Associates Capstone Essay
In going through some of things regarding buying the business I think Mike should make sure that the coffee shop is up to code. He should talk to officials about required standards, for running a coffee shop, licenses; the different laws for having the shop in Sunnydale, Illinois, all of will be needed and will help to keep the restaurant running properly inside and out. It is also important that he reviews each file for all employees making sure all documents that are needed for hire are there, reading through and seeing the difference in their duties and the performance prior to him buying the shop and respond accordingly and whatever decisions he makes with each one or if hiring new document all that is done to cover himself within the law. Going through the business files and reading the comments given by customers is important for this will help to give him proper information on what is liked and dislike about the coffee shop and making a plan to change things or get new things to keep them satisfied and coming back, for ex: as accepting credit cards for payments as well as cash.
Going more into the business files checking on the finances and accounting is important to be sure all is accounted for, profits are being make and what the next plan would be according to what is found. This will also help in what they are spending for supplies and necessities and where he can save money and use it for other things needed, also go over the income part to see where they can change prices and get better ideas compare the coffee shop to the competitors place and prices. Also make sure all appliances are up to date and properly handle according to code. After reviewing all of these things an going forward making a proper business plan and procedures of moving forward will give Mike a properly ran business with happy customers coming in and employees glad to keep it running and making profits.
In reviewing some of the personnel files on the employees it seems you will have to definitely put together a company/employee/personnel manual. This will help with the government regulations for the State in which the coffee shop is in and it will also spell out what the Company will expect of the employees and what they expect in terms of benefits and other topics related to employment. (The Complete Idiot’s Guide to Starting Your Own Business, page 203). Be sure that when creating this manual you have included all the necessary rules that you want and intend to enforce, (no drinking on the job, no smoking in the workplace, excessive tardiness, or absenteeism, no sexual harassment, no discrimination in the workplace, no stealing and all other rules that will be enforced, then have a meeting with the current employees and any new employee to review before getting started and have them each sign it to keep in their personnel files. This will let them know that you intend to enforce these rules and if not followed the consequences could be termination.
First thing I would do is create a business plan, Mike is considered the Strategic Manager for the coffee shop and he will need to create a plan, organize it, lead it and control the outcome of all that will happen within the business. He will need to focus on the long term goals of the shop and once he has these can move forward in communicating with the employees. He will then need to meet with each of the employees individually to go over their files, be sure to update them with all proper paperwork and they are legal to work. When discussing things with them do not bring up personal topics: marital status, race, religion, etc. for this would be a violation and is not permitted during any type of interview or meeting with an existing employee or new employee.
You can let them know the good things about working for you at the shop and even some things that are not so good, make sure the employee knows what work they will be doing and agrees to it and they will be able to perform these duties, you can also see if they have questions regarding the manual and take care of it at that moment have them sign indicating they have read and understand it. I think he should also review the break room and clean it up putting up the proper documents on the board and take down all that unnecessary stuff on it. He needs to have posted the proper documents of the law with minimum wage and health. The only other thing up there could be the schedule and notes of reminders of what needs to be done. He then should take care of the stock room and office to have them both properly cleaned up things in right places. Once all these things have been accomplished it will make for a better organized area and easier for him to control and lead his employees and have a well established running coffee shop.
Finance and Accounting
Reviewing the finances is important; it seems they have a very high salary expense (for a coffee shop) and supplies expense that needs attending to. This means checking with other suppliers and their prices. As for the salaries we would need to go over everyone’s positions held and the salary they are being paid and make sure it fits with their positions and pay scale. As I continued going through the files I noticed the income tax/employment tax and other forms were still from 2006, need to get all those updated from previous owner or get them taken care of and all financial and payroll taxes to date. Not filing properly for state taxes/employment/unemployment is a violation and subject to penalties. I would also review the loan that was taken out on the freezer and be sure all payments had been made previously on time and see what the payoff is, he may be able to save monies on paying it off then paying the extra interest each month. Once all of these are reviewed and items that need attention either corrected or forms filled out and all things brought to date, Mike will have a better understanding of the numbers and all within in the business to get him started and ready to go.
Make the decisions on what actions need to be taken to achieve these goals. This is part of the strategic planning of the long term goals for the company; it covers major portions of the company. Organizing, Joe will have to get organize the departments, get the right people in place, create the proper systems needed to properly run the company, bring together all resources needed to have it run properly. Now he will have to take these and lead his employees under him to want to be there and work and give there all, with motivation and communication. He will maintain good contact with them to give them what they need to keep the company running properly with all he has organized.
Proper leading of employees will help to give more of themselves to produce quality work by giving guidance and inspiration to them. Leading takes place in many areas of the business not just from the top, also from teams, divisions and departments. He will also set values and mission with his leading. Now the last part of the management function is controlling, taking all of the planning, organizing and leading and controlling it to keep it functional. All the other functions isn’t the success of the company it is the monitoring the performance and make changes where necessary. He needs to make sure the plans are being used and goals are being met within the company, also needs feedback in all areas so that he can make changes, to processes, procedures where needed.
Checking to be sure all the financial statements have been done and balanced is very important. In checking the business files it seems they balanced but not all were completed, this will help to know where the business stands and where changes could be made. There are 4 parts to the financial statements, income statement, balance sheet, cash flows and owner’s equity. I only noticed 2 of the 4 mentioned in the business files each one of these statements has its own meaning that should be understood even if Mike plans to have someone else handle it, income statement will let him know whether or not the business is profitable, it totals the revenue and then subtracts the expenses associated with making that revenue; results being the pretax profit and after taxes are paid net income.
These statements can be done monthly, yearly, quarterly or year to date, I think for Mike monthly would be good for it will show how much he has sold and what it cost to create the sales each month. The balance sheet is a snapshot of how things are at a particular moment, shows the amount of assets and liabilities at a particular point and time, where his income statement shows the flow of money in and out of the company in a specific time frame. His cash flow statement could be the most important for it will tell him whether or not he has enough cash to pay the bills. This statement will reflect investments, borrowing, etc. and other balance sheet changes. The key challenge is that he will need to keep more cash coming in than going out especially with just starting out. His owner’s equity will be the portion of the balance sheet which shows what is left over when all liabilities are subtracted from all assets. This is the number he wants to maximize because it can reflect the book value of his company. Once Mike has reviewed all of these and are updated he will know what changes will need to be made within the coffee shop from many points.
Problem solving and decision making are very important factors in every managers or persons within their business, even in the Coffee Shop for Mike. He will have things that happen or a daily basis and even on an hourly basis in which his skills as the owner and manger are in demand. He may at first with many as a reaction to things react against it, which can cause a downward spiral. He may look at the past and use the old way to fix a current problem and that usually doesn’t work. Mike will need to have a planned approach and then execute it.
By doing this he will avoid having the same problem over and over again and use doesn’t continually solve a different problem the same way as the other. There are a few approaches he can take, he can define the problem, look at the potential causes, find different ways to solving the problem, choose which solution is best, make the action plan and then monitor and verify the solution. By doing these things it will help to ensure all is working properly as it should after the solution has been decided. Mike can use these basic steps in his new role as Owner/Manager of the Coffee Shop, making this plan to solve a problem and the decision will make for a better team in the Coffee Shop.
Management, Bateman and Snell, Chapter 1 and Chapter 4, 2010 http://ezinearticles.com/?Top-Level-of-Management&id=20181389 The Complete Idiot’s Guide to Starting Your Own Business, Fourth Edition by Edward Paulson http://www.brighthub.com/office/project-management/article/87158.aspx
Subject: Balance sheet,
University/College: University of Chicago
Type of paper: Thesis/Dissertation Chapter
Date: 17 December 2016
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