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, 07085402972, 07064494085)
Business growth is the result of “positively motivated business intentions and actions
on the part of the owner-manager or the entrepreneur”.
Business growth is neither automatic nor the result of chance or good luck (Lambing
and kuehl, 2007)
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Often it is not smooth, some firms grows and then backslide while some skip growth
stages that others experience (Eggers and Leahy, 1995)
2009)
Types of franchising
a. Product franchising or dealership
b. Manufacturing franchising
c. Business format franchising
Disadvantages of franchising
To Franchisee
a. Inability of the franchisor to provide services, advertising and location as promised in
the franchise agreement
b. The franchisor’ failure or being bought out by another company
To Franchisor
a. Difficulty in finding quality franchisees
b. Poor management
c. Increase in the number of franchisees
2. Joint Venture: it is a separate entity that involves a partnership between two or more
active participants (Hisrich, et al, 2009)
Mergers and Acquisitions: A merger occurs when two companies combine to form a
single company. It is similar to a takeover or an acquisition, except that in the case of
merger; existing stockholders of both companies involved retain a shared interest in the
new corporation.
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Types of Mergers
a. Horizontal merger
b. Vertical merger
c. Market – extension merger
d. Product – extension merger
e. Conglomeration
Market extension conglomerates
Product extension conglomerates
A Combination of the two above
Reverse Merger: occurs when a private company that has strong prospects and is eager
to raise financing buys a publicly listed company, usually one with no business and
limited assets.
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c. The entrepreneur must develop the appropriate financial package which must meet
the needs and objectives of the providers of the fund
For the Economists, Business is any activity that seeks profit by providing goods and
services together (William, 1996)
For scholars of Management, Business is any activity that seeks to (preferably at a
profit) satisfy existing and created needs of customers (Drucker, 1993)
Planning is deciding in advance what to do, when to do it a and who is to do it, knoontz in
ujo (1984)
So planning is defined as deciding in advance what to do, how to do it, when to do it
and who is to do what in making available goods or services for the satisfaction of
existing and created needs of customers.
The business plan is an agreement on how your management team plans to carry out
certain functions to achieve business results and serve as a means of measuring the
company’s performance.
Goals are general targets that the enterprise intends to achieve over a long period of
time, usually five (5) years and above.
Objectives are specific and measurable targets the enterprise intends to achieve over a
relatively shorter period of time, usually one week, one month, one year etc.
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Start-up is a company with a limited history, i.e., newly created and is in a phase of
development and research for markets. “Start-up Company” is often associated with
high growth, technology oriented companies.
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3. Choice of location
4. Concluding a feasibility study
5. Recognition of the obstacles and devising ways of overcoming them
6. Planning of operational strategy
7. Deciding on the nature of business formation
8. Registration and commencement of business
Advantages
Easy organization
Quick Decision making
Customer satisfaction
Flexibility
Supervision
Profit
Taxation
Disadvantages
Limited financial Resources
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Unlimited liability
Lack of continuity
Lack of Economics of scale
Mismanagement of Resources
Labour Turnover
Fatigue
Advantages
Large capital
Skill and experience of partners
Continuity
Effective Decision making
Taxation
Division of Labour
Risk sharing
Disadvantages
Conflict among members
Unlimited liability
Lack of Continuity
Liability of the actions of members
Limited size
Not being a legal Entity
Advantages
Large capital
Continuity of Business
Effective management
Easy transfer of investment
Limited liability
Economics of scale
Legal Entity
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Disadvantages
Organizational complexity
Slow Decision making process
Separation of ownership from management
Rigidity
Heavy taxation
Lack of secrecy
Lack of personal contact with customers
Types of capital
1. Equity capital: comprises of personal money and other assets of the owner(s) of the
business enterprises (okungwu and saleh, 2004)
2. Debt capital: comprises of money and assets realized from loans from individuals
and/ or financial institutions like banks, financial houses etc.
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Environment is defined as all elements outside an organization that are relevant to its
operation (stoner, freeman, Gilbert 1995). Business environment denotes the full range
of public policies, institutions, regulations and administrative systems within which
people and firms operative (Eboh and Lemchi, 2010). Marire (2004) describe the
environmental factors that affect organizations and businesses thus;
a. Internal environment factors such as the organizational members and the physical
resource needed for the running of the organization
b. External environment factors such as the economic factors, technological, social,
political/legal and ethical factors
1. Political and legal environmental factors: This includes good governance, efficient
and transparent public administration etc
2. Economic environment: economic factors which affect the businesses viz capital
labour, general price level, government fiscal and tax policy and the general economic
growth etc.
3. Technological environment: Effects of technology as in the development of new
products, new tools, machines and new services on the businesses
4. Infrastructural environment: the effect of (in) sufficient access to infrastructure
relevant to communication, energy, transport, water which is severe concern to business
owners.
5. Social environmental factors: This consists of the attitudes, desires, expectations,
general education attainment, culture, beliefs and philosophy of a group.
Environmental Analysis
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Threats and opportunities characterize the future and the present of any business. To
identify these threats, the entrepreneur has to analyze the environment internally and
externally.
Externally, he/she must check the general economic conditions, industry projections,
technological changes, competitors, consumer preferences, trends in government
regulation etc
Internally, he/she should examine the organization’s resources to determine its
strength and weaknesses
Sources of funds are places where capital is or can be acquired. Finance refers to raising
of capital funds and using them for generating returns and paying returns o the
supplies of funds which may be equity or borrowed funds (Pandey, 2001).
Nwude chuke (2004) grouped sources of funds into: The short term, medium term and long
term funds.
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Unamka, P.C and Ewurum U.F (1995) grouped the sources into: Short term and long term
funds.
Short term finance does not exceed two years e.g trade credit, accrual, prepayment, bill
of exchange etc
Medium term finance is between one to ten years e.g term loan, venture capital, leasing,
hire purchase etc
Long term finance is between ten years and above e.g Bonds, warrants, shares, rights
issues, depreciation etc
The above classification can further be narrowed to equity and debt financing.
A general source of funds includes;
1. Personal funds
2. Thrift societies
3. Partnership
4. Age grade association
5. Trade credit
6. Credit union funding
7. Line of credit
8. Leasing
9. Depreciation
10. Family and friends
11. Service contractors
12. Capital stock
13. Cooperatives societies
14. Mortgage loans
15. Commercial banks loan
16. Angels and venture capital
17. Retained earnings
18. Governments etc
Angel investors
Angel investors are Affluent individuals interested in businesses withpromising growth
potentials, and who provide capital for business start–up
Venture capital
Venture capitals are funds established in the form of a trust/company including
corporate bodies.
4. They are the last resort to a few new businesses that cannot access start – up funds
5. Many new ventures depend on these sources for their growth and survival.
Credit is the trust which allows one party to provide resources to another party where
that second party does not reimburse the first party immediately, but instead arranges
either to repay or return those resources at a later date.
Types of credit
1. Trade credit: Refers to the approval for delayed payments for purchased goods.
2. Consumer credit: consumer credit is money, goods or services provided to an
individual in lien of payment.
Record keeping
This is the practice of maintaining the records of an organization from the time they are
created to their eventual disposal.
Cost of credit
This is the additional amount, over and above the amount borrowed that the borrower
has to pay.
When interest rates are raising, fixed-rate loans are usually better.
When interest rates are falling, variable rates are generally more attractive
Loan Tenor
This is the amount of time left for the re-payment of a loan or contract or the initial term
length of a loan.
Credit Risk
Credit risk is an investor’s risk of loss arising from a borrower who does not make
payments as promised.
Guarantor
A guarantor is an individual, company or institution pledging to make good on a debt
or product.
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Cost of credit: This is the additional amount over and above the amount borrowed that
the borrower has to pay.
1. Open, social, associationist and integrative
2. Voluntary
3. A morally conscious organization( fair and equal)
4. A peoples private organization
5. Educational
6. An autonomous self-help organization
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Ordinary PCs: Members run their businesses separately but own common assets
cooperatively.
Full PSc: All productive activities are fully collectivized. (Group production)
5. According to the sector of the Economy when the cooperative societies operative
Agricultural
Industrial
Service Cooperatives etc
Establishment of service gaps which the formation of a cooperative society can fill
Step 2:
Search for suitable project/type of cooperative
Step 3:
Set up an organizing committee
Step 4:
Conduct economic and social feasibility study of the project that the cooperative is to
embark on
Step 5:
Invite prospective members to a general meeting
Step 6:
Commence educational programmes and trial run of the cooperative project
Step7:
Commence legal documentation
Step 8:
Management Structure of the Cooperatives is confirmed and election of officers held
Step 9:
Registered with cooperative Department
Step 10:
Operations of the new cooperative society.
Marketing is the activity, set of institution, and processes for creating, communicating,
delivering and exchanging offerings that have value for customers, clients, partners and
society at large. kotler Philip (2008).
Marketing is a set of process that are inter-connected and interdependent with other
functions, whose methods can be improved using a variety of relatively new
approaches (Selden, 1997).
Marketing concept aims at fulfilling its organizational objectives through the
anticipation of the needs and wants of consumers and satisfying these more efficiently
than competition (Amstrong, 2008).
Marketing therefore is used to identify the customer, satisfy the customer and keep the
customer.
Production concept or orientation is the specialization of a firm in the production of a
given product or service as much as possible. Product orientation emphasizes quality of
the product in the midst of many products.
Recent approaches in marketing include B2C, B2B, B2S, B2C is relationship marketing
with focus on the customer. B2B is business or industrial marketing with focus on an
organization or institution. B2S is social marketing that is concerned with benefits of the
society.
NB
B2C = Business to Customers
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According to Michael porter’s classic book “Competitive Strategy” the three most
common competitive Strategies are: - low-cost supplier, differentiation and niche
The whole thinking here can be subsumed into an algebraic representation of 6W +H
which means: What, Who, Why,
When, Where, Which + How?
The word customer refers to one with intention or willingness to encourage or stand for
the benefit and business success of a business person by buying and motivating other
users of the goods and services to buy and use the goods and services produced by the
business person
Customers are also current or potential buyer or users of the products of an individual
or organization called the supplier, seller, or vendor.
Types of Customers
1. Business customers – buys to re-sell
2. Consumer customer – buys to consume
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Customer care service is made up of the nature of the organization, type of services
rendered by the organization to the customers, customer’s service needs and
expectations and satisfaction of customers’ expectations. Lyons (1970) stated that
customer care service is all the direct and indirect contact between an organization and
its customers.
Efficient and effective customer service involves;
Attentive listening to customers
Making polite suggestions
Making promises that you will keep
Taking an extra effort
Building an efficient customer service team
Knowing who is the boss
Identifying and anticipating needs
Making customers feel important and appreciated
Helping customers understand your systems
Appreciating the power of “yes”
Giving more than expected
Getting regular feedback
Treat employees well
Electronic business is a flexible process that enables everyone in any geographical area
to partake actively in business around the world both in abstract and real object forms.
E-commerce deals directly with the exchange of goods and their payment facilitated by
electronic transaction e.g retail shopping, airline booking, and banking Etc. The driving
force behind e-business is the Networking economy.
E-Trading deals with the selling of financial instruments such as stock, bonds and
treasuries electronically. (B2B, B2C)
Basics of E – Business
1. The parties (actors) you are dealing with e.g customers, suppliers, Government,
Competitors.
2. The resources at your disposal e.g investment funds, infrastructure, personnel,
strategy etc
3. The business functions to be performed e.g Delivery, Promotions, Procurement,
Management, Operations etc
EDI involves data exchange among parties that know each other well and make
arrangements for one – to – one connection , usually dial – up.
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Transit must occur in many new ventures either for the reason of retirement or death of
the owner, or expansion of the business.
The life cycle of an industry is depicted as an S – shaped curve and is made up of four
stages;
Experimentation
Exploitation
Maturity
Decline
A succession plan is a process in which leadership, and eventually ownership is
transferred t a successor
Personal Discipline in Business
This is the ability to do what is necessary or sensible without needing to be urged by
somebody else. The ability of the entrepreneur to stick to the right code of conduct or
behaviour in spite of his personal desires largely depends on his traits,
attitudes and habits.
Stressor (stimulus) refers to anything that can induce stress. Stress may be positive or
negative. When stress emanates from a good source, for example getting a promotion or
political appointment, it is called eustress. But negative stress is called distress e.g
Excessive pressure, bad news etc.
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Effective Leadership
According to ken “SKC” Ogbonnia, “effective leadership is the ability to successfully
integrate and maximize available resources within the internal and external
environment for the attainment of organizational or societal goals”
An effective leader is generally someone that leads by example and other people just
tend to follow because they believe what they do is the right thing.
Keeping promises is another sign of effective leadership.
Situational Leadership
This leadership theory was developed by Paul Hersey, professor and author of the book
Situational leader and Ken Blanchard, leadership guru and author of the one minute
manager while working on the first edition of management of organizational behaviour
(now in its 9th edition).
The fundamental under pinning of the situational leadership theory is there is no single
“best” style of leadership. The driving philosophy behind Blanchard and Hersey’s
leadership theory is the importance of a good match between leader and follower.
Leaders must be mature enough to take responsibility for their actions and choices.
The four basic ways of leading followers in the situational leadership method are;
Directing
Supporting
Coaching and
Delegating
Interpersonal Skills
Interpersonal skills are sometimes referred to as people skill or communication skills.
Interpersonal skills are the skills that a person uses to interact with other people such as
active listening and tone of voice.
Helpful tips for improving interpersonal skills
a. Smile
b. Be appreciate
c. Pay attention to others
d. Practice active listening
e. Bring people together
f. Resolve conflicts
g. Communicate Clearly
h. Humor them
i. See it from their side
j. Do not Complain
Conflict Management/Resolution
Conflict refers to perceived incompatibilities resulting typically from some form of
interference or opposition.
Conflict management is then the employment of strategies to correct these perceived
differences in a positive manner Conflict management were introduced by Nurmi and
Darling. Dysfunctional conflict is destructive and leads to decreased productivity,
functional conflict may actually encourage greater work effort and help task
performance.
Sources of Conflict
According to both Draft and terry, several factors may create
organizational conflict:
Scarce Resources
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Jurisdictional Ambiguities
Personality Clashes
Power and Status Differences
Goal Differences
Communication Breakdown
Conflict Management Styles
1. Avoiding Conflict Resolution Style
2. Competing Conflict Resolution Style
3. Accommodating Conflict Resolution Style
4. Compromising Conflict Resolution Style
5. Collaborating Conflict Resolution Style
Time management is the act of arranging, organizing, scheduling and budgeting one’s
time for the purpose of generating more effective work and productivity.
Tips for Effective Time Management
1. Spend time planning and organizing
2. Set goals
3. Prioritize
4. Create a ‘to do list’
5. Be Flexible
6. Learn to say no
7. Reward yourself
8. Eliminate the urgent
Time Management Techniques For Students
Procrastination
This is the art of doing something else when there are more important things to do.
Tips To Avoid Procrastination
1. Make a plan quickly and start working with it
2. Complete a task and move on
3. Practice time management techniques
4. Do not be a perfectionist
5. Develop self discipline
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Information management refers to any act that utilizes information systems technology
and management skills to the task of managing enterprise data resources, to fulfill the
information needs of both internal and external requirements of the firm.
Business information management can be applied in the following areas:
1. Marketing information system
a. Marking/marketing research
b. Market management
2. Manufacturing information systems
3. Human resource management information system
4. Accounting information systems
5. Advertisement and promotion information systems
6. Sales management information systems
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Care of ICT
1. Cover appliances always to prevent dust
2. Place the appliances in a ventilated environment
3. Clean the surface with dry cloth daily
4. Connect with Stabilizer or Ups
5. Never place heavy objects on ICT appliance
6. Never place ICTs on wet surface
7. Always shutdown appliances properly
8. Do not attach ICTs with spliced extension wires
Visual Aids
The purpose of visual aids is to support verbal communication. It should
be used to show;
a. What something looks like
b. How something looks or works
c. Relationship between things
d. Highlights important information
e. Clarify the structures of your argumentation
f. Emphasize technical terms, names, titles etc.
Decisions are hypothesis put forward for the solution of a problem. – Okoli (2004)
Decision is a choice whereby a person forms a conclusion about a situation Appleby
(1981)
Decision is a conclusion drawn from factual premises and value premises – Herbert
Simon(1957)
Decision Making
Decision making implies the selection from among alternatives of a course of action –
(Chukwuemeka 1998)
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Types of Decision
According to Drucker (1954)
Tactical Decision – routine and few alternative
Strategic decisions
Other types
Organizational decisions
Personal decision
Basic Decision
Routine Decision
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A business plan is a written statement that describes and analyses your business and
gives detailed projections about its future (Mckeever, 2007).
PRODUCTION PLAN
Production planning is the process of making decisions as to the resources which the
organization will require from its production operation. Dilworth (1993)
A carefully developed production plan will allow your company to meet the following
objectives:
Minimize costs/maximize profits
Maximize customer service
Minimize inventory investment
Minimize changes in production rates
Minimize changes in work-force levels
Maximize the utilization of plant and equipment
How to plan
The production plan needs to address specific key elements well in advance of
production:
Material ordering
Equipment procurement
Bottle necks
Human resources acquisitions and training
Communicate the plan to the employees
Consider changes
MARKETING PLAN
This is a written document that specifies in details an organization marketing objectives
and how marketing management can use the controllable market tools to achieve these
objectives.
Organizational plan is basically a to do list for an organizational that lists out the plan
of work, programs and organizational growth over a period of time- six months, a year,
five years. It encompasses the following aspect:
a. Forms of business organization
b. Organization structure (organogram)
c. Staffing pattern
d. Pre-operating activities
e. Schedule of pre-operating activities
f. Pre – operating cost
6. Support
7. Follow through
8. Plan evaluation
Staffing pattern
This indicates the personal/personnel requirement (skills required and personnel) by
function (marketing, production, administration, and finance) and an estimate of
compensation.
FINANCIAL PLAN
This is the means where by the entrepreneur answers questions on the immediate and
future solvencies and liquidity and adequate finance generated internally or externally
at the best possible terms of revenue and capital requirement.
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