Size of Business
Braid Runner (BR)
Lewis is a hairdresser. He rents a small shop which he uses as a hairdressers called Braid Runner (BR). Lewis is a sole trader and he set up BR 25 years ago.
BR is the smallest of all the hairdressers in city Y. Lewis works on his own. He has repeat customers who have been using BR for many years. However, there are many large franchises in city Y which offer a much cheaper haircut than BR.
Lewis is considering increasing the price of a haircut and he has outlined the costs and revenue of the business in Table 2.1.
Table 2.1: Costs and revenue of BR
Variable costs per customer | $3.50 |
Fixed costs per week | $675 |
Price | $8 |
Lewis would like to employ another hairdresser so that he can work fewer hours in BR. The new employee would have to be able to work in BR on their own. They would be responsible for taking bookings, dealing with customers and some financial transactions. Lewis has drawn up a person specification (see Fig. 2.1) that will be placed on a job website.
Characteristic | Essential | Desirable |
Qualifications |
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Physical |
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Experience |
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Personal qualities |
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Fig. 2.1: Person specification created by Lewis
Analyse one advantage and one disadvantage for Lewis of operating as a small business.
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