Unit 29: Managing and Running a Small
Business
Unit code L/508/0566
Unit level 5
Credit value 15
Learning Outcomes and Assessment Criteria
Pass | Merit | Distinction |
LO1 Discuss how a small business or social enterprise plans and allocates resources to achieve objectives | |
P1 Discuss the main considerations a small business or social enterprise needs to address when planning and allocating resources to achieve business objectives. | M1 Apply relevant tools and techniques in a structured and analytical way to plan and allocate resources in an organisational context. M2 Assess the importance of planning and allocating resources to achieve business objectives. | D1 Critically analyse the application of appropriate resources to demonstrate links between resource allocation and achievement of business objectives. |
LO2 Explain and evaluate the customer relationship management process for a small business or social enterprise, including understanding the benefits and challenges of transnational operation | |
P2 Explain and evaluate different processes of customer relationship management for a small business or social enterprise. P3 Explain how a small business can develop transnationally and determine the benefits and drawbacks. | M3 Apply and evaluate the elements of the customer relationship management process in relation to achieving business objectives. M4 Evaluate the potential to develop transnational operations using the stage model of internationalisation, assessing both benefits and challenges. | D2 Critically evaluate the customer relationship management process at all stages and provide recommendations for overcoming challenges of developing transnational operations. |
Pass | Merit | Distinction |
LO3 Develop and analyse a cash flow forecast, budget and break-even analysis and interpret key financial statements | |
P4 Produce an annual itemised monthly cash flow forecast showing fixed and variable costs set against income for a specific organisation. P5 Explain how break- even analysis could be applied to an organisational situation. | M5 Apply appropriate quantitative and analytical techniques to provide an appropriately detailed cash flow forecast and break-even analysis. | D3 Produce an accurate cash flow forecast and break-even analysis with a critical evaluation of how key financial statements contribute to the successful management of the business. |
P6 Interpret key financial statements for an organisation in relation to how they contribute to the successful management of the organisation. | | |
LO4 Discuss the implications of regulation and | |
legislation on a small business or social enterprise | |
P7 Discuss key legislation | M6 Evaluate the | D4 Critically evaluate key |
and regulations that have | implications of key | legislation and |
implications on small | legislation and | regulations that affect |
businesses or social | regulations in an | small businesses or social |
enterprises. | organisational context. | enterprise organisations, |
| | taking future |
| | developments and |
| | changes into account. |
Introduction
This unit will
provide students with a practical understanding of the key aspects of running a
small business or social enterprise. Students will learn about the activities
involved in running a small business, including developing good relationships
with customers, planning and allocating operational resources, forecasting and
budgeting, interpreting financial statements, recruitment and retention of
staff, leadership and building a team, dealing with legislation and regulation
and how to put together a business plan.
Students will
be able to apply their learning to a simulated business of their choice that
they will work on as part of a group. They will develop an understanding of how
all of the different aspects of running a business interrelate to achieve
success, and develop an appreciation of the benefits and importance of
organisation and planning.
Learning
Outcomes
By the end of
this unit a student will be able to:
- Discuss how a
small business or social enterprise plans and allocates resources to achieve
objectives.
- Explain and
evaluate the customer relationship management process for a small business or
social enterprise, including understanding the benefits and challenges of
transnational operation.
- Develop and analyse
a cash flow forecast, budget and break-even analysis and interpret key
financial statements.
- Discuss the
implications of regulation and legislation on a small business or social
enterprise.
Essential
Content
LO1 Discuss how
a small business or social enterprise plans and allocates resources to achieve
objectives
Planning
resources – premises and equipment, people and skills:
- Planning of
activities in a business to include capacity utilisation and management,
identifying resources and skills needed to develop appropriate job
specifications.
Being an
employer:
- Organisation
structures applicable to the business purpose and organisation stage.
- Establishing an
appropriate organisational culture.
- Consideration
of human resource management: recruitment and retention, performance management
and team building.
- Use of
outsourcing, networks and external advisers.
- Understanding
key aspects of employment legislation relevant to a small business, for
example, equality and diversity.
The business
plan:
- Effective
articulation of the vision, goals and objectives. Key components of a business
plan.
- Consideration
of when a business plan might be needed, for example, when securing an
overdraft or bank loan.
- Project
management techniques, including use of Gantt charts and critical path
analysis.
LO2 Explain and
evaluate the customer relationship management process for a small business or
social enterprise, including understanding the benefits and challenges of
transnational operation
Building
customer relationships:
- Assessment of
customer value, acquiring and retaining customers.
- Developing
effective channels for customer communications and customer care programmes.
- Digital
platforms for effective customer relationships to include email marketing for
mobile devices, online chat and forums for real time responses and solutions,
online testimonials and ratings and use of social media.
Transnational
sales:
- Defining
transnational sales and considering why start-up and small firms
internationalise.
- Preparing to
sell and source transnationally and application of the stage model of
internationalisation.
- The process of
exporting and key considerations.
LO3 Develop and
analyse a cash flow forecast, budget and break-even analysis and interpret key
financial statements
Sources of
finance for start-up and small businesses:
- The main
sources of finance for start-up and small businesses, including own savings,
equity finance or loans from family and friends, bank loans and overdrafts,
leasing and hire purchase, invoice factoring.
Forecasting and
budgeting:
- Techniques for
forecasting and budgeting: using time series data, calculating a moving
average, finding a trend, dealing with seasonality
- Developing
budgets, including ‘What-if’ sensitivity analysis. Using budgets for
performance monitoring and control.
- Variance
analysis. Break-even analysis.
Financial statements
for a small business:
- The key
financial statements that are required for a small business and how to
interpret them.
- The difference
between profit and cash and the vital importance of cash flow for a small
business/social enterprise.
- The elements of
working capital and how to manage cash flow effectively.
LO4 Discuss the
implications of regulation and legislation on a small business or social
enterprise
Legal and
regulatory issues:
- The legal and
regulatory issues applicable to a small business in the country it is
registered: record keeping, tax and employment, health and safety, insurance,
data protection and cybersecurity measures.
- Examples of
regulatory issues that may apply to different business types, different
products or services and different localities such as environmental and waste
regulations, professional practice guidelines, and local planning restrictions.
- The potential
sources of information to determine applicable regulation.
