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The small business enterprise is the business which is generally owned by the private individual and operated by less number of the employees with the lower volume of sales. Small businesses are the corporation owned by private individuals, with partners and of sole proprietorships. The small business in various countries may comprise of different employee number which may vary from 15 employees to 500 employees. It can also be classified into the areas of sales, assets and the net profit of the business. The small businesses are very common in all the countries and they depend on the operations of the economic state of the country where the business originates. Small stores, shops, restaurants, small-scale manufacturing units, hairdresser shop, small online business are few of the examples of small business en
The small businesses have to face various challenges and rewards which are not suitable for everyone doing such businesses. The services and products that are obtained from the small scale business are judged locally and the public reviews are the only mode through which the business can stand for the longer period or fall in the instance.
Skinny Tan is one of the small business enterprises which generally deal on the self-tanning and spray tan solutions and products & accessories. They are the first to self-tan which does combine with natural tanning with skin smoothing activities that are naturally derived for the purpose to tan, provide contour and to reduce the appearance of the visibility of cellulite. The business was started in the year 1980 and is one of the largest health and beauty retailers. The other similar business enterprise is Tan Warehouse which deals with the similar types of products and services.
The aim of the study is to investigate the performance of the business and the changes that will help to improve the management along with business performance. Further, it is studied about the business objectives and the plans to incorporate the proposed changes. The study also includes the impact of change management on the operations of the business.
1.1 Profile of the Company (AC1.1)
The chosen entity selected for the continuance of the study in order to easily evaluate the comparison of the firm with the other enterprises in the industry. The company specializes in the beauty products. One of the most special products which the commerce specializes is the self-tanner. It is the product that specializes in its ingredients as it helps in reduction of tan and even smoothening of the skin. It helps in reduction of the cellulite and its appearance.
The firm is founded through the funds acquired by winning of the Dragon's Den the famous reality show. The enterprise was started by its founders Kate Cotton and Louise which was further invested by Kelly Hoppen via the reality show. After winning the show the corporation was able to attract a large number of investments. With the help of the investment, the entity was able to expand itself well (Morgan, 2012). The company started its operation in the United Kingdom on 6th February 2013. The chosen commercial stands within the private limited with the minimum number of share capital investment (Skin Care. 2017).
The strengths that are very well highlighted by the entity are to effectively manage its resources well, as the prime motive of the entity is to achieve the customer satisfaction level the maximum. The corporation has proved its strengths well as becoming the sole manufacturer of the specialty of the beauty products (Churet & Eccles 2014). One of the biggest strength is the special ingredient which helps in the reduction of the cellulite for its users. The company also claims well its specialization of the product in reducing the tan.
With the strengths, the company is able to bears certain weakness which becomes hurdle as in the growth of the enterprise to all a new level. One of the biggest weaknesses is the lack of skilled folks as employee workforce. According to the Zairi (2012) has well mentioned that the company should further help in the development of the brand image. The brand image helps in an escalation of the sales, which leads to a rising in the profits. The entity lies in providing proper training to the employees. The training helps in the proper division of the duties, in order to follow the procedures well in which the entity works. The communication network is also where the firm lies. The firm lacks in the authority structure coordination as at presently, there exists the communication gap between the founders as well as the shareholders.
1.2 Comparative Analysis of the stated firm along with the Tan Warehouse (AC1.2)
The analysis comprising of both the entities helps in evaluating the financial position well. The figures well reflect the entries for the year ended 2015-2016.
|Particulars||Skinny tan||Tan warehouse|
|Profit and loss||£9294||(£83532)|
|Current Liabilities of the firms||£1536||£4034|
|Total Current Assets||£2123||£242|
|Current Ratio= (Current Assets /Current Liabilities)||1.382||0.059|
|Cash Ratio (Total Equivalents / Total Current Liabilities)||1.62||4.95|
After evaluating the figures, it is easily figured out well the first entity as working on the small scale line in the association of the other corporation which is a big corporate house. The entities lying in the same segment present as in beauty industry situated in United Kingdom (Self-tanning & salon spray tan solutions, products & accessories.2017).
From the calculations it can easily derive some significant conclusions firstly, the current ratio of the entity one has better use of the current assets well. The corporate, on the other hand, correspond to that it is not using the assets properly. On the contrary hand, the firm cash ratio is well deal which truly represents the proper usage of the cash. It easily signifies that the current assets are properly used (Maina & Ishmail, 2014).Lastly, from the analysis it can be figured out well, that the corporate house despite strong expansion as well as the wealth accumulation reflects the scarcity of management of firm operations as the excess of cash ratio according to the positioned ideal norms, which demonstrate poor management of cash and other liquid assets (Skin Care. 2017).
The marketing is considered as one of the most important areas of the function that is involved which leads to the preparation of detailed research, followed by the proper planning. In order to properly conduct the research the entities ideally hire the use of the tools such as SWOT. (Mella, 2012) This helps in the identification of the strengths, weakness of the firm along with the opportunities and the threats.
|Particulars||Skinny Tan||Tan Ware House|
|Strengths||One of the fastest in terms of growth within the industry as through winning the reality show.||One of the best ever enterprise in comparison with the rest of the enterprises in the demographic region.|
|Weakness||Lack of Skilled Workforce.||Lack of proper planning.|
|Opportunities||Expansion in the terms of the geographical boundaries.||The entity focus on the introduction of the new range of the products.|
|Threats||Existing large-scale firms with huge capital occupy the too majority of the market.||The start-ups within the industry have led to too much of competition.|
From the above table, we can clearly figure out well the detailed aspects that involve the functioning of the firm.
According to the Kastalli & Van Loo (2013) has well covered in their text that the production levels of both the entities are different. The first entity since a small scale enterprise though on the track of growth expansion has lower production levels. Whereas the other company is large scale enterprise has a huge variety of the products range followed well by the enhanced production levels.
The resources are very well used by the second enterprise as its one of the leading corporate house. The entity uses a specialization of the resources as the human resources. The human resource used by the second corporation is the huge number of the skilled folks. In contrary, the other enterprise is the small scale unable to recruit well the skilled forces (VukšiÄ‡, Bach & PopoviÄ, 2013).The folks are required as it helps in designing of the new plans, actions, along with the innovation techniques.
The technology aspect is one of the most effective one in the terms of the growth. The corporate house is well equipped with the latest technology. The entity uses well the integrated process which helps in the raising the production levels. The production in order also leads to the introduction of new range of the products (Yu et al. 2013). On the other hand, the small scale entity is bound with the usage of the limited technical software’s. The enterprise at presently uses well the CRM and ERP software which leads to the integrated process. Though, the company continuously focuses on expansion through its investment which leads to the rise of the up gradation of technology level as its future plans.
In the terms of sale both the companies has well reflected positive figures. The corporate house has shown a growth of 10 percent in the sales of its entire products range. The company also prepare its action plans to double up its sales figures well. The sales team has come up with the new and advanced strategies that will help to boost up their sales (Saeidi et al. 2015).On the other hand, the small scale company even reflects positive figures by the growth of five percent in its revenue. Further, the firm plans to recruit three sales executives to work on its sales areas.
2.1 Recommendations to overcome the weaknesses of the organisations
The enterprise is not able to be in the competition market along with various big brands that are situated in the industry. And have various other weaknesses that have to be overcome for stability in the business. According to Abbott (2014), there is the requirement of few changes to overcome the issues.
The enterprise must need to change the structure of its operations. It can be done easily by the making of the proper plans and structure for every activity that comprises well in the production, sale and marketing.
The business enterprise must change the technologies which are being used for long times and are traditional to the small business. The changes of technologies which they generally use are to be changed with some modern and effective technology and can be ideal for such business industry. The change in the technology would help the business enterprise for being in the competition of the related industry.
There must be employees with better efficiency and talents which are the most desired criteria for such industry to satisfy the customers. Alden & Nariswari (2017) stated that, the expert employees with prior experience and better skills to deliver their duties are to be recruited by the enterprise for better delivery of their services. Human resource managements are the best to find such employees and can provide them to the company. Human resource managements are the responsible system which does find the desired employee which are suitable to serve the company for meeting the requirements of them. There should be professional advice from the better advisor who can provide the right matter which can be helpful for the enterprise to run better in the competition market.
The employees of the company should be smart, efficient and honest and can handle all the works including cash handling in effective ways (Basin, Burri & Karjoth, 2014).
The environment of the enterprise has to be clean and hygienic so that the customers are attracted toward the company and are able to satisfy themselves from the services that the enterprise provide to them. Thus these are the few changes that are very much needed to grow further in the competitive market.
2.2 Ways to maintain and strengthen the existing performance of the company
The report has proved that the small business enterprise is in the growing stage within the competition market in terms of sales and services of its products. There is fast growth in the sales and services of the enterprise. Di Zhang & Swanson (2013) stated that, more the increase in sale and service more is the level of profit in the business. The profits of the enterprise are general in the industry and are meeting the ideal norms of the industry. Along with the profit, the enterprise does choose for providing the customers with the range of products that do diverse. The company does provide various products which are related to tanning of skins and other salon products that are sold directly as well as through online marketing. Apart from these services and products the company has various other products and services which are appreciated by the customers and they are satisfied from the enterprise. Ghose, Lê & Morrison (2013) stated that, hence this can be clearly noticed that the enterprise has wide chance to expand rapidly and based on the previous performance the enterprise will sooner become a huge corporate house in the leading industry. Existing performance can be strengthened by the made of the better performance of the employees and the products and services of the enterprise.
2.3 Suggestions for new areas to expand the business
For expansion in the business of the enterprise, there are various areas to maintain and change to its existing performance. Goss (2015) stated that, the technologies used by the enterprise are the main area which has to be managed in some specific processes which can reduce the lacking aspects of them. For perfect adoption of modern technology, the enterprise can look for new technologies that are available in the market which can make their processes easy and effective to succeed in the competition market. The change in the technology with modern amenities can help the enterprise to grow its production processes with respect to the production of their products and services.
The maintenance of the processes of the enterprise can be maintained with the help of the modern technology (GU, 2014). Along with the production, the modern technology does help the enterprise to be in the process of maintaining the records of them. The record of the various aspects which may comprise of the sale, profits, expenditures, and the overall record of the employees and related thing to the enterprise cam be maintained with the modern technology and are helpful to keep such records for future reference to find the company’s growth and the status of the enterprise in the competition market. The records can be comprised of payrolls of the employees and sale record, with net & gross profit along with the expenditure of the enterprise. According to Huang, Wu & Chen (2013), the collection of the debts can be maintained within the records and it is one of the most important areas that have to be done through the modern technology. The records are necessary to maintain to collect or pay the debts and without such record, the enterprise would be unable to determine the fact about their financial status and may fall in the ill effect of the financial condition which ultimately makes the enterprise lack in the competition market.
The perfect audit in required for the enterprise with all the activities and processes done within it. Not looking for the size of the organisation or enterprise, there must be the audit to all the companies for better control and maintenance of the company. It is necessary to audit the company for critically analyse the areas of the company and the performance of the company are determined for future expansion in the business and stay within the market of industry competition (Kowalkowski et al. 2017). Audit of an organisation and enterprise are helpful for the assessment of various analyses of the costs and development for the employees with respect to the performance in the business processes.
3.1 Existing business objectives and plans
The enterprise has its own objects and targets as all the other organisation is comprised of with it. The enterprise did choose the prime targets for enhancing the quality of the products and the services that they offer to the customers. The company does focus on the primary products and services which comprise of the huge variety of the diverse with the help of firm diversification that is able to gather the large area within the market. López-Cózar-Navarro, Benito-Hernández, & Platero-Jaime (2017) stated that, in the recent time, the enterprise does offer a variety of products and services to the customers. With the various products and service, the enterprise does specialise in the skin tanning products and its services. The company objective to focus on the specialised product does create the good impact on the customers and are able to locate them in the identified location with some specialised name in the market.
With the sales, the enterprise did focus on the development of the brand image within the market which is essential to staying back in the competition market. The enterprise is in the process of making various advertisements to attract the emotion of the customers, which is despite their financial condition. The customer attention towards the company and its product and services are the main pillar for the success of the business (Min, 2015).
The enterprise has obtained various plans for competing in the industry market. The most important plan of the enterprise is to recruit specialised employees who can fulfil the desire of the company and finally can satisfy the customer which is the ultimate way to increase the profit of the business. The products are being made to be more enhanced in quality and this would attract the customer which they are satisfied from and the services are enjoyed by the customers. The enterprise is in the trend to increase the product supply to all the leading supermarkets and through online marketing. Morison & Ramsay (2015) stated that, with the increase in the product supply, it would be easy to provide the product and services to the small cities and towns along with the large cities.
3.2 Review of the business plans and suggestions of area to change in business strategy
The plans and strategies of the company that are managed by the top management of the enterprise, does lead the company within the track of developing in the industry market. The management of the enterprise has framed some detailed business strategies and plans which cover the essential areas of the enterprise. Piekkari, Welch & Welch (2014) stated that,the important aspects of the function plan do cover the productions, investments and employment of skilled employees for the enterprise. The enterprise does look forward to the increase in production since the company do believe that the concept of economy of demand and the supply that state about the more supply of products will be demanded by the customers.
The enterprise does want to meet the targets and the objectives of them to meet the ultimate destination of the enterprise which is the success making factors of them to lead in the market industry. With the well-planned strategies, the enterprise is working in certain areas for the need of the company for betterment in the business. These strategies may comprise of the aspects such as the smaller package of the products that the company deliver to the customers (Pina, Romão, & Oliveira, 2013). The company also does focus on the effective communication skills of the employees with the customers and within the enterprise which is the easy process to find the gaps and share of the new ideas which can become the helpful matter for the company. The enterprise should make some more development to enhance the mode of communication through every channel that the company generally follow for their entire processes.
3.3 Implementation of action plans for changes
The action plan of the enterprise is to be made for the development of the business for future growth of business. There should be framed action plans for successful implementation of them to the business. According to Rujivanarom & Gopalakrishnan (2014), the company does plan to enhance their products with better packaging and cost effective smaller packages that can be easily accessed by the customer to grab one for them. The company also approach to the finance providing organisation to be availed of with huge amount of finance for implementation to the business which is helpful to the business and the processes they perform within the enterprise. They are looking for better management system which can manage their all over business processes to enhance in the competition market.
4.1 The impact of the changes over business and its personnel
According to the plans for business development, the enterprise is supposed to gain better experience from the business. According to Sharma & Osei-Bryson (2015), the attractive packaging does attract the customer’s attention which leads to purchase of the products without the actual need for one of them. The attractive packages are easily grabbed by the customer even there is the existence of similar products with traditional packages. Collaboration with different supporting companies to campaign products and to distribute them can be cost effective for the enterprise. The expansion in the financial state would lead to filling the gaps that while present in the business may affect the business (Stone, 2013). The proper management of the entire business leads to the effective business making.
4.2 The management plan for the changes in the business
The business of the Skinny Tan needs various significant changes to improve the performance in the business. There should be the process of management of the business which are easy to handle by the enterprise in terms of environment and the financial state and it would be able to compete with other companies in the race track of industry market. The promotion of the products which are actually promoting the brand image has to be in some innovative way that the customers are easy to convince for grabbing them. Yoder, Visich & Rustambekov (2016) stated that, the promotion of the products through different media should be effective enough for easy access for every viewer.
The advertisements have to be done by the company for the publicity of the brand image and their products and services. More the campaign did more the customers is attracted towards the brand or products. The potential increase in the brand name and the fame of the products and the services has the significant areas to the customers which allow the business to grow in the industry.
4.3 Improvements that reflect well the performances of the company in the past of two years
There exists ideally a range of scope of the improvement for the corporation stated. Firstly it can be clearly found that the overall sales lead to the growth in the figures of the entities especially in the context derived from the observations across the few years. The most noteworthy fact with the grounds of the improvement is preferably the use of the management strategies (Keisidou et al. 2013).The corporations have noticeably reported well the improvement in a previous couple of the years. There an increase well in the products segmentation which leads to sales increasing as one of the core requirements in order to make the well-renowned customer as a base.
This part shows well the different attributes of the people depending on their customer requirements. There is the increase in the overall profit from $225 (000) to figures improve on $ 375(000). The entirety revenue has very well generated and has further increased well to the higher mark. The total assets of the firm have shown doubled up with the figures in comparison with the rest of the previous periods. Thus, it can be clearly seen that the company is well on the growth as it focuses well on the accumulation of the assets (refer to appendix 1).
From the study, it can be concluded that the small business enterprise Skinny Tan is helpful for the all over evaluation in their performance in the business of the small enterprise. Comparative analyses on different kind of studies on the enterprise from the similar enterprise are helpful for them to respond positively for the betterment of the business. There is various suggestion provided for the enterprise which is helpful for the betterment of the business. Hence it can be concluded that the small business enterprise in the study has successful to manage the growth in the industry along with some limitation which can be overcome through the various effective measure.
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