I’ve also heard the argument that tattoos are just a fad and they aren’t going to become about forever. “There was a time when the deliberate infliction of
harm on oneself or on other people was illegal” (Students). What many people do not understand will be the history behind tattooing and how long this art type has been
around. Tattooing has been about for about 5200 years. There has been lots of evidence that tattoos had been first place on the human body to protect them and
their soul. Some may also suggest that tattoos had been applied to alleviate joint discomfort and had been overall therapeutic. As time went on, the art of tattooing started to spread all over the world. It does appear like tattoos have gotten increasingly popular more than the recent years. Individuals want to broadcast towards the
world what they’re all about. Think it or not “tattooing will be the country’s sixth-fastest expanding retail company. And it’s growing at the startling rate of more than one new tattoo studio each and every day”. One main reason many people won’t get a tattoo is because they think they are going to regret it. Pop culture has had an enormous effect on acceptance of tattoos within the workplace. “According to a survey conducted by Harris Interactive on-line during July 2003 among a nationwide sample of 2,215 adults, eighty-three percent of Americans with tattoos don’t regret getting them”.
Tattoos have turn out to be much more common in this generation-and it shouldn’t prohibit applicants from
getting a job. If increasingly more young people are deciding to get these body modifications, then it will only be a short time till we see lawyers, physicians
and Tv anchormen with tattoos.

“Despite historical associations with deviance and marginality, tattooing is practiced by a diverse population in the Usa today, top some to argue that it has grown beyond its negative associations”. Employers ought to be more accepting of body art. Plus, those making the hiring decisions are obtaining younger and shouldn’t be as stringent about holding on to conventional suggestions about workplace appearance. The bottom line is the fact that yes, you are able to possess a tattoo along with a great profession. It might still be tough now since many company owners really feel that the appear of “[a] tattoo doesn’t fit the image from the establishment.” Nevertheless, it is still feasible that the “establishment” is easing up on its image specifications. In the event you wouldn’t judge somebody by the color of their skin don’t judge them by the colors on their skin.

Starbucks is really a fascinating company. They’ve ‘taken over the world’ with coffee shops in over 35 nations. Starbucks is obviously about a great deal over merely promoting coffee. Organizational culture is one thing that’s very important to Starbucks and is something that starts with their upper management. Jim Donald, the current CEO and president, describes himself as “fanatical about communicating.” He’s a very forward thinking person and this is all evidenced by his continuous time management and attention to details as minute as a fifteen minute period of someone’s day. According to the vice president of the beverage category, Starbucks could save $12 million if all the executives performed like this. He is concerned with saving cash and increasing the bottom line but not at the expense of his workers. The culture is just American. Whilst Starbucks is known for its cup of coffee, they hope to become able to add to that image in the public eye. Starbucks Chairman Howard Schultz has often talked about creating the coffee shops a place where they can come outside of their home and office to unwind and think.

The values that Starbucks and I share are the desire to unwind, make individuals really feel as welcome, and comfy as you possibly can. I want people to always feel so comfortable around me and know that it’s okay regardless of who they’re they’re totally free to talk and I will listen or if they don’t want to speak but just sit that is fine too. From my own individual experiences with Starbucks it’s a third location for me and my girlfriends to sit and eat a pastry and just unwind.

Everything within the environment at Starbucks radiates relaxing, calming and tension relieving really feel to it. It makes it a perfect comfort zone and it is even a location that one can possess a study group and debate politics of a paper. Howard Schultz, the chairman of Starbucks, comments that “People aren’t thinking about just how much you realize, it is just how much you care.” This is something that rings true all through the organization and especially in regards to Starbucks social consciousness. The seven primary characteristics that Starbucks embodies are focus to detail, people orientation, team orientation, aggressiveness and stability. It’s essential to get a business like Starbucks to spend focus to detail and deliver the relaxing atmosphere that they so want to get across to customers. Individuals orientation comes into play because the people who operate this business want it to remain in expanding but have the ability to talk and invest time with their employees and do what’s in the best interest from the workers. They want a big business with the small business feel-where employees are close and function together and depend on one another to get their jobs carried out. The organization works as teams more than anything. It’s a chain reaction one prepares it then hands it to the barista who puts it all together after which the individual who hands it to you by calling you by your own name rather of creating you feel like you are a customer. From the extremely top of the company to the newest member of the team, they work together to deliver you great pastries, great tasting coffee and in an atmosphere that lets the consumer remain real and alive. The Starbucks Company is trying to develop aggressively but almost too quick since they did need to shut down some shops this past year.

Which in hindsight, probably helped the business because it was obtaining to exactly where their name and store was everywhere and it was losing the concept of how unique of a business Starbucks is. How great it is to drive via this town and uncover “hey there’s a Starbucks.” Even though, we want them everywhere because they are great, if we had it every time wanted it then the things that make Starbucks unique get lost in the usual day to day run. Stability is definitely a large part in this business. Starbucks makes sure that the business is always expanding with new trainings and intense evaluations. To a customer, the function at Starbucks might be just pouring coffee into a cup. However the function is grueling and fast paced and can even be a bit harmful because of the temperatures that are being worked with.

Starbucks has a very strong culture. And it’s ethical and customer responsive. It is extremely apparent that Starbucks has faithful customers that are totally satisfied with the service that they’ve received. There’s something about Starbucks and some thing to be said on their consumer service. They really try to go above and beyond to make you really feel that you are an individual with a name with a preferred drink or pastry. They are usually attempting to educate their customers with knowledge on what they’re drinking and other drink that they may enjoy. The customers that are serviced through Starbucks are the normal every day American. There are Individuals which are Starbucks clients. They come from all financial levels, from physicians to construction workers to school teachers to stay at house moms. These clients are hardworking and just looking for a pick me up or perhaps a increase of power prior to a lengthy day begins or even at the finish of the lengthy difficult day.

Customer service is extremely important particularly inside a business like Starbucks, even the restaurant business, customers are usually first. They may not always be correct but don’t show that in front of them. That can be discussed further after the consumer has left the location.

Where I stand on customer service, as Client Solutions Director, attend towards the consumer with high opinion, use proper name, and steer clear of terms of endearment, i.e. sweet heart, dear, or hon. Focus on the customer being serve. Respect the customer’s confidentiality. Demonstrate understanding for the customer’s worry. If interrupted when providing service, express regret to the consumer. When a fault in service is exposed, correct the error with out a negative reflection on the individual or department responsible for the error. If the employee is unable to meet the customer’s need, then that employee needs to offer option options. Please don’t provide opinions, info or expressions that reflect negatively on or any other business that is a competitor, or any other organization. Recognize that our customers’ perceptions are influenced by our conduct, whether or not on or off duty.

Every thing in this company was founded on difficult work, small town values and customer service and good coffee. If other companies would work to please people half as hard as Starbucks works at it, there wouldn’t be a need for consumer service.

Strict liability is absolute liability for conduct with couple of, if any, defenses accessible When individuals are held accountable for damages even when they did not act negligent or intend to trigger harm it’s strict liability. If damages arise, property owners may be held strictly liable when storing harmful chemical substances or animals on private property.

Capturing the Company Tourism Sector very moderate.
The answer to this really is to construct up a distinctive Singaporean niche. There’s small point in promoting
Singapore as a nation wealthy in heritage and culture; rather, the IRs will marketplace the contemporary
entertainment, vibrant city life, along with a continuously altering atmosphere Singapore can greatest
contact her personal. Using the rise of China and also the influx of middle-income Chinese tourists (the
segment using the biggest growth possible, and who’re most prepared to splurge in the
gaming ),  the IRs have turn out to be much more essential than ever. The Feedback Unit itself has
ascertained that Singapore desires ‘an iconic destination resort that provides world-class
entertainment and leisure facilities’, not a mere gambling facility like Macau; one ought to
bear in thoughts that the IRs primary functions go beyond the mere attraction of tourist income
through the casino, but rather within the creation of a holistic tourist destination.
Additionally, tourism-related industries stand to reap the spin-off advantages of the IRs. Hotel
occupancy will rise3; shops, restaurants, as well as other tourist attractions about Singapore will
benefit positively from the creation of a vibrancy and buzz which will popularize Singapore
as a leading travel destination.
The IRs will strengthen our status as an aviation hub and improve our appeal within the hosting
of conventions and exhibitions. The corporate marketplace is an additional huge new tourist
The typical Chinese visitor to Macau spends $322, $40 much more than the typical visitor to
Las Vegas.

segment Singapore hopes to capture – reports indicate that corporate guests invest a lot
much more per individual than any other group of tourists. The Bayfront IR project is particularly
appropriate for this – targetting MICE4 guests, it’ll complement the creation of a international
identity by simultaneously increase ing Singapore’s tourist and company attractiveness.
Investors have also indicated their willingness to sink 2 – 4 billion dollars in improvement,
with out which it’s estimated that Singapore will take a minimum of 15 years to tender out the
land in person parcels and to create the region on a comparable scale. Singapore faces stiff
regional competitors in this region – e.g. Macau, Kuala Lumpur and Bangkok5. As a Merrill
Lynch report observed, “It is… (the IR projects)… that suggestions investor mindset toward
accepting that Singapore is transforming itself into a diversified service-based economy”.
On a macro-economic scale, the IRs happen to be projected to make a minimum of 35,000 jobs and
significantly improve household income. For instance, Kerzner International6 has
effectively turn out to be the biggest non-government employer within the Bahamas, supplying up
till 8% of employment. Alongside employment, the gaming business is expected to
offer a substantial improve in tax income – betting revenues currently presently
constitute the Singapore Government’s third greatest supply of income. It’s hoped
that the IRs will act as a powerful booster towards the Singapore economic climate and improve national
Hotel occupancy rose from beneath 65% in 1993 to a wholesome 80% in 2003 within the Bahamas
following Kerzner International took more than an ailing casino resort and transformed it into
Atlantis Resort.
Guests to Meetings, Incentive tours, Conventions and Exhibitions
Venetian Macau, the centerpiece from the COTAI Strip, will have 1 million sq ft of
convention and exhibition space, a 2000 seat theatre, along with a 15000 seat arena.
Other Advantages: Job Creation & Tax Revenues

An Integrated Resort- Casino for Singapore: Assessing the Financial Impact

Within the face of this central agenda, you will find a number of paradoxes that remain unresolved.
It’s recognized that foreign patrons will be the primary engines of growth for the IRs, since
the most successful casinos are typically those that attract much more foreign patrons than locals7.
Whether foreigners will prefer Singapore to other gambling hotspots within the region still
remains impossible to predict, however – particularly since there’s a GST levy slapped on leading
The existing IR within the Bahamas.
80% of patrons to Nevada casinos are foreigners, for instance.

Limitations & Paradoxes

from the standard gaming tax of 5%. If possible investors are unable to generate the expected
revenues, they stand to lose billions; but the repercussions go far beyond that. Since the IRs
represent a gamble in themselves, a failure would destroy Singapore’s competitiveness in
the international economic climate and wreck our company climate.
Finally, the problem of transparency within the casino bidding process may give us some insight
into the importance from the IRs in boosting the flagging company climate in Singapore. The
US investment bank Merrill Lynch has recently described Singapore’s criteria weightage
for the IRs as being highly ‘subjective’, referring towards the dodgy problem of whether Singapore
will favour Temasek Holdings-linked syndicates MGM Mirage-CapitaLand and Harrah’s
Entertainment-Keppel Land more than rivals within the bidding process. Ought to the Singapore
government allow issues of transparency to cloud the creation from the IRs, their financial
significance as an indication that Singapore is prepared to remake itself into a ‘diversified
service-based economy’ will be destroyed. Singapore cannot afford to have the IRs
destroying themselves before they are even built by marring company confidence within the
impartiality from the Singapore company atmosphere.
As Singapore moves towards a historical step within the building from the IRs, it’s essential that we
keep a number of issues in thoughts. How far exactly is the Singapore Government prepared to
go in making a holistic tourist attraction symbolic of Singapore’s distinctive metropolitan
identity? Will the inherent paradoxes within the building from the IRs prevent us from achieving
that, particularly since we are caught in between two apexes of a conventional conservative.

Society along with a international city identity? The IRs aim to attract foreign patrons and to prevent
domestic leakages to gambling hotspots elsewhere, but GST and high gambling taxes are
slapped on, and entry levies are instituted as a concession to moral convention. It should also
be considered whether the IRs in themselves are enough to maintain Singapore’s tourism
and company edge – IRs are not a novelty and happen to be constructed worldwide, and there
is nothing stopping our regional neighbours from doing the same. What does Singapore
have in its IRs that differentiates us from the rest from the globe? The implications are
huge – we should be prepared to go far enough within the creation of an enduring
metropolitan identity which will take us through competitors and imitation, or watch the IRs
gradually becoming lacklustre attractions.

Leadership style is the manner and approach providing direction, implementing plans, and motivating people. When dealing with leadership designs three major leadership styles are distinguished. The very first leadership style will be the authoritarian. This kind of leadership style is used when leaders tell their employees what they want done, and how they want it achieved without any guidance or input from their followers. Workers have a tendency to see this kind of leadership style as “being bossed around”, along with a extremely unprofessional leadership style. It is clear that an authoritarian leadership style could be detrimental to an organization like Walt Disney. Walt Disney prides itself on the ideas and imagination of its employees also as its customers. An authoritarian leadership style would take this asset of the business away totally. The second leadership style is participative leader. The participative leader consists of one or more of their workers within the choice creating process. Nevertheless, the leader holds the proper to create the final choice. Occasionally, this leadership style can be noticed as a sign of weakness; nevertheless it is completely the opposite. An employee generally come to benefit this, and is really a sign of strength that workers tend to respect. Utilizing this style is usually a mutual benefit for the employee also because the leader. It permits the workers to become part of a team, and permits the leader to make better decisions. This appears to be the leadership style that’s practiced inside the Disney organization. Their use of employee survey’s and emphasis on imagination is a prime example of Walt Disney wanting the opinions and thoughts of their workers to become heard and recognized. The third style of leadership is delegat. In the delegative style the workers are allowed to make the choices, nevertheless the leader is still responsible for the choices which are made. This style is most advantageous when the employees are given all of the information needed to make an educated decision. This style of leadership could be a downfall within an organization such as Walt Disney for a few factors. The main one becoming that a lot of individuals creating a lot of choices could turn out to be utter chaos. Nevertheless, this leadership style gives workers the freedom to create choices for their organization.

Within organizations are sources of energy. Energy is defined because the ability to influence, and ability to impact, an capability to mobilize, a capacity to assert influence, and also the ability to employee sanctions. There generally three different sources of power. These included coercive power, reward energy, and legitimate energy. Coercive power is really a energy that’s based mainly on fear. Fear of management by employees. This source of energy generally ends negatively. This source of energy would have negative impact on an organization like Walt Disney. Workers would act out of fear, as opposed to operating for enjoyment for an employer they feel respected by. Reward power is a energy workers have come to comply with management and directives simply because positive benefits incur. These positive benefits are known as rewards. These rewards may be but aren’t restricted to recognition, promotions, bonuses, and new employee assignments. Walt Disney is known for rewarding their workers for their hard work and dedication, consequently rewards energy is utilized in one senseor an additional. Most organizations use legitimate energy. Legitimate power is based upon structure within an organization. Usually, it’s associated having a position held inside a business. This source of power is not obtained out of fear or rewards, but gains acceptance by employees due to positions held by authority. This appears to become the trend in organizations today including Walt Disney. This source of energy together with reward energy has a confirmed positive track record within the Disney organization in regards to their good results and communication.

We define motivation because the processes that account for an individual’s intensity, direction, and persistence of effort towards attaining a objective. In history there happen to be numerous motivational theories. To name a couple of are acquired requirements theory, this theory indicates we as humans seek energy achievement, and affiliation. Attribution theory which suspects humans have to attribute cause that supports ego’s. Cognitive evaluation theory which suggests that we select particular tasks depending upon how doable they’re. Communication and motivational theory can go hand in hand. How we communicate what’s important to us as workers, is what motivates us simultaneously. Consequently, the motivational theory that coincides within the Walt Disney Corporation is Expectancy theory which states we are motivated by desirable things we anticipate we are able to achieve, and goal setting theory which states workers need and desire different types of objectives which motivate us in various ways.

Commitment in the workforce inside in organizations is by far one in the most significant attributes in a company. Commitment in the workforce in some cases could determine the good results or failure of a business. Organizational commitment is defined as a state in which an employer identifies having a specific organization and its objectives and wishes to preserve membership within the organization. There are three separate types of commitment within the function force. The very first and among the very best is affective commitment. This degree of commitment is a benefit towards the employer as well as the employee. It means the employee has an emotional attachment towards the organization, and most importantly believes within the company’s core values. The second will be the continuance commitment. The continuance commitment can be an unhealthy commitment to a workforce. The continuance commitment in a nut shell is someone operating for and staying with an organization because they need the money, and support for their family. This type of commitment can bring down an organization with individuals who don’t believe in what the company stands for. The last is normative commitment. An employee who has this kind of commitment only stays employed by business because they do not want to put the organization in any kind of bind. It is clear to see that Walt Disney has probably has had a mix of all, realistically. Nevertheless, those that stay a component of this organization, and who are component of their good results could be amongst the very first of these commitments listed.

In closing, like culture within an organization like Walt Disney leadership, sources of energy, motivational theories, and commitment of workforce all go hand in hand with communication. Together these aspects of communication have led to good results with the Walt Disney Corporation in the past, present and future.

SWOT analysis involves looking at your strengths, weaknesses, opportunities and threats. Strengths and weaknesses are looked at internally, focusing on company culture, image, staff, capacity, efficiency, brand awareness, market share, experience and even trade secrets. Whilst opportunities and threats look to the external focusing on customers, competitors, trends, suppliers, social changes, new technology and the economic and political environment.

Once the best opportunity to satisfy an unfulfilled customers needs is identified a marketing strategy can be put in place to pursue this opportunity. The strategy then looks at segmentation, targeting, positioning the product within the target market and the value proposition to the target market. Subject to the external and internal constraints of the marketing environment there are four parameters that the marketing manager can control. Known as the four P’s the aim is to find balance between these relating to your marketing strategy.

At this stage the plan has been developed and the product launched. Since markets change constantly, results should be monitored closely and as this occurs changes can be made ever so small or big to your marketing mix to keep your consumer happy.

There are 5 main marketing orientations of which a company will adopt one. This will determine the way it interacts with the customer. These include product orientation, sale orientation, marketing orientation, relationship marketing orientation and societal marketing orientation.

Product orientation suggests that a company focuses inwards looking at what it is actually capable of, rather than the needs and wants of the consumer. It is strategic in the fact that it is doing what it does best, but it does not recognize the needs of the market

Sales orientation is based upon selling existing products with a hard sell approach. Very aggressive tactics are used, this can work but again the balance is out, there is no consideration of the consumer it is about turnover and that is it.

Marketing orientation is based around the needs and wants of a customer whilst of course still meeting business objectives. It assumes that a sale depends on a customer’s decision to purchase a product, recognizing that there is no reason why they should buy your product over someone else’s unless the perceived value is higher.

Relationship marketing orientation recognizes the value of repeat business over a one off sale, not only with customers but suppliers as well. This can be seen in many industries, hotels store information on guests and when they return can know what newspaper they like, if they want a smoking room and so on. Although these are little things it can impact on guest satisfaction.

The societal marketing orientation is relatively new in the scheme of things but suggests on top of meeting the needs and wants of the customer and the organization there is the societies interests to be looked at as well. It suggests that a customer may choose a companies equal product over another because it is more environmentally or animal friendly, for example the body shop.

Marketing management and planning is essential to any business,   it is the implementation of strategies to achieve long run profitability   and growth. When a company is looking at how it will achieve this,   its two key points to consider are: What is the organizations main activity at a particular time? And how it will reach its goals?    To answer these questions and through this, devise methods of which employees can implement these goals is a marketing plan. It involves designing a strategy that insures a consistent approach to offering your product or service in a way that will outsell the competition whilst keeping in mind the changing market. Without a plan you can not implement strategies and decisions for the company because there is no basis to work from. These include product line, distribution methods, marketing communications and pricing. It is physical model of which everyone from the General Manager to the front line staff can work from and to achieve common goals. It also provides a basis by which actual and expected performance can be compared. It allows total knowledge of a company from value to implementation.

Internal factors include personality, motivation, learning, perception and attitude.

External factors include culture, social class, reference groups, family and personal influences.

Situational factors include time, income, mobility and availability. Time recognizes today’s societal pressures of time available. Income is to do with available money that can be spent. Whether or not it is possible to get to the location to purchase the product or its availability on-line. Availability is if you can get hold of the product that will satisfy your needs.

There are 5 steps to consider when analyzing the consumer decision-making process, it involves need recognition information search, evaluation of alternatives, purchase and post purchase behavior. It will not necessarily be in this order and can be stopped at any time by the consumers’ decision not to buy a product.

When a consumer is exposed to internal or external experiences and the realization occurs that they do not have something they want is the first step in need recognition. Once this occurs a consumer then looks for options in fulfilling this need through an information search. It then comes down to evaluating the alternatives and the decision to purchase or not purchase occurs. It is important to recognize that after purchase customers are still processing their decision as to whether their expectations have been met and it is important for the marketer to recognize this as part of the buying process.

One “official” definition of consumer behavior is “The study of individuals, groups, or organizations and the processes they use to select, secure, use, and dispose of products, services, experiences, or ideas to satisfy needs and the impacts that these processes have on the consumer and society.”

They donate money to many charities showing care towards the community, they show ethical concerns with regards to the environment and responsible purchasing. All these are societal orientations and have a positive effect on the community and are positive external factors in the consumer behavior model on purchasing.

1) An existing business with a record of operations has a better chance of obtaining finance than a newly established business.

2) Some form of capital invested by the owner/founder of the business is always essential in order to get capital assistance from outside.

Personal funds

Before potential investors (partners, stakeholders) consider investing in a small business of lending financial assistance they always want to know how much the owner has invested this is because in every new business that is started there is always a risk involved on whether the business will survive it is always a better assurance if the owner also has a risk in financial loss too. It is better for the owner to look for financial assistance by other sources as well and not only from investors if he does not have a lot of capital to invest. It is important that the owner has assets of his own to invest in the business. The more that can be invested the greater his share in the profit he will get, as well as his independence will be.

Loans from relatives and friends

This is usually not an ideal way to obtain finance, but is very common way to obtain finance for small businesses, usually there is no other way that finance can be obtained after trade credit and supplier contracts have been use. It makes sense because they know you better than anyone else and are aware of your weaknesses and strengths, however this source is not desirable because relatives and friends would the try and intervene and this is not always desirable as trouble and arguments could cause complications in the running of the business smoothly mixing family and friends with business can be risky and undesirable. If this source is chosen it is always recommended to stipulate terms of the loans are clearly specified, such as rights of lenders to make operational policies and involvement in the day to day operations. The best way to avoid problems is to ensure all the parties involved respect the right of the owner to make business decisions. All the terms of repayment and any option for early payment should be put in writing. It is also important to record such transactions in the correct financial statement. In the balance sheet – if exceeding a financial year then must be presented in non current liability, but if a proportion due in the financial year should be presented under current assets in the balance sheet.

In conclusion family and friends tend to invest in the founder rather than by a sophisticated analysis of the business and its an easier source of funding for the owner because he doesn’t have to make detailed plans and analysis just to obtain the funds, but there is also a strong eager not to disappoint the people you love.

 Trade credit

Trade credit is financial assistance provided from other businesses with which the business has dealings with most commonly the suppliers of  the inventory to the business, example a wholesaler wants business from a retailer so in order to get there business they provide special repayment plans they will give the retailer for example R 30 000  worth of goods R20 000 they pay and the other R 10 000 they provide a payment plan to receive the money in a few weeks once they have actually sold the stock already and have the money to pay them( the wholesaler has basically provided 10 000 worth of capital). This is just one example there are many other terms that can be offered once the business is well known for its successful operations. The number of suppliers your business will have should also be considered. If a large discount is offered for repayment of your debt quickly, should always pay when get the highest discount.

Loans or credit from equipment sellers

This is like another form of trade credit, with some differences. The small business may need equipment; essential equipment e.g chairs, computers, desks etc are a large proportion of the investment of the funds that is essential for the running of the business. The purchases of equipment are not a regular transaction, but initially is a large proportion of the capital that is invested is used on the purchasing of such equipment. The suppliers usually provide good credit terms as long as there is a proportion of the total cost as a down payment and the remainder is stipulated in a contract for the remainder that is payable over a few years. This type of credit can be very helpful. Problems come in when overuse because payments come out of the profit made therefore if overuse this type of credit it is not good for the business liquidity. This happens when the profit earned for the month is not as great as the amount payable for the fixed assets.

Mortgage loans

If a small business owner owns a building they can secure a mortgage on it and pay it back over a number if years this way instead of paying rent every month, he will pay back the mortgage every month in some cases second mortgages will be used, but not ideal it is not recommended to commit assets to the mortgage claims especially when profits can not be determined, if profit of the business can be established more accurately, The use of mortgage risk becomes less

Commercial bank loans

in earlier days, this is when a small business obtains a loan from a bank  to allow a merchant to purchase inventory of merchandise, when the merchandise gets sold the repayment of the loan will commence. This is the best way to get a loan from a bank. This has become a dominant way to obtain finance as there are many other types of loans that are available to the public as a service from financial institutions. The business owner will approach a bank with a business plan(a detailed plan of the business what the owner plans to sell, the estimated profit, why it is a unique service/product that it likely to succeed etc..) Long term -loans are less available than a short -term loan. Short-term loans are loans that are less than a financial year of a business. If you have assets to secure a loan longer -term loans are then more likely to be obtained or surety can also be used (e.g. Wealthy friends or family agree that if you are unable to pay then they agree to pay on your behalf. Interest rates charged to small business is much higher than interest rate charged to larger businesses. Although banks are lenders of a large number of small businesses credit unions and trust companies also offer loans to small businesses. There are three types of loans, term loans, mortgages and overdraft loans-this is a flexible borrowing arrangement when the bank allows you to spend more money than you actually have, the purpose is to help people to pay for their working capital needs (the interest rate is usually higher than a term loan, but in monetary terms it is probably cheaper because you only pay interest on the money withdrawn (outstanding balance), but you may have to provide personal assets as security.

Owners are not keen on obtaining finance this way because although it is a good source, if you are an inexperienced founder it is very difficult to qualify for finance from a bank and banks generally tend to only lend money to businesses or people who have a trade record or successes and proven credibility as well as have some sort of surety.

Small business loans

This is when the owner of a small business or someone who is trying to establish a business, may borrow funds under this program to purchase fixed assets or for leasehold improvements (improvement of the existing premises) or to purchase land or buildings that is required for the operations of the business. The loans are usually provided by banks and other lending institutions. The loans have a fixed terms and conditions of repayment, at a  predetermined number of years and the interest rate is fluctuating(it may increase every year) The banks prime rate increasing by a percentage or more every year.

Taking in partners

Sometimes in order to raise sufficient funds it is convenient to take one or more partners into the business, the new partners will invest money or assets into the business and may also be employed as managers. The relationship between each partner, duties and responsibilities, authorities as well as profit and loss ratios should be stipulated clearly in an agreement.

Selling capital shares

This is a very effective way of raising capital, but most small business owners believe that this form of obtaining capital is only used by larger organizations only. This form is not usually used because many people do not know about it, and what the advantages are. If the owner doesn’t have enough money to invest, he can offer preference shares or common shares to the public. He does this by issuing a prospectus to interested parties(invitation to invest) must enclose the plans of the business, how and why it will succeed and ensure investors the issuing of the shares is not fraudulent to steal money. he will obtain the money he needs and the people who invested will get a share or the profit in accordance with the percentage stipulated by the business. The owner can then hold the unsold shares for possible future expansion and financing. The preference share holder gets preference over the other shareholders to receive their dividend but the disadvantage is they don’t get voting rights unless there rights are in jeprody where as common shareholders do have voting rights, but if  the business makes a loss the common shareholders will not receive their portion of money.

The advantages of this form of finance are that you don’t have to plead with friends for money or accept new partners in the business. There would be a predetermined estimated profit etc for the financial years ahead. This type of raising funds is called “private placement” of limited shares distribution,(limited shares because it is a small business).

Venture capital funding

This source of financing is more sophisticated tan friends and family and more sophisticated in what they invest in

Sometimes there are certain situations where a small business Qualify for investment funds from venture capital businesses (doesn’t happen too often) these companies provide capital for small business they consider having potential for high and fast growth.

In order to apply to be considered for a venture capital company it is essential to provide them with a very detailed business plan, must demonstrate a strategic plan and researched understanding of their opportunities and threats ,if it progresses past the first screening, investigations by the company will continue further with due care, skill and diligence to find out about the product, the technology, potential market share, if there are significant competitors, as well as the financial projections and requirements, and the most important investigation will be to establish if the managers have skills and required competence to run the organization effectively and efficiently.

If a venture company decides to invest in the company it usually requires part ownership in the business (by shares) or by provision of direct loan with share purchase options. The venture business will try to protect its investment by being able to assume control if the small business gets into financial trouble (judicial management).

A venture capitalist is more likely to invest business that has been around for a while because they already have clear growth strategies in exchange for needed money the owners would have to surrender part of the equity and some control of business.  This is not always desirable to owners.

In a small business there is a limited amount of shares that can be issued to investors without complicated paperwork and always room to expand. Before offering shares to the public you must be aware of the laws, regulations, and requirements.

The benefit of issuing shares is that investors with a lot of experience and knowledge believe in your business to succeed which assures you that your business idea is a good one and likely to succeed instead of just thinking that it will work and taking out large loans with expensive interest expense repayments and it might have a chance of failing.

In order to accommodate equity financing two things must happen:

1) You must convince the investors that you have a worthwhile product this is commonly done by issuing of a prospectus, a prospectus is an invitation to investor to purchase shares, it explains everything to investors from business plans, profit forecasts, sales forecasts, calculation of capital needed to start up the business, for what the capital will be used on to auditors report stipulating the business is legit.

2) You must have an entity that must accommodate investment that is you must do all the paperwork required by laws and regulations.

There are different types of shares that can be issued such as ordinary shares and preference shares, ordinary shares you will pay out money to investors according to how many shares they hold they also have a right to maters with regard to the business, where as preference share holders will get paid out money before the ordinary shareholders they do not have a right to vote unless there is a decision to be made that will effect their shares.

Advantages of issuing shares

• Funds can usually be kept indefinitely.
• Dividends may be paid out but only on the earnings (no payments are required on the funds.
• No collateral is required (assets required as security).

Disadvantages

• Dividends payments are not tax deductible for the corporation.
• There will be more share holders.
• There is more shared control over the entity which can impose restrictions over how it operates (this is not always a bad thing because then good sound decisions are made).
• Less profit there is for the principle owner.