WALAS started Business on 01/01/2010 with a capital of Three Million Ghana cedis(GH 3000000) in the Bank. WALAS ’s Investment Portfolio as at 31/12/2014 included Poultry Farming, Forex, Sale of Tires and a Shopping Mall. The first Business to be opened was the Poultry Farm on 01/01/2010 and the remaing three Businesses were opened in 2011/2012/2013 respectively.
The Poultry Farm was opened in his own home town at Bunkuugu Yenyo where the Product enjoys a high market share but the growth in that market , however, is low. The Forex is operating in the Business city of Accra in which the market share is substantially high but with high Growth rate in the Forex Industry. WALAS has approached his Bankers for a Loan Facility of Two Million Ghana cedis (GH 2000000 Cedis) for recapitalisation. WALAS is very much concerned about the Tire Business which always gives him a sleepless night. The growth rate within the Tire Industry is high yet share of the WALAS market is infinitesimal. The location of the Shopping Mall was such that the market share was very low at the same time the growth rate within the Industry is also very low.
WALAS is an Entrepreneur who is not risk averse and has the conviction that the success and failure of his Business is within his control and external influence has nothing to do with the success or failures of his Business. As an Entrepreneur he saeizes all opportunities that comes his way and has always have high sense of Urgency and Achievements. He always finds his Business. He is also not Troubled by any unstructured situation because he always finds his way out.
His Bankers agreed to approve of a loan Faccility he requested for recapilasation at 12.5% interest per annum. Since the inception of the Business on 01/01/2010 WALAS is convinced that the only way to continuously increase the share of his market in any of the Investment for the the next 3-5 years and increase his sales volume all things being equal is to provide the lowest possible price in all his Business. Additionally, potential customers are not homogenous because they have different needs, wants, taste, income level and characteristics. One way by which they can get larger share of the market in the next three to five years is to concentrate more on customers in the middle level income.
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WALAS is becoming a Successful Business Person. Since the inception of the Business it was an established policy to ensure prudent management of the business financial position for development, growth, sustenance and realization of its profit motives in the short-long term through the deployment of sound financial practices such as effective record-keeping, frequent inventory taking, monitoring of cash coming and going out of the Business, other relevant accounting control measures and strategic sourcing and disbursement of funds will be strictly adhered to.
At the end of every Accounting Period, the Accountants of WALAS will prepare the Trading Profit and Loss Account of each Business and the Statement of Financial Position to ascertain the Net worth of each Business entity and advise the Proprietor on the performance of each Business.
WALAS is an experienced Entrepreneur with a team of Human Resource whose knowledge, skills and comprtence is recognised within the industry in which they find themselves. They argued that Preparing only the Profit and loss Account and the Statement of Financial Position at the end of every year will not give the true and fair picture of the Business in terms of performance. One Important Financial Statement that they continuously prepare is to monitor the liquid cash that comes into the Business and the liquid cash that goes out of the Business. The Accountants in their view argue that this statement show their strength and weakness when it comes to meeting the short term liability commitments which must be taken serious.
From the Case study read above, answer the following questions below:
(i) Explain two (2) market strategies used by Business WALAS over the year.
(ii) Explain five (5) qualities exhibited by WALAS as an Entreprenuer.
(iii) Explain the four different markets in which each of the products of the Business WALAS is operating.
(iv) Explain the importance of two (2) Accounting documents the Business
