Chapter 1Small Business Management

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Case Study – Upin & IpinCreators of Upin & Ipin - Nizam Abdul

Razak, Safwan Abdul Karim and Usamah Zaid - among founding members of Les' Copaque.

Trio were Multimedia University graduates who started off as animators in another local animation, till in 2005, they met a former oil dealer, Haji Burhanuddin Radzi, and his wife, Hajjah Ainon Ariff, to set up Les' Copaque.

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Case Study – Upin & Ipin…continued

First series - produced specially for Ramadan in 2007 to instil the significance of the holiest month amongst its audience.

According to Safwan, "We started this short four-minute animation series last year to test local market acceptance and to gauge how it would react to our story telling capabilities.“

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Nizam believed - international animation market may be interested in a particular Malaysian cultural aspect made of a relaxed, unhurried village life.

He explained in a 2008 report, "Famous animation series, such as Japan’s Doraemon, are based on their respective local rather than international culture. We believe we can do the same with ours."

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Upin & Ipin…concept

Wielded its influence in countries of the Malay archipelago - in Malaysia and Indonesia which share linguistic and cultural similarities.

Its first season landed its first award, for Best Animation in KLIFF 2007.

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Upin & Ipin…influence

1. Definition of SMEshttp://www.smecorp.gov.my/v4/node/14

Central point of reference for SMEsAdopted a common definition of SMEs to

facilitate identification in various sectors and subsectors.

To formulate effective development policies, support programmes, provision of technical and financial assistance.

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An enterprise is considered an SME in each of the respective sectors based on Annual Sales Turnover or Number of Full-Time Employees

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Manufacturing, Manufacturing-Related Services and Agro-based industriesEnterprises with full-time employees not

exceeding 150 OR

with annual sales turnover not exceeding RM25 million"

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Micro Small Medium

Sales Turnover < RM 250,000 or

< RM 10 million

< RM 10 and < 25 million

Full time employees

< 5 5 and 50 51 and 150

Category: Manufacturing, Manufacturing-Related Services and Agro-based Industries

Services, Primary Agriculture and ICTEnterprises with full-time employees not

exceeding 50OR

with annual sales turnover not exceeding RM5 million

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Micro Small Medium

Sales Turnover < RM 200,000 or

< RM 200,000 and < RM 1 million

< RM 1 million and < 5 million

Full time employees

< 5 Between 5 and 19

Between 20 and 150

Category: Services, Primary Agriculture and ICT

2. FocusSmall businesses are imitative in nature – doing what other

businesses have done with a twist.Considered an entrepreneur if:

Self-employed (e.g. accountant, graphic designer, lawyer)FoundersFranchiseeBusiness buyersHeirs

Highly entrepreneurial businesses are characterized by novelty – products, services, and business models are INNOVATIVE.

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3. Key Differences between Small Businesses and High-Growth Ventures

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4. Small Business and Economy

1. In the US, small business - the engine of job creation, generating 75% of the 3.4 million new jobs

Small businesses employ > half of all Americans

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Malaysia? Great important to Malaysia economy. Recognized as the backbone of the economy andplayed a significant role in:• Generating employment• Nurturing a culture of entrepreneurship• Opening up new business opportunities• Supporting the large scale industries

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With a small capital requirement – always considered as a platform for young and aspiringentrepreneurs to start their businesses.

According to the National SME DevelopmentCouncil, 99.2 percent (518,996) of total businessestablishment in Malaysia are made up of SMEs. • Employs about 5.6 million people• Contributes 32% to Malaysian gross domestic product• 19% of total exports of the nation.

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Innovations - Creative Destructionthe way that newly created goods, services,

or companies can hurt existing competitorsE.g CD players; however, in 2001, the iPod

was released. E.g. The availability of online news has

resulted in declining circulation of newspapers

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5. RewardsGrowth rewards

what people get from facing and beating challenges

Income rewards $$$money made by owning one’s own business

Flexibility rewards ability of business owners to structure life in

the way that suits their needs1-18

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Figure 1.2

6. Myths about Small BusinessesNot enough financingYou can’t start a business during a recessionTo make profits, you need to make somethingIf you fail, you can never try againStudents don’t have the skills to start a business

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Revision

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