Waji Boutique

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Also, the perceived opportunity such as lack of segregation of duties and lack of proper authorization system had caused such issues happened. When there was no other employees, the only employee would do anything he wished to do as there would be no whistle blowers to the owner on his wrong-doing. Next, there was no proper authorization system in the boutique and this had caused the only employee had made loan on business without the authorization from the owner.In other words, the causes of problems were lack stringent internal controls to prevent fraud which including lack of segregation of duties, lack of proper authorization, lack of physical safeguards and lack of proper documentation.

Lack competency of the owner

When setting up the boutique at the first time, Mr Bashir had no related knowledge or experiences in doing boutique business, hence he was just simply made references to others’ boutique when designing his shop and also asked favor from his wife to help in purchasing the clothes in order to commence the business. This had obviously indicated that the owner, Mr Bashir was not competent to start a new business especially in selling ready-made ladies clothes as he had no any ideas on how to do a business since heworked as an IT consultant for over forty years. Besides, he did not attend to any seminars or courses or seek consult from any experienced persons which could help him to strengthen his knowledge for setting up a new business. Lack in business knowledge was definitely a contributor to the unfavorable incidents took place in Waji Boutique.

Poor in marketing or promotion strategies

There was no any promotion or marketing techniques applied at the very start of business for Waji Boutique. Generally, marketing always helps the business to identify the need or demand of customers and can also determine which categories of markets should be focus and supply the products to serve those markets. The Four P’s of marketing which refers to “Product”, “Place”, “Price” and “Promotion” should be taken into account for a business to gain profit and to survive in long term period of time.Among these four elements, promotion plays a huge role in creating the awareness among the customers. However, Mr Bashir had not performed any strategies to promote his clothes, thus customers were less aware of Waji Boutique and this was absolutely a factor that caused lesser sales in the boutique. The poor achievement in sales had also result a net loss in first three month as it generated only a tiny gross profit or even zero profit against the huge expenses in rental fees and employee’s salary.

Poor method of hiring employee

The way of hiring the employee used by Mr Bashir was inappropriate as he just simply hired Khawar who suggested by the gardener who might also have no knowledge or experience in doing business. When offered the job to Khawar, Mr Bashir had only judged him by looking at Khawar had working experiences as a sales person, sharp sales instinct, possessed the accounting knowledge and able to communicate with customers in friendly way. However, Mr Bashir did not put much consideration on Khawar’s background, previous working history and others. A pre-employment background check can not only save money in the long run, it can also protect business. A background check can also provide insight into an individual’s behavior, character, and integrity (Caron_Beesley, 2012). In this case, Mr Bashir did not inquire much on the background of Khawar and thus naturally not able to know well on his real personality such as honesty.

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Decision Criteria and Alternative Solutions

Decision criteria

To make a better decision, the alternative solutions should be evaluated by some criteria such as cost involved, the procedure of changes and also the time for implementation.

Alternative solutions

The first alternative solution is by implementing an efficient and effective inventory management system so to manage the inventory in organized manner. Inventory is the most complicated assets to be managed. As mentioned in the case, Mr. Bashir managed the inventory of boutique by using two tag system which the system did not have proper records. He thought that the tag system was the best system to manage the inventory but he was wrong. Therefore, there are several techniques that can be implemented in the boutique operation such as Manual Inventory Record Keeping and Computerized Inventory Management System and physical safeguards.

Manual Inventory Record Keeping can be implemented by having a stock book where employee can log the transactions. The employee will need to list the types of item in one column and write down the sales in another column. It does shows at a glance to the owner that how many of each items have been sold. Such manual log book system can be more efficient by using tags, cards or tickets to track each type of product, entering them in the log book as what the employee have sold.

The advantage of the Manual Inventory Record Keeping will be in low cost and suitable for the new enterprise like Waji Boutique. However, there are several disadvantages which refer to the accuracy of records of the manual system can be manipulated and this system will be getting complicated to be applied as the business grows.

Furthermore, the next technique can be implemented is Mr. Bashir may implement the Computerized Management Inventory System. He may choose either to develop his own inventory system or just using the existing software system that had been ready in the market. This system can be operated by using bar code for each product. Therefore, Khawar as salesperson can only scanned the barcode and the transaction will be automatically recorded and updated in the system. When it comes to the time of reviewing the records, the system will be able to track every transaction made in short time. The computerized system can also help Mr. Bashir to make decision whether which inventory needs to be reordered from suppliers. Besides, he will be able to know the hottest selling items demanded from the customers and the old inventory which still have not been sold.

Mr. Bashir may enjoy the benefits if he choseto implement the computerized system since he himself was an expert in IT and had become an IT consultant before. He may have the ability to develop his own computerized system then it would save the cost as there is no