BUSINESS RESOURCES

BUSINESS RESOURCES
Mobilising Resources for the Business
he resources usually needed to establish a new business are broadly classified into three groups: financial, human and material. These are the
inputs required by the business to generate the output (product or service)of the business. The process of transforming the resources (inputs) into output is what is called the operations or production process.The entrepreneur may need to mobilise sufficient finances to initiate operations.
However, human resource support, may not be required in the mutual stages if the entrepreneur can manage the work at hand alone. The entrepreneur qualities are expected to help with finding finances and material resources, while a
sprint of initiative and self-reliance is important in getting the business of be ground.
Entreprenuer innovative
Financial Resources
Starting a business requires financial resources, but the magnitude of this becomes clear only when the nature of the new business has been decided. Now we will need to estimate the cost of starting operations, and these may include the cost The entrepreneur's innovative qualities are expected to help with finding finances and material resources, while a spirit of initiative and self-reliance is important in getting the business off the ground.Business Resources
Premises Utilities
Equipment
Initial stock
Insurance, etc.
Sources of Funds
The funds for starting the business may be obtained from one or a combination of
sources such as:
• Personal savings
Family and friends
Community co-operative organisations
Community financial syndicates
Micro-finance organizations
• Savings and loan associations
• Banks, etc.
Banks offer a variety of financial facilities, such as
Current or cheques accounts
• Savings accounts
• Loan services.
It is usually necessary to open an account with a bank before you qualify to obtain
Financial assistance. Loans and facilities obtained from banks will normally involve
repayment with interest A new entrepreneur should investigate as many sources
of funds as possible in order to secure the best terms and conditions for Repayment. This means 'shopping around' for the most favourable interest rates and payment conditions is highly recommended for start up.
Prospective business, such as a business plan, a guarantee and a contribution by the entrepreneur, before they actually disburse funds.
Is important to note that lending institutions may require evidence regardıng the business start up capital.

entrepreneur needs to be meticulous about keeping records of income on the one

hand, and expenditure on the other. The entrepreneur's financial records need to

be reconciled with periodic statements that the lending institutions will send.The entrepreneur needs to be particular about malaing repayments, according to the schedule agreed on by the two parties, in order to avoid penalties and higher

interest rates.Financial discipline is key to a successful business. Business account need to be

Kept completely separate from personal accounts.

Income Statement

An income statement is a simple summary of the business' income generating ability. It is a statement of income against expenditure. It should be prepared on a monthly basis and should contain at least the following information:

• Income (funds procured to start the business, such as the loan, and money

earned by selling your product or service)

Cost of materials (includes all cost

incurred in buying materials)

•Operating expenses (own salary,

labour cost, overheads such as

electricity and water, etc.)

Repayment of loan (capital

interest)

* Gross profit (the earning after cost

of production)

Taxes (the national government, as An Income statement a simple summary of the business' cash

generating ability.

•Net profit (the earnings of business after all expenses have been well as, state and local authorities may levy taxes on business operations)

Select a business

As the students to devise an income statement for the business

Business Resources

Cash Flow Statement

A cash flow statement is a record of cash inflow and cash outflow within the business. It is important because it gives the entrepreneur an idea of the amount of the liquid cash available in the business at any given time. It is prepared by

recording all income received by the business on the one hand, and all the expenditures incurred by the business on the other. The difference between the two gives an indication of the positive or negative cash flow situation in the

business at the end of a given period.