The four businesses that I have chosen are as following:
Name of business
This business is called Kentucky Fried Chicken
Type of ownership
This business is classified as a franchise as they are many restaurants of it around the world. For example there is one of these shops in west end and also in Victoria. A franchise is when an individual pays a fee to sell a brand of goods. Firstly there has to be an agreement between a franchisor and a franchisee. The franchisor allows the use of their businesses name for an agreed length of time. The franchisor provides materials, training and advice but the franchisee must provide money to start to start their business. The franchisee must also make regular payments to the franchisor.
Size of business
This is a business is classed as a small business as it only has 6-99 employees. And its scale is global as it is in countries like Venezuela.
Purpose
Its purpose is to make their customers happy with their food, and also introduce the company with new types of food like the “New snack wrap”. This is to attract more customers to come and buy their food so they can earn money.
Name of business
This business is called La vida loca. A small barbers shop in Elephant and Castle.
Type of ownership
This business is classified as a sole trader, a sole trader is a person who is in business and is not in a partnership with anybody else. So they keep all of their profit, make all the decisions, work when they want to work and are their own boss. The disadvantages about being a sole trader are that they could lose all of their money and become bankrupt. And since they are their own boss they have to work all of the hours, even if they are sick they don’t get paid and have to raise the finance on their own.
Size of business
This is a micro business as it only has1- 4 employees. It is a local business as there is only one of these shops in the world and that is in London, Elephant and Castle.
Purpose
This sole trader’s purpose is to make a profit by providing a service by cutting and doing people’s hair at a reasonable price. Also to make customers happy this sole trader also has a little food shop at the side of his barbers shop so that people can also buy food if they are hungry.
Name of business
This business is called John Lewis Ltd.
Type of ownership
This business is a partnership as it has more than two people running the business and less than twenty people. A partnership is like a small business and tends to be larger than a sole trader. There are always two or more people running the business, the maximum number of partners is usually 20. Partnerships are very easy to set up and the money is generally provided by the partner’s.
The money is normally shared between the partners. This type of business is very easy to set up and is always larger than a sole trader.
Size of business
John Lewis is classified as a large business as it has more than 250 employees. This business is a national business as it is only in England. But it has many stores of it around England.
Purpose of business
This businesses purpose is to provide goods to their customers by selling furniture, clothes and appliances. This business also improves their company by making a website for people to order online so this satisfies their customers as they also provide a delivery service.
Task 2
Task 2a
The growth and decline in employment industry
Primary sector
The primary sector has fallen throughout the years of employment on the primary sector for example the farming employment has decreased over the years because we now have new technology, machines that will do our work faster than before. So now our society does not have that much farming as they did in 1993 now that we are in 2007.
Secondary sector
In this graph you can see that the employment is declining each year this is because in the previous years companies needed employees to carry out work
In this graph you can see that the employment is increasing because, in the tertiary sector machines have not been made were they can sell products to customers so you need workers to work at a counter. Also they import most of their manufactured goods from abroad and more people are employed in the tertiary sector and employment appears to increase because most workers are part time workers.
Task 3
Task 3- Why it is beneficial for businesses to set themselves aims and objectives?
Aims
The aims of an organisation are often developed from their mission statement. Organisations major goals are to achieve the overall mission of the mission statement. It is important that a business has aims because they are made to state what the business wants to achieve. Both, profit making and non-profit organisations will have aims in order to make the organisation run better and keep the originations running well.
Some of these aims may include:
- Increase profit
- Introduce new products
- Challenge competitors
- Retain existing customers
- Target new customers
For example some supermarkets have an aim of being more environmental friendly. In order for them to achieve this, they must have objectives. For instance Sainsbury’s supermarket came up with the idea of selling a bag called ‘I’m not just a plastic bag’ which is made of unbleached cotton instead of just plastic; this eco-friendly bag could be an objective so they can achieve their aim of being environmental friendly.
Objectives
Aims are fine but they do not highlight the steps to achieve the organisation’s goals. They are called objectives. Nobody will understand what the goal if you do not have aims. Reasons why businesses have objectives are that objective is a target that can be worked towards. Objectives can be long term or short term.
Smart objectives
S.M.A.R.T refers to the key characteristics of meaningful objectives, which are Specific (concrete, detailed, well defined), Measurable (numbers, quantity. Comparison) Achievable (feasible, actionable). Realistic (considering resources) and Timely (a defined time line).
Specific
Specific objectives are clear and well defined; the objective must be straightforward and must emphasize action and the required outcome and to also communicate what you would like to see happen. To help set specific objectives it helps to ask:
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WHAT am I going to do? This is best written using strong, action verbs such as conduct, develop, build and plan. This helps the objective to focus on what’s most important.
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WHY is this important for me to do?
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WHEN do I want this to be completed?
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HOW am I going to do this?
Achievable
Objectives need to be achievable but in order to do this, a person needs the right resources for example; computers, tools, etc. If the person has a lack of skill then they will not have access to key people and may not have management support. Achievable objectives ensure that everything is in place and that if the person does not reach their goals they cannot reasonably blame some one else for it.
Realistic
Objectives that are achievable may not be realistic. However, realistic does not mean easy. Realistic means that you have the resources to get it done. The achievement of an objective requires resources, such as skills, money, and equipment and so on. Most objectives are achievable but may require a change in your priorities to make them happen. Objectives should also add useful value within the context where they are being set, being aligned with strategies and higher goals.
Timely
Objectives should also include timescales of what is required and when it is required. This may include details of delivery, stating where objectives are to be completed. Time scales creates the necessary of urgency and also prompts action.
The difference between an aim and an objective is that an aim is something that a business wants to achieve and an objective is the steps taken to achieve the aim.
The purpose of setting aims and objectives for businesses have many reasons. This may include:
Survival – If a business is having difficulties they may want to make good profits and aim to survive until the situation improves.
Break even – This means making enough money to cover the total costs involving producing and selling the goods or services and running the business.
Growth – Some businesses may aim for growth, so that they sell more goods or services. This also means expanding by opening other branches.
Develop their relationships with other businesses – Some businesses aim to improve or develop their relationships with other businesses. This involves joint activities to provide goods or services to more people. For example; Tiscali and Home choice became a joint service to provide a better service for their customers.
Aims and objectives can change depending on the business sector. E.g. Government departments their purpose is to provide a quality service to the community. Their aims and objectives are to improve service provision and to meet customer targets. This is called a public sector. On the hand a voluntary sector such as Oxfam, provide a free service for the needy. Their aims and objectives are to increase services offered and to increase revenue from donations.
J. Sainsbury’s:
The business I chose is J.Sainsbury’s. At Sainsbury's it is everyone's job to think about what our customers want.” This is a quote taken off by the mission statement of Sainsbury’s.
Their business is now focused very much on Sainsbury’s Supermarkets
and Sainsbury’s Bank following the sale of Shaw’s and JS Developments
during the year.
Their three priorities are based on the environmental impacts that are considered the most significant for the business. Sainsbury’s aims are:
· Reduce the environmental impact of products.
· Reduce CO2 emissions.
· Reduce waste.
They work hard to make sure that they meet their customer expectations and they continually ask their customers what they think. They source with integrity that is the way they do business, from what they sell to the way they procure them. They also respect the environment, “Climate change is a key driver for us so reducing energy, packaging and waste are big priorities for our business”.
Their Objectives are:
· Environmental Management System: Manage the significant
environmental effects over which we have direct control and seek to
influence those of our customers and suppliers who reduce the impact
our organisation has on the environment.
· Own-Brand Products and Suppliers: Influence our suppliers to reduce
their direct environmental impacts and improve the environmental
quality of own-brand products through more sustainable sourcing.
· Transport: Increase the efficiency of transporting our products, and
address employee and customer travel, with the aim of reducing CO2
emissions while achieving customer satisfaction and business growth.
In order for them to achieve this aim they divide this overall aim into three different aims and they are:
- Developing products that costumers want.
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investing in the within stores
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Providing good to look after customers
To achieve these aims they must follow objectives which are set up by different functional areas. For instance marketing: Marketing helps M&S to meet their aim of “developing products that customers want” by doing market research. Market research involves finding out information about a market. This could be about:
- What particular needs of a group are
- Changes a group needs
- What customers think about an specific product
- How they can improve it
Kentucky fried chicken
This is the other business I chose to write about. This business is classified as a franchise as there are many of these stores around the world; KFC has more than 11,000 restaurants in more than 80 countries and territories around the world.
“The more, the merrier, when everyone’s enjoying KFC”. Their business is now much focused on introducing new food products to the business and making their customers happy. “At KFC we take great pride and care to provide you with the best food and dining experience in the quick service restaurant service”. At KFC they believe that eating sensibly, combined with an appropriate exercise, and are the best solution for a healthy lifestyle.
In order for them to achieve this aim they divide this overall aim into three different aims and they are:
- Developing products that costumers want.
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investing in the within stores
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Providing good to look after customers
Compare and Contrast the Ownership, Aims and Objectives.
Kentucky fried chicken and J.sainsbury’s have different ownerships therefore have different things they want to aim for. J.sainsbury’s work to make a profit out of the things they sell and the services they provide. On the other hand Kentucky fried chicken work to develop products that customers want and making more franchises on the business, also providing a good service and making customers happy.
Task 3a
- Task 3a- Choose 2 of the businesses to write about in more detail. You need to compare (find similarities) and contrast (find differences) between them. You could do this in a table or write a paragraph.
Name of business
J Sainsbury’s
What kind of business it is? - J Sainsbury’s is a Public Limited Company. It is a public limited company because this company sales shares.
Number of employers- The number of employers in J Sainsbury’s is large because they have store all over Britain and the need workers to keep the store running well and they need workers to pick goods and bring to he stores.
The scale of the business- The scale of J Sainsbury’s is a global business because it is around the world.
Does it supply a good or service- Yes Sainsbury’s does supply goods and service an example of their goods is what u buy within their store and an example of their service is when you purchase your goods online they will delivery your goods to your home
Does it aim to make a profit? - Sainsbury’s aims to make a profit but them also aim to keep their customers happy so that they customers will come back to their store again.
The size of the business- The size of J Sainsbury’s is large this is because they have store all over London.
Main purpose- This businesses purpose is to improve their goods and services in order to satisfy their customers. They try to improve their store and make customers happy by giving them what they want. They have services as well as they have a website where their customers can buy their goods online and the company can deliver it to their homes. And also can do car insurance, borrowing loans and much more. But this business only tries to make a profit and will only sell goods at below cost if they have to, for example if there is a lot of stock of one item and not that many customers are buying the item so they reduce the price.
The departments that J Sainsbury’s have within their company are:
Supply chain – it involves making sure that the food gets around.
– it is about covering the core skills of display and merchandising, product safety, customer service and people management
- (customer services, personnel, hygiene and safety)
- (supply chain and new product development)
– it makes sure that the customer’s voices are heard and new products are to their expectations.
– it ensures that they bring in the freshest, healthiest and safest foods.
– it is where their team buys the food they make sure that is safe to buy and be put in stores across the country.
–it is all about supporting the business by delivering profitable new trading floor space and improving the performance of their existing property assets.
Administration in virgin deals with the paper work
– it is about managerial and technical skills, where it makes sure that the business is successful.
– it plays a big part in the store because it is all about development the store, refurbishment, extension or new store buildings. This plays a big part with the retail because it is a way of ensuring that best value is driven from their property.
Sainsbury’s aims are:
- To make a profit
- To keep their customers happy
- To get new branches
- To be customers first choice for food
- Delivery out standing quality of products
Name of business
John Lewis
Type of ownership- This business is a partnership as it has more than two people running the business and less than twenty people. The money is normally shared between the partners. As this type of business is very easy to set up and is most likely larger than a sole trader.
Size of business- John Lewis is classified as a large business as it has more than 250 employees. This business is a national business as it is only in England. But it has many shops of it around England.
Purpose of business- This businesses purpose is to provide goods to their customers by selling furniture, clothes and appliances. This business also improves their company by making a website for people to order online so this satisfies their customers as their goods can be delivered to their homes. They sell all of their items at cost and if they have to sell their items below cost because not that many customers are buying it they will sell their stock below cost.
The departments that John Lewis has within the company are:
Sales- have to tell the ICT department what they have in stock before the ICT department can put anything up on the website of John Lewis.
The supply chain- insures that the goods of John Lewis get around to other stores or the customers homes safely.
Customer and marketing- it makes sure that the customer’s voices are heard and new products are to their expectations.
- it is about managerial and technical skills, where it makes sure that the business is successful.
- it plays a big part in the store because it is all about development the store, refurbishment, extension or new store buildings. This plays a big part with the retail because it is a way of ensuring that best value is driven from their property.
: it is all about supporting the business by delivering profitable new trading floor space and improving the performance of their existing property assets.
John Lewis’s has seven principles which define how they run their business:
- Purpose
- Power
- Profit
- Members
- Customers
- Business relationships
- The community.
Task 4
Functional areas
There are several functional areas in business. They are:
1. Marketing
2. Human resources
3. Administration
4. Finance
5. Distribution
6. Production
7. Research and Development
8. Sales
9. I.C.T
10. Customer service
The production function
The production function is responsible for the whole manufacturing services; they turn raw materials into finished goods. Gregg’s is known as a production function because they sell and make their own goods during the process they also have to check the quality of the product and they have to plan to the product schedules. The production function orders stocks of raw materials from approved suppliers and produces or assemble the finished product. Before they send the product off they check the quality of the product throughout the production process and pack and process the final products before distribution.
Production planning
Production control
Machine utilisation control
Staff utilisation control
Final quality checks
Marketing
This functional area is about knowing, meeting and identifying the customer’s needs. Everyone in the organisation is trained to put the customers first. The production worker, who has to produce high quality goods, must respond to a customer enquiry promptly and accurately. For example, on a businesses website they promote and advertise their goods online and also send newsletters to the customers that are registered members of the website. This also attracts customers to buying their product, by advertising their products online and giving the customers information about their business. For example, the Jane Norman clothes store has a website and they advertise their clothing line to their customers, and they can also order online, they also give information of where you can find the closest store of Jane Norman so the person viewing the website can actually go to the store and see for themselves what the store has to show for them.
Definitions of Marketing:
- The function that links to a business with customer needs and wants in order to get the right product to the right place at the right time.
- The achievement of corporate goals through meeting and exceeding customer needs better than competition.
- The management process that identifies, anticipates and supplies customer requirements efficiently and profitably
- Marketing may be defined as a set of human activities directed at facilitating and consummating changes.
Research and Development (R & D)
This functional area is about new product development as well as improvements to existing products. In other industries it also involves product design as well. New products may be developed because of technological scientific advances. For example, mobile phones, new medicines etc. Many organisations aim to continually improve both product design and performance. Designers want their product to stand out from its competitors and to look attractive so the product can attract customers. For example, designing the packaging of a perfume, designers make it look colourful with a lot of light and pictures so it attracts the customer’s attention.
I.C.T function
ICT always helps a business to become more popular or sell their stock online. ICT is everywhere today, we use it to find jobs, in schools and we also have internet on our mobile phones. Nearly every business today has got something to do with I.C.T, if something goes wrong with the computer then they will need some one to try and sort the problem out. For example, some one that knows how to add additional software, such as printers and scanners. I.C.T is also responsible for the system security, making sure that only authorised users have access to the system, protecting the system from viruses and hackers and ensuring there is a full back up system to protect the computer.
Sales
Most businesses don’t need sales staff as they only sell small items such as chocolate bars or magazines. But companies that sell electronic goods such as cars or televisions need sales staff to help them sell the product because the customer needs more help and advice if they want to buy a complex or expensive item. Therefore stores that sell these types of products need trained and friendly staff that will help the customer come to their specific needs. Also business buyers expect a high quality service in depth advice and information. So if they may want to buy a highly complex item they need to negotiate finance arrangements and also insurance and also discuss discount purchases. For example our school has many sales with the uniform, the canteen so we can dine and also selling revision books to the pupils for a lower cost than in the shops.
Customer services
All businesses must look after their customers who have an enquiry or a problem with something. When people contact a business they expect many things, for example a prompt, polite and knowledgeable response. For example, at home I have a box that controls the internet, television and phone, and a few days ago we had a problem with the box because the internet wasn’t working properly, so we called home choice (the businesses name). And we explained the problem to them and they helped us to try and get the internet back, not matter how long it took they were there to help us with what ever they could. And in the end, the internet started working again. So people like that, that help customers when they have a problem, helps the business maintain customers so they keep purchasing that product, because what the business doesn’t want is to start losing customers. Another example of customer services is Primark, if the customers want to exchange a product or has a complaint on the product they go to customer services. But the bad thing about Primark’s customer services is that when customers need help with something, there is always a long cue and most customers don’t like this. For this reason, may businesses have customer service staff or a customer service department- where trained staff handle enquiries and complaints positively and professionally. This does not mean that other staff can ignore customers and their needs.
The administration function
The administration function collect and distributes and dispatching mail. They store and retrieve paper and electronic records and also organise meetings and prepare the meetings documents. They respond promptly to enquiries and prepare documents using word processor, spreadsheet and presentation packages such as PowerPoint. They send and receive message by telephones fax and email and also make arrangements for visitors.
The distribution function
The distribution function ensures all goods are appropriately stored before dispatch and also ensure goods for dispatch are securely packed and correctly labelled and ensure the goods are dispatched at the right time. For example they check vehicle loads are safe and secure and plan and schedule vehicle routes. The distribution function checks that all deliveries match orders precisely and notifying sales if there is a discrepancy. Plus they notify sales staff of delivery schedules so that customers can be informed.
Finance
The finance function produces invoices, checks payments are received and chase up over due payments and also record money received. They prepare the payroll and pay off staff salaries. They monitor departmental budgets reports to all departmental managers and check departmental budgets to make sure managers are not overspending and issue regular budgets reports to all departmental managers. They produce cash flow forecasts and regular financial reports for senior managers. For example in our school BTG we have a finance officer for the it a department so the heads of departments can buy chairs or pencils for the students if they are short for those products.
Human resources
The human resources of a business are its employees. They look after their staff on a basis, if the staff are well trained and committed to the aims of the business then the organisation will become more successful. The organisation is responsible for recruiting new employees to the fill vacancies that are best suited for that person. This is very important because they need the right person to the job, it will be a waste of money training some one and in the end they are not good enough for the job. Hiring the wrong person could cause problems towards the company and that person. When a person is new to a job the have to attend an introduction programme that explains to them about the business that they are working for and what their responsibilities and expectations are for that job. Employees also expect things from their job. They expect to enjoy themselves while they are working there and to be treated the same as others and get paid fairly for what they are doing in that job. And also expect some one to take their place if they are sick or have personal problems. Employees are like students really, they want their job to be interesting and they also want praise when they have done something really good in their job or they have worked really hard, this keeps them working harder an feeling proud of themselves.
Human resources function:
- Maintaining staff records
- Checking health and safety and keeping accident records
- Monitoring the working conditions of staff
- Advertising job vacancies
Why is it important for functional areas to work together?
It is very important for the functional areas to work together so the business activities are carried out correctly. It is also for the business to achieve its aims and objectives. People work together in departments to carry out each task that relates to their department.
Task 5
How functional areas contribute to achieving their aims and objectives.
La Vida loca:
La Vida loca is a small barbers shop in Elephant and castle owned only by one person. This person aims to make as much money as possible. In order to complete this aim, the functional areas work together by:
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Marketing: This person aims to make his customers happy, by giving them what they want. And that’s a good hair cut! He advertises his business by leaflets and also by telling friends and family members about it.
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Customer services: Even though this person works by themselves they still handle complaints carefully and professionally.
These functional areas help to support and achieve the aims and objectives by making sure that they make their customers happy and also making sure they make a profit. They also help the business get more customers, by advertisement e.g. leaflets and word of mouth.
There was a point when this business went down hill, and did not achieve all of their aims and objectives. The sole trader did not come in for a period of time and had someone to cover for him, but that person did not manage the business very well. So the business did not earn that much profit and most of the customers were unhappy. The functional areas such as customer services did not interact very well, as they did not sort out the customer’s complaints and this resulted in failure of communication.
On the other hand, J. Sainsbury’s functional area works to make a profit by:
J.Sainsburys:
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Administration – It is responsible for all the secretarial work, payroll and accounting.
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Finance –It is responsible for the managements of accounts. Keeping record of any purchases and payments made.
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Human resources - It is responsible for the needs or rights of the staff in Sainsbury’s. And making sure that the people that are going to be hired for the job have the right qualifications or experience.
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Production – It is responsible for manufacturing process, this includes turning raw materials into finished goods.
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Research and development (R&D) – It is responsible for the inventions of new products or simply making the existing products better in this case food and clothes.
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Marketing - It is responsible for the research of what the customers want and then providing it for them. So finding out what is on fashion or what new/improved products people want.
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Sales- It is responsible for making contact with the customer and getting orders from the customers.
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Distribution – It is responsible for controlling the movement of products or goods in the business, managing papering of deliveries or received goods, supervising the drivers the way they should go.
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Customer service – It is responsible for satisfying the customers, meaning that if they have a complaint or comments, customer service will be the one that is in charge. This is linked to all the departments because is the complaints/suggestions made to the whole business.
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ICT -It is responsible for introducing new/updated equipment to the system and creating a back up system if anything goes wrong. Also for making a security code for the system encase anyone out of the authorised personal wants to enter.
J. Sainsbury’s functional areas help achieve their aims and objectives by making sure that everything in the business goes well and by satisfying their customers. All of the functional areas work together like distribution, sales etc. They all play a role and by working together they achieve the businesses aims and objectives.
There was a period of time when J.Sainsbury’s had a failure of its £3bn investment in its distribution network and supply chain IT, that had left goods stuck in depots and warehouses. This was due to lack of distribution and IT functional areas communication. If those two functional areas had worked and communicated better, this problem would not have happened.
