Practise how businesses combine resources and decisions to create value, classify sectors and respond to start-up opportunities and risks.
A hotel combines human resources such as managers, receptionists, housekeeping and catering staff with physical resources such as the building, rooms, beach, restaurant, equipment and ICT, and financial resources such as investment, revenue and working capital. Martin read statistics and secondary market data, conducted a marketing audit and constructed a position map; he realized that The Imperial could attract travellers interested in safaris or cultural tourism. Jomo Kimathi moved from Kenya to the UK for a work permit and hotel career before returning to Kenya; Martin was born in London, studied and worked across cultures before returning to Kenya; Craig Chapman moved from Liverpool to Kenya to run an orphanage and remained there. These examples show domestic and international labour mobility driven by work permits, careers, personal heritage, family and humanitarian motivations.
Describe how a hotel such as The Imperial combines human resources, physical resources and financial resources for its business activity.
Suparman Fish ( SF )
Gepa Suparman owns and operates four fishing boats in Indonesia. There is a growing demand for canned (tinned) food, including cans of fish. Gepa wants to enter the secondary sector by opening a small factory producing cans of fish.
Gepa's business will be called Suparman Fish ( S F ) and will be a private limited company. Gepa will own all of the shares. The factory will be located in a village three miles from the harbour. Because unemployment is high in the village, Gepa should easily find workers for the new factory. In addition to the manager's salary, workers' wages, and the cost of fish, supplies, and cans, S F will have the semi-variable cost of electricity.
Gepa has prepared a four-month cash-flow forecast based on the following information:
- opening balance month 1: .
- month 1 : sales revenue of increasing by 20 % per month.
- manager's salary: per month.
- workers' wages: per worker per month.
- variable costs (fish, supplies, and cans) are equal to 40 % of sales revenue.
- semi-variable cost of electricity: fixed cost of per month, plus a variable cost of per kilowatt hour (kwh). Month 1 usage: 100 kwh , increasing by 10 % each month.
Although S F would create several jobs in the village, many residents are not happy about the new factory. The new factory would use chemicals, which cause pollution. Residents are concerned about the unpleasant smells from the factory. A representative from the local employment office is concerned whether Gepa's factory will provide a safe working environment.
Define the term secondary sector.
Make-Up (MU)
Lana Lane is an image coach and plans to open Make-Up (MU), a shop where she can sell her own brand of beauty products. Because Lana is a female entrepreneur, her local government will pay 50 % of the rent for the space in which M U will operate.
Lana has forecasted the following figures for M U for the first six months of operation, beginning on 1 July 2023 (see Table 1). The opening balance will be .
Table 1: Figures for the first six months of operation, beginning on 1 July 2023
Lana has learned that a new competitor with lower prices will enter the market before the end of 2023.
State two characteristics of an entrepreneur.