Management 1

SMALL BUSINESS MANAGEMENT

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 Management 2

Small Business Management

Currently, the business strategy is to run one location. What might be the

advantages and disadvantages of adopting this strategy to multiple sites?

Overview

Presently, the business strategy is to run one location, a large piece of

underexploited agricultural land (Hatten, T. 2018, 305). Before adopting this strategy

to multiple sites, the business needs to establish a strategy based on its capacity to

meet the demands of different clients who have varying interests and needs. If the

business chooses to run one location on multiple sites and plans to continue

providing full-on activities, it may encounter some difficulties. Because the business

is relatively new and has not fully dominated the birthday party industry, business

growth is expected to remain at a low level for a while, and expanding to multiple

sites can affect the growth and revenue process. Before running one location in

multiple sites, the business needs to focus on female participants and acquire

financial strength, which will facilitate expansion in new locations.

Advantages of Running One Business Location in Multiple Sites

With a single business site, should the site become unavailable due to

disasters such as major floods or earthquakes, the business may not be able to run

its day-to-day operations. With multiple sites, the business can continue offering

birthday party entertainment services. Additionally, the multiple sites could continue
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providing these services with the addition of overtime to cover money lost from the

affected site. Running one location in multiple sites can increase the business’s

popularity, lower transport costs, and is more convenient for customers because

they do not have to travel to the business’ single site to access the services

provided. Moreover, having multiple business sites can offer saving opportunities for

the business because labor can be cheaper in secondary locations, which results in

cheaper variable costs.

Disadvantages of Running One Business Location in Multiple Sites

Operating costs are one of the most critical factors that must be considered.

All sites will require duplicate services and personnel, such as receptionists, and the

business may not be able to cover costs that come with duplication of activities.

Communication across the business can become more challenging with multiple

locations, and the business can potentially lack direction and control. Different legal

systems and cultural standards in different countries can further affect the smooth

running of the business in different sites. These differences can also increase

strategic risk – the risk that the business does not adequately understand the new

markets it is entering, which can materially impact the business’s achievement of its

main goals (Allan, N & Godfrey, P. 2007, 137).

Is the cost and effort of legally protecting the company’s intellectual property

a worthwhile investment?
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The cost and effort of protecting the company’s intellectual property (IP) is a

worthwhile investment. Protecting the company’s IP is an investment that will foster

innovation because, without the protection of inventions, the business owner and the

businesses at large cannot reap the full benefits of ideas and inventions. In the

business community, patent infringement, copyright piracy, and trademark

counterfeit have become significant problems that impact both small and large

businesses, and, as such, the company’s IP needs to be protected.

The business owner, an ex-army officer, has established a birthday party

business based on a military outdoor theme. The birthday party business provides a

two-hour party to all participants filled with activities including hide-and-seek,

shooting games with Nerf guns, cooking sausages, toasting marshmallows, picnics,

and hosting and supervising parents are provided with access to self-service cold

and hot drinks, as well as a place to perch (Hatten, T. 2018, 305). Should the

company venture into new markets and sites, it should get the appropriate forms of

IP protection to prevent other businesses from stealing his ideas (Sharma, D. 2014,

85). Additionally, the company should protect its IP because foreign companies can

copy the business concept even though it has never conducted business in foreign

countries. Foreign counterfeits can steal ideas and register those ideas as their own

in their country if a business has not already registered it there. Thus, legally

protecting the company’s IP is a worthwhile investment.

Added to these, protecting IP can help enhance the company’s value

(Sharma, D. 2014, 85). IP can generate income for the company through
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commercialization or sale of protected services or products or licensing. In turn, this

can raise the company’s profits or improve its market share. In case of acquisition,

merger, or sale, having protected and registered IP can increase the company’s

value. Protecting the company’s IP can also enable it to monetize its intellectual

property assets through licensing, sale, or using the IP assets for collateral to

finance debt(s) (Jaiya, G. 2003, 27). Moreover, the company can use its IP as an

advantage when applying for government or public funding, such as loans or

subsidiaries.

Given the existing facilities and staff capabilities, can you identify additional

product/ service offerings?

Assessment of the Current Market

The children’s party market is a huge industry that is not affected by the

recession. This is because parents are willing to “spend a fortune on their children’s

birthday parties” (Hatten, T. 2018, 305) to ensure that they each have unique

experiences. The children’s party market primarily appeals to parents of boys and

male participants aged between 6 and 10 years, who make up 75 percent of the

customer segment (Hatten, T. 2018, 305). Popular products and services include

outdoor adventures, props, themed food, and themed parties.

New Product and Service Offerings

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Given the parental desire to spend large amounts of money on birthday

parties, there are opportunities for new products and services. For starters, the

children’s party market mainly appeals to parents of boys and male participants. The

company should equally divide its focus on male and female participants so that one

group is not prioritized over the other. The company should incorporate new

products and services for female participants, including:

1. Frozen Party – Anna and Elsa are the most loved Disney princesses in

contemporary society, and the winter theme associated with the movie makes

this idea more appealing to female audiences. The company could decorate

the venue in a blue and white theme, dress the birthday girl as Elsa, and get

everyone present for the party to make snowflakes with paper and hang them

up with strands of thread. The company can also get a customized cake with

Anna and Elsa figures on it, and distribute tiaras to everyone present.

2. ‘Fashionista’ Party – It is no secret that girls love fashion, and a fashionista

theme is great for girls aged between 10 and 13. The company can decorate

the venue with lipstick, heels, dress, and mirror paper cutouts. The birthday

girl can be dressed to look like a model, and the company can organize a

fashion show for all the girls. The company can also order a customized cake

in the shape of a dress with heels on top of it or cupcakes with different

beauty ornaments crafted on them.

The company needs to focus on female participants because neglecting them will

cause them to look for services and products elsewhere. Once the company has
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given equal attention to both customer bases, there will be opportunities for new

products and services such as:

1. Superhero themed parties – Superhero themed parties are extremely

popular and appeal to boys and girls, as well as adults.

2. Sports themed parties – Racing, football, cricket, etc. can be organized to

keep the children engaged and on their feet.

3. Creative theme parties – Hands-on activities, including making craft items

and painting, are popular among children.

4. Harry Potter-themed parties – Harry Potter is a popular theme irrespective

of age and gender. The birthday boy or girl could send invites with the

Hogwarts stamp on it, the company could decorate the venue with posters of

characters from the film, and the guests could all be given hand-made robes

and wands.

Themed décor, dressed-up characters, beverages, food, and entertainment such

as photo booths, bouncy castles, trampolines, scavenger hunt, obstacle course, and

ball pit are opportunities for new products and services that are fun and entertaining

for male and female participants and provide a hassle-free experience for parents.

Thus, it is correct to conclude that the children’s party market has room for additional

product and service offerings.

Critically assess the proposed low-cost marketing activities for enhancing the

generation of future bookings and brand awareness of this small business.

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There are various low-cost marketing activities that the business plans to

incorporate to enhance brand awareness and generate future bookings. The

business plans to (1) share business cards or small colored flyers, which they will

give via the party bag to departing guests. This is a great strategy because

disseminating snazzy flyers and business cards will allow more people to find out

about the business and reach out when they need birthday services. The business

plans to (2) post flyers at church halls and local clubs. Flyer marketing is effective

since individuals prefer having something in their hands that they can feel, touch,

save on their shelves or desks, and return to when they are ready to make a

decision. Flyer marketing also allows businesses to target their desired audience

(Miranda, M. 2007, 3). The business plans to incorporate (3) directory advertising in

its marketing activities. Advertising in directories (telephone and web) will ensure

that the business will reach out to its target audience and meet new suppliers.

Additionally, advertising in directories works out to be more inexpensive since

advertising in television or newspaper requires large amounts of money to sustain a

campaign. With a few advertisements in reputable telephone and web directories,

the business’s advertising budget will have more mileage for a prolonged period

(Khera, R. 2020, 1).

The business intends to (4) donate a free party to a community charity auction

or a school. This will allow the attendees to see all the products, services, and

activities the business has to offer and get an idea of what they will get when they

avail the business’s services. The business also intends to (5) write advertorial
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content accompanied by strong images in the local press. Advertorial content is

more targeted, which means that the business can choose where its ideal target

audience is most likely to spend time online. This will increase the business’s

chances of converting readers into sales and business leads and increase the

quality and awareness of the brand (Viknesh, T. 2018, 1). The business intends to

(6) create a website and social media presence on key sites. Creating a website is

an excellent marketing tool as it will help the business represent itself on the

internet. The business can use its website to engage visitors with visuals such as

grids, banners, and favorites. The business can also create accounts on social

media sites such as Facebook, Snapchat, Instagram, Google+, and Twitter, which it

can use to run ad campaigns. Establishing social media presence is vitally important

for the business because social media usage is among the most popular online

activities in modern society (Ospina, E. 2019, 1).

Finally, the business intends to (7) perform at community groups and school

events and (8) print car stickers to build brand awareness. Performing at community

groups and school events is an excellent way to get the attention of prospects and

clients. Furthermore, performing at these venues will give the business valuable

‘face time’ with potential clients and offer the clients an opportunity to experience the

personality, feel, and look of the brand. Using car stickers to build brand awareness

is highly effective because stickers act as miniature billboards everywhere they are

taken. Car stickers are affordable, easy to give out, and the message printed on

them can reach more people compared to other forms of marketing. The above
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proposed low-cost marketing activities can all help build brand awareness and

enhance the generation of future bookings.

Would you invest in a business like this? Provide reasoning

I would invest in a business like this because it is a recession-proof business.

A recession-proof business is one that thrives during hard economic times or

survives unscathed, and as stated by Frolich, individuals are willing to spend “an

absolute fortune on their children’s birthday parties” regardless of the economic

condition (Hatten, T. 2018, 305). Investing in a business like this is shrewd because

no parent wants to miss out on celebrating milestones. As such, they will pay to

have someone plan a spectacular party for their children and take the stress out of

planning for birthdays. Birthdays happen, and to ensure that they are executed right,

parents almost always hire event planners. Because the society we live in loves to

have fun, the business is guaranteed an opportunity to thrive despite the economic

condition.

Secondly, I would invest in a business like this because it is profitable. Tim

Jenkins states that “a modest £50 party spend per UK child equates to an annual

£35 million for a single school-year group” (Hatten, T. 2018, 305). Additionally, an

outsourced party can generate between £120 and £295, which, when totaled, can

value the business in the hundreds of millions. With such large amounts of profit, the

business will find it easier to expand its operations in different sites, hire more

employees in these new sites, and attract investors’ financing. Investing in a

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business like this is ideal because it remains profitable when the economy is rotten,

and when it is steady and has high chances of venturing into new markets.

What additional revenue and market opportunities might the business

investigate?

The business might investigate additional revenue and market opportunities,

such as offering in-studio parties in brick and mortar locations. The business might

also investigate the option of bringing the party to individuals’ homes by using on-

the-go studios. By providing both in-studio and on-the-go birthday party options for

customers, the business will be able to appeal to parents who prefer having their

guests and activities at the studio as well as parents who would rather have the

birthday party in their backyards and enjoy all the services and creative activities

that the business has to offer. Because the business has no direct competitors in

their space, it might investigate how it can provide its customers with the custom

birthday party experiences they are looking for, which is a huge opportunity for

revenue.

The business might also investigate additional revenue opportunities such as

kids’ fitness programs. Because the business is currently operating on a large piece

of underutilized land, it can use this land to promote kids’ fitness by exposing them

to fun sports and activities. The U.S. Department of Health and Human Services

advises children and adolescents aged between 6 and 17 to get at least “60 minutes

or more of moderate to vigorous physical activity daily” (Piercy et al. 2018, 48). The
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business can generate additional revenue by providing strength-building activities

and 60-minute exercise routines at least times per week.

With parents who are engrossed in work, an ever-increasing population of

children who need engaging and enjoyable birthday parties yearly, and multiple

market and revenue opportunities, the business has a huge potential for success.
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References

Hatten, T.S., 2018. Small Business Management: Creating a Sustainable

Competitive Advantage. SAGE Publications.

Sharma, D.K., 2014. Intellectual Property and the Need to Protect it. Indian J. Sci.

Res, 9(1), pp.084-087.

Jaiya, G. S, 2003. The Importance of Intellectual Property for the Competitiveness of

SMES. World Intellectual Property Organization. pp. 1-71.

Miranda, M.J. and Kónya, L., 2007. Directing store flyers to the appropriate

audience. Journal of Retailing and Consumer Services, 14(3), pp.175-181.

Khera, R., 2020. The Advantages of Advertising in Trade Directories. More

Business.

Viknesh, T., 2018. The Pros and Cons of Advertorials. Thunder Quote. Retrieved 10

July from https://blog.thunderquote.com/2018/11/11/the-pros-and-cons-of-

advertorials/

Ospina, E. O., 2019. The Rise of Social Media. Our World in Data. Retrieved 10 July

from https://ourworldindata.org/rise-of-social-media

Piercy, K.L., Troiano, R.P., Ballard, R.M., Carlson, S.A., Fulton, J.E., Galuska, D.A.,

George, S.M. and Olson, R.D., 2018. The physical activity guidelines for

Americans. Jama, 320(19), pp.2020-2028.

Allan, N., Davis, J. and Godfrey, P., 2007, August. Ten steps to managing strategic

risk—a holistic approach. In Proceedings of the Institution of Civil Engineers-

Civil Engineering (Vol. 160, No. 3, pp. 137-143). Thomas Telford Ltd.