BUSINESS OPERATIONS

Course CodeBBS106
Fee CodeS1
Duration (approx)100 hours
QualificationStatement of Attainment
Study business operations.

The aim of this course is to provide you with the building blocks for a successful career in business planning and operations.
Most successful horticulturists will at some stage in their career, either own a business, or be managing a business; and to do this well, you need to not only be a skilled horticulturist; but also knowledgeable in the field of business operations.

Lesson Structure

There are 6 lessons in this course:

  1. Introduction
    • Business law
    • types of businesses
    • starting a business
  2. Finance
    • Liquidity
    • The money market
    • terminology
    • insurance
  3. Financial Records
    • Simple Bookkeeping procedures
    • cash flow
  4. Financial Management
    • Taxation
    • costing
    • budgeting
    • investing
  5. Business Planning
    • Overview
    • Improving results in business
    • Developing a 12 month business plan.
  6. Mistakes to avoid
    • Pitfalls: lack of market research, problems with marketing, cash flow, attitude, etc
    • Profitability
    • Profitability ratios
    • Reasons why businesses fail

Each lesson culminates in an assignment which is submitted to the school, marked by the school's tutors and returned to you with any relevant suggestions, comments, and if necessary, extra reading.


What is involved in the Production Process?
 
Businesses sell things, and the things they sell are either things which they produce; or services they produce.
 

Producing a product (or service) can involve the business operator in the following ways:

  • Purchasing (e.g. buying the raw materials needed).
  • Production (e.g. growing produce, mining, manufacturing, creating something).
  • Managing the finished product – marketing, sales, product reviews.
  • Controlling credit.

Businesses often fail when they do not balance these four components of production.

Consider:

  • A business with excessive raw material, waiting to be used, but an inability to process the material into something that is saleable.
  • Having a farm with heaps of produce, but nowhere to store it, let alone sell it.
  • Having a team of consultants, all ready to provide a great service, but no clients to work for or sell to.
  • Producing a product that is no longer wanted – all good businesses must review clients, needs and forecast new directions and requirements.
  • Having produced and supplied products and services to lots of customers, but piles of unpaid customer accounts on your desk.

Think of this as a 3 part closed system:
1. Inputs
2. Operations
3. Outputs

  • Inputs may be things such as raw materials, component parts of goods being created, energy and manpower used.
  • Operations refer to the processing or converting of inputs.
  • Outputs refer to the goods that are produced, as well as any waste (e.g. pollution, energy losses, etc.).

Production Activities
A typical manufacturing plant might involve the following production operations:

  • Purchasing
  • Receiving
  • Shipping (dispatch)
  • Quality Control
  • Research and Development
  • Maintenance
  • Stock-keeping

Forecasting
When a business does forecasts, they are establishing what the expectations of customers, or customer opinions or trends will be at a later date. And they do this by using data collected in the past (such as past sales, marketing data etc.). This is an important process for any business, because forecasting will also tell them how much money the business will need today, in order to capitalize on future. And forecasting establishes the benefits of such long term investments. It allows you to decide whether such long-term investments are worthwhile or not.

We talked about Nigel and his video store earlier, Nigel became so wrapped up in his video store, looking at what he wanted to do and so on, he did not notice that DVD was becoming more and more popular and would eventually overtake video.  When we are inspired by something, it can become the sole focus of our attention, until we do not notice other factors that could impact on this business – for example DVDs in Nigel’s case.  When running any business, you need to be aware of possible changes in the market.

The market can change due to:

  • Changes in consumer tastes.
  • New products becoming available.
  • New legislation and regulations changing how products must be made.
  • An increase in visibility of the product.

Changing Tastes are Unavoidable
People are becoming more and more sophisticated. They want more choice.  A particular product may be very popular for a time, but products can go out of fashion (the same as anything else).  A product might be the “thing you must have” in December, but by April, no one is really interested in them. This is particularly the case when dealing with items such as children’s toys.  The toy everyone wants for Christmas can be discarded and out of fashion before the end of January. So try to be aware that a product is becoming less popular – slowing of sales in January for example can be attributed to an after Christmas lull. However if sales have not bounced back by February then you will need to consider what you will do:

  • Just keep the stock until it might become popular again? This is a courageous decision to make as the product may never be popular again.
  • Sell it off at a discount to get rid of the stock? At least this way you continue to have cash flow.
    These actions hold a risk:
    With the first approach– you may be left with a lot of unwanted stock and therefore loss of turnover but also a loss of your original investment.

With the second course of action you may sell off at a loss so you also crystalize your losses with no hope of recouping this loss once the goods are sold.
Sell just above cost to cover your initial outlay for the goods and your administration and selling costs – you cover losses and get your money back – however the goods may not be cheap enough to attract customer’s attention.

Although all these actions hold a risk – the first one (no action) is the riskiest. The others have less risk. However you must be in the best position to decide which action you take and how much risk you are willing to take. Experience, understanding your market and analyzing your sales, will all help in minimizing your exposure to risk. This will also help you to make better decisions when faced with these types of situations.

Meet some of our academics

Bob James Bob has over 50 years of experience in horticulture across both production sectors (Crops and nursery) and amenity sectors of the industry. He holds a Diploma in Agriculture and Degree in Horticulture from the University of Queensland; as well as a Masters Degree in Environmental Science. He has worked a Grounds Manager at a major university; and a manager in a municipal parks department. Over recent years he has been helping younger horticulturists as a writer, teacher and consultant; and in that capacity, brings a diverse and unique set of experiences to benefit our students.
Gavin ColeGavin has over 20 years of industry experience in Psychology, Landscaping, Publishing, Writing and Education. Former operations manager for highly reputable Landscape firm, The Chelsea Gardener, before starting his own firm. Gavin has a B.Sc., Psych.Cert., M. Psych. Cert.Garden Design, MACA.
John Mason Parks Manager, Nurseryman, Landscape Designer, Garden Writer and Consultant. Over 40 years experience; working in Victoria, Queensland and the UK. He is one of the most widely published garden writers in the world; author of more than 70 books and editor for 4 different gardening magazines. John has been recognised by his peers being made a fellow of the Institute of Horticulture in the UK, as well as by the Australian Institute of Horticulture.
Kate GibsonKate has 12 years experience as a marketing advisor and experience as a project manager. Kate has traveled and worked in a variety of locations including London, New Zealand and Australia. Kate has a B.Soc.Sc, Post-Grad. Dip. Org Behaviour (HR).


Check out our eBooks

Business OperationsIn the daily operation of a business, some days will challenge you and some will inspire you. Most of them however will be just part of the daily routine of normal business operations. Unfortunately your business will not run itself - goals need to be set and decisions need to be made in order to achieve these goals. This book talks you through all of the different aspects involved in running a business from finance and forecasting to staffing changes and legal issues.
Farm ManagementThis new e-book looks at everything you need to improve your farm management skills. Learn about the farm site, production systems, managing livestock, managing pasture, crops, marketing and more.
Starting a BusinessBusinesses don't need to fail! This is concise, easy to read, and alerts you to all of the things that commonly make a difference to business success or failure. Seven chapters are: “A Reality Check”, “The Product or service”, “Managing a Business”, “How to Find Customers”, “How to Make a Sale”, “Delivering the Product or Service”, “Pitfalls to Avoid”.
Starting a Gardening or Landscape BusinessExpert advice on how to get started in your own garden or landscape business! Packed with valuable business advice, horticultural and landscaping knowledge, and practical ideas - this book is a must have for garden lovers. It is great for anyone thinking about (or already involved in), a horticultural, landscaping or garden business. This updated re-print is only available as an ebook.

 

 

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