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Your firm's sales are increasing. How will you benefit?

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Introduction

St.Albans Girls' School Centre Number-17519 Madushi Fernando 10M Business and Economics Portfolio Piece Unit 3 - Risk or certainty Your firm's sales are increasing. How will you benefit? Introduction When people start up businesses they automatically take a risk on whether they will gain or lose the money put into the business. The idea is that they will do well and make a profit. With all the fixed costs paid then there will be some profit left. I think that any person starting of a small business is taking a risk. Many questions go through their mind like whether who the customers are, how strong competition is and what prospects there are for growth. If all goes well then there are many different paths you could take to expanding your ideas for the business. I looked into ways that firms could expand their businesses, which are doing well. Case study John Mackenzie recently opened up a fish and fish shop in Wheathampstead and he said " Wheathampstead is a street that is dying out and nowadays many of the shops in the village are closing down due to lack of business. I took a very big risk in fact opening a fish and chip shop right on the high street. ...read more.

Middle

Growth of businesses Growth could lead to higher profits and higher share values, simply because more is being sold. It could also lead to diversification as being in two markets reduces risk. If one firm does badly then the firm can fall back on the profits made by the other firm. Growth could lead to a reduction in costs. Lower costs would lead to higher costs. Growth could lead to greater control over the market. The bigger the share of the market that a company has, the more likely it is to be able to exploit monopoly powers - fixing high prices and earning high profits. Partnerships With sales increasing there is no reason why firms cant go into partnership. It is a cheap and easy to form, just requiring a legal contract called a Deed of Partnership; Having more than one owner should increase the amount of money that can be raised for investment in the business; There is no need to disclose publicly the accounts of the business; Partners who do not work in the business can have limited liability. Hiring more workers I think that the more workers that are hired the more chance of work getting done more efficiently and quicker. ...read more.

Conclusion

How often do you shop at Budgens? Everyday Every other day Three times a week Few times a week not very often 3. Do you think the supermarket plays an important part for the community Yes No Don't know 4. Do you feel he prices are reasonable in Budgens? Yes No Don't know 5. In over the years do you think Budgens has changed for the better or worse Better Worse Don't know 6. Are you going to carry on buying your shopping at Budgens? Yes No Maybe I wrote to Budgens asking for their latest annual reports and accounts but they did not get back to me. I wanted to find out about the aims of the firm's expansion. From looking at my results I can see that Budgens is doing very well and are going to keep going. Someday maybe Budgens could even reach as successful as a supermarket like Sainsburys. Conclusion I think that for any firm to do really well you must first of all take a risk. Once you have done that then if you succeed in getting a lot of profit then there are many ways in which you could increase that amount of profit a little more. People who do well have strategy and aims to achieve to make profit. To maintain the amount of sales you are doing requires hard work in order to get a large profit. ...read more.

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