Small Business
Final Report: Growth, Innovation, Sustainability, and Succession
Students will evaluate three growth strategies (company-owned, franchise, and joint venture).
Required Elements to include in the Report:
- Identify within the scenario the information necessary to complete the template.
- Once completed, the student must analyze the findings to determine which strategy aligns best with the owner's goals for succession planning and sustainability.
- The student must also address the role of innovation in achieving the owner's goals.
Required Formatting of Report:
- The student will present his/her findings in a two- to three-page report, not including the title page, references, or the template
- Include references including reference other than the textbook;
- This paper is to be written in the third person. There should be no words in the paper such as "I and we;"
- Use APA formatting for in-text citations and reference page. You are expected to paraphrase and not use quotes. Deductions will be taken when quotes are used and found to be unnecessary.
Scenario
Mark Brothers Commercial Cleaning - Business Scenario
Mark Brothers started their commercial cleaning business 15 years ago with a truck and a buffer, by pitching their service to local supermarkets and shopping malls. Mark Langdon, now age 58 and his younger brother Robert, age 40 built the business around Marks' sales ability, and the area's need for a reliable commercial cleaning service. Mark quickly acquired new accounts with his personal charm and unique sales method. Robert never had what it takes to make a sale, but was very proficient at operating the business. He is always up to a challenge, and motivated by money, and never shared Mark's passion for the family business.
Mark Brothers operated the business over the 15 years with the same equipment and business philosophy "Mark Brothers will Get-r-Done," a philosophy that Mark backed up with a 100% satisfaction guarantee. Mark was adamant about his method of sales and customer service and viewed his equipment as irreplaceable work horses even though it often took longer to do the job than some of their competitors. Mark Brothers never opted to hire employees , Mark felt they could get the work done, even if it took a longer time than if employees were used.
Recently, it seemed as though Mark was losing interest in the business. A cleaning business does their cleaning "after hours" when the stores are closed for business, so the cleaning service hours could range from 10 PM to 5 AM. The long hours were keeping Mark from spending quality time with his family. He still enjoyed doing the work, and just wanted to spend less time with the business.
The local economy was growing fast, and there was an abundance of potential commercial customers. Despite the area's strong business climate, sales had recently declined to 14 clients, having maxed out at 18 clients just two years prior. Some stores had closed, but many had dropped Mark Brothers and were using competing cleaning services.
Mark finally admitted to Robert that he wanted to relinquish his share of the business and move on to other interests. You are tasked to work with them as their Business Advisor to discuss their options. Note there are no particular right or wrong scenarios, only recommendations. But do your recommendations make good business sense? You make the case in your PowerPoint.
Here is some additional information:
Financially, both Mark and Robert had done well with the business, both having a personal Net Worth of over $750,000, approximately $300,000 in liquid assets. The business itself only had assets of $25,000 of which $20,000 was in cash and the balance mainly in supplies and depreciated equipment. A reasonable valuation for the business, based on the revenue stream from existing accounts was around $300,000. Mark requested that Robert pay him $150,000 for his share of the business, which Robert agreed as a reasonable amount.
Robert now has to make an important strategic decision. Should he:
- Continue the business as a Company Owned Commercial Cleaning Business
- Purchase a Franchise and operate the business as a Franchised Cleaning Business
- Consider a Joint Venture with another Business
As their Business Advisor, you will present "Three growth strategies for Succession Planning and Sustainablity of the Business," using the template provided.
The report will identify the key issues related three growth strategies (Company-Owned, Franchise, or Joint Venture).
FINAL PROJECT TOPIC TEMPLATE
- Title
- Introduction
- Company Remains a Company-Owned Business (Issues, Advantages & Disadvantages)
- Company Remain a Company-Owned Business (Issues, Advantages & Disadvantages)
- Should Remain a Company-Owned Business (Issues, Advantages & Disadvantages)
- Purchase a Franchise (Issues, Advantages & Disadvantages)
- Entering into a Joint Venture (Issues, Advantages & Disadvantages)
- Recommendations to Grow the Business and Re-establish Market Leadership