Section #3: Resource
Management
Human Resources & Financial Resources
The Business Plan
1)
2)
3)
4)
5)
6)
Executive Summary
Market Analysis
Resource Analysis
Operating Strategy
Financial Strategy
Contingency Plan
Resource Analysis
1)
2)
3)
4)
Financial Resources
Human Resources
Material Resources
Technological Resources
Financial Resources
• The money needed to start and open your
business
• Unfortunately – money doesn’t grow on trees
• What do we need money
for when opening a
business?
Financial Resources
• Often – it can cost tens, if not hundreds of
thousand of dollars to open a business
• Not Often – do entrepreneurs have tens of
thousands of dollars hiding under their
mattress
Financial Resources
• Financing – securing funds for your business
• Three options
1) Personal Funds
2) Bank Loans/Line-Of-Credit/Small-Business Loans
–
Getting money from a financial institution with the promise of
paying them back + interest
3) Investors
–
–
Getting money from private investors & giving up a percentage
of ownership
Example: Dragon’s Den and Shark Tank
4) Often a combination of all
Financing Your Business
Type of Financing
Personal Funds
Bank Loans/Line of
Credit/ Small Business
Loans
Investors
Advantages
Disadvantages
Financing Your Business
Type of Financing
Advantages
Disadvantages
Personal Funds
• All revenue goes right in your
pocket
• Your money – Your responsibility
• risk of losing house/ children’s tuition
• more than likely not a large amount of
money
• going to the poorhouse if the business
fails
Bank Loans/Line of • Get funds you would not
otherwise have access to
Credit/ Small
• ensures your business plan is
Business Loans
• Risk of defaulting on payment/
bankruptcy
• have to pay money + interest
together
• Often can get grants (free money)
Investors
• may get expertise
• do not have to worry about paying
money back
• share in the responsibility/losses
• Have to share your profits
• Potential for conflict
Human Resources
• The people that are needed to make your
business happen!
• Without the right people, the venture is unlikely
to succeed
• 2 types of Human Resources
– “Front-Line Employees”
• Direct interaction with the customers
– Management
• In charge of the “behind the scenes” activities of the
business
– Depending on the size of the business – may be both
Human Resources
• You must look at what duties must be done
within the business
– Example: Restaurant
•
•
•
•
Need people to cook the food
Need people to serve the food
Need people to sit people at tables
Need managers
Human Resources
• What employees are needed for:
VS
Human Resources
• Sure....it would be great to hire a different
employee for every task that had to be done
within your business
– This would cost you a ton of $$$$$$$$
• Must decide what an individual employee could
handle realistically
– And what duties they can do well
• More on deciding specific duties for specific
employees in the operation section
Human Resources: Skills Needed
• Before deciding who to hire
– What can you and/or your partner bring to the table,
in terms of skills
– Hire employees that can bring skills to the table that
you do not possess
• Most small businesses employ less than 5 people.
• Example: Disc Jockey
– One partner may handle the DJ duties & one the
promotion/bookings
– Need to hire an employee to handle money
Human Resources: Hiring Employees
• Must establish what characteristics/skills you
want in an employee being the selection process
• You find these things out during the application/
interview process
• The more you pay – the
more skills you will get in
your employees
– High School drop out vs.
college graduate
HR Assignment