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Small Business Management

In: Business and Management

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Small Business Management

Joseph Lofoco

Strayer University

Professor Willie Robinson October 31, 2010

Abstract

In this paper I will answer the following questions about My Friend’s Bookstore Plan:
1. Describe what would happen to the cash position and cash flow of My Friends’ Bookstore if the owners decided to open another store.
2. Is My Friends’ Bookstore a good candidate for franchising? Explain and defend your answer.
3. Describe what the owners would have to do to prepare to franchise their business.
4. The three partners own the bookstore equally. What are some of the difficulties they may encounter in sharing management duties equally?
5. What processes might the owners put in place to clarify their duties as equal partners?

Small Business Management

1. Describe what would happen to the cash position and cash flow of My Friends’ Bookstore if the owners decided to open another store. The cash position of My Friend’s Bookstore would decrease if the owners decided to open an additional store due to the amount of cash or equivalent instruments held during this transition would transfer to the other store to initiate the start up of this business and the start up costs would most likely be taken from the existing store’s liquid assets. Cash inflows usually arise from one of three activities - financing, operations or investing. Cash outflows result from expenses or investments and the investment in the new store would be taken from the cash flow revenue of the existing store to cover the expense of the new store over the start up period. This would decrease the available cash flow for

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