Introduction:
JK Saddlery is a small family business that makes and sells saddlery and other rural supplies to farmers, producers and tourists. The organization’s products are very well known, famous and popular among its customers. This therefore gives them the opportunity to sell both in retail to its customers, in wholesale to other retailers and through mail orders to the general public.
Don't use plagiarized sources. Get Your Custom Essay on
Jk Saddlery’s Cashiering Function
Just from $13/Page
However, the owner (manager) of the organization does not like them selling through the internet because he does not trust this method. On the contrary, he prefers selling the old school way of selling which is tried and proven by many business people to be the best. This is where only the trusted customers are in a position to be given credits, can pay in cash and cheque at the cashier window or via email while the other customers are allowed to pay only by cash or by cheque at the shop. Furthermore, the owner of the business employees only one cashier who is in charge of all payments and all banking activities.
Systems Documentation
A Data Flow Diagram
A system documentation data flow diagram is a diagrammatic representation of how any data or information flows within a business during business activity and processing. It shows every detail of any type of data that passes through the business process or is involved in the business process. However, there may be some assumptions made by the business when it comes to drawing a Business System Data Flow Diagram. Therefore in this diagram the assumption is that the mentioned activities and information is the only information that is required to complete a business cycle for the organization i.e. there is no additional activity or subtraction of any activity(Sciascia and Mazzola, 2008).
Process Map
A process map is workflow diagram that show a person how an organizations activities are done and follow as well helping a reader to understand and follow the process schedule as it must be. It is used by any organization to show what it does, who does what and where the activity is done as well as what time the activity should be done. This means that, it is a different way of managing a business and eases the work involved in a business process by allocating the workers according to their specialization, qualifications, experience and skills(Singal and Gerde, 2015).
Assumptions
- That all the workers are perfectly qualified and skilled in their respective places of work and responsibilities. E.g. the cashier is well trained and experienced on accounting activities and any finance related activities.
- Also it is assumed that the mentioned activities are the only involved in the whole business process with no addition or subtraction of any other. That is the above activities complete the business cycle.
Business Risk Analysis
Management Risk
JK Saddlery being a family business is faced by the risk of poor management. The owner of the business is the man in the family who uses his own knowledge to manage and run the business. E.g. he prefers the old way of serving their customers whereby they have to pay either cash or cheque only for them to buy the organizations products. This business risk may lead to lack of business growth, poor or no development, overall business operation failure among other effects. (Entrepreneurship in Family Firms, Business Families, and Family Business Groups, 2015).
Financial Risks
Risk of incorrect financial reports. The business owner has employed just one cashier to deal with all the financial issues whereby he receives all the payments, balances them all at the end of the day, documents them, balances them before starting a business day to name just but a few responsibilities played by the cashier of JK Saddlery. Also, there is a risk of delayment of the financial report delivery or even wrong and incorrect reports. When cashiers are overloaded with a lot of work there is a Probability of them coming up with incorrect financial data because of incorrect calculations, frequent errors in balancing or calculations (Filbeck and Lee, 2000) to name just but a few problems related to finances. With this risk, the management is likely to make the wrong financial decisions when it comes to expenditure and investments to new projects(Craig and Salvato, 2011).
There is a risk of the business facing fraud from its management. Since JK Saddlery is a family business, there is a risk of the owner taking control of all the finances and more so using them as they would like, for different purposes rather than business and at whatever time he want to. This therefore may lead to employee separation, misunderstanding and mistrust especially to the management.
Furthermore, the business owner prefers storing the business’s money i.e. cash and cheques in a cashier drawer which they lock to ensure safety and security of the funds. However, this is one of the most old and insecure ways of storing money for any organization or individual. With this risk, the business is likely to be faced with robbery and theft by outsiders as well as the employees. This risk may also lead to mistrust between the employees and the management or any one that may be associated with the business (Caselli and Gatti, 2005).
Operational Risks
The owner practices customer discrimination whereby he offers the customers whom he only can trust a chance to buy the organizations products on credit. He also goes further and gives them a chance to pay in cash or cheque to the cashier window or through the email. This means that the owner does not treat his customers equally which is wrong when it comes to business dealings and management. Therefore, this shows that the business may be on the verge of losing its customers because of the worthless discrimination and inequality when it comes to methods of paying for the products. Thisrisk will definitely discourage other customers who may be loyal to the business but not being treated equally and this is likely to cause low sales, low profits and therefore no business growth and development in general.
Furthermore, the owner does not allow buying of the organization’s products online and instead he opts for the buyer to go and purchase the products in person at the business premises. Therefore they risk losing a lot of sales, profits, their current markets as well as potential markets. This is because in the modern or current world, the most popular and common used way of product purchase is through the internet (online shopping) which JK Saddlery business does not use.
Employee loss risk. The business has very few employees in general. The fewer the employees, the more the work and the more the time taken to process any business activity or transaction. Therefore, in JK business, the business process may be short but the employees will have work more than they should so that they can complete a business transaction. The risk of losing of losing employees will lead to the risk of customer loss because of low customer service rate, losing its employees because of being overworked, decreasing its sales because of low customer numbers among other negative effects of lacking enough employees in a business. Also when the business loses its employees the remaining employees are likely to be left overloaded with work and therefore lead to poor, low quality and slow service process for the customers(Dyer, 1989)..
Conclusion
For any business to be successful, it has to be very well managed and must have enough, qualified and skilled personnel. Also, it must have enough resources e.g. machines for ensuring smooth and perfect running of the business activities as they should be without any hitch. Therefore, for JK Saddlery to be successful it has to change its management, increase its number of employees, change its ways of operations especially methods of product payment and methods of product selling. By doing this, the business will be in a position to bloom and do better in the market.
References
Caselli, S. and Gatti, S. (2005). Banking for Family Business. Berlin, Heidelberg: Springer Berlin · Heidelberg.
Collins, L. and O’Regan, N. (2012). Family Business Jubiliee: a celebration of global family business.Journal of Family Business Management, 2(2).
Craig, J. and Salvato, C. (2011). The Distinctiveness, Design, and Direction of Family Business Research: Insights From Management Luminaries. Family Business Review, 25(1), pp.109-116.
Dyer, W. (1989). Integrating Professional Management into a Family Owned Business. Family Business Review, 2(3), pp.221-235.
Entrepreneurship in Family Firms, Business Families, and Family Business Groups. (2015). Journal of Small Business Management, 53(4), pp.1290-1290.
Filbeck, G. and Lee, S. (2000). Financial Management Techniques in Family Businesses. Family Business Review, 13(3), pp.201-216.
Sciascia, S. and Mazzola, P. (2008). Family Involvement in Ownership and Management: Exploring Nonlinear Effects on Performance. Family Business Review, 21(4), pp.331-345.
Sciascia, S. and Mazzola, P. (2008). Family Involvement in Ownership and Management: Exploring Nonlinear Effects on Performance. Family Business Review, 21(4), pp.331-345.
Singal, M. and Gerde, V. (2015). Is Diversity Management Related to Financial Performance in Family Firms?. Family Business Review, 28(3), pp.243-259.
Stewart, A., Lumpkin, G. and Katz, J. (2010). Entrepreneurship and family business. Bingley: Emerald.
