INTRODUCTION TO BUSINESS

Program: BBA (HONS)

Section: (B) (Morning)

Semester: 1st

Submitted To:

SIR FARAN

Submitted By:
MEHWISH ZAFAR Bsf180777

TEHREEM TANVEER Bsf1804859

M. BABAR KHAN Bsf1804864

M. NOUMAN AMJAD Bsf1804935

M. TANVEER MUNIR Bsf1804781

SELECTION OF BUSINESS:
As the most important decision before engaging oneself in any
business activity is the selection of business. So the persons who are
interested to starting a business should be very careful in selection of a
business. Because selection of business is the first stage of starting a
Business. One wrong decision in selection can take a businessman in
trouble situation. And then business goes through many difficulties and
complications. To ignore the difficulties and complications in business,
a person should take wise decisions in starting a business. Once a
decision is taken and a business is established, it then becomes difficult
to change it, so detailed investigations and utmost care should be taken
up in the selection of business. Therefore, after know the importance of
selection of business, we selected a business of baby garments. This
business has a lot of profit. The special thing about this business is that,
the products of this business are being sold in whole year. Therefore,
we were really attracted from this business. Before starting this
business we were confident because we knew the importance of this
business. No one can deny the power of this business. Usually the
population increasing day by day and the clothes are the basic need of
everyone. People need fancy dresses on special events. This thing
shows the importance of this business.

DEMAND FOR THE PRODUCT:

A business should not be taken up on the basis of current demand.

Future trend in demand should be carefully examined. If the demand
for a product is irregular, seasonal, uncertain and the margin of profit
earned by any person is very low. It is no use in starting such a business.
The particular methods used to increase product demand vary based
on the time frame and current status of your product in the market.
Product of a business is like an asset for owners of a business. So
product of a business should be of a quality material, so that it can
attract the customers. Therefore, now a days almost every
businessman tries to improve the quality of its product according to the
requirements of customers. So the basic thing is that the more advance
your product, the more profit you will get. If a person start his business
without having the requirements of customers then he will go through
many difficulties, infact he will ruin his business. So it is necessary for a
businessman to make innovations in his products or at least he should
run his business according to the hops of customers. Thus, we looked to
the business of Children Garments. Because the products of this
business do fulfill the requirements of customers. In our shop, we have
every stuff of children‘s wear like Cotton, Wool, Linen, Arabic lawn,
Falees, Jeans, Blanket set. Every single person know the importance of
these products. People need these things to cover their children and
make them look trendy according to the fashion. And on Eid days
marriage ceremonies or Special Occasions mostly parents prefer this
kind of embroidered and fancy dresses. So therefore we make profit
every month, because of the progress of this business. We hope this
business will get success in future.

SIZE OF BUSINESS UNIT:

The size of business unit means the scale of business. The size of
business unit depends upon the demand for the commodity in the
market, the availability of resources, technical and organization ability
of the entrepreneur etc. If the business is carried on a large scale, it
brings economics in expenses. However determination of the scale of
business is an important factor to be considered before establishing any
business activity. Size can have its benefits and its drawbacks, and each
business will have its own benefits and drawbacks that comes from
either increasing in size or remaining small, and these will depend on
the market in which the business is present. For example a small
business may be small for many reasons. It may be small because it has
just started out in business, and still has relatively little funds, so
although the owner and manager may have aspirations of the business
growing. The size of a business does however depend on a great deal
on the market which it is in. This means that the optimum size for a
business in a market with little growth and only a small number of
prospective customers would be large enough to serve as many
customers as it had market share for, but small enough to ensure that
they don’t over produce. Small businesses surround us. They are on
every other street and in every corner. Every second thing someone
buys comes from a small business. In Pakistan where unemployment is
a serious issue, small business gains a special position in the industrial
structure because of their ability to utilize labor and create
employment. After know the basics of scale of business. We decided to
open the business at small scale. Because we had normal number of
capital investment for a business. So therefore it was not possible for us
to start a business at large scale. Small businesses are independently
owned organizations that require less capital and less work force and
less or no machinery. These businesses are ideally suited to operate on
a small scale to serve a local community and to provide profits to the
business owners.

PROVISION OF CAPITAL:
Capital is the life blood of business. Before starting a business, the
capital needs of the business is to be assessed. The capital needs
depend upon its fixed and working capital requirements. After
considering the financial requirements, the sources for raising funds for
the business should be taken up. In case the full amount of capital for
establishing and operating business cannot be met from owned capital
then arrangements shall have to be made for raising of borrowed
capital from banks, friends etc. Capital is essential for a business.
Without capital a business cannot run. Capital serves as an instrument
of production. Anything which is used in production is capital. Capital
has been produced by man working with nature. Hence, capital may
also be defined as man made instrument of production. Capital, thus
consists of those physical goods which are produce for use in future
production. Machines, tools and instruments, factories, canals, dams,
transport, stock of raw material etc are some of examples of capital. All
of them are produced by man to help in the production of further
goods. Capital involves the element of time, as it renders it service over
a period of time. That is why payment for capital is calculated in terms
of so much per cent per annum. The use of capital makes roundabout
methods of production possible. Its applications increases efficiency
and the productive power of all the factors with which it is combined
and used. Capital has a big role in raising economic development,
capital occupies a central position in economic development. We know
the importance of capital. As we started a business as a Sole Proprietor.
We had a capital of 2 million. We knew that what amount of capital was
necessary for Children Garments business.

LOCATION:
The selection of a suitable place for the establishment of a business is
of utmost importance for the success of a business. The availability of
raw material, trained labour, banking facilities, telephone, gas, cheap
transport, nearness to market for finished products etc are the most
important considerations in the selection of site for business. Choosing
a location for a new business is one of the most important decisions
entrepreneurs make during the planning phase of launching ventures.
The location of a business can affect many aspects of how it operates,
such as total sales and how costly it is to run. Even home-based
businesses and online businesses can be affected by location-
dependent rules and regulations. Location is of utmost importance to
businesses that sell goods or services directly to customers at brick-
and-mortar establishments. For example, a card shop located in a
popular mall is likely to attract more customers than a similar shop
located in a run-down part of town. Location can also influence a
business's ability to market itself. A business with a storefront on a busy
street is more likely to attract customers with signs and storefront
displays than a business that is not in a busy area. A business's location
can affect the competition it faces from businesses that sell similar
products and services. For instance, an upscale neighborhood in a
major city might have dozens of ethnic food restaurants, while a small
town might not have any businesses that sell ethnic food. Starting a
business in an area with few direct competitors can increase the
likelihood of attracting customers. By having all these things in our
mind, we decided to establish our shop in a Wandala Bazar behind
Amina marriage hall Lahore. We actually rented a shop in a wandala
bazar of shadrah. And our shop name is AJWA BABY GARMENTS.
Wandala Bazar is basically in the SHADRAH. This bazar is famous for its
good quality products and its reasonable prices. So Wandala Bazar is
very popular among citizens of Shahdrah. So we really wanted this
place. There is a hustle & bustle of customers in the Bazar And almost
our shop is making good profit from months. We consider that location
of a business is the most important thing in business. Because it can
take a business on the peak of success. But if location would wrong
then it can take a business in trouble situation as well. Thus, a
businessman should be very careful in selection of business location.

Selection of physical facility:

The selection of physical facilities depends upon the nature of a new
business. In case of manufacturing concern, the decisions acquiring
land, building, machinery godown etc through purchase, or on rent
basis or on lease are to be carefully undertaken. In case of trading
concern the purchase/hire of store in the shopping centre, provision
and proper displays of good etc need proper consideration. All types of
business need physical facilities. The layout of a business is the physical
arrangement of its physical facilities. It is based on layout planning. It
should produce efficiency by blending people, physical surroundings
and business needs. The available space should be used effectively. The
needs of the business determines layout. Space functional and
structural requirements affect layout of building. Efficiency-physical
facilities should be logically arranged to produce efficiency. Accessibility
materials should be easily accessible to the workers. Goods should be
easily accessible to the customers. There should be places for
customers and employs to sit, stand and move about. Natural condition
layout should blend with natural condition of the site. Clear view layout
should provide a clear view of merchandise, materials and employs to
the owner and customer. The design characteristics of a store visibly
reflects its image and can dramatically influence patronage. Many
customers appear to size up a store based on its outward appearance
of architecture and signs and hence are drawn to the store or repelled
by it, based on their perception of whether the store looks right for
them. All physical facilities are necessary in manufacturing business.
We are running a trading business so we don’t need many physical
facilities. We just needed fans, lights, tables, chairs, dressing room and
mannequins. These were the physical facilities which we needed. Shop
is also a physical facility for a retail business. We hired shop on rent.
And we give thirty thousand per month for its rent.

Plan layout:
The plan layout is the most important thing in business. Because it is
the biggest source to attract customers. A building must offer adequate
space and be adaptable to accommodate a business’s daily operations.
If space is restrictive at the outset of operations, efficiency will suffer.
The physical appearance of a building determines the first impression
that customers have of a business and contributes significantly to
establishing its identity in customers’ minds. Therefore, a building’s
appearance must be consistent with the entrepreneur’s desired image
for the business. Retailers, in particular, must recognize the importance
of creating the proper image for their stores and how their shops’
layout and physical facilities influence the image. All entrances to a
business should invite customers in. Wide entryways and attractive
merchandise displays that are set back from the doorway can draw
customers into a business. A store’s entrance should catch passing
customers’ attention and draw them inside. By having all these things
we decided a good plan layout. We made a big board outside our shop
for advertisement. Owner is on the counter for the cash dealings. We
adjusted ranks so that the customers can easily elect baby dress of their
choice. We also have two fans, one ceiling fan is for the customers We
adjusted one wall fan for the owner and the worker. We have a
changing room for the ease of customers. We built this room for the
customers satisfaction in size, color and quality. We have a good
lightening outside of our shop and as well as inside. It is necessary so
customers can see the products easily. And also for the ease of worker.

Selection of Staff:
A new business has to acquire adequate staff both skilled and unskilled
for the operation of a business. Here care should be taken that right
persons are selected for the right job. Staff play very important role in
the progress of business. Because, they do handle customers and they
deal with them in every situation. But one thing should be in mind that
an employ should be chosen for right job. Basically, it means that if an
employ who don’t know about manage a store is chosen by owners.
Then that employ can harm the business by his wrong managing skills.
So, the owner of a business should be very careful in selection of
employs. In order to avoid risk to one’s retail reputation, retailers must
realize that their workforce is as central to brand success as their
customers. Owners must ensure that our staff play an active and
positive role in building our brand relationships with shoppers and
customers. The enthusiasm of engaged employees is palpable for
customers. Employers can engage through the provision of platforms
that give employees a voice and make it easy to share ideas and offer
feedback. Engagement is infectious– so a trusted community is key. By
having all these things, we hired an employ, who has efficient skills to
manage the shop and customers. We hired him on twelve thousand
salary per month and giving bonus on occasions despite of salary. We
just hired only one worker in our shop because, there was no need to
hire more employs. Our employ just have to deal with the customers
and just have to manage the different varieties in shop. After the work
of all day he give the details of sold outlets to the owner of shop.

Office equipment:
The provision of office equipment, tables, chairs, counters, calculators,
bill pads, machinery, etc are essential for a business house. These
equipments improve the working and efficiency of the staff.
Equipments of business should be of good quality because it affect the
performance of employs. Because employs usually need good quality
equipment to do better work. Consequently, office equipment
requirements should become a big part of the overall business plan.
Certainly, a few decades ago a business office could easily get away
with minimum equipment. The basic equipment might include a
telephone, desk, chairs, files, typewriter, adding machine, and copier.
This was all the basic equipment required to operate an average office.
Today’s ever expanding technology makes it necessary to add much
more equipment to the office. We partners also managed the
equipments in our shop according to the requirements of business. We
have different variety of racks, hanging rods for hanging clothes,
mannequins for displaying fancy dresses, 3piece suits, different shapes
of hangers, tagging supplies, packing supplies, calculators, chairs,
stationary things, tables. We partners spent three lacks on all Shop
equipment. And all these equipments are of good quality.
Fulfill of legal requirements:
An entrepreneur before Starting a business has to fulfill the conditions
and rules enforced by the state. Illegal business may send him to jail. So
it is essential thing for a businessman to fulfill the legal requirements.
Many different elements go into starting a new business. One of the
primary requirements for setting up a business is to abide by the legal
requirements set by federal state and country rules and regulations.
Abiding by these rules allows you to start your business off on the right
path to help you avoid legal issues regarding the business structure in
the future. When a person start a business, then the business structure
he choose dictates the paper work. He has to file with the state
secretary’s office where the business operates, but he first has to
register his business and name with the state secretary’s office. The
internal revenue service requires businesses especially those with
employs to obtain an employer identification number. This is require by
the state just for the security purposes. Sales and use tax permits is also
require by the state from retailers. We were fully aware about the legal
requirements by the state. But we did not registered our business. It is
a sole proprietorship so there is no need to register infact we started a
business by knowing all the security measure and legal requirements.
We started a legal business by following our country’s rule. This is
basically really necessary because a person in a country cannot do any
activity which is illegal.

We made an agreement with the shop’s owner for 3 years. Agreement

with the worker, according to that salary of the worker will increase
after a year.

Rent of the shop will be increased upto 25% after 3 years.

 AJWA BABY GARMENTS
Annual Income Statement
For the year of 2018-19

Sales 2,953,228

Less : Cost of goods sold (1,700,000)

Gross Profit 1,253,228

Less : All operating

Expenses

Rent 360,000

Salary 154,000

Utility Bills 18,000

Other Expense 124,590

Depreciation 17,200
Expense(Furniture)

(673,790)

Profit Before Tax 579,438

Tax (1,000)

Profit After Tax | Total 578,438

THANKS!