James Mowing Business Report
James’ Mowing is a lawn mowing business that caters for the lawns of the South-Western region exclusively. The business’ main goal is to provide customers with premium and comprehensive lawn mowing services including mowing, edging and trimming, hedge clipping, and (for clients with fruit-bearing trees) bug-spraying. James’ Mowing provides an affordable and efficient service to the community, leaving lawns neat and tidy.
The following Business Report provide integral information on James’ Mowing by clasifying the business according to size, geographical location, its industry, and its legal structure and outlining factors that have influenced the business’ current legal structure. Furthermore, it will examine external and internal influences of the business environment and the strategies responding to these influences, as well as describe the impact key stakeholders have on the decisions made by James’ Mowing. Finally, the Business Report will reveal which stage of the Business Life Cycle that James’ Mowing is currently in and the strategies used by the business to overcome this stage of the Business Life Cycle. A plagiarized Student Sample: ORDER YOUR PAPER NOW
1.0 Classification of Business
James’ Mowing is a small business located in Revesby, New South Wales, 2212. It established in 2014 and independently owned and operated by two partners, James Bounty and Jimmy Mars, who make most management decisions, including who to hire, what to produce and how to advertise a product, the owners provide most of the capital. In addition to the two owners of the business, James’ Mowing also hires twelve employees and does not have a large share of the total market sales.
- Geographic Location
Local businesses have a restricted geographical spread. James’ Mowing serves the surrounding area and is in no position to offer a range of products to another region within New South Wales. Therefore, local businesses, such as James’ Mowing, frequently targets consumers who live nearby.
- Industry Sector
James’ Mowing is a business within the quinary industry. This industry includes all services that have traditionally been performed in the home. Due to social and lifestyle changes, as well as an increase in the number of two-income households within South-Western NSW, James Mowing recognises the demand for quinary-type services is also estimated to expand rapidly during the next two decades. Many small businesses, such as James’ Mowing, is currently filling a niche in the market.
- Legal Structure
James’ Mowing operates as a partnership of two parties, James Bounty and Jimmy Mars. Both partners assume an equal share an responsibility through all business dealings. Shares are even split between them and they will both be equally liable for any losses and debts incurred by the business.
A partnership structure allows the business to remain entirely within the control of the two owners, as all decisions, as well as profits and losses, are controlled by James Bounty and Jimmy Mars. A disadvantage of this structure is the potential for dispute between partners. As this is an equal partnership, there may be instances when both James and Jimmy feel strongly opposed on an issue. Furthermore, as unlimited liability exists within a partnership structure, the business may change to a private company structure, within two years. A plagiarized Student Sample: ORDER YOUR PAPER NOW
2.0 Factors that have influenced the structure of the business
- Size of the Business
As sales increase and the business operations grow to meet this higher level of customer demand, James’ Mowing may need to consider moving from a partnership legal structure to a private company. In this instance, the business will need to purchase new equipment, which requires the injection of more money. Therefore, a private company may be formed with private shareholders bringing with them extra finance, skills and expertise. If expansion is rapid, James Bounty and Jimmy Mars may wish to seek the protection of limited liability, in which case the private company legal structure is highly appropriate.
James’ Mowing currently operates as a partnership business between two owners and employs twelve staff. Within a few years, the business has the potential to expand into a private company. A private company has between two and 50 private shareholders and often tends to be small to medium-sized, family-owned businesses. A private company would allow James Bounty and Jimmy Mars to maintain a high degree of control of the business and would offer the protection of limited liability.
3.0 External Influences
External influences are those influences that a business has little or no control over. External factors in the business environment highly influence the operations of James’ Mowing. These factors are the competitive situation of the business and current state of the Australian economy.
- Competitive Situation
Competition between firms to be the ‘market leader’ or to win customer loyalty benefits James’ Mowing. This provides customers with more choices, a range of qualities and a variety of prices. James’ Mowing aims to achieve a sustainable competitive advantage, which refers to the ability of the business to develop strategies that will ensure it has an ‘edge’ over its competitors for a long period of time.
In order for James’ Mowing to run as a successful business, James Bounty and Jimmy Mars have conducted thorough primary market research to anticipate what they need to do in order to satisfy their customers. Primary data consists of first-hand information obtained about houses and lawns including observations, interviewing community members and having current customers completing surveys.
- Economic Influences
Economic influences have a significant impact on both business and customers. They influence James’ Mowing capacity to compete and customer’s willingness and ability to spend. When economic problems start to appear, consumers become more cautious with the way they spend their money and therefore the business’ overall confidence begins to fall. Furthermore, when there is evidence of a growing economy, confidence returns. The consumer is more willing to seek out lawn mowing services, which in turn sees spending levels rise and James’ Mowing profits improve.
4.0 Internal Influences
Internal influences are aspects of the business which the business has some degree of control over. The internal business environment of James’ Mowing prominently relates to management and location influences.
James’ Mowing operates as a partnership and employs twelve employees. Due to the rapid advances in technology and pressures on businesses from increased competition, businesses such as James’ Mowing have flattened their business structure. This means that there are fewer levels of management and the business can adapt quickly to meet changing consumer needs and market conditions because there are fewer managers who need to approve decisions.
Businesses that adopt a flatter organisational structure reduce the number of levels of management, giving greater responsibility to individuals in the business. If James’ Mowing intends to expand their business within a few years, James and Jimmy will require employees with capable working and customer service skills as well as administrative skills, however they will not need managerial experience.
James’ Mowing does not require a corporate headquarters, as they are an on-call, mobile business that comes to the customer. Appointments are primarily made over the phone. In relation to storage of equipment and client information, the business is located in a shop owned by James Bounty and Jimmy Barnes in Revesby Centre. This is suitable for current clientele, who are situated in the South-Western Region, as the business can reach customers in this area quickly.
5.0 Impact of stakeholders of the business
A stakeholder is any group or individual who has an interest in or is affected by the activities of a business. Two key stakeholders that impact James’ Mowing are employees and customers.
Employees are vital James’ Mowing as they provide a lawn-mowing service to customers of the South-Western Sydney region. Employees influence the business as the quality of the service provided depends on the employees’ working and administrative skills and commitment to the process. James’ Mowing puts forward that if employees are valued, paid fairly, trained properly and treated ethically, they will be become more valuable to the organisation. Furthermore, as James’ can provide for customers’ needs, employees will be more inclined to put effort into work tasks and will be motivated to meet customer expectations.
Consumers are powerful stakeholders in the external operating environment and they are increasingly prepared to seek compensation if they believe they have either been unfairly treated or purchased a good or service that did not perform as promised. Due to the influence customers have, James’ Mowing hires suitable employees to both fulfil business objectives, and more importantly, the customer satisfaction policy.
6.0 Stage of the business life cycle
James’ Mowing is currently in the growth stage of the business life cycle. In this stage, the business is experiencing a rapid increase in sales and profits are rising as establishment costs have been paid off. In addition, more clients from the South-Western region of NSW are seeking lawn-mowing services from James’ Mowing and employees are gaining more skills and experience in the business.
As James’ Mowing continues to expand, they are purchasing supplies in bulk, which is decreasing costs through economies of scale. That is, more services provide the benefit of reducing per unit cost of the product resulting in profits to increase.
In the growth stage, attracted by the opportunities for profit, new competitors will also enter the lawn-mowing market. In order to survive and thrive in the competitive market, James’ Mowing will introduce new services in order to sustain a competitive advantage.
Finally, promotional expenses will remain almost at the same level or a slightly higher level than the establishment stage. Educating the market remains still a major goal, but now James’ Mowing also needs to meet the competition in the market.
7.0 Strategies used to overcome challenges at the Growth Stage
- Economies of Scale
Economies of scale are the cost advantage from business expansion. As James’ Mowing continues to grow in size their unit costs begin to fall due to purchasing economies when large businesses often receive a discount because they are buying in bulk. Developments in production can lead to more efficient ways to manufacture high volumes of a particular product, helping to lower costs even further.
- Marketing Strategies
When the sales at James’ Mowing peaks, goods and services have entered the maturity stage. This often means that the market will be saturated and the owners may find that they need to change their marketing tactics to prolong the life cycle of their product. Common strategies that can help during this stage fall under one of two categories:
- Market modification – this includes entering new market segments, redefining target markets, winning over competitor’s customers, converting non-users.
- Product modification – for example, adjusting or improving their product’s features, quality, pricing and differentiating it from other products in the marking.
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