their hairdressing standards-Fantasia has to keep up with the standards and improve them in whatever way possible. Since we live in a changing world, they have to be up to date with the new hairstyles and any latest technical services to do with hair.
To increase sales-now that the business has survived, they wish to increase their sales which will bring in new ideas and make room for new developments e. g. others services Fantasia can offer and products they can sell. This helps them to diversify the business which will lead in an expansion of the business which is also one of their aims. Sales have also increased for Fantasia as one of their competitors has gone out of business which has lead them to have more customers. To expand the business-Fantasia would like to expand their business as they are now well established and are performing well.
They would like to enlarge their current shop or open more shops which will offer a wide range of services as they will also wish to expand their activities Objectives of Fantasia Objectives of a business are planned to achieve the aims. Objectives are short term goals and in the long run are supposed to meet the aims. Objectives of Fantasia include the following: * Fantasia wish to keep a continuous business flow and carry on improving the business. Fantasia has continued to improve as they have achieved more sales and it has now increased its profits overtime.
Mrs Locum also wish’s to offer new products and services which will in turn help her accomplish her aims. The wider the range of activity Mrs Locum gets involved in, the more customers and larger profit she will make. When she starts to provide new latest on the market products and new services especially services that are latest on the market she will attract a large number of customers which will in turn bring about business and huge amounts profits. Some of the new services she is providing are manicure, tanning and is also thinking about introducing therapy and Indian head massage.
Offering new products and services will help Mrs Locum achieve most of her aims. These include; surviving as she will able to due to the new products and services that bring about customers which ensure her survival. To make profit, which is very possible as the more customers she gets with the wider range of activity she gets involved in the larger the profit will be. This will also lead to her increasing her sales and this makes it possible for Mrs Locum to expand her business which in a way is making her competitive and so she can achieve most of her aims.
Mrs Locum also wants to improve her services. In order to achieve this objective, she has done various things like purchasing new furniture for her shop, importing new products from Italy and she has also decided to redecorate her shop so that it can be attractive to the eye of customers and passer-bys and make them interested to pay it a visit. This also portrays a good image of the firm and attracts more customers. She has also thought of purchasing the latest machinery/equipment to use. All this helps Mrs Locum to improve her standards of service.
Mrs Locum has achieved most of her objectives and the new services she is providing are a contributing factor. Bringing about new services will ensure that Fantasia have a steady business flow and continue to improve their business. The new services will catch the attention of many people and therefore create a centre of attention for lots of people to buy hair products or do their hair. This means more customers and more sales, therefore, a bigger profit. This will create room for Mrs Locum to carry out other objectives she has planned. Mrs Locum will now be able to provide new services e.
g. manicure, tanning and Indian head massage. She will also manage to import new products from Italy. She will also be able to redecorate her shop, purchase new furniture and even buy the latest machinery/equipment. Activities of Fantasia Fantasia is a hairdressing business. It was started as only a hairdressing shop but since being ten years in business, it has grown to provide a wide range of services and hair products to sell. It now deals with service like manicure, colouring, tanning, cutting, styling, Indian head massage and any technical services to do with hair.
Fantasia falls under the tertiary sector as they provide a service to the people. Since Fantasia also sells hair products, they provide client services and sales under the tertiary sector. Since Fantasia sell hair products and provide a hairdressing service, they can also be classified as retailers. Below is a diagram illustrating Fantasia as retailers; Manufacturers Wholesalers Retailers (Fantasia) Customers The activities that Mrs Locum carries out help her to achieve her aims and objectives in that they have been successful and have ensured her survival.
They have also drawn the attention of many customers and this has increased her sales and made even a bigger profit which has brought about room for expansion. Her activities have helped offer new services and products as well. Being ten years in business Mrs Locum’s aims and objectives have altered overtime. She first started with her aim of survival and this was achieved as she is still in business. After breaking through the first year, her aims were to break-even and make a little more profit.
In the course of ten years she has continued to increase her profits and achieve the aims she sets herself and therefore she now a new aim, which is to open a new saloon although she does not know where to set it up yet. Just as well, Mrs Locum as achieved her objectives in due time. For her first year, she set an objective, which was to make i?? 20 000 profit and she managed to achieve it. From then on, she has been able to achieve her other objectives as well such as increase her sales and make profit and are she is currently making a i?? 100 000 profit annually.
Her sales have increased over the last few years and Mrs Locum still wants to boost her sales even more in the future. Having achieved those objectives, she then wanted to beat her competitors and she accomplished this as well because one of her competitors went out of business. Fantasia was able to do this as they provide good quality service to satisfy the people and also provide regular training for their staff which helps them to improve their skills which in turn also improves the standards of service of Fantasia. They also provide good advice to customers who are on need of any and give good consultation as well.
This is given on the wide range of services and goods that they provide. Mrs Locum also has to take into consideration that as her aims and objectives are changing, she also has to change her activities and what she offers the consumers e. g. she is currently thinking of opening up a new saloon in another town and if she succeeds in doing this then she will have achieved her aims in the long term * Expanding her business- as she would have now expanded her business to two saloons. * Increasing sales- another saloon will mean that more customers and therefore, she will increase her sales.
Increasing profit-when the sales increase then the profit will increase as well. Mrs Locum has had to change some of her activities in order to suit her changing objectives. She’s had to change her styling, add colours and her perming has also changed. Mrs Locum has also recently started to do more marketing which has helped her business to be known. They have also started carrying out charity work and this is beneficial as well, together with the current marketing they are doing it helps them achieve their aims. It also helps their business to be recognised. Fantasia can also do weddings.