1

TOPIC : 4
SMALL BUSINESS MANAGEMENT
AND
PLANNING

DIBENTANG OLEH :

DR. ROSMANIZAH DERAHMAN

POLITEKNIK SULTAN IDRIS SHAH

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 2

myTiny experience & education

DIPLOMA IN BUSINESS STUDIES (UiTM)
DIPLOMA IN EDUCATION (Accounting And Economy)-MPPP
BBA Marketing (UKM)
MBA Marketing (UiTM)
CHARTERED IN HUMAN RESOURCE PRACTICE (CIPD UK)
PHD Marketing ( UTP)

Subjects : Strategic Management, Management, Marketing Management, Human Resource

Management, Business Mathematics, Principles of Accounting, Micro and Macro Economy,
Fundamental Of Retailing, Retail Operations, Fashion and Visual Merchandising, Quantitative
Method of Research Analysis, Organizational Behavior, Marketing for Tourism, Public
Speaking, Entrepreneurship

Management Trainee at MATRADE

Business Development Executive at Federal Power Sdn Bhd
DR. ROSMANIZAH Experience – 3 years Pemeriksa kertas SPM Prinsip Akaun – La Salle School
DERAHMAN
3 years Pemeriksa kertas Ekonomi Asas – La Salle School
15 years teaching DPM, DRM & BBA (Marketing), Advanced Entrepreneurship at Ungku
Omar Polytecnic
DR
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 CHAPTER IN TOPIC : 3
4.1 Study the overview of business plan and guideline
4.1.1 Explain the overview of business plan
4.1.2 Identify the standard format of business plan

4.2 Discuss human resource management for small business

4.2.1 Identify human resource functions
a. Human resource planning
b. Job analysis
c. Recruitment and selection
d. Training and development
Note : Typing error dalam syllabus ( 1.1.1 dan 1.1.2 ialah 4.1.1 dan 4.1.2)
CLO & CLUSTER ASSESSMENT
Business Plan Presentation
CLO2 : Develop a viable business plan by organizing
Proposed Topic : T4
business objectives according to priorities (A3, CLS 4)
SLT : 11 Hours (F2F)
9 Hours (NF2F)

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 CHAPTER IN TOPIC :
4
4.3 Explain marketing elements for small business
4.3.1 Explain the importance of marketing for entrepreneurs
4.3.2 Describe the basic concepts in marketing
a. Needs, wants, demand, values and satisfaction
b. Market segment, target customers and positioning
4.3.3 Explain marketing mix

4.4 Discuss basic operation management for small business

4.4.1 Location planning
4.4.2 Equipment and Layout planning
4.4.3 Inventory management
4.4.4 Operational costs and product costing

CLO & CLUSTER ASSESSMENT

Business Plan Presentation
CLO2 : Develop a viable business plan by organizing
Proposed Topic : T4
business objectives according to priorities (A3, CLS 4)
SLT : 11 Hours (F2F)
9 Hours (NF2F)

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 CHAPTER IN TOPIC : 5

4.5 Discuss the basics of a financial plan for small business

4.5.1 Explain the overview of financial management
4.5.2 Prepare a financial plan for small business
a. Project implementation cost and sources of fund
b. Cash flow projection
c. Projected financial statement
d. Projected balance sheet

CLO & CLUSTER ASSESSMENT

Business Plan Presentation
CLO2 : Develop a viable business plan by organizing
Proposed Topic : T4
business objectives according to priorities (A3, CLS 4)
SLT : 11 Hours (F2F)
9 Hours (NF2F)

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 SMALL BUSINESS MANAGEMET AND
6

PLANNING
CHAPTER FOUR

4.2 HUMAN 4.3 MARKETING 4.4 OPERATION

4.1 OVERVIEW RESOURCE MANAGEMENT
4.5 FINANCIAL
MANAGEMENT

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The price of success is hard work,

dedication to the job at hand, and
the determination that whether
we win or lose, we have applied
the best of ourselves to the task at
hand
TIM ROLLINS

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 4.1 OVERVIEW OF BUSINESS PLAN
8

CHAPTER FOUR

SLT

4.1.1
LECTURE : 1 HOUR

TUTORIAL : 1 HOUR

OVERVIEW OF
BUSINESS 4.1.2
PLAN FORMAT
OF
BUSINESS
PLAN

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 9

4.1.1 SMALL
BUSINESS
Small business is defined as a privately owned
corporation, partnership, or sole proprietorship that
has fewer employees and less annual revenue than a
corporation or regular-sized business.

Definition of SME in Malaysia

Manufacturing Sales Turnover less than RM50 Million
Full time employees less than 200 workers

Services and other sectors Sales turnover less than RM20 Million
Full time employee less than 75 workers

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Why we need a plan
10

SEEK LOAN/
BASIC OF
INVESTOR
MINIMIZE CONTROL
SUCCESS
asking a bank, AVOIDS UNCERTAINTIE Planning clearly
angel investor, or HAZARDOUS S specifies the
70% small business
venture capitalist The risk and targets to be
failure due to lack ACTION
for funding insecurity are achieved.
planning Planning avoids
minimized
aimless activities.
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 11
Types of
Business Plan
Types of Business Plan for small business includes , but not limited to

INTERNAL BUSINESS FEASIBILITY

PLAN BUSINESS PLAN

START UP BUSINESS STRATEGIC OPERATION AND GROWTH

PLAN BUSINESS PLAN BUSINESS PLAN

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SEE TRADIOTIONAL
BUSINESS PLAN
4.1.2 FORMAT
Various format could be used,
i) Traditional
ii) Lean
Suggestion content would be
LEAN START UP PLA
N https://www.sba.gov/business-guide/plan-your-business/write-your-business-
plan

SAMPLE FORMAT OF BUSINESS PLAN

START UP FORMAT https://www.spmvv.ac.in/ecell/docs/business-models/3.pdf
PUNB https://www.punb.com.my/ms/sumber/25-sumber/84-tips-rancangan-perniagaan
TEKUN NASIONAL https://www.tekun.gov.my/wp-content/uploads/2020/03/JPP-BORANG-06-KERTAS-
RANCANGAN-PERNIAGAAN-KRP.pdf.

COMMERCIAL BANK https://www.scribd.com/document/344347062/Format-Rancangan-Perniagaan-1

RISDA https://www.risda.gov.my/images/pdf/Muat_turun_borang/AET/
FORMAT_KERTAS_KERJA_AET.pdf
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FORMAT of a Business Plan

Marketing/ Sales Strategy
EXECUTIVE SUMMARY (ES) Briefly outline your plan

For Start Up Business, ES Competitive Advantage

An executive summary is the overview of
SHOULD have Describe the strategy to combat rivals and what is your
your entire business plan and should
succinctly highlight the most important specialty compared to others

parts of the plan. ... "If the executive

Business Implementation Plan
summary lacks specific information or
does not capture the attention of the
Opportunity Describe human resource/ expertise, financial projection in
Describe the need/ opportunity
reader, the rest of the plan might not be brief. (From your planning stage to opening your door)
read.“

An executive summary provides a

Target Market Tips to write
Describe the need/ opportunity Keep strong and positive words but not arrogant,
condensed version of the main
don’t over claim, keep it short, put yourselves in
text. Business Model readers’ place, tailor to your audience (entice
It must be clear and concise investors), not more than 2 pages long, not tell
Describe the product/ services everything (entice them), write this after competed
report, although it is located earlier in the report .
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FORMAT of a Business Plan

TABLE OF CONTENT(TOC) For Start Up Business, TOC should

have

The table of contents in a business plan

introduces your new business to investors,
suppliers and prospective business partners. It
helps provide an overview of what readers can
expect to read within the business plan.
All main and subheading
You can manage it with Word Document, add in TOC and view
using Navigation Pane. You can either prepare last or prepare it
earlier. If you prepare it earlier it can ease you in managing the
report writing.

An introduction explains what the text is

about and why it is written. Appendix section

Includes with appendices and add in page numbers which

can be linked to TOC

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FORMAT of a Business Plan

INTRODUCTION
Future prospect of the
For Start Up Business, business
The introduction should INTRODUCTION should have
contain a two or three

page management
Product service description
Business Concept
overview of the Product service summary, key product or
your particular product or service, and how you
business. It covers the service features, target customers, target
plan to make your business a success.
customers, key customer benefits, value
description of the (Details of company, nature of business,
preposition or purchase motivation
business, the goals and industry profile, location and expected of

commencement)
why the business is a Factors selecting proposed
good venture to start ventures

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FORMAT of a Business Plan

PURPOSE OF PREPARING A BUSINESS PLAN

It provides a blueprint of the company which describes the company`s products or services, the business
model, the management team, the competitors and the business risk faced by the company.

Entrepreneur should clearly and specifically state the purpose of preparing the particular business plan.

With business plan the entrepreneur has solid well-grounded information to supplement the planning and
decision-making process.

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FORMAT of a Business Plan

Management Team
COMPANY/ BUSINESS BACKGROUND Briefly outline your plan

For Start Up Business, COMPANY Mission Statement

A company overview (also
PROFILE should have Describe the strategy to combat rivals and what is your
known as company
specialty compared to others
information or a company
summary) is an essential part Business Name Target Market
of a business plan. It’s an
overview of the most Location
important points about your Detail address and location Objectives and Goals
company—your history,
management team, location,
Legal Structure Statement of goal

mission statement and legal Form of business ownership

structure. It usually appears
after the executive summary
in your business plan.

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FORMAT of a Business Plan

BACKROUND OF OWNER/ PARTNERS Partnership Agreement

Personal Particulars Name of the business

Name of the owner/partners/directors Form of business
Identity card number Location of the business
Permanent address Equity contribution
Correspondent address (includes website/email
Financial matters
address)
Management and position
Telephone numbers
Date of birth Death and dissolvement
Age Labour rights
Marital status Other matters
Academic qualification Signature of each
Courses attended
partners
Skills
Present occupation, and www.companyname.com
Experiences
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FORMAT of a Business Plan

BACKROUND OF THE PROPOSED BUSINESS

Proposed Location
a) Physical location
b) Prices of premises
c) Distance from the sources of materials
d) Availability of manpower
e) Transportation facilities
f) Distance from customers
g) Basic amenities (electrical, water & telephone facilities) and infrastructure

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FORMAT of a Business Plan

ORGANIZATIONAL/ ADMINISTRATIVE/ VISION, MISSION &
MANAGEMENT PLAN OBJECTIVES
ORGANZATIONAL CHART

Administration plan is a plan that which controlling and maintaining

the business routines that provides information and instructions
covering the logistic and administrative support of the operation.
Besides, administration also responsible for partnership and the
employee get salaries and take care employee welfare such as
SOCSO, EPF, bonuses and medical leaves, emergency leave,
maternity leaves or annual leaves (statutory benefits).
The use of money also will be calculated to make sure it well
managed to avoid wastage. All the things such as equipment,
furniture, office supplies and so on will be calculated by the
administrative plan. Recruitment alternatives are also considered to
avoid higher recruitment cost.
This thing will be calculated every month to estimate the cash flow.
The objectives is to reduce the cost and increase revenue.
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HUMAN RESOURCE/ MANPOWER PLANNING
Scheduled of Task and responsibility (JD & JS) , remuneration,
recruitment plan, alternatives to recruitment
EQUIPMENT AND SUPPLIES
EXPECTED ADMINISTRATIVE
EXPENDITURE
- Administrative expenditure (office equipment, office furniture etc
- Working capital – human resource expenses, remuneration plan, salaries
- Other expenses – office utilities, administrative vehicle cost, road tax
and insurance, office rental, legal fees
- Contingency cost – allocated around 5% -10% for unexpected cost and
should be put aside
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FORMAT of a Business Plan

PROMOTIONAL
STRATEGY
Recognize IMC (Integrated Marketing Communication)
MARKETING PLAN Strategy – Advertising/ Sales Promotion/ Personal Selling/

For Start Up Business, Public Relations/ Digital Marketing

The marketing plan details the MARKETING PLAN should have Describe,

strategy that a company will MARKET SHARE

use to market its products to
PRODUCT & OFFERINGS Expected market size, market share and
customers. The plan identifies (PRODUCT)
Detail products & services, picture, diagram, the expected sales (Sales Forecast)

the target market, the value level of products,

MARKETING BUDGET
proposition of the brand or the SEGMENTATION, TARGET AND
POSITIONING (PLACE) Expected budget for marketing (4pcs)
product, the campaigns to be
Identify segments which has been targeted and positioning
Launching product cost
initiated, and the metrics to be strategy used to gain competitive advantage.
Describe and compare the competitive advantage Identify Product Development Cost
used to assess the logistic/ supply chain strategy
Research and Development Cost
effectiveness of marketing (outsource or self-managed)

initiatives. www.companyname.com Annually promotional cost

 22

FORMAT of a Business Plan

OPERATIONAL/ PRODUCTION PLAN
An operation plan is an
Inventory Management
Inventory system used
Do an outline of your business' day-to-day
operations, including your hours of operation Process Flow Chart
and the days the business will be open. If the
business is seasonal, be sure to say so. Describe the operations/ manufacturing/ production process.

extremely detail- Show with chart/ drawing

oriented plan that Physical Plant Operational Layout

clearly defines how a Describe the type, site, and location of premises for Draw the arrangement of the plant/ process/ operations.
your business. If applicable, include drawings of the Manpower involved and system used ( JIT etc)
team or department
building, copies of lease agreements,
contributes to reaching Operational Budget
Equipment, Assets, Special Allocation of operation/ production. Eg : cost of
company goals. Requirement, Material machine, materials cost (direct/ indirect) , direct
It outlines the daily labour and overhead (utilities).
List down and the expected cost
tasks required for Good to have Breakeven Analysis Graph/ calculation
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running a business
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FORMAT of a Business Plan

FINANCIAL PLANNING CASH FLOW
A cash flow statement is an explanation of how
For Start Up Business, FINANCIAL PLAN much cash your business brought in, how much
should have cash it paid out, and what its ending cash balance
Building a financial plan was, typically per-month.
Monthly/ 3 months expected
can be the most
Sales Forecast and Break Even
intimidating part of Analysis PROJECTED INCOME STATEMENT/
writing your business plan Sales Forecast – Marketing Section Profit & Loss Statement
Break Even Point – Operational Section
A cash flow statement is an explanation of how
. It’s also one of the most much cash your business brought in, how much
PROJECT IMPLEMENTATION cash it paid out, and what its ending cash balance
vital. Businesses that
COST AND SOURCES OF FUND was, typically per-month.
have a full financial plan Monthly/ 3 months expected
COST & SOURCES OF FUND
in place more prepared to PROJECTED BALANCE SHEET
pitch to investors, receive Your business’s financial position—
funding, and achieve at a particular moment in time, how are you doing? How much cash do you have in the bank,
how much do your customers owe you, and how much do you owe your vendors ?
long-term success.
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FORMAT of a Business Plan

PROJECT IMPLEMENTATION SCHEDULE

The project implementation

schedule is an important time
management document that
defines and schedules the
major phases of project work
being carried out to fulfil the
desired project objective(s) and
achieve the expected
deliverables.

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FORMAT of a Business Plan

CONCLUSIONS AND RECOMMENDATION

This section concludes and justifies the purpose of preparing the business
plan. It should highlight the viability and potential of the proposed project.

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4.2 HUMAN RESOURCE MANAGEMENT
26

CHAPTER FOUR

SLT

4.2.1
LECTURE : 0.5 HOUR

TUTORIAL : 1 HOUR

Human
a. Human Resource
Resource Planning
Functions b. Job Analysis
c. Recruitment &
Selection
d. Training &
Development
e. Compensation

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 27
Entrepreneurial
QUOTES

"Success depends on

employees. For me knowing and

connecting with my employees is

very important." -Divine Ndhlukula,

founder and managing director of DDNS

Security Operations Ltd

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 28
HR PLANNING
WHAT

Human resource planning (HRP) is the continuous

process of systematic planning ahead to achieve

optimum use of an organization's most

valuable asset—quality employees. Human

resources planning ensures the best fit between Review and

Evaluate Access
employees and jobs while avoiding manpower
CURRENT HR
capacity
shortages or surpluses. HR
PLANNIN
G Develop
Forecast HR
PROCESS TALENT
REQUIREMENT
When 71% of CEOs believe that their Strategies
employees are the most important factor in
their company’s economic success, it’s easy
to understand the importance of the human
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resource management planning process
 a. HR PLANNING
29

FORECAST HR REQUIREMENT
ACCESS CURRENT HR CAPACITY
HR Department identify available
AND emergent business/ new

01
HR Department will determine

current HR CAPACITY 02 ventures/ new line of products etc.

Matching Demand and Supply of
workers
( permanent and temporary post) . Come out with ESTIMATED
number and details of employees

DEVELOP TALENT STRATEGIES

REVIEW AND EVALUATES
Strategies involved various stages like
i) Recruitment Evaluate whether the plan

03 ii) Selection
iii) Hiring
iv) Training and Development
04 has helped the company to
achieve its goals in factors
like production, profit,
v) Compensation employee retention, and
vi) Performance Management employee satisfaction
vii)Employee Relation

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In Human Resource Management JOB

DESCRIPTION
DEFINITION

Job analysis is the process of studying a job to determine which activities

and responsibilities it includes, its relative importance to other jobs, the
qualifications necessary for performance of the job and the conditions under
which the work is performed.
PURPOSE
Basically to develop/ rewrite the
Job Description and Job Specification
METHOD

1. INTERVIEW

Job analyst would conduct face to face interview with job

incumbent. Eg : To prepare a job analysis of a clerk, an interview

with clerks would be conducted to further study and learn about

the job and other requirements required to perform better .

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 b. JOB ANALYSIS
31
JOB
DESCRIPTION
In Human Resource Management (CONT. )

2. SURVEY

Survey would be conducted among the job holders.

Eg : In a large organization, there might be a large number of clerk,
thus survey would be conducted either thru online or hardcopy survey
to seek on the new and required characteristics and responsibilities of
a clerk; a new post which HR Dept should prepare the job analysis
with
3. OBSERVATION

Job Analyst would also observe the job incumbent to further explore
on the requirement of the particular post.
Eg : Job Analyst observe the nature of the job and how it can be
further enhance and improve

4. JOURNAL AND RECORDS

Job Analyst would study journal and past records on the criteria, nature and
characteristics of the particular post.
Eg Job Analyst found and learn that the post need an improvement on
salary or work process or may be it require more tools to perform the job
effectively. Thru this method job analyst would prepare the job description
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and job specification better.
JD and JS
32

Human Resource Management

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c. RECRUITMENT AND SELECTION
33

RECRUITMENT PROCESS

STEP STEP STEP

STEP
1 2 4
REQUIREMENT 3
FROM HR DETERMINE RECRUITED
EVALUATE
PLANNING AND SOURCES OF INDIVIDUAL
ALTERNATIVES
MANAGER’S RECRUITMENT
TO RECRUIT
REQUISITION

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 RECRUITMENT
35

EVALUATE ALTERNATIVES TO RECRUITMENT

OUTSOURCING PROCESS
assign the task of recruitment to the third party specialist, who then carry out all the recruitment activities
which would have been done in-house otherwise. It is beneficial for the firms which are small and have a
lack of expertise in recruitment. OUTSOURCIN
G
OVERTIME
In case the demand for a product peaks due to the
temporary market fluctuations, then a firm asks its
employees to work extra despite recruiting new hands
TEMPORARY
OVERTIME
EMPLOYMENT
EMPLOYEE LEASING
the permanent employees of other firms are hired due to their specialization in a ALTERNATIVE
certain field on a lease basis
S

SUBCONTRACTING
The subcontracting is prevalent in the complex jobs such as construction,
building, and information technology.
SUB
EMPLOYEE
CONRACTIN
LEASING
TEMPORARY EMPLOYMENT G

The temporary employees are those who are hired for a specific time period until the
task gets accomplished

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36

DETERMINE SOURCES OF RECRUITMENT

EXTERNAL
INTERNAL

Employee Audit/ Inventory/ Employee Agencies

Re-hiring
Campus Recruitment
Rehiring former employees

Promote favourite employee SOURCE Employee Referrals

S Unsolicited applicant files

Job Posting And Bidding Advertisement
Notice in board/ intranet
Internet – web sites

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RECRUITMENT PROCESS
RECRUITED INDIVIDUAL
Call/ letter for offers – do not clear the second list Induction program

A. Offer employment to successful applicants

i) Contact the successful candidates to prevent them to other. For the unsuccessful, contact later after the chosen candidates confirm to take
the offer. A well written documents will soften the blow and maintain company public image

ii) Prepare the contract of employment An agreement between employer and employee. Details of terms of contract, job title, wages,
allowances, overtime rate, increment, bonus, normal working hours, holiday expectation from employer, benefit of employee, probation
period, Terms must not conflict with employment legislation eg ; if not stated employer contribution to EPF, that terms is invalid because it
against employment legislation. Always refer to Employment Act 1955.

iii) Give letter of appointment by the first day he starts work

iv) Implied Terms Obligation derived from common law which not included in contract eg care, trust and provision of works , obedience
etc. Example - like provide safe working environment , obey and does not expose fellow workers to danger.

B. Induction of New Employees

Purpose - Overcome anxiety, reality shock, problem to adapt to new environment
Contents
i) Organizational issues – history, structure, product, policies and rules
ii) Introduction – to supervisors, trainers, co-workers
iii) Employee Benefit and procedures – wages, holidays, rest breaks, benefit
iv) Job Duties – job location, overview of job, r/ship to other jobs

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 Selection
38

Recruitment and Selection

Once you have developed your recruitment plan, recruited

people, and now have plenty of people to choose from, you can

begin the selection process. The selection process refers to the

steps involved in choosing people who have the right

qualifications to fill a current or future job opening.

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Selection process 39

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 d. TRAINING AND DEVELOPMENT
40

HUMAN RESOURCE MANAGEMENT

Concept of Training and Development. ...

A formal definition of training & development is it is any attempt to improve current or future employee performance by

increasing an employee's ability to perform through learning, usually by changing the employee's attitude or increasing his or

her skills and knowledge

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TRAINING AND DEVELOPMENT 41

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TRAINING AND DEVELOPMENT
42

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 COMPENSATION/ REMUNERATION 43

HUMAN RESOURCE MANAGEMENT

Compensation is the total cash and non-cash payments that you give to an employee in exchange for the work they do for
your business. It is typically one of the biggest expenses for businesses with employees
BENEFI
WAGES REWARDS
T

STATUTORY NON STATUTORY FINANCIAL NON FINANCIAL

SALARY
TIME OFF INCREMENT OF PERFORMANCE
Cash payments paid to employee EPF
AWARDS
on a regular basis in return for Marriage,PAYMENT
Paternity Leave, Personal SALARY
Compulsory to employer
Emergencies, Pilgrimage, Study Leave,
their labour who have minimum 5
Death of relatives etc
permanent employees BONUS LETTER OF
SOCSO APPRECIATION
HEALTHCARE
canteen, laundry,
MATERNITY LEAVE transport, nursery etc PROFIT SHARING
SPONSORSHIP TO
SUBSIDIES & SEMINAR
GAZETTED PAID SERVICES COMMISSION
LEAVE FINANCIAL
(Weekly Rest Day, Public SERVICES REWARDS FOR
Holiday, Annual Leave, Sick Loans to buy house, car, SHARES.
LONG SERVICES
Leave) computers etc
INSURANCE, Gold Watches, dinner
RETIREMENT event, trips to overseas
BENEFIT
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4.3 MARKETING FOR SMALL BUSINESS
44

CHAPTER FOUR

SLT

4.3.1
LECTURE : 0.5 HOUR

TUTORIAL : 1 HOUR
4.3.2
Importance of
Basic Concepts in
Marketing to Marketing
Entrepreneurs a. Needs, wants,
demand and
satisfaction
4.3.3 b. Market segment,
Marketing Mix target customers and
positioning

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 4.3.1 Marketing for Entrepreneur
45

MARKETING

MARKETING
marketing is
01 Marketing Is an Effective Way of Engaging Customers a social and
managerial
process by
which
02 Marketing Helps to Build and Maintain the Company’s Reputation, Build
individuals
Relationship and Channel to Inform Customers
and
organizations
Marketing provides insight about your business obtain what
03 and Helps to Boosts Sales they need and
want through
Marketing Helps Your Business to Maintain Relevance and keep the creating and
management team to make informd decision. exchanging
04 value with
others

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 Designing a 46

Customer-Driven
Marketing Strategy

Marketing concept is the

idea that achieving
organizational goals depends
on knowing the needs and
wants of the target markets
and delivering the desired
satisfactions better than
competitors do
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4.3.2 Basic Concepts of Marketing 47

NEEDS
A human need is a state of felt deprivation.
Examples include the need for food, clothing,
warmth and safety.

WANTS
The form human needs take as they are shaped by culture and
individual personality. A hungry person may want a steak at
Victoria Station, wants to drive a Jaguar, or wear UNIQLO,
Tudung People or Channel or hold iPHONE12 PRO

DEMANDS
Human wants that are backed by buying power. When you have
money, your iPHONE 12 become a demand after you pay for it.

SATISFACTION
is perceived value delivered relative to a buyer’s
expectations
Value equal to (=) expectation = SATISFIED
Value less than (<) expectation = DISSATISFIED
Value more than (>) expectation = DELIGHTED
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 4.3.2 Basic Concepts of Marketings
48

b. Segmentation, Targeting and Positioning

SEGMENTIN
G TARGETING
Dividing a market into distinct groups
of buyers with different needs,
characteristics or behaviour, who
might require separate products or
marketing mixes.
Eg : Aware of various segments in
the marketplace such as products
for youngsters, adults and senior
citizens
A set of buyers sharing common
needs or characteristics that the
company decides to serve.
Eg : Choose one or 2 of the
segments to serve.
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POSITIONING
refers to the process of establishing the image
or identity of a brand or product so that
consumers perceive it in a certain way. Setup
your brand in consumers mind.
Eg : Use specific way so that consumers perceive
your brand in a certain position.
If your products target youngsters, all the marketing
mix must be appropriately channelled to youngsters
medium.
 4.3.3 MARKETING
49

MARKETING FOR SMALL BUSINESS

PRODUCT
MIX
Product Anything that can be offered to a market for attention, acquisition, use, or consumption
that might satisfy a want or need. Eg : Car, chocolate
Service An activity, benefit, or satisfaction offered for sale that is essentially intangible and does
not result in the ownership of anything eg experience of water park, a hair cut, an educational

PRICE
The amount of money charged for a product or service; the sum of the values that customers
exchange for the benefits of having or using the product or service.

PLACE ( SUPPLY CHAIN)

Producing a product or service and making it available to buyers requires building relationships not
only with customers but also with key suppliers and resellers in the company’s supply chain. This
supply chain consists of upstream and downstream partners.

PROMOTION
also called its marketing communications mix— consists of the specific blend of advertising,
public relations, personal selling, sales promotion, and direct-marketing tools that the company
uses to persuasively communicate customer value and build customer relationships.

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ABOUT

level of PRODUCT
50

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 Core Customer Value in PRODUCT 51

The fundamental need or want that

consumers satisfy by consuming the
product or service.

Core products MUST offer

COMPETITIVE ADVANTAGE
(something you have, others don’t)

Thus, most sustainable companies tell in

their tagline:

Revlon – We sell HOPE

Honda - The Power of Dreams
EcoWorld –
'Creating Tomorrow and Beyond‘
Lazada –Everything Can Sell
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 Place Channel Distribution/ Supply Chain
54

MARLETING FOR SMALL BUSINESS

Choose your channel line as long it provides the below functions

01 INFORMATION AND PROMOTION

Channel can gather and distribute marketing intelligence as
well as developing and spreading persuasive communication
about an offer. Eg : May use agents to ensure getting
continuous feedback on products.

02 CONTACT AND MATCHING

Finding & Communicating with prospective buyers and
shaping & fitting the offer to the buyer’s needs . Eg Channel
line may fulfill buyer’s need accordingly with minimal cost
like COD Delivery

03 NEGOTIATION AND PHYSICAL DISTRIBUTION

Reaching an agreement on price and terms as well
transporting and storing goods ; Eg : May use Drop Ship
which enable on agreement with customers and they
may store and deliver it directly to customers

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 PROMOTION/ Integrated Marketing Communication
55

MARKETING FOR SMALL BUSINESS

PUBLIC
RELATIONS

SALES
Short-term
PROMOTION
incentives to
Building good relations encourage the
with the company’s purchase or sale of
various publics by
ADVERTISING obtaining favorable
PERSONAL SELLING a product or
DIGITAL service.
Any paid form of non publicity, building up a Personal presentation by the firm’s Eg : Point of
personal presentation and good corporate image, MARKETING Purchase,
sales force for the purpose of making
and handling or heading Coupon,
promotion of ideas, goods, off unfavorable rumors, sales and building customer Direct connections
relationships. Patronage,
or services by an identified stories, and events. with carefully targeted
Rewards. Among
sponsor Despite personal approach, this kind individual consumers
best opt SP for
of promotion utilise social media and to both obtain an
- Tv Ads, Billboard, print immediate response
small entp : Flash
other tools. Sales, free
and online ads, EG : Mary Kay, Virtual Events, and cultivate lasting
samples/
Programmatic Ads, Pin Insurance, Coway etc customer relationships
tripwire,
interest, Video Ads, PS prohibited from displaying the recurring sales,
Mobile Ads products on retail shelf free gft
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 OPERATION MANAGEMENT
58

What is OM Definition

Operations management (OM) Managing Resources to Create and Deliver Products and Services

is the administration of (Chris West, 2015)

business practices to create

the highest level of
efficiency possible within an
organization.
It is concerned with converting
materials and labor into goods
and services as efficiently as
possible to maximize the profit
of an organization.
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 4.4.1 Location Planning
59

OPERATION MANAGEMENT

Choosing a location for business is all about setting your business up for success. You shouldn’t just choose
the trendiest building or the cheapest listing. You need to put careful thought into where you want to establish
your business. After all, your business location isn’t something you can easily change .

AFFORDABILITY SPACE AND STYLE

SUPPORT SYSTEM
AND ACCESSIBILITY
RULES AND
SECURITY

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 Three Types Location
60

OPERATION MANAGEMNET

BRICK AND MORTAR BUSINESS ON THE GO BUSINESS IN THE CLOUD

A mobile business provides

A brick-and-mortar business A virtual company operates on a remote basis,
services to customers on the go.
provides face-to-face customer without a physical business location. All work is
This type of business is flexible
service in a physical store completed online, and employees are often located
and can operate from a variety
location. Eg Restaurants and in different states or countries. Eg: common virtual
of locations. Eg : Food truck
SPA businesses include Web design and online
and Cleaning Services
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 4.4.2 Equipment and Layout Planning
61

OPERATION MANAGEMENT
EQUIPMENT PLANNING
In general, equipment refers to anything that is necessary to run your
business and will retain its value over time, including:
1. Large vehicles
2. Manufacturing equipment
3. Healthcare equipment
4. Construction equipment
5. Restaurant appliances
6. Industrial printers and copiers
7. Even smaller things, like computers, desks, restaurant tables, and
phone systems and internet system.
The amount that should be in your equipment budget depends entirely
on the size and nature of your business. Thus you need to :
a) Make a detailed list of any and all equipment that your business
needs.
b) After making your list, contact suppliers to get quotes for each piece
of equipment that you need and you still haven’t acquired.
c) When making your list, you should account for equipment that you
will likely need in the future. A budget is a forecast of expected
expenses, so it should include more than just what you need at this
moment.
d) Lastly, you need to account for the costs of running the equipment,
maintenance, and repairs. Typically, these expenses are factored into
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your pricing, but it’s important to know what these costs are when it’s
time to get equipment financing for your small business.
LAYOUT PLANNING
After the site location decision has been made, the next focus in
production planning is the facility’s layout. The goal is to determine
the most efficient and effective design for the particular production
process.
Service organizations must also consider layout, but they are more
concerned with how it affects customer behaviour. It may be more
convenient for a hospital to place its freight elevators in the centre of
the building, for example, but doing so may block the flow of
patients, visitors, and medical personnel between floors and
departments. Else layout of a SPA must also consider on customer
preferences.
There are four main types of facility layouts:
1. Process
2. product
3. fixed-position
4. cellular.
you may chose .
Source :
https://courses.lumenlearning.com/wm-introductiontobusiness/chapter/
facility-location-and-layout/
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 62

Cellular Layout Planning

Cellular layouts combine some aspects of
both product and fixed-position layouts. Work
cells are small, self-contained production units
that include several machines and workers
arranged in a compact, sequential order. Each
work cell performs all or most of the tasks
necessary to complete a manufacturing order.
There are usually five to 10 workers in a cell,
and they are trained to be able to do any of
the steps in the production process. The goal
is to create a team environment wherein team
members are involved in production from
beginning to end.

Cellular manufacturing is a type of layout

where machines are grouped according to the
process requirements for a set of similar items
(part families) that require similar processing.
These groups are called cells.

Read more:
https://www.referenceforbusiness.com/management/Int-Loc/L
ayout.html#ixzz73ubQsyX3 www.companyname.com
4.4.3 INVENTORY MANAGEMENT 63

Inventory management is the science of inventory, where you use the

information from your inventory sheet to create usable data, but you don't
need a mastery of data analytics to make it work, just a little practice.
2. With a dedicated inventory management system, most of the math is
automated. 3. 3. Inventory management helps you track sales, shipments,
and production, so you can see which products are selling, where, and in
what quantity. (It's science, not magic, we promise!)
4. It allows you to predict your entire supply and demand curve, to adjust
shipments and deliveries, or even production, to precisely meet your needs.
5. All of this allows you to reduce inventory costs to improve profitability. It
also helps you to reduce costs and headaches related to over and under
stocking.

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Source : https://www.tradegecko.com/inventory-management/small-business-inventory-management-introduction
4.4.4 OPERATIONAL COST AND PRODUCT 64

COSTING
It is essential for an entrepreneur to determine the total operational cost to enable him to calculate the cost
per unit of the goods produced. Operational costs include costs of direct material, direct labour and
overheads.
Direct material costs are the money spent on materials that are directly used to produce the products or
services.
Direct labour costs are the money paid as wages, salaries and benefits to the workers involved directly in
the production of the products and services.
Overhead costs include rent, insurance, and wages of indirect labour, maintenance and depreciation.

Operational costs can be calculated using the following formula:

Operational costs = Direct material cost + Direct labour cost + Overhead

cost

Using the operational costs, the entrepreneur can determine the cost per unit of good produced or service
provided by using the following formula:
Cost per unit = Total Operational Cost (RM)
Total Number of output (Units)
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4.4.4 OPERATIONAL COST AND PRODUCT 65

COSTING A practical example of this is to look at how

the formula is applied to a jewelry-making
business. Fixed monthly expenses total
RM1,000 and variable costs for each piece
of jewelry are RM50. This covers materials
and labor. Since similar pieces of jewelry
can cost RM70, you decide this is your
price per unit.

‍ ixed Cost
F = RM1,000
Variable Cost/ unit = RM50
Price/ unit = RM70

BEQ = RM1,000
(RM70 - RM50)
= RM1,000/RM20
= 50 units

This means you would need to sell 50

pieces of jewelry at RM70 each per
month to break-even.

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9 best FREE Inventory Management SOFTWARE 2021 66

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 Organize Inventory In Small Business
68

INVENTORY MANAGEMENT

ORGANIZE PRODUCT AND RECEIVE INVENTORY ORDER

CREATE AND SUBMIT ACCURATE
VENDOR INFORMATION ACCURATELY
PURCHASE ORDER
ePOS System or Spreadsheet

TRACK TAKE REGULAR PHYSICALRECONCILE ORGANIZE

TAG AND LABEL
INVENTORY AS INVENTORY COUNTS INVENTORY STOCKROOM &
INVENTORY
IT’S SOLD Annually, Cycle Counts, DIFFERENCES WAREHOUSE
A POS system will dramatically
Counting using POS System Monitor for theft
streamline this process Annually, Cycle Counts,
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Counting using POS System
Source : https://fitsmallbusiness.com/inventory-management-for-small-business/
 OPERATIONAL COST 69

The operating expenses refer to the specific costs after gross revenue is defined in the income statement . .

Before calculating a company’s operational expenses/ cost, it is essential to identify the operational activities or the
primary revenue-producing activities of the business .

RENT MARKETING COST ADMINISTRATIVE COST RAW MATERIALS

PAYROLL OFFICE EXPENSES COGS ( COST OF GOOD SOLD) MAINTENANCE

EXPENSES

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OPERATING COST
OPERATION MANAGEMENT

= + +
OPEX DIRECT DIRECT
MATERIA LABOR OVERHEAD
L COST COST Insurance, Rent, Indirect labor,
Direct material costs
Wages, Salary maintenance, depreciation
Benefits to employee

Operating expenses are important because they can help assess a company’s cost and stock management efficiency. It highlights the
level of cost that a company needs to make to generate revenue, which is the main goal of a company.
If a company incurs relatively higher OPEX as a percentage of sales compared to its competitors, that may indicate they are less
efficient at generating those sales. ALWAYS IN BUSINESS, PROFIT WILL INCREASE WHEN THE COST CAN BE LOWERED.

COST/unit = OPEX
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4.5 FINANCIAL PLAN FOR SMALL
CHAPTER FOUR
BUSINESS
SLT

4.5.1
LECTURE : 1 HOUR

TUTORIAL : 2 HOUR

OVERVIEW OF 4.5.2
FINANCIAL FINANCIAL PLAN
MANAGEMEN a. Project Implementation
T Cost and Sources of Fund.
b. Cash Flow Projection
c. Projected Financial
Statement
d. Projected Balance Sheet
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4.5.1 FINANCIAL
MANAGEMENT
Quality financial management
offers many benefits to you as a
business owner. Financial
management includes
bookkeeping, projections,
financial statements, and
financing, which forms the
foundation for reaching your
goals through sound business
decisions.
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SUCCESS
72
1
MESUREMENT
Financial management is one of your
main avenues to success as a
business owner. Financial
management is the way you know if
you are making a profit.
OPERATIONAL TOOLS
2
Financial management helps you decide
what you can afford in terms of store or
office location, inventory purchases,
employees, and equipment. You need sound
financial information to set your prices and
select your vendors
TOOLS FOR PLANNING
3 Financial management gives you the tools to
plan for overall business growth, for
diversification of your product lines, or for
reaching new markets. Financial
management helps you decide which
products, services, and markets are
profitable
 73

4.5.2 FINANCIAL PLAN

PROJECT IMPLEMENTATION PROJECTED FINANCIAL

COST AND SOURCES OF FUND STATEMENT

PROJECTED BALANCE
Incorporate both long term and CASH FLOW SHEET
current trends and
short term expenditure required to
expectations to A balance sheet is an
start a business project.
Cash flow is the arrive at a financial important financial
Cost Estimation of :
money coming
picture that statement that gives a
i) Organizational (administrative into and going
out of your management snapshot of the
cost)
business financial health of your
ii) Marketing Cost believes it can attain
business at a point in
iii) Operational Cost as of a future date.
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time.
a. PROJECT IMPLEMENTATION COST AND SOURCES OF FUND 74

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b. Proforma CASH FLOW statements 75

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b. CASH FLOW - 12 months Cash Flow 76

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b. CASH FLOW - 3 Year Cash Flow 77
Operating Activities
Operating activities make up the
day-to-day business, like selling
products, purchasing inventory,
paying wages, and paying operating
expenses. Perhaps the most
important line of the cash flow
statement is the Net Cash Flow
from Operations.

Investing Activities
Investing activities include buying
and selling assets like property and
equipment, lending money to others
and collecting the principal, and
buying/selling investment
securities.

Financing activities
include borrowing from creditors
and repaying loans, issuing and
repurchasing stock, and collecting
money from owners/investors, and
payment of cash dividends.
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c. INCOME STATEMENT 78

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c. PROJECTED INCOME STATEMENT 79

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d. BALANCE SHEET ( ASSET = LIABILITY + EQUITY) 80

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d. PROJECTED BALANCE SHEET 81

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HOW FINANCIAL STATEMENT LINKED TOGETHER 82

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REFERENCES

1. MPU 22012 Entrepreneurship, Mazura et al (2020).

2. https://corporatefinanceinstitute.com/resources/knowledge/accounting/3-financial-

statements-linked/

3. researchgate.net/figure/Project-implementation-cost-source-of-financial_tbl4_281308416-

Syahida Abdul Azis

4. www. google

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CQI ( Suggested)

1. Numbering for Chapter 4 – 1.1.1 to 4.1.1

2. 4.5.2 c. Projected Financial statement to Projected Income Statement

3. Add BEP in Operation Management

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