Ella the Entrepreneur: Small Business 101
Unlocking Business Success: Ella's Journey
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What You Will Learn!
- Real-Life Case Study: Ella's journey is not theoretical; it's a real story of a budding entrepreneur facing financial challenges head-on.
- Hands-On Learning: Put theory into practice as you tackle financial scenarios inspired by Ella's business. Gain experience in making key financial decisions
- Entrepreneurial Skills: This course equips you with the skills and insights needed to navigate the business world successfully.
- Key Financial Concepts: Master financial concepts, such as calculating Gross Profit, Depreciation, Interest, and understanding Fixed Costs versus Variable Costs
- Financial Reporting: Learn how to prepare your Income Statement even when you can't afford an accountant.
- Cash Flow Management: Discover how to track your cash position using a Cash budget.
- Inventory Control: Learn to track your inventory effectively and know the value of goods in your store.
- Self-Paced Learning: Learn at your own pace, with lifetime access to course materials and the flexibility to fit learning into your busy schedule.
Description
Meet Ella, a driven entrepreneur who's taken the plunge into the world of baby diaper distribution. Ella's story is not just about diapers in cartons; it's a tale of financial strategy, smart investment, and calculated risk. Let's dive into her entrepreneurial adventure!
The Leap into Distribution
Ella's journey began when she became an authorized distributor for a reputable baby diaper brand. To seize this opportunity, she had to meet specific requirements:
1. Invest in a truckload of products - a whopping 2,200 cartons.
2. Secure a retail store for her business operations.
3. Acquire essential ICT equipment, including a computer and printer.
4. Employ at least two staff to support her business operations.
With a savings pot of USD41,600, Ella was halfway there. But to fulfill all the prerequisites, she sought additional financial support from a bank. They offered her a loan in the same amount of her equity, USD41,600, payable over 24 months at an annual interest rate of 9%, paid monthly, with the principal loan amount to be repaid at the end of the loan tenor, 24 months from the date of disbursement.
Investing Wisely
Ella put her USD83,200 capital to good use, allocating it as follows:
Goods (Inventory) - USD33,000 (2,200 cartons x USD15)
Refurbished ICT Equipment - USD300
Retail Store Lease (1 year) - USD36,000
Furniture & Fittings - USD400
Working Capital - USD13,500
This strategic investment set the stage for her entrepreneurial journey.
Sales Progress
Ella's business gradually gained momentum:
Month 1: 500 cartons sold.
Month 2: 1,000 cartons found new homes.
Month 3: A whopping 1,500 cartons flew off the shelves.
Each carton was sold at USD30 and each month, Ella replenished her inventory based on the exact quantity sold in the previous month. She adhered strictly to a 'No credit sales' policy, ensuring a financially secure foundation for her business.
Operational Costs
To support her business, Ella employed a Store Manager and a Sales Associate, with monthly wages of USD3,000 and USD1,500, respectively. She invested USD2,000 monthly in online marketing to attract new customers. Additionally, she incurred USD500 every month on 'other running costs'.
Calculating Success
As Ella, could you:
1. Calculate your Gross Profit Margin per unit sold?
2. Determine your break-even point?
3. Calculate your Profit Before Tax (PBT) for months 1, 2, and 3?
4. Estimate how much cash you will have in the bank at the end of month 3?
5. Assess the value of your inventory in the store at the end of month 3?
If you can't answer all five questions correctly, this course will help you understand how to do so and apply the knowledge to your own business.
Ella's journey is not just about numbers; it's about resilience, adaptability, and calculated decision-making. Join her in this exciting business venture and explore the world of entrepreneurship and financial acumen. Let's crunch the numbers and discover the key to her success!
Who Should Attend!
- Small business owners and aspiring entrepreneurs.