This case study provides a comprehensive analysis of Wanda’s sole proprietorship business, focusing on key data related to product sales, sales prices, and profit margins. Visual representations are used to illustrate the business’s performance, revealing insights into the strengths and weaknesses of each product line. The study also examines the choice of a sole proprietorship business structure and discusses its benefits. It further explores the internal operational areas and the various costs involved in the business. Wanda’s reliance on friends and relatives as labor, paid in dog treats, is addressed. The case study highlights the external components influencing the business, including external entrepreneurs and stakeholders. Finally, the study concludes with recommendations for potential changes in business practices, such as considering a partnership structure and paying employees in money.
BUSINESS OVERVIEW 1
Visual or graphical representation:
The following is the data related with the business:
Products
% of
sales
Party pooch 45
Chicken
cutties 18
Bison bites 5
Lamb lovies 32
The following is the graph:
The above graph shows that the % of sales in respect of the product Party pooch is the highest
and the lowest % of sales is for the product Bison Bites.
The following is the data related with the business:
Products Sales price
Party pooch 20
Chicken
cutties 15
Bison bites 21
Lamb lovies 24
0
5
10
15
20
25
30
35
40
45
PARTY POOCH CHICKEN CUTTIES
BISON BITES LAMB LOVIES
% of sales
BUSINESS OVERVIEW 2
The following is the graph:
The above graph shows that the highest selling price is in respect of Lamb lovies and the
lowest sales price is in respect of Chicken cutties.
The following is the data related with the business:
Products Profit margin
Party pooch 21.6
Chicken cutties 8.64
Bison bites 2.43
Lamb lovies 15.2
The following is the graph:
0
5
10
15
20
25
PARTY POOCH CHICKEN CUTTIES
BISON BITES LAMB LOVIES
Sales price
BUSINESS OVERVIEW 3
The above graph shows the highest profit margin in respect of Party Pooch and the lowest
profit margin is in respect of Bison Bites (Small business chron, 2015)
The business form that Wanda is operating is the sole proprietorship. The business is being
operated using this form due to the following reasons:
1. It is very easy to form
2. It has number of tax benefits with it
3. It is an easy way of employment
4. It is easier to make the decisions (Legal match, 2015).
Wand is operating in the sole proprietorship business but is taking the help of her friends and
relatives to whom she is paying in dog treats.
The following are the various internal operational areas:
1. Rent
2. Electricity
3. Telephone
4. Water /Sewer
5. Internet
6. Website
7. Salaries
8. Owner's Draw
9. Office Supplies
10. Loan Payment
11. Insurance
12. Other
Further, the other costs includes the activities like packaging, labelling, the
ingredients, and the time it takes to make the treats.
She is exposed to the following external components:
0
5
10
15
20
25
PARTY POOCH CHICKEN CUTTIES
BISON BITES LAMB LOVIES
Profit margin
BUSINESS OVERVIEW 4
The external entrepreneurs that are giving her their advice on as to how to take the business
to the next level. They are also suggesting her on the various concerns such as the – finances,
legal structure, marketing, production and overall strategy.
The stakeholders in the business consists of the following:
1. Wanda
2. Her friends
3. Her relatives
4. The government since the business sis paying taxes to them.
Wanda is working in sole proprietorship business and it’s her money that has been invested in
the business, so if anything goes wrong with that that would affect her.
Her friends and relatives are also working in the business. Now, if anything goes wrong with
the business, the livelihood of these people would also go hay wire. This is irrespective of the
fact that they are being paid in the dog treats.
Further, the government is the ones that is earning income form the business in the form of
taxes, so even if the accounts have been manipulated or if the business activities are being
conducted in the wrongful manner, then the government would in turn also be affected.
The following change must be made by Wanda:
1. She must start paying her friends and relatives in money. This is due to the fact that
the business should always be conducted in the most effective manner and in the most
professional way. If the activities like the present ones are being conducted, then she
would just end up losing up her rinds and relatives since the money is the reason of
the majority of the problems.
2. She could also go for partnership form of business. This would entail investments
from all the partners’ use of different ideas of taking the business to the next level and
sharing of all the duties and responsibilities, among many others.
Also, the following are the main advantages of a partnership:
• two heads (or more) are better than one
• your business is easy to establish and start-up costs are low
• more capital is available for the business
• you’ll have greater borrowing capacity
• high-calibre employees can be made partners
• there is opportunity for income splitting, an advantage of particular importance due to
resultant tax savings
• partners’ business affairs are private
• there is limited external regulation
• it’s easy to change your legal structure later if circumstances change (business.tas.gov.au,
2015).