INTERCAMP CONSULTING

STARTING A

SMALL SCALE

BUSINESS TRAINING MANUAL

CAMPBELL MARIAM OLUWATOYIN

11/10/2010

This document is a product of INTERCAMP CONSULTING and is used

for the purpose of training.

It is not to be distributed or used without the prior consent of the

company or the author.

Table of Contents

STARTING A SMALL SCALE BUSINESS ............................................ 4

BUSINESS MODELS ................................................................................ 4

BASIC FORMS OF OWNERSHIP .......................................................... 5

REGISTERING YOUR BUSINESS.......................................................... 7

INTRODUCING YOUR BUSINESS TO CLIENTS .............................. 8

HOW DO I GET CLIENTS ...................................................................... 9

CONTENTS OF A COMPANY PROPOSAL ...................................... 11

MAKING VISITORS FEEL WELCOME .............................................. 12

BOOKKEEPING ..................................................................................... 16

STARTING A SMALL SCALE BUSINESS

A business can be defined as an organization that provides goods and

services to others who want or need them. A small scale business can be

said to be one that requires a small amount of capital to establish it, this

kind of businesses usually have a small number of employees or in most

cases personally handled by the owner.

Adapting to change is crucial in business and particularly in small

businesses not being tied to and bureaucratic inertia makes it easier to

respond to the market place quicker. These proprietors of small scale

businesses tend to be intimate with their customers and clients thereby

resulting in greater accountability and responsiveness. These kinds of

businesses are common in many countries depending on the economic

system in operation.

BUSINESS MODELS

There is more to deciding on the right business other than settling on the

actual product or service you will be producing. Here are a number of

other factors that may be a consideration in identifying the right model

for your business.

• Buy a Franchise vs. Join a Direct Marketing Business vs. Start

From Scratch

• Home-based vs. Office-based

• Invent Something New vs. Produce a Product vs. Offer a Service

vs. Consult as an Independent Contractor

• Long Term Commitment vs. Build a Business to Sell

• Not-for-profit vs. Profit-based

• Online vs. Physical Business (or Both)

• Sell Your Product or Service in a Physical Location vs. Contracting

Your Goods or Services Out to the Federal or State Government

BASIC FORMS OF OWNERSHIP

Although forms of business ownership vary by jurisdiction, there are

several common forms:

• Sole proprietorship: A sole proprietorship is a for-profit business

owned by one person. The owner may operate on his or her own

or may employ others. The owner of the business has unlimited

liability for the debts incurred by the business.

• Partnership: A form of for-profit business owned by two or more

people. In most forms of partnerships, each partner has unlimited

liability for the debts incurred by the business. There are three

typical classifications of partnerships: general partnerships,

limited partnerships, and limited liability partnerships.

• Corporation: A limited liability entity that has a separate legal

personality from its members. Corporations can be either

privately-owned or government-owned, and privately-owned

corporations can be organized either for-profit or not-for-profit.

Furthermore, a privately-owned, for-profit corporation can be

either privately held or publicly held. A corporation is directed by

a board of directors, which hires the business's managerial staff.

• Cooperative: Often referred to as a "co-op", a cooperative is a

limited liability entity that can be organized for-profit or not-for-

profit. A for-profit cooperative differs from a for-profit

corporation in that it has members, as opposed to shareholders,

who share decision-making authority. Cooperatives are typically

classified as either consumer cooperatives or worker cooperatives.

Cooperatives are fundamental to the ideology of economic

democracy.

REGISTERING YOUR BUSINESS

Once it is decided what form of business you would be starting the next

step would be registering your business. It is important to register your

business for various important reasons which include:

1. Clients would see you as more responsible and established if you

have a company name and a company account

2. It is easier to manage the account of the company once the

business is registered

3. You can only have a company bank account when your business

is registered

4. No government agencies will deal with a person but would find it

easy to deal with a business establishment

5. Once your company begins to grow and expand you will need to

file for company tax

All businesses in Nigeria are registered at the Corporate Affairs

Commission (CAC). The business owner is usually advised to contact a

legal practitioner who has an understanding of the charges and what it

entails to register a business. Generally it costs about N20,000.00 –

N30,000.00 to register a Sole Proprietorship or partnership (what is

otherwise called a business name) and about N90,000.00 – N120,000.00

and even more at times to register a limited liability company (i.e.

partnership, corporation or co-operative) depending on what the share

capital for the business will be. Most companies start with a million

shares.

The registration process begins with the name search which is legally

searching whether the name the business owner has chosen is available or

is been used by another business owner. Once this is completed and the

name of the business is identified and agreed on the registration begins

and takes from 2 weeks to 1 month if it is contracted to a professional.

However some business owners find it easy to start and complete the

registration process themselves but this is not advisable as the CAC

would require certain information that only a lawyer can provide. Also

the time for registering the business yourself takes longer than if you had

contracted it out but it might cost you less.

INTRODUCING YOUR BUSINESS TO CLIENTS

It is important that as a new business you are able to identify who your

clients will be and where they can be found. There are different ways of

identifying your clients but most important is the fact that as these clients

are identified you should be able to introduce your business to your

clients. The introduction should be done in a way that it leaves a good

and lasting first impression, so much so that the name of your business

will be remembered and you will be contacted for the services you render

anytime it’s needed.

The best way to get this done is to have at your disposal company sales

materials and a good sales pitch that will catch the prospective client’s

attention. You could also introduce your business by sending out letters

of introduction to prospective clients.

Sales materials may include the following:

1. Company business card

2. Company brochure (that shows a general profile of the company)

3. Company handbills or fliers

HOW DO I GET CLIENTS

This is one of the major challenges of small business startups. Once you

have duly registered your company and have identified your customers

then the next question becomes; “how do I get customers?”

This has been made somewhat easy with the introduction of a lot social

networks and events. Presently most businesses and small business

owners have profile pages on major social media networks such as

facebook, twitter, myspace, linkein and even nairaland and nairalist.

The possibility of how you can get your clients is endless and in most

cases does not cost you much. However the methods of getting clients can

include online networking and physical networking.

Online networking includes the following:

1. Having a blog that showcases your products and services and

educates people about your business

2. Having a profile page on social networks such as facebook,

twitter, myspace, linkedin, nairaland

3. Having a company website

4. Subscribing to other peoples blogs and social media pages

5. Listing in online free business listing sites such as nairalist,

craiglist and a lot of others

Physical networking includes:

1. Letting your friends and family know about your business and

asking them for patronage and referrals (maybe even for a

commission)

2. Discussing your services at events and giving out company sales

materials

3. Exchanging business cards with prospective clients and doing a

follow-up

4. Sending out formal proposals to companies and organizations

introducing your company and services

5. Attending seminars and conferences that allows you to meet

prospective clients

CONTENTS OF A COMPANY PROPOSAL

Writing a company proposal must be done by the owner of the business

as he/she alone has a concise understanding of the business and how the

business would work. However some business owners outsource the

writing of the company proposals to consultants that have better

knowledge of how it’s done and what clients would expect. When this is

done it is advised that the business owner paints a picture of the business

to the consultant to avoid a clash of perception.

A typical business proposal (or in some cases company profile) will

include the following:

1. Cover page

2. Introduction

3. Core values

4. Corporate vision statement

5. Corporate mission

6. Our services (what we do)

7. Our clients

8. Our team

9. Charges

MAKING VISITORS FEEL WELCOME

• Keep an appointments book that shows when visitors are

expected. Wherever possible make appointments for visitors to

discourage unexpected visits.

• Design any notice boards (vehicle control board, meeting board,

etc.) nicely so that they make the office look more attractive.

• You may want to hang a display board showing the organisation’s

current activities. This could include photos (with captions) of

staff or partners at work, workshops they have attended, and

visitors to the office.

• Display the organisational structure chart, mission statement and

strategic plan if you have them.

• Make sure that the reception area, however small it may be, is

always clean and tidy.

• Take any steps necessary to make the office accessible to disabled

people.

BOOKS AND FORMS

1. Telephone messages: Whenever a person calls for someone who is

not in the office, the Administrator (or Secretary, if the office has

one) should write down the name of the person who called, his or

her telephone number, the time and date of the call, and any

message. The person who took the message should also sign her

name.

2. Appointments book: The appointments book can be a diary or any

other calendar that is used only to record appointments. The

Administrator or the Secretary should record all the appointments

and remind people about them closer to the time.

TELEPHONE MESSAGE FORM

For: _______________________________________________________________________

Mr/Mrs/Miss ____________________________________________________called you

at __________________________ am/pm on ____________________________ [date]

Please call back. Telephone number:___________________

Will call you later.

Will visit you.

Left a message for you:

Prepared by:

Name: __________________________________________________________________

Signature:________________________________________________________________

Job title: _________________________________________________________________

3. Visitor’s book: The visitor’s book can be a blank book. In it,

visitors should sign their name, their organisation’s name,

address, telephone number, fax number, email address, and the

date of their visit. Some visitors will just give a business card; the

Administrator can attach that to the book instead. The

Administrator can also write down later with whom that person

met, and what was discussed. If the organisation uses a computer,

the Administrator can put the visitor’s information in a database

or spreadsheet so that the organisation can keep a contact address

list.

BOOKKEEPING

Financial records document the operations of a business. Financial

records are an extremely important tool for managing the inflows and

outflows of a business activity. There are certain required records that

must be maintained to satisfy the Internal Revenue Service for income tax

reporting, however, the need for good record keeping goes beyond the

IRS. Information that is specific to your business should be documented

in an organized manner. This will enable you to efficiently and effectively

manage your business. If adequate records are kept, peaks and dips in

sales are easily determined, cash needs for payroll or outstanding bills are

easily counted, and inventory can be properly controlled. The simplicity

or complexity of the record keeping system is dependent on your

personal preference and the needs of the business. For example, an

accounting system can be as simple as a 3-ring notebook or as complex as

an entire computerized system.

No two sets of financial records are the same. However, the basic format

includes:

1. A Cash Payments Journal (checkbook register)

2. A Cash Receipts Journal (receipts book)

3. A Sales Journal

4. An Accounts Receivable Journal

5. An Accounts Payable Journal

6. A General Journal

There is also the need to have a financial statement for the company to

show the growth rate and the prospect of the business. The financial plan

is also used to plan the future of the company over a period of years and

how many clients the business expects to get within a certain period of

time.

The standard financial statements include:

1. A Balance Sheet

2. An Income Statement

3. A Statement of Owner’s Equity

4. A Statement of Cash Flows

The accounting vocabulary can be overwhelming at times. A “journal” is

nothing more than a diary or logbook. The purpose of the diary is to keep

track of similar type transaction items in a separate book. For example, in

the Sales Journal, you keep track of all your sales in the same diary, which

is separate from your check register called the “Cash Disbursements”

Journal.

LEDGER BOOKKEEPING

TYPE OF JOURNAL HOW IT IS USED

Cash disbursements journal Cheque book register records money

spent

Cash receipts journal Receipt book records money received

Sales journal Record invoices when sale is final not

dependent on cash received

Accounts receivable journal

Detailed listing of customers to whom

you sold merchandise on credit

Accounts payable journal Detailed listing of vendors from whom

you bought merchandise on credit

General journal Master file, records all individual

entries and transactions from each

journal

CASH DISBURSEMENTS JOURNAL

Date Purpose Amount Collected by Disburse

d by

Sign

10/10/200

9

money spent

in purchase of

materials for

chair covers

15,000.00

Mrs.

Aiyelabola

Manager

12/10/200 sewing of 300 Solace The

9 chair covers 5,000.00 Fashion Manager

13-10-

2009

Transportation

to Lagos

Island

(Idumota

market for

supplies

800.00

Sola The

Manager

CASH RECEIPTS JOURNAL

Date Purpose Amount Recieved

by

Paid by Sign

17-10-

2009

decoration of venue

for a wedding

70,000.00

The

Manager

The Bride

to be

(Miss

Davids)

17-10-

2009

Rental of 500 chair

covers

50,000.00

The

Manager

Deji

Shobanjo

18-10-

2009

retal of bridal chair

3,500.00

The

Manager

Deji

Shobanjo

SALES JOURNAL

Date Product Amount client Payment

method

Sign

17-10-

2009

decoration of

venue for a

wedding

70,000.00

The Bride

to be (Miss

Davids)

cash

17-10-

2009

Rental of 500

chair covers

50,000.00

Deji

Shobanjo

cash

18-10-

2009

retal of bridal

chair

3,500.00

Deji

Shobanjo

cash

18-10-

2009

decoration of

venue for a

company end

of year party

100,000.00

Emzor,

Isolo

cheque

ACCOUNTS RECEIVABLE JOURNAL

Date Product Amount

Receivable

Client Sign

25-10-2009 rental

decoration

materials

25,000.00

Mr. Smith

11/11/2009 rental of 300

chair covers

20,000.00

Lanre (empress

evnts)

ACCOUNTS PAYABLE JOURNAL

DATE PRODUCT AMOUNT VENDOR COLLECTED

BY

SIGN

GENERAL JOURNAL

Date Product Amount Client Comment Sign

10/10/2009 money spent in

purchase of

materials for chair

covers

15,000.00

Mrs.

Aiyelabola

Paid in

full

12/10/2009 sewing of 300 chair

covers

5,000.00

Solace

Fashion

Paid in

full

13-10-

2009

Transportation to

Lagos Island

(Idumota market)

800.00

Sola for

supplies

17-10-

2009

decoration of

venue for a

wedding

70,000.00

The Bride

to be (Miss

Davids)

cash

17-10-

2009

Rental of 500 chair

covers

50,000.00

Deji

Shobanjo

cash

18-10-

2009

rental of bridal

chair

3,500.00

Deji

Shobanjo

cash

17-10-

2009

decoration of

venue for a

wedding

70,000.00

The Bride

to be (Miss

Davids)

Cash

deposited

in bank

account

17-10-

2009

Rental of 500 chair

covers

50,000.00

Deji

Shobanjo

Cash

deposited

in bank

account

18-10-

2009

retal of bridal chair

3,500.00

Deji

Shobanjo

cash

18-10-

2009

decoration of

venue for a

company end of

year party

100,000.00

Emzor,

Isolo

cheque

25-10-

2009

rental decoration

materials

25,000.00

Mr. Smith Paid

27,000.00

11/11/2009 rental of 300 chair

covers

20,000.00

Lanre

(empress

evnts)

Paid

30,000.00

Invoice

[Your company slogan]

Date[Enter a date]

Invoice #[100]

[Your Company Name]

[Street Address]

[City, ST ZIP Code

Phone[000-000-0000]

Fax [000-000-0000]

[e-mail]

TO [Name]

[Company Name]

[Street Address]

[City, ST ZIP Code]

Phone [000-000-0000]

Customer ID [ABC123]

Salesperson Job Payment Terms Due Date

Due on receipt

Qty Description Unit Price Line Total

Subtotal

Sales Tax

Total

Make all checks payable to [Your Company Name]

Thank you for your business!

Receipt No.:1002

Paid by:

Paid to:

Description Amount

SUBTOTAL

DISCOUNT(S)

TAX

TOTAL

Date: Received by:

Receipt No.:1003

Paid by:

Paid to:

Description Amount

SUBTOTAL

DISCOUNT(S)

TAX

TOTAL

Receipt No.:1001

Paid by:

Paid to:

Description Amount

SUBTOTAL

DISCOUNT(S)

TAX

TOTAL

Date: Received by: