unit 2 d1 d3

UNIT 2 D1 

Evaluate how managing resources and controlling budget costs can improve the performance of a business

In this assignment I will be evaluating the managing resources and controlling budget costs which can improve the performance of The Small Local Printing Company.

It is extremely essential for a business to manage and control their costs, especially a small business like The Small Local Printing Company because if they do not keep on top of the finance side of the business, it will possibly start to fail and could possibly end up shutting down. Keeping on track and organised by having a formal structure will massively help and ensure they are running the business as successfully as they can.

Controlling their budget will all them to not have any financial difficulties or major problems because The Small Local Printing Company will be on top of all the budgets and costs and will solve any problems that occur instantly. Also, for The Small Local Printing Company to be successful, it must plan out the financial activities that are going to take place far in advance to be prepared. In the plan it will include the revenue, income and expenditures using previous data from activities that The Small Local Printing Company have done in the past to prepare future trends. The Small Local Printing Company have staff that specialise in controlling budgets and costs in a business who have experience in what they are doing and know the best, most efficient way to control them in order to allow The Small Local Printing Company to make the most profit they can as well as being as successful as they can. The Small Local Printing Company keep all their previous data an information about the budgets within the business which will be used to help make future plans and predictions although, if more research is needed then this could be quite costly which The Small Local Printing Company would have to think about doing and consider whether they can afford to do the research or not.

Additionally, by planning future things this will allow The Small Local Printing Company to be able to see if they have the money to expand and make chains depending on how they are doing which improves their performance. By controlling their costs it will mean that they will be able to reduce the amount of waste they produce. Although, The Small Local Printing Company doesn't make the phone cases, some may be broken or given back because they are faulty which is seen as waste. They can control the amount of waste they receive and if this is affecting their profit or income and consider appropriate measures in order to reduce the amount of waste if necessary. The Small Local Printing Company will spend a maximum budget whenever they order their stock which has been looked at from previous income, profit and financial sheet and make to ensure they do not order too much stock that they aren't selling. The Small Local Printing Company could decided using their budget costs if they can afford to spend some money on extra training for their staff to support them and help them to do their job more efficiently. Training costs money and it may be a sufficient amount, but it is so worth in in the long run as their staff will do their job as effective as can be and this will save The Small Local Printing Company money in order to

The Small Local Printing Company have physical resources which are mainly equipment and tools within the business that are used. For example, printer, printing ink, paper, stationary, film etc. Every member of staff, the Small Local Printing Company employee will manage the equipment and tools regularly which includes cleaning them and making sure they are fit for purpose. They will check if they are fully functional and if they aren't then this problem should be made aware off and solved immediately by calling maintenance. Any problems with the physical resources will cost money to be fixed which comes out of the businesses profits which makes them lose out on money. Therefore, by controlling physical resources ensures that they won't need to spend money on broken or faulty equipment which will mean the business will keep all there profit and this improves the businesses performance. The Small Local Printing Company have to make sure they provide induction sessions for new staff when they start because this will allow the employees to gain knowledge about the products that they are selling as well as getting used to the equipment and tools they are going to use e.g. till. If employees cant work a piece of equipment or use a tool properly this decreases the efficiency of the business which decreases the business performance and will slow down the profit they make.

Managing physical resources can be a problem, because this could be expensive and be time consuming to use to correct cleaning procedures. It can take up a lot of time practising the appropriate cleaning procedures constantly as well as ensuring no equipment of tool is faulty or broken. Employees have to be especially careful when using the ink and the printer because ink can stain surfaces and clothes which is something they need to carefully think of whiney are using the ink. Also, employees should ensure the printer is used carefully because it is very delicate and expensive to fix or replace. Spending money on good equipment and tools is better than buying cheap equipment and tools because they will last for longer and they are safer, although it may be expensive it is better for the long run because The Small Local Printing Company won't have to keep replacing fault or broken equipment or tools.

Human resources are the employees within The Small Local Printing Company. They are a massive part in the business and are there mainly to keep the business making a profit. The Small Local Printing Company rely on their staff massively because they have multiple roles in which they have to do on a daily basis and they also have multiple responsibilities, some of which are extremely important for the business. Human resources need managing carefully because employees affect the business performance massively. Ways they can be managed is by providing regular training sessions for employees to improve their skills and maybe develop new skills which will improve The Small Local Printing Company performance. By doing this, it will ensure employees don't slack and don't do their job properly which makes the businesses performance bad. Employees could cut corners in their tasks they are required to do which means they are not fulfilling their tasks and responsibilities correctly which brings the businesses performance down. The Small Local Printing Company would lose out on money because they would be paying their employees to do their tasks and responsibilities although they won't be fulfilling their appropriately, for example an employee could be not taking out the trash cans every day which means the store could end up smelling and this could damages the stores reputation and prevent customers from coming in.

By providing regular training sessions for all the employees, this can end up costly a lot of money as well as employees taking time out of work hours which they may not want to do or may not be able to. Employees may not have the motivation to attend the sessions which means some employees will be more knowledgable than others and they will perform better which means they will stand out. This could make some employees feel worth less than other employees. This could decrease their productivity within the business and could lead to a loss of customer and a negative customer service. This could be solved by ensuring staff are always supportive of staff who cannot attend training sessions although they could ensure a set amount of sessions are compulsory to enable staff to get a minimum amount of extra training to improve the businesses performance.

Technological resources within The Small Local Printing Company are things like air conditioning, television, till, electricity etc. By having air conditioning this allows customers to feel more relaxed and cool in the store, if the store didn't have air conditioning in the hot weather then customers would probably not come into the store because they would feel too hot and not in the right mood to shop. Being a printing shop, the heat of the printer could spread across the store especially because its a small space which means the air conditioning will keep it cool. By having air con, this increases the amount of customers that will come into The Small Local Printing Company compared to other stores because customers will feel too hot. Having a television in the store could entice customers especially if they have children because this will enable them to shop whilst their children could watch the television. This improves The Small Local Printing Companies performance massively because it will allow loads more customers than if the business didn't have a television because there are multiple benefits to having one. Another benefit is that music could be playing in the background within the store which gives the store a nice lively vibe which makes customers want to shop in their. When customers are waiting in the queue they could watch the television to pass their time and stop them from leaving the store which is a huge advantage of having the television because time passes by when they watch the television. In order to use the till employees need to be trained appropriately to know how to use it efficiently because it is hard to use and there are many functions within the till which you would need to learn how to use. If any of the technological resources are faulty or broken, it is the employees responsibilities in order to call maintenance or fix the problem. However, tills are expensive and can cost the business a lot of money to replace or get fixed which means the employees need to be careful when using the till to ensure it doesn't break or gets damaged. A till is essential in The Small Local Printing Company which means it improves the businesses performance along with having air con and television etc.

There are problems ensuring the technological resources are managed and controlled because the employees may feel this is a big responsibility for them as the resources cost a lot of money which are expensive to replace or fix. Also, they may feel under pressure to learn all the new skills to ensure they know how to use the till, air con, television etc. They have to ensure all the health and safety procedures are placed out for example, not getting any water over the printer because this could damage it which are extremely expensive to replace.

UNIT 2 D3

Evaluate the problems they have identified from unmonitored costs and budgets

Within this assignment I will be identifying the problems that The Small Local Printing Company have come across from not managing their costs and budgets.

Budgeting and monitoring budgets and costs are an essential part of a business and if they are not done correctly, then this can result in a business losing profit, becoming unsuccessful and potentially having to shut down. Therefore, it is important to keep the business in order by controlling their costs and budgets.

One problem that I have noticed within The Small Local Printing Company from unmonitored costs and budgets is the extra money they have spent on wages for the employees. This is because The Small Local Printing Company aren't properly planning and budgeting their costs in order to work out how much they are giving their staff and then taking that money of their profit. The Small Local Printing Company have hired too many staff which is efficient for the business however, by not managing their costs and budgets they are spending way too much of their profit on giving their staff their wages and salaries. A minimum wage is required which is what the staff are paid although, this is still costing The Small Local Printing Company too much money. A way of sorting this out could be to have less staff in the business which would mean you are paying less staff and therefore will save some of the profit. The money that is saved could maybe go towards getting the remaining staff extra training sessions to improve their skills and make them more efficient now that there are less of them.

Another problem that I identified in The Small Local Printing Company was they weren't making enough profit. This is due to the prices of their products and services they offer being too high e.g. printing, ink. Having high prices for printing is silly because customers will go elsewhere to one of their competitors which means The Small Local Printing Company is losing out on money. They have priced their prices too high because they have a lack of knowledge when it comes to pricing due to them not managing their costs and budgets. Due to this they wouldn't have been able to notice that they weren't making a sustainable profit and selling enough products. The Small Local Printing Company could solve this issue by doing appropriate market research in order to find out how much their target audience would pay for their services and products. As a result of this they would lower their prices in order to sell more and appeal to customers, they could also consider their competitors prices and try to compete with their prices to entice customers into The Small Local Printing Company instead of their competitors. Special offers, deals and promotions could also be introduced in order to appeal to customers especially new ones because customers love deals.

The Small Local Printing Company didn't plan their budget out appropriately therefore this was inaccurate and not realistic. This affects the business because it means they don't have a realistic budget to work with and they are just spending money. By not having a proper budget to work this this means that the business don't have a plan or an average price for how much they should spend. This means the business do not have a stable balance of their money because they do not have a set budget which is from not monitoring their costs. By looking at their costs they would be able to work out how much they spend in a set period of time and set a realistic and appropriate budget for the business to work with in order to budget and save their money. This could be avoided by ensuring their have a set budget by looking through their costs and working out a suitable budget for a set period of time. The Small Local Printing Company could put aside an emergency fund, which is in case of an emergency where for example, one month the business use more than their budget they have an emergency fund to help them the next month to get even again.

Additionally, The Small Local Printing Company will not be able to determine its performance if costs and budgets are not monitored. The business will be unable to understand their performance if they do not control how much average profit and how much money they are spending, because they won't be able to see if they are making too much or too little. For example, the business could be making £4,000,00 a month, which means their business performance is positive and very good. Although, by hanging their costs, they may be able to see that they spent e.g. £4,400,00 meaning the business is actually making a loss and this results in them having a extremely bad performance.

A noticeable problem that occurred within The Small Local Printing Company because of unmonitored costs and budgets is the overspending on advertisements. As a small local business this is a real problem because they are not that successful that they can be spending a lot of money on advertisements. By controlling the costs and budgets, they will be able to see if they have the money spare to spend on advertisements and if they will be redundant after. By having a budget, this will help in order to see if they have enough money in their budget to fund their advertisements without the risk of damaging their profit. A suitable resolution for this is by monitoring their budgets around the period that they want to have a new campaign or advertisement so that they know how much they are spending on their advertisement and they will be ensuring they are stable enough.

Achieveing goals is a problem for The Small Local Printing Company due to them not managing their costs and budgets properly. Setting goals allows the business to grow and achieve goals that are set by the business owners. Goals will not be met if there is no organisation and no management within the financial side of the business because the costs and budgets need to be managed in order to see if goals are achievable otherwise there is no point of working towards them if they are unrealistic. A set budget should be laid out in order to show where and what money should be spent on and if its a good idea to set goals. If the costs are not managed then they may have issues with the budgets therefore the goals may not be suitable, which can cause over expenditure or not spending enough on having the right resources and equipment in order to meet the goals. The Small Local Printing Company should look at their costs and budgets and set a sensible budget based on how much they are making, and then set a few goals they would like to achieve in a set period of time, if practical.

The Small Local Printing Company find it hard to make decisions in the business because of uncontrolled budgets and costs. This means the business is unable to expand and make any changed because they cant decide or make suitable decisions on anything important in the business because they have nothing to base their decisions on. They have unmonitored costs which results in issues with their budget because they will not know if they have money to make the changes the want to make within the business. To solve this they could make sure they set a sensible budget for a set period of time and outline the decisions they want to make. By monitoring their costs and having an appropriate budget, this will enable The Small Local Printing Company to be able to see if they have enough money to fulfil the decisions they have agreed on.