The type of business to be established is a sole trader business. A sole trader business is a business owned by one person. Local creations will be the name of the entrepreneur’s business and it will be involved in the production of locally made items. The business involves secondary production, this means that industries take raw materials and change them into finished goods. In the business raw materials such as straw, sea shells, flowers, clay and many more to make finished products such as pillows, bouquets of flowers, chains, cold pots and many more.
* The business will make a profit of at least 20% within the first two and a half years of operations by meeting the needs and wants of customers and selling the products at the most reasonable prices. * The business will expand after 5 year period by training people who are willing to learn about producing crochet and many other natural products and items.
“Advancing the future through creativity and productivity”
Justification of location
Local creations will be located in Jeremie Street in the capital city of Castries, close to other major business and shopping areas. Three reasons why this place was chosen:
* It would be an ideal location for the business because it would be situated between many shopping malls where tourists visit e.g. La Place Carenage.
* Availability of raw materials e.g. embroidery, thread, needles and sewing supplies will be low because local creations will be located in the middle of the city and there are major shopping areas. This will make it easier and very convenient to get the business raw materials.
* There will be easy access to infrastructure such as electricity, roads and telephone lines which will be essential to the proper functioning of local creations.
Selection of Appropriate Labour
Local creations will be involved in skilled and semi skilled labour. The business will employ a total of six persons. There will be five semi skilled persons and one skilled worker.
The Semi Skilled Workers
* A Security: To ensure that the business is secured and safe. * Three Factory Production Line Workers: They will be responsible for producing the finished products. * A Cleaner/ Janitor: Will ensure that the business place is clean and tidy.’ The semi skilled workers were selected to ensure that the business runs smoothly and produce goods adequately with the help of hands.
The Skilled Workers
* A Mechanic: Responsible for fixing machines being used by employees in the business if needed. The skilled labour were selected to ensure that the entrepreneur have good quality products.
Sources of fixed and working capital
Fixed capital refers to the permanent capital invested in an organization which is used to purchase fixed assets. Local Creations will require a total of $100,000 to set up the business. A loan will be borrowed from Bank of St. Lucia to purchase land, building, and vehicles. Working capital is the day to day finances needed for running a business. This capital is needed for paying bills, purchasing raw materials. The entrepreneur can help by using personal savings to purchase e.g. crochet thread and paying wages.
Role of the entrepreneur
The entrepreneur is an individual who undertakes a risk by investing money, time and energy in the building of a business with the aim of making a profit. Functions of entrepreneur:
* The entrepreneur has to mobilize resources for the implementation of the business plan. * The entrepreneur has to co-ordinate various units effectively by having proper communication channels and supervision. * Raise capital for Local Creations from savings or borrowing for investment in the business.
Type of production
Local creations will be engaged in secondary production. Raw materials e.g. crochet thread which will be the main raw material in...