MOB IA

Name of Candidate: Carl La Guerre

Candidate Registration Number: 1600040346

Name of School: Arima Central Secondary

School Centre Number: 160004

Subject: Management of Business Unit 1

Topic: An investigation into the factors that makes J & A school café a successful

business operation: the nature of sole trader businesses, establishing business

objectives, clearly defines organisational structure, motivation and finance.

Teacher: Mrs. Rattan

Abstract

This research project is derived from three modules in unit one (1) of the

Management of Business Syllabus; Module 1- Business and its environment,

Module 2- The management of people and Module 3 Business finance and

accounting. This project endeavors to bestow knowledge in the field of analyzing

and reporting the nature of a real life business organization. The data obtained in

this report made use of the following primary sources: questionnaires, interviews

and visits to the organization. The secondary sources of data collection were in the

form of textbooks and the internet.

(i)

Acknowledgements

I would like to thank the many individuals that have contributed to the

successful completion of this project. Special thanks go to Mrs. Rattan, my

Management of Business teacher, for all the guidance, support and useful

comments on the report. I am also indebted to my parents and friends for the

contribution of ideas and most importantly God, for the continued strength and

patience that allowed me to shape and structure the project

(ii)

Table of Contents

Page number

Abstract (i)

Acknowledgement (ii)

Introduction 1

Planning of Project 8

Module 1: Business and its Environment 11

Description and analysis

Module 2: Management of People 17

Description and analysis

Module 3: Business Finance and Accounting 23

Description and analysis

Presentation of data 28

Analysis and Interpretation of Data

Conclusion 26

Recommendations 27

Appendices 31

Bibliography 35

Introduction

Purpose of Study

This report attempts to develop my skills in collation, communicating,

evaluating and interpretation of data, as well as my ability to extrapolate and make

suggestions. The study examines the operations of a private sector enterprise and

show how basic tasks are formulated within the organization. The aim is to

understand and connect the theories studied in the classroom to that of an existing

business and understand the impact of these principles on the day-to-day operation

of the business. Additionally, it helped me to appreciate and understand the

importance of setting organizational goals and progress awareness of the effect of

human motivation, decision-making, organizational effectiveness and business

finance.

Background of the Enterprise

J & A School café was established to serve the catering needs of the

students’ population of six hundred and fifty (650) and a staff of sixty (60) teachers

at Arima Central Secondary School. The enterprise takes the structure of a sole

trader. It is owned and operated by Ms. Judy Williams. To assist with the day-to-

day tasks her husband, Mr. Abraham Williams, alongside three (3) workers takes

the responsibility of this burden. The café is located on the school’s compound at

Marie Street, Arima. It opening hours is from 6 am to 5 pm Monday to Friday. The

organization is involved in both secondary (food is cooked and prepared on

location) and tertiary (selling of goods in the café/ catering service is also

provided) level production.

Ms. Williams supply the school population with daily lunches and meals for

special occasions. Catering for any, other non-school related events are also

provided for such as birthday parties, christenings and Christmas parties. Over

seventy percent (70%) of the commodities sole are prepackage food. These consist

of snakes and drinks or food from wholesalers e.g. pastries. The remaining thirty

percent (30%) of commodities are prepared in the school’s kitchen. These consist

of hamburgers, hot dogs and the ‘meal of the day’. The café has been in operation

for the past ten (10) years and was officially launched in 2000 when the owner,

Ms. Williams, resigned from her previous occupation. Currently, the business has

one branch. On the school’s compound, all the preparation is done for all types of

events.

Mission Statement “To serve clean and reasonable meals to all customers in a friendly manner.”

Limitations of Data Collection Methods:

The sole trader kept salaries and profits confidential.

Time constraints. There was only time to conduct one interview

with the owner.

Ms. Williams misunderstood some of the business jargons used in

the interview.

Planning of the Project

Methodology

The data obtained in the report, to gather evidence, was based on verifiable

evidence and not on personal belief. This report made use of both primary research

methods and secondary research methods of obtaining data. Primary research

methods were in the form of questionnaires, interviews and visits to the

organization for observation purposes. The secondary sources of data collection

were in the form of textbooks and the web.

Description and selection of sample

The reason for interviewing Ms. Williams was, she is the owner of the

organization and the necessary information needed on the factors that make J & A

café a successful business operation would have been easily obtained from her.

There were two (2) questionnaires issued to gather data for the successful

completion of this report. The first one was distributed to four (4) employees of the

café to get adequate information on what makes her business a success. The other

questionnaire was distributed to a convenient sample size of twenty (20) to the

students of the school; ten (10) males and ten (10) females from all forms of the

school.

Description of Research Instrument

The questionnaires issued to the employees of the business and student

population were more closed ended questions with easy to capture information by

having individuals respond to ‘Yes’ or ‘No’. Another questionnaire, which was

more open-ended, was formulated to serve as a guideline in the in-depth, face-to-

face interview with the owner, Ms. Williams. This session lasted approximately

one and a half hours. Four (4) students were appointed to take detailed notes so

that adequate material could be acquired. This was a superlative and effective

method of research because specific information was needed relating to the topic.

The information obtained from the questionnaires was shown in the form of

graphical representation. The graphs and charts were used to analyse the data

received from the market research conducted.

Description of Research Design

The interview with the sole trader and the questionnaires for this project

was carried out at Arima Central Secondary. We chose a private sector business of

the economy; a sole proprietorship. The research population consisted of the

owner, the employees and the student body. The student population was chosen

because we were able to gain valuable insight on the improvements or

recommendation on the business. Hence, the study was both explanatory and

exploratory in nature since it enabled me to get wind of how stakeholders deemed

the business. The questionnaire distributed to the students was the ideal method for

data collection as they were allowed to carry it home and contemplate so that

meaningful responses would be submitted.

Outline of Research Procedure

Activity Date

Finalize objectives 31st March, 1st April, 2009

Develop questionnaire 15th March, 2009

Administer questionnaire to sole trader

17th March, 2009

Administer questionnaire to students 17th March, 2009

Administer questionnaire to employees

19th March

Analyse data 14th, 15th, 16th, 17th April, 2009

Took out pictures 13th April, 2009

Enter data into computer 17th, 18th April, 2009

Submit to teacher 19th April, 2009

Unit 1: Management Principles and Process

Module 1: Business and its Environment

General Objectives:

2. To understand how different business organizations function

Specific Objective:

2. To understand the nature/operation of a sole trader business.

3. To explain the importance of business objectives

The nature of sole trader business – advantages, disadvantages

Some of the advantages of a sole trader type of business are; the capital need

to start the business is easily acquired, has few legal requirements and has total

control over the operations of the business.

Some of the disadvantages of the sole trader type of business are; the owner

has unlimited liability and lack of funds to obtain sufficient capital.

To explain the importance of different business organizations

The business’s long-term objective is to serve clean meals to all customers in

a friendly manner. This objective would be achieved through Operational

decisions, Tactical decisions and Strategic decisions.

All workers have a say in the operation of the business to achieve the

operational decisions. Ms. Williams is always in close contact with her customers

so she does informal market research to determine the prices, which her customers

might afford. Initially when the business started, it was difficult to estimate how

many meals to prepare however, with time she has learnt to sharpen her market

research skills.

The tactical decisions would be determined in conjunction with all members

of staff. Purchasing of kitchen equipment e.g. deep fryer done through needs

assessment in terms of time saving and based on market demand/ projected intake

of students. To ensure that students are well informed of products and prices and to

sustain demand in both the short term and long term distributor signs are posted in

the café.

The strategic decisions are obtained with a backward linkage with a specific

supplier ensures that vegetables and meat suppliers are purchased at one stabled

price.

Analysis and Interpretation of Data

J & A Café is the simplest and most customary form of private sector

businesses, a sole trader. Ms. Judy Williams is the owner and operator of the café.

Setting up as a sole trader is very straightforward. There are minimum legal

requirements needed in establishing a sole trader type of business however, sole

traders do have many legal responsibilities once they have become established.

One of the legal formalities required by Ms. Williams and her workers is the

acquirement of food handler’s permit from the Arima Borough Corporation. Sole

traders must also comply with legislation aimed at business practise. For example,

legally they must provide healthy and safe working conditions.

Advantages of the sole trader:

She already has the relevant managerial skills. E.g. planning,

organising, controlling and communicating.

She is independent and free to make decisions

After expenses are paid all the profit belongs to her.

She is flexible to go home and make preparations because her husband

stays to close the café at 5 pm.

She offers a personal service to customers. E.g. catering.

She is free to take holidays when school is closed for Easter, summer

and Christmas.

Disadvantages of the sole trader:

She has unlimited liability.

There is lack of sufficient collateral.

If she prepares contaminated foodstuff she can be sued.

All businesses have objectives, whether they may be in the form of a sole

trader or a large company. These are the goals of the organization such as the

targets or outcomes that the business wants to achieve from it quotidian operations

to its long-term operations. The overall aim and purpose of the enterprise is clearly

defined in the mission statement in a qualitative term. It states, “To serve clean and

reasonable meals to all customers in a friendly manner.” The goals of the business

are divided into operational, tactical and strategic objectives.

To achieve some of her operational objectives Ms. Williams incorporates a

democratic leadership style in the operation of her business so that all of her

worker has a form of involvement in the diurnal activities of the firm. To keep

customers satisfied, she does her own unsanctioned investigation to ascertain

economical prices as to which her customers can afford. To keep purchasers well

informed, daily advertising is done around the café area, noticeable to passers-by.

The “meal of the day” is advertised on the kitchen door and the regular courses and

price lists are on display in the café to increase customer awareness.

The meal of the day advertised on the kitchen door

A price list of the available daily foodstuff

Additionally, leftover meals, initially prepared for the school population, have been

decided to cater the needs for the YTEEP classes after school.

The tactical objectives of the business are quantitative goals. They include

purchasing of technological cooking equipment for the kitchen such as a deep fryer

and lager freezers. With acquirement of these extra equipment, Ms. Williams can

cut back on the time it takes to prepare the meals and increase the amount of goods

prepared for daily consumption. Another tactical objective is to make sure the

prices are well informed as well as to sustain demand in the long and short term.

Most importantly, her strategic objective is to maintain her backward linkage

with a specific supplier of poultry and vegetables to ensure goods are purchased at

a constant price despite price deviations, as a result of seasonal changes or paucity.

Building such a relationship with a supplier is the key to affordability allowing Ms.

Williams to maintain her constant prices. In turn, the supplier benefits form

continual sales from the sole trader.

Unit 1Module 2: The Management of People

General Objectives:

2. To understand the roles and responsibilities of employers an employees

within an organisation

3. To develop an awareness of the effect of human motivation on

organizational effectiveness

Specific Objective:

3. To explain the features of the formal organization structure

4. To explain the theories and practises of motivation

Features of the formal organizational structure

All businesses need to organise their activities and appoint workers with

specific roles and responsibilities. At J & A café, each worker has a set of daily

tasks to carry out so that all their objectives can be met effectively and

efficiently. Although the organizational structure is simple, it is very helpful to

organise the business into a number of clearly define sections. For example,

Mr. Williams is the only other employee who can make payments to suppliers

on behalf of the owner whereas the remaining employees can only carry out

their specified task according to their position in the business.

Factors that stimulate and influence motivation

Ms. Williams is has incorporated both financial and non-financial forms

of human motivation in her business. As time goes by her workers receive a pay

increase and she sponsors social event gathering such as family days for staff.

They are also apart of the decision making processes within the operations.

Their inputs are taken into careful consideration and then a mutual objective is

established.

Provision of a safe working environment is constantly, along with a family

like atmosphere are some of the forms of motivation practises that are

incorporation into Ms. William’s business to keep employees contented and

enthused.

Analysis and Interpretation of Data

Ms. Williams superintends the planning and arrangement of all the meals,

she is in charge of all purchases from suppliers, payment of expenses, sourcing of

capital investment, recommencement of employees and acquisition of workers. Her

span of control is narrow with four (4) subordinates under her authority. Her

husband, Mr. Williams, is an assistant to her and his functions in the day-to-day

running of the business are to aid in the buying and selling of goods and makes

payments to suppliers on behalf of her. He also in charge of opening the café at 6

am and closing at 5 pm to cover breakfast, lunch, and evening sales to students of

the school and YTEEP students. The three (3) other employees are given the

position café and kitchen assistant.

The kitchen assistant, assisting in the preparation of the daily lunches.

Their main roles in the organization are very simple and straightforward.

They assist in the café sales at peak times such as break time and at lunch, lend a

hand in the processing of the vegetables and packaging and labelling of ordered

lunches. Luckily, all her worker came in with the relevant catering experience

from their pervious job, so there was no need to train workers.

The following is diagram of the organizational chat:

According to Abraham Maslow’s hierarchy of needs, humans are motivated

by multiple needs, and these needs exist in a hierarchical order. Maslow identified

five (5) general types of motivating needs and they are physiological, safety,

belongingness, esteem and self-actualization needs. Ms. Williams fulfils all these

on-the-job needs to maintain job satisfaction, which in turn increases productivity.

Maslow’s Hierarchy of Needs:

Workers are compensated on a weekly basis and they receive just above the

minimum wage bracket. Workers are remunerated for eight (8) hours a day,

although they do not work the full eight hours. According to the owner, every two

(2) years the workers receive salary increment as profitability increases. The

kitchen and café area are well ventilated to maintain a cool and relaxing working

atmosphere. To sustain a safe operating environment, the kitchen, as well as the

cafe is well fitted with strategically placed fire extinguishers and first aid kits.

At J & A, café workers experience a sense of belongingness as the owner try

to make everyone feel like a family. Annually, Ms. Williams take her team on an

all expenses paid outing or dinner to express her gratitude as an employer. In

Physiological needs. E.g. base salary, air

Safety needs. E.g. safe work

Belongingness needs. E.g. work groups

Esteem needs. E.g. responsibility

Self-actualization needs. E.g. creativity, training

practise, this is seen as an effective motivational factor and has been working very

well for the sole trader for the past ten (10) years. Within the organization,

employees are given different levels of responsibility and recognition, as they are

involved in the decision-making process.

Ms. Williams is not only concerned about profits as a businessperson,

because she also sponsors meals to penurious students. This enables her to fulfil

some level of self-actualization need according to Maslow’s hierarchy of needs.

Unit 1

Module 3: Business finance and Accounting

General Objectives:

1. To understand the roles and functions of finance in the business

Specific Objective:

1. To identify the main needs for funds and how such needs maybe met

2. To differentiate among the main sources of finance

Main need for funds in the business

Finance was needed to purchase equipment for cooking and to disburse

for the first term rent.

Analysis and Interpretation of Data

The business was established in the year 2000 with a start up capital of just

ten thousand dollars ($10,000). The initial capital was used in the acquisition of

cooking equipment, pots, containers, utensils, a stove, a fridge and the payment of

the first month rent. The venture capital was acquired from a general savings

account held by the owner. Money made from the week’s sales is deposited into

the same savings account at a local bank for future investment.

Payment of workers and operational expenses are funded with the cash make

from daily sales. Rent is paid at the commencement of every term at an

undisclosed amount to the school. The full rent is paid regardless of holiday time.

It has been agreed that future investment in fixed capital is necessary to increase

output, convenience and save time in preparation of meals. Some of the desired

future investments include a freezer, a fry master, and a wider range of cooking

utensils.

Equipment purchase by the sole trader with the start up capital:

Presentation of data

Analysis and Interpretation of Data

This section contains the chats and diagrams to illustrate the results of surveys

taken by the student population and employees of the organization.

Results for market research conducted with students to determine consumer satisfaction.

Diagram 1: Percentage of students satisfied and unsatisfied with the number of meals offered at the café:

Diagram 2: Percentage of students satisfied and unsatisfied with the taste of the meals at the café:

Diagram 3: Percentage of students thinks that healthy choices are important:

Diagram 4: Percentage of students satisfied and unsatisfied with the level of customer service:

Results for market research conducted with workers to determine employee satisfaction.

Diagram 5: Number of workers who feel a part of the decision making process:

Diagram 6: Number of workers that feel they can accomplish tasks within the given time frame given the current kitchen equipment:

Conclusion

J & A café has proved itself very effective in setting its organizational goals

because it has been able to circumvent any conflict among workers by including

them in the decision-making process, maintaining sale levels by keep up demand,

supplying the student population with a variety of meals and conducting market

research to ensure customer satisfaction. By closely following her objectives, Ms.

Williams can evaluate the performance of her business, which can assist her in

making informed decisions.

With reference to the data received, it has been understood that the secrets to

success are: a high-quality relationship with workers, expressing a form of

appreciation for work done and providing innocuous working conditions for

employees. Her methods of management have proven to be extremely effective in

delegating responsibility and increasing productivity.

Over the years, Ms. Williams has been recoding significant amounts of

profits therefore her methods of saving and spending has brought her into the

success she is today. She is the intelligence behind the entire operation with a well

effective and efficient team continuously able to meet the demands of the catering

needs of the general public, and the student/teacher population of Arima Central

Secondary.

Recommendations

Although her business has been successful, Ms. Williams, can provide

healthier meals to ensure students and teachers receive a balanced diet. The

headmaster can issue a calendar of events to her so that she can be aware of exam

times. Around these times, there are fewer students at school and if properly

notified, Ms. Williams can adjust her daily output of prepared meals to reduce

wastage of food materials. Moreover, the sole trader can rework her mission

statement to include the words ‘healthy’ and ‘clean’.

Although Ms. Williams has incorporated successful management principles,

she can practice segregation of duties with the business. That is assigning specific

functions to each employee. In this way, employees would have clear and distinct

roles within the organization. Furthermore, the sole trader should ensure that

personal relationships do not encumber production.

For convenience and ease of mobility, she could consider future expenditure

on a motor vehicle instead of paying a delivery van or depending on members of

staff for the transportation of foodstuff and supplies. Ms. Williams can continue

with her methods of saving and financing expenditure. Consideration can also be

given to expand the business’s capital base in a money market fund or

development corporation

Appendices

This section contains the questionnaires used to gather primary data taken by

the student population and employees of the organization.

Questionnaire used in the interview with the sole trader:

1. What is the name of the business?

2. What is the ownership status of the business?

3. What type of business activities does your organization engage in?

4. How many years has the business been operating?

5. What is the business address?

6. How many branches does the business have?

7. What are the cafeteria hours?

8. What are the business long-term objectives?

9. How is this objective achieved?

10.What is the structure of the organization?

11.What are some of the duties for each of the positions held in the business?

12.When and how much do you pay workers?

13.What type of Safety procedures does the business have?

14.How do you motivate workers?

15.Do you sponsor events?

16.Do you train workers?

17.What was your starting capital?

18.How was your capital sourced?

19. What did you purchase with the venture capital?

20.What types of capital investment are you considering?

21.How do you fund your daily operations and pay workers?

Market Research questionnaire conducted with students to determine customer satisfaction.

1. Are you satisfied with the variety of meals offered at the school café?

Yes No

2. Are healthy choices important to you as a customer of the school café?

Yes No

3. Are you satisfied with the taste of the café meals?

Yes No

If you stated ‘no’ to the above, could you make some suggestions as to what improvements could be made.

____________________________________________________________

4. Are you satisfied with the level of customer service at the cafeteria?

Yes No

If ‘no’ to the question above could you state why.

Market Research conducted with workers.

1. Do you feel that the owner includes you in the decision making process at work?

Yes No

If ‘no’, please explain why. _______________________________________________________________________

2. Do you feel that you can adequately accomplish your task within the given time

frame given the current equipment in the kitchen?

Yes No

Bibliography

Dave Hall, Rob Jones, Carlo Raffo. Business Studies.

Bruce R Jewell. An Integrated Approach to Business Studies 4th Edition.

Susan Hammond. Business Studies 3rd Edition.

Encarta Encyclopaedia 2007.