Clay Boys Barbershop

Clay Boys Barbershop

Projected income statement for the first two years

Startup cost and its funding

Plan for hiring and retaining competent employees

Clay boys barbershop will utilize the strategic human resource in ensuring it recruits and retains competent individuals. The principles that govern SHRM ensure the specific objectives and goals of an individual organization are aligned with those of an individual employee hence promote compatibility between an employee and the organization. SHRM ensures critical observation of job specification and job description. Job specification outlines the qualifications, personalities, and individual traits that are expected from an individual to be considered as fit for the job under question (Collins, 2020). On the other hand, job description outlines the responsibilities and functions expected within a specific job.  These two are essential tools for ensuring an organization recruits highly competent and effective individuals that can enhance the effectiveness of its systems and procedures for better competition.

Additionally, it ensures an effective projection of the current and future needs of a company’s workforce capacity and capabilities. This will ensure Clay boys barbershop designs a robust and effective training regime customized to fit the specific needs of individual employees to help them effectively respond to the different challenges that exist in the contemporary world’s business environment. The constant development in regards to technological innovation and invention witnessed in the contemporary world always results in new and emerging trends that an individual company must always respond to for effective competition. Similarly, globalization has presented the challenge of intense competition among individual firms (Collins, 2020). All these require the enhancement of an individual employee’s competency to ensure they effectively compete.

Similarly, the use of job rotation and job sharing significantly enhance the job satisfaction of individual employees within the company.  Job rotation ensures an individual employee attends to different duties within the organization in different periods. This enhances their level of expertise and increases their skillset; hence help them become relevant and highly competitive in the highly volatile contemporary world’s business environment. Job sharing also ensures individual employees gain new skills and level of expertise from fellow employees hence enhance their competency levels as well.  All these give individual employees the feeling of satisfaction and self-enrichment, which in turn helps them achieve higher levels of job satisfaction (Collins, 2020). Similarly, the close attention that SHRM gives to the specific needs of en individual employee allows the use of programs like work-life balance. Work-life balance ensures an optimal balance is achieved from an individual employee’s duties within the organization and private as well as social life. This further enhances an individual employee’s self-enrichment and satisfaction, which are essential in ensuring the retention of highly competent employees within the organization.

Pitch

The company will need to generate a total of $140,000 to facilitate an effective and seamless start of the operation.  This will be raised through the use of personal savings and loans from the bank. Personal savings amounts to $60,000 and the remaining $80,000 will be covered by 12% bank loan repayable within 10 years. The company expects to generate a net sales of $243,000 in its first year of operation with a projected cost of sales of $123,000. The projected cost of sales in the first year is 50% of the projected sales as s result of the different challenges expected in the first year of operation. This is the period in which the company is to establish supply chain networks in which some may work out and some may prove to be costly. However, as long as the organization does not incur losses at the end of the year these costs are necessary to ensure effective competition within its environment (Viriyasitavat & Hoonsopon, 2019). On the same note, the company will also incur a total of $85,000 as its operating expenses. Out of these, $25,000 will be for social media advertising while $40,000 will be for newspaper advertising. Similarly, the company expects to incur a total of $20,000 as its administrative costs in its first year of operation.

The company also expects to generate a net sales of $300,000 in the second year of operation with a gross margin of $170,000. The projected cost of sales for this year is to be slightly lower in terms of its percentage to net sales as compared to the first year. This will be a result of the use of an already existing supply chain framework with very minimal expansion to accommodate growth. The total operating expenses are set to be similar as compared to the first year only with increase witnessed in administrative expenses and a reduction in the expenses incurred in newspaper advertising. However, the expected profit before tax in the second year is expected to be $85,000, which will be a 243% increase in profit compared to the $35,000 expected in the first year of operation. Generally, the business will be highly efficient and effective considering the strategic approach taken in relation to the management of different elements involved like in managing its workforce and advertising. The use of social media is cost-effective and reaches a wide base of targeted consumers. From the profits resulting from the income projections, the company will be competitive enough.

References

Collins, C. J. (2020). Expanding the resource-based view model of strategic human resource management. The International Journal of Human Resource Management, 1-28.

Viriyasitavat, W., & Hoonsopon, D. (2019). Blockchain characteristics and consensus in modern business processes. Journal of Industrial Information Integration, 13, 32-39.