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BUSINESS TRAINING MANUAL

BUSINESS TRAINING MANUAL 9
f o u n d a t i o n BUSINESS TRAINING MANUAL A practical guide for training micro entrepreneursBUSINESS TRAINING MANUAL A practical guide for training micro entrepreneurs By Emil Tin / LORIKA Foundation. Revision 1.0.1 October 2007. This manual is published under the Creative Commons AttributionNoncommercialShare Alike 2.5 license, as detailed on http://creativecommons.org/licenses/byncsa/2.5/ Under this license, you are free to copy, distribute, and use the manual, and to make derivative works, as long as you attribute the work to LORIKA Foundation and include this license information. However, you may not use the work for commercial purposes. Business Training f o u n d a t i o n Table of Content Background Modules Energizers Introduction . . . . . . . . . . . 6 Welcome . . . . . . . . . . . . 30 Energizers . . . . . . . . . . . 86 Target Groups . . . . . . . . . . 8 What is a Business . . . . . . 32 Templates Group: Rural Maasai . . . . . . 10 Profit and Loss . . . . . . . . . 36 Template Overview . . . . . . 88 Group: Business Owners . . . 11 Credits . . . . . . . . . . . . . 40 Timanoy Sustainable Communities . . . 12 Money for Living . . . . . . . . 44 Business Tree Business Skills . . . . . . . . . 14 Avoiding Failure . . . . . . . . 46 Business Flower The Tree Metaphor . . . . . . 16 Business Community . . . . . 48 Money Plan The Timanoy Story . . . . . . 18 The Business Plan . . . . . . . 50 Daily Records Working with Illiterates . . . 19 Business Ideas . . . . . . . . . 52 Business History Creating a Learning Space . . 20 Marketing. . . . . . . . . . . . 54 Training Certificate Training Activities . . . . . . . 22 The Money Plan . . . . . . . . 56 Questionnaire Training Delivery . . . . . . . 24 What you Need . . . . . . . . 60 Business Plan The Business Club . . . . . . . 25 Loans . . . . . . . . . . . . . . 64 Checklist Materials . . . . . . . . . . . . 26 Keeping Records . . . . . . . . 68 Further Reading . . . . . . . . 27 Business Activities . . . . . . . 72 Sustaining Life . . . . . . . . . 76 Program Your Next Steps . . . . . . . . 80 Three Day Training . . . . . . 28 What you Learned . . . . . . . 82 Goodbye . . . . . . . . . . . . 84 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Introduction About this Manual This is a manual for how to conduct a business training program for Maasai micro entrepreneurs, providing basic skills needed for starting up or improving a micro business. The training program has been developed in the Olkiramatian group ranch in the Rift Valley in Kenya, based on field research and test train ings. The program is made suitable for illiterates by the use of drawings and stories. About the Training Program This program builds on the belief that business, community and nature are interlinked. Economic growth in itself can no longer be seen as the answer. Instead it must be coupled with a broader understanding of the principles of sustainability and ecology. Otherwise we only accelerate the destruction of the web of life that we all depend on. Understand ing how to sustain this web of life will help people to build healthy and thriving communities. When we want to create sustainable communities, we can learn from nature, because ecosystems are sustainable communities of living organ isms. The training uses many images and metaphors from nature, for ex ample the tree. The purpose is to communicate practical business skills in a fun and effective way, and at the same time inspire an integrated understanding of business, community and environment. Page 6 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Background Business Training f o u n d a t i o n Content of the Manual Notations used in the Manual The intention of this manual is to provide background information and Games are described as a series of steps, marked with small squares. tips, as well as work as a field guide. You might want to read it through Find a ball. before you do your first training, and then bring it as a reference after that. The manual is divided into four main sections. Play football. • The Background section explains the ideas behind the training program, as provides general tips for how to conduct the training. Stories you can read aloud are marked with big double quotes. Timanoy is a young Maasai woman. She has a husband and two • The Timetable section provides the suggested ways to combine the “ children. modules into a three day training. ” • The Modules section contains description of the individual modules Business scenarios are indicated as a sequence of steps, marked with for teaching, including the goal, preparations, games and activities, small arrows. exercises, etc. Timanoy invests cash of 2 to start a bead business. • The Templeates secion contains visual templates and tools for use Timanoy uses all her cash of 2 to buy a stock of beads. during the training, ready to be copied or printed. When particpants should have time to work on their business plans, a small pencil is shown: Page 7 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Target Groups How to define Target Groups The training program is intended for people with low levels of formal education, including illiterates. However, choosing the target groups can be a challenge, because people vary according to three independent parameters: • Literacy level • Level of business experience • Languages spoken You might find almost any combination of these people with business experience who don't read and write, people who read and write but don't speak Maa, people who speak Swahili but don't have any business experience, etc. If a class it too mixed it can be slowed down because everybody don’t speak the same language, and it can become difficult to find a pace that suits everyone. So it’s important to make a choice of the groups you want to reach. Target Groups in Olkiramatian When it comes to Olkiramatian group ranch, the training program is initially intended for two groups: a large group of rural Maasai, and a smaller group of existing business owners, many of which are Gîkûyû and Kamba. The definition of the two target groups might exclude a small group of Maasai who already own a business and but don’t speak Maasai. But it will improve trainings, because you avoid problems with multiple languages and differences in level of business experience. If you don’t have enough resources to reach everyone, it's better to start focused and ensure quality for those who attend the training. The two target groups are described in more detail below. Page 8 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Background Business Training f o u n d a t i o n Filtering Participants To know how many will attend a training, you need to setup a registration process before the training. During this registration people can sign up, and pay the contribution. During the registration it's important to be clear on the intended target groups and filter participants strictly. Otherwise you might get groups where not everybody speaks the same language. For example, if you’re doing a training in Swahili, make sure that everyone really do speak Swahili. Barriers to SelfEmployment Not everybody is ready to start a business. Their circumstances might prevent them from having success. In such cases, it's better that they deal with these barriers before they try to start a business. The registration or public information meeting can include a discussion about such barriers and the pros and cons of selfemployment. This can help people to make a more informed choice of whether or not to invest time in the training. Women The training program is targeted at both men and women. Although it might make sense to focus on women, because they need empow erment the most, and are often more responsible, a choice has been made to not to exclude the men. It was decided that not allowing men at the trainings would generate too much resistance among the men in the community. However, it should be considered at a later point to do separate trainings for men and women. Women do show up and also participate well in the training. The Maasai women are often a little more quiet than the men, but do ask questions, take part in all the exercises, etc. But you should be careful to include them and provide them the space to speak up, discuss and participate. Don’t let the men speak all the time. Page 9 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Target Group: Rural Maasai Definition Key characteristics Those who speak Maa, cannot read and write and don't own a busi • Speak Maa ness. • Cannot read and write Situation • Don't own a business The group consists mainly of traditional pastoral Maasai, living in the bush. Very few ever go to Nairobi. Most depend heavily on their cattle • Harder to reach and train and goats. Income is very low and comes mainly from selling animals. • Lives in the rural/bush areas Periods with drought can be very tough because animals often die. Their traditional culture is increasingly under pressure. • Less resourceful Language • 8090 of the potential training participants in Olkiramatian They all speak Maa, a few speak Swahili, and very few speak English. They have very low levels of formal education. Only few have entered Key training needs primary school, and very few have finished it, specially amongst women. • Learning how to start up a business Most are illiterates, but everyone can count and are used to handling money. • Teaching done in Maa Views • Teaching process adapted to illiterates Most are traditional or even conservative in their views when it comes • Training close to where they live to gender issues and business ideas. Women are not traditionally al lowed to own anything, or speak in front of men, although this is now changing. Almost all woman in this group are married and household duties take up considerable amount of their time. Most women are part of at least one woman group. Most in this group consider selfemployment a second choice, and would rather be employed if they had the choice. Outreach The people in this group are harder to train, especially because most are illiterates, but they also need the training most. Page 10 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Background Business Training f o u n d a t i o n Target Group: Business Owners Definition Key Characteristics Those who speak Swahili, can read and write, and own a business. • Speak Swahili Situation • Can read and write The group consists of the ‘business experts’ in the community, although • Owns a business many actually struggle to run their businesses well. The group consists mainly of Gîkûyû and Kamba, but also has some Maasai. Most live in the • Easier to reach and train villages. In the Olkiramatian group ranch, the main part live in Entasopia. • Lives in the villages Many go regularly to Nairobi to trade goods, or for other reasons. Many have moved to the area from other places, and they often have some • More resourceful amount of business network to rely on. • 510 of the potential training participants in Olkiramatian Language They all speak Swahili, many speak English and some Maa. Most read Key training needs and write. • Learning how to improve their business Views • Teaching done in Swahili They are less traditional in their views, and are open to new ideas. Women are often business owners. Selfemployment is seen by most • Written material in Swahili and English as something respectable and beneficial, also when compared to being employed. Outreach The group is relatively easy to reach, and also easier to teach. By involv ing them in the program, they can inspire and help the group of rural Maasai. It will also be valuable to be in contact with this more resource ful group, who can provide input, knows local regulations, etc. They might also be a potential source of new training staff. Page 11 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Sustainable Communities What is our Challenge The first step in this endeavor, naturally, is to understand the principles of organization that ecosystems have developed to sustain the web of life. This Our current economic system is threatening to undermine the fabric understanding is what I call ecological literacy. The ecosystems of the natural of life that we all depend on for our survival, through the degradation of natural environments all over the world. To change this, economic world are sustainable communities of plants, animals, and microorganisms. development must be coupled with a broader understanding of the prin There is no waste in these ecological communities, one species’ waste being ciples of sustainability and ecology. Instead of just growing, our goal another species’ food. Thus matter cycles continually through the web of must be to create sustainable communities. life. The energy driving these ecological cycles flows from the sun, and the diversity and cooperation among its members is the source of the community’s When it comes to training, it means that our challenge is not just to teach business skills, but to teach how to sustain the web of life, and resilience. to do it in a way that is relevant to poor people who need food on the A sustainable community is designed in such a way that its ways of life, table, an whose only way to get it is to start a micro enterprise. businesses, economy, physical structures, and technologies do not interfere The aim of this training program is to provide practical business skills with nature’s inherent ability to sustain life. in a fun and effective way, and at the same time inspire an integrated Being ecologically literate, or ecoliterate, means understanding the basic understanding of business, community and environment. Hopefully this principles of ecology and being able to embody them in the daily life of human will help people build healthy and thriving communities. communities. In particular, I believe that the principles of ecology should be the guiding principles for creating sustainable learning communities. The word Sustainability and Ecoliteracy ecology comes from the Greek oikos (“household”). Ecology is the study of how To build sustainable communities, the first step is to understand sustain the Earth Household works. More precisely, it is the study of the relationships ability. Here’s how author Fritjof Capra, describes sustainability: that interlink all members of the Earth Household. Since its introduction in the early 1980s, the concept of sustainability has often been distorted, coopted, and even trivialized by being used without the ecological context that gives it its proper meaning. So, I think it is worthwhile to reflect for a moment about what sustainability really means. What is sustained in a sustainable community is not economic growth, development, market share, or competitive advantage, but the entire web of life on which our longterm survival depends. In other words, a sustainable community is designed in such a way that its ways of life, businesses, economy, physical structures, and technologies do not interfere with nature’s inherent ability to sustain life. Page 12 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Background Business Training f o u n d a t i o n A lively community also depends on a multitude of partnerships between Six Principles of Ecology Fritjof Capra summarizes six principles of ecology, described below. businesses, organizations and people, both formal and informal. No business can exists on its own. These principles can provide guidance when we attempt to integrate business skills with ecoliteracy in the training. Our challenge is to create new partnerships across traditional boundaries, and find creative solutions that provides mutual benefit. We must also Networks learn to see nature as the essential partner it is, instead of an enemy. All ecosystems consist of networks nested within larger networks. For example, a forest is a network of tree, plants and animals. And each Diversity animal is a network of organs and cells. Diversity strengthens an ecosystem and makes it stronger. A lack of di In a similar way, a society is a network of communities. A community is a versity makes it fragile. For example, a field with only one type of crop network of businesses and people. A business can be seen as a network is more at risk of suddenly being destroyed by a pest. of different activities working together. In a similar way, a community with only one type of business can sud Our challenge is to become aware of the different networks we are part denly be hurt hard by a drop in marked price. A variety of business of (not least the environmental networks), and build businesses that types will make the community more resilient. sustain and strengthen these networks, instead of degrading them. Our challenge is to value diversity and find ways to sustain it, both when it comes to culture and the natural environment. Understanding the value of diversity will also lead to an appreciation of the local. Solar Energy The various ecological cycles are all driven by energy from the sun. Green plants convert sunlight and store the energy in special molecules. Animals then eat the plants. The heat of the sun also causes drives wind, rain and rivers. Cycles Our challenge is to switch energy sources based on the sun, instead of In ecosystems, energy and matter cycle continuously through the networks. Nothing is wasted. One species’ waste is another species’ depending on fossil fuels like oil which pollute and will eventually run out. Solar cells, solar cookers, wind power and electric cars are all part food. For example, manure is used by plants to grow. of this move towards clean, renewable energy. In a similar way, a business thrives on a continuous flow of money and goods. Dynamic Balance Our challenge is to create an economy where all materials are recycled Ecosystems are everfluctuating networks where no single variable is continuously, and nothing ends up as poisonous waste. maximized. A thriving community will also experience fluctuations as people make appropriate responses to changing conditions. Partnerships Our challenge is to think beyond profit as the only goal, and establish a Ecosystems develop through partnerships, not competition. broader agenda that includes quality of life, social inclusion and environ mental sustainability. Page 13 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Business Skills Guiding Principles However, a lack of more fundamental business skills, especially financial skills, is often what causes the biggest problems for micro entrepre The choice of topics can be seen as guided by two questions: What neurs. So this program tries to take up the challenge of communicating will the participants use most And what will cause them the biggest such skills. It’s true that sophisticated budgets or lengthy business plans problems if not used can’t be expected from participants who can’t read or write. Core Skills However, the basic principles and processes behind the list of core busi The goal of the training program is to help micro entrepreneurs start up ness tools above are actually not too complicated, and can well be un a business, or improve their existing business, by teaching a set of core derstood as long as the usual accounting language is dropped, and things business skills: are explained in a more creative way, using everyday words, drawings and stories. • Generating business ideas • Choosing a marketing strategy Teaching current Business Owners Amongst current micro business owners, there’s also a lack of basic • Using a balance sheet business skills, and few have tried to use tools like a budget or the marketing mix. So core business skills are useful for almost all micro • Creating a business plan entrepreneurs, which means that the same set of skills can be taught to • Creating a cash flow budget both beginnings and current business owners. But when training the group of current business owners, the pace can • Taking and repaying loans be faster, and finer details or more complicated examples can be cov • Keeping business records ered. Presenting the same topics for both target groups will make the training program simpler to deliver, and also make it easier for the two • Managing the use of profits for personal use groups to meet and help each other after the training. This can facilitate This might seem like an ambitious list, considering the fact that many the creation of a community of practice around entrepreneurship. participants can’t read or write, and that the suggested length of the training is only three days. Many other topics that could be taught, per haps more easily, like producing sales materials or improving sales tech niques, and indeed this is often taught to micro entrepreneurs. Page 14 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Background Business Training f o u n d a t i o n Focus on Financial Skills Rules and Regulations When looking at the list of core skills, some might seem more ‘fun’ to The training does not include teaching about official rules and regula teach, like marketing. Other topics, like the cash flow budget, might tions, because it’s not needed by most micro entrepreneurs. seem more ‘dry’ and challenging to explain. However, financial skills and In Kenya a business is not required to pay tax, deliver accounting in planning are important, and must not be left out or pushed to the end formation, etc. if it's below a certain threshold. In principle, you're sup where they risk becoming a footnote. posed to register your business, no matter how small, but in practice, For this reason, financial skills are introduced from the beginning of the this is never done anywhere. training, but are given simpler names and explained using the metaphor However, it should always be your responsibility as a teacher to advice of a tree: participants if they are about to do things that requires them to observe rules and regulations. You should at least know the overall framework • Balance Sheet Business Tree of official business regulations that might affect your participants. • Cash Flow Budget Money Plan • Business Plan The money plan (budget) is probably the most difficult topic, and is given special attention. There are three modules dealing with different aspects of using the Money Plan. Page 15 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n The Tree Metaphor The tree can therefore provide a shortcut to an understanding of A Visual Language When working with illiterates, it’s very helpful to use an inviting visual the dynamic interplay of business activities, how a business requires a continuous flow of money, etc. The tree is also quite culturally neutral, language. The training program uses the metaphor of a tree to explain which helps to avoid cultural misunderstandings during the training. key business topics, and create a link to the natural world and the principles of ecology. The tree can provide you with straightforward Connecting to Business metaphors for many business concepts: The tree is a good way to explain the dynamics of business, and can link • Tree business a range of business, community and environmental topics in a natural Business Tree way. For example, it’s a way to explain the otherwise difficult topic of • Seeds ideas the balance sheet. Roots show assets, while branches show liabilities. • Water money In this way, the business tree work as an inviting entry point into different business topics like markets, balance sheets, cash flows, management • Branches activities and planning. • Roots sources • Withering loss • Drought bad times • Flowers marketing • Fruits results • Soil market Throughout the training material, these metaphor are used for a range of visual icons that are easy to understand for illiterates and can help them memorize and recall the content. Tapping into Existing Knowledge Another benefit of using the image of a tree is that it taps into existing knowledge. Everybody knows many things about trees; their different parts, how they grow, their needs, etc. Page 16 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Background Business Training f o u n d a t i o n Stock:2 / Owners Cash:2 Connecting to Ecology The tree metaphor is straightforward and easy to understand, yet rich Timanoy sells all her beads for the price of 2. (Profit of 1) when explored further. Cash:3 / Profit:1 Owners Cash:2 The image of a tree provides a different mental framework than the one The scenarios can be used for demonstrating how to use the business provided by an image of a machine. tree, as exercises, etc. Each step indicated by a small arrow describes a business event. If a step results in a profit or loss, it is indicated in A tree is alive, and part of a larger network of organisms, supporting parentheses at the end of the line. each other, continuously recycling energy and matter. Considering the relationships between leaves, roots, branches, flowers, fruits, soils, etc. After each step, the resulting situation is written in small letters. The can open up a deeper understanding of both business and ecology. part before the slash (/) is the branches of the business tree (the assets), while the part after the slash is the roots (the liabilities). If a particular You can’t control a tree in the way you control a machine. You can’t item on the business tree has a value of zero (cash, stock, loans, etc), command the leaves to grow, as you might hit a button on a machine. it’s not shown. Instead you must care for the tree by creating the right conditions for the natural process of healthy growth. This is a better foundation for Symbols creating a sustainable and socially responsible business. A number of small symbols based on the tree metaphor is used to The tree help to clarify how similar principles operate in business, nature illustrate central items and roles. and communities. Using images from the living world will hopefully remind us that we’re all part of the web life, and that the businesses we create should sustain this web. Small Business Product HandsOn Using the image of a tree provides opportunities for handson learning. Small Business Owner For example, you can draw a business tree on a flip chart, and move Supplier pieces around between branches and roots to show how the value in a business changes when you buy and sell, etc. When the tree is drawn on a piece of paper, it also works well as a kind of board game, where participants can play out different business situations, by moving beans around between the different branches and Money roots, indicating buying of stock, taking loans, etc. Business Scenarios Customer Lender A number of small business scenarios are described in the manual, made up of a sequence of steps. For example: Timanoy invests cash of 2 to start a bead business. Cash:2 / Owners Cash:2 Timanoy uses all her cash of 2 to buy a stock of beads. Future Delivery Future Payment Page 17 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n The Timanoy Story Stories Stick Humans like stories. A story can often make it much easier to understand a topic and remember information. This is especially true for people I want to start without formal education. Say hi to Timanoy: A local Maasai woman who starts up a small beadwork a business.... business. She lives in a traditional settlement with her family. Timanoy experiences different things like borrowing money, buying beads from a supplier, having a good day at the market, paying for school fees, loosing her goods, having to buy on credits, etc. The Timanoy story can support you during the training, by making topics like giving credits, taking loans, loosing money, buying on credit, etc. easier for participants to relate to. Throughout the manual, many topics include pieces of the Timanoy story, indicated by big quotes. Some topics also include a number of additional ‘events’, indicated by small arrows, which you can use for group work or exercises, to work with the business tree, discuss possible cause and solutions to Timanoy's problems, etc. Improvising Don’t be afraid to make up new events in the story about Timanoy, if it can help you in your training. Yon can even ask participants what might happen next with Timanoy, for example when you’re working with the business tree and want to play out different scenarios. If you improvise, it’s helpful to know a little about the local business situation what typical problems and challenges are, what kind of goods are produces and sold, etc. Page 18 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Background Business Training f o u n d a t i o n Working with Illiterates Drawing If typical prices are counted in hundreds or thousands (as is the case in Kenya) just drop the zeroes. Instead of 200, use 2. You can still say ‘two When people can’t read, drawings are useful. For example, when using a hundred’ when presenting the example if you wish. flip chart, try to add drawings and symbols to all titles and text. Mixing drawings and words are good when some in the class can read. Avoiding Negative Numbers Making up good symbols require a bit of imagination. Try to find some Negative numbers can be confusing, especially to illiterates. For example, that are easy to understand, and not ambiguous. It’s often helpful to the result in a month can either be a profit or a loss. When creating a keep building on the same underlying metaphor. For example, if a tree budget, we would often use a single box, and write a negative number symbolizes a business, a forest is the business community, a drop is if we have a loss, or a positive if we have a profit. Instead, it's better to money, etc. use two boxes next to each other; you write in one if you have a profit, But you also have to accept that numbers and words are effective tools in the other if you have a loss. This way you avoid negative numbers for recalling and manipulating meaning and language. When you lack and can place a visual symbol next to each box, like a healthy leaf, and them, things will take longer. a withering leaf. Another problem with negative numbers is that you can't easily display Telling Stories them with things you count. Again, it’s better to have two different Stories is a natural way to structure and memorize information when boxes for placing the pieces or beans in. you can’t read or write. Explaining things through the use of stories can be powerful. Even people who read and write enjoy stories they make They’re not Kids things more interesting and fun Working with illiterates require imagination and a bit of patience. Even though participants can't read and write, it's important to remember Counting that they are not kids otherwise you risk being patronizing. It's useful Almost all people can count, even if they might not be able to read or to tell yourself that the problem is not that they can't understand it it's write numbers. So when working with numbers, try to use physical that you can't explain it. things you can count instead of written numbers. Move pieces around on the flip chart and provide the participants with beans they can count. They can Get Help This way, participants can follow examples, and even do simple addition Illiterate participants often have children or friends who can help them and subtraction themselves. to read material or write things down later. You should also encourage To make this possible, use small amounts (16) when giving examples. participants to help each other in the class. Numbers above ten quickly become impractical when you have to count and move pieces. Page 19 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Creating a Learning Space Facilitating Learning 4. Action. Filling out business plans, playing games and moving beans around on a business tree allows participants to actually try things and The best learning does not come from being told something, but from take decisions, instead of just talking. discovering it yourself. When you discover something yourself, you believe it and remember it easier. To make the training effective, it’s Adjusting the Frame important to include a variety of activities where the participants can You should try to adapt your teaching style to what the participants find gets handson experience, try things themselves, etc. It should not just appropriate. Be careful about assuming that the participants like the be you talking all the time. same thing as you like. Providing opportunities for participants to discover things for themselves For example, in places where resources are lacking, a teaching style that requires that you take a role that’s a little different that the traditional is too informal can make participants insecure. In this case it’s better to role of the teacher. Instead of just transmitting knowledge, you need make the training a little more formal, because it shows you respect the to create a space where learning can happen. Instead of providing the participants, and go to the trouble of making things neat. answer, you help participants find it themselves. You facilitate learning. Being formal can be as simple as aligning tables, providing a timetable, A big part of being a facilitator is to be receptive of what is happening, assigning a timekeeper and a chairman, ringing a bell at breaks, doing and what is needed in each moment. For example, it’s important to prayers before and after training, and handing out officiallooking sense when the energy in the class goes low, so you can adjust the pace, certificates at the end of the training. A more formal training style does or put in breaks or games when needed. not mean you can't be friendly and personal or do games and physical exercises. Four Flows A way to improve your facilitation skills is to be aware of four ‘flows’ When things don’t go as Planned that are always present when people work together. When all four flows When you facilitate learning, instead of just explain things, unexpected work well, things will feel easy, fun and productive. things might happen. So part of being a good facilitator is to be able to 1. Purpose. When the purpose is clear, people are motivated. When adjust along the way and work with whatever happens. So be ready to the purpose is not clear, the participants might be frustrated or resists improvise. You might need to change games, use different examples, what you’re doing. change the timetable or deal with small conflicts. 2. Emotions. A spirit of helping each other, honest reflections and fun If things don’t go as you planned or hoped, your task is not to force games all provide good energy. On the other hand, conflicts can drain the things back on track, but instead to find an appropriate way forward. energy and prevent learning, even if your training is otherwise good. It’s often a good idea to tell the participants what you observe is hap 3. Information. Facts, clear explanations, good drawings and relevant pening in the class, and present participants with relevant choices. examples helps the participants. If they lack, participants might be confused, or the training might feel irrelevant. Page 20 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Background Business Training f o u n d a t i o n For example, if you can see that you don’t have enough time, you can • Speaking the same language as the participants is important. It is tell the participants that you’re now running short on time, and ask if possible to do the training using a translator, but it's impractical and they would rather finish what they’re working on, or move on to the will slow things down. next topic. • Local konwledge is very useful, including the local business situation Of course it’s still your responsibility as a trainer to organize the train what are common types of goods, what are produced locally, what ing, but involving participants in this way can often improve learning by is not produced locally What are typical prices for common goods building an atmosphere of honesty. It’s also important for you to be honest and admit when one of your Tips for Working with Maasai game or ways of explaining didn’t work well. Then you can find a more • Let the group choose someone to lead prayers at the beginning and helpful way. end of each day of the training. Trainer Skills • Let the group choose a chairman, who will gather requests, There are some skills that will help you as a trainer. You don’t neces complains etc. from the group and deliver them to you. sarily need them all. You might think of them as possibilities for you to • Assign a timekeeper, who will ring the bell to start and end classes. learn more and become an even better trainer. • Maasai like to sing gospels they are almost all Christian. • Pedagogical skills and experience with training is good. But what’s more important is that you like to help others, are patient and enjoy • Maasai prefer beef or goat meat for lunch. explaining things. • Many Maasai don’t eat fish or chicken because it's considered taboo. • Faciliatation skills, like how to lead games and reflections and create a good learning space, are very helpful. • Business experience is great when you’re teaching business, and willmake you more trustworthy. At least, be sure you really understand the core tools like the balance sheet and the cash flow budget. • An understanding of ecology is important, because the goal of the training is to integrate ecoliteracy into the business training. There's a list of recommended articles in 'Recommended Reading', in case you want to learn more about ecology and sustainability. • You need to draw. But don't worry everyone can draw You don't need to be an artist. The point is just to draw simple things to help the participants follow along. Page 21 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Training Activities Vary the Training You can also asks participants for realworld experiences related to the current topics. Have someone experienced a similar situation Some people learn best by working in groups, others individually. Some learn well from doing games, others like stories. People have different Games styles of learning. For this reason, it’s good to have different types of Games work very well for lifting energy and as a basis for reflections. activities in the training. By having a mix of activities, you can make the Often we learn something better when we use the body in some way. It training fun and engaging for everyone, change dynamic and lift energy. helps to make a topic concrete, fun and easy to remember. If participants Flip Chart start to look sleepy it might be time for a game A flip chart is a good way to focus attention and is important when you Reflection need to draw. You can use it to explain things. It also works well to Reflecting and sharing insights is important when learning. The key to invite someone up to the flip chart and do some kind of task while the facilitating good reflections is to avoid discussion, and instead focus on class watches. For example, you might work with the person to analyze personal experiences and insights. their business using the business tree. This would provides a realworld example, and make things relevant. Breaks Breaks are an important part of any training. Mix in smaller breaks for Individual Work stretching and drinking water when you feel the energy is going down. Individual work is used when participants fill out their business plans. It’s often good to combine it with group work, so they can help each other at the tables. Group Work Working in smaller groups, for example around each table, provides space for all participants to speak and get help from their peers. Someone who might not speak when the whole class discuss will have an easier time when there’s only two others. Class Discussion Asking questions to the class engages the participants. If it’s only you talking, it can get boring Asking questions gives participants a chance to share their knowledge, which is important when teaching adults. The key is to ask good questions, which cannot be answered with just a yes or no. How Why are often good questions. Page 22 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Background Business Training f o u n d a t i o n Page 23 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Training Delivery Length Charging a fee also provides a direct feedback to the training organiza tion if people are not satisfied with the training they will stop paying. The suggested format for the training program is 15 hours of training This will help make sure that the training stays relevant and useful. ,delivered over three days. (18 hours including lunch breaks.) This length was chosen as a balance between resources and needs. On Typical Steps one hand, longer trainings would provide more time for teaching the To deliver a training, typical steps will include: skills people need. On the other hand, longer trainings would make • Decide location it more difficult for people to attend, and require more resources to deliver. • Coordinate with local chiefs Three days is enough time to teach basic business skills if you focus on • Arrange venue the essentials. It’s short, but makes the delivery flexible. Suggested time of day for the training is from 11 am to 5 pm on week • Invite the community to a public meeting (baraza) days. (But remember to avoid marked days, etc.) • Public meeting (baraza) Price • Registrations and payment Other NGO’s have done business training in the nearby city of Magadi, paying people to attend, as well as providing free transport, accommo • Training dation and food. • Business Club. It's good to arrange opportunities for the participants For this reason, locals might tell you that people will never pay to attend to meet again and help each other, keep up their motivation, etc. a training. But the pilot project showed that people are in fact willing to pay a price of KSh 100 (about 1€) for a training in the local area. The turnout was good, and included traditional Maasai women. Some even choose to pay again to go to the second training as well. Providing the training for free would send the wrong signal after all, business is about the value of things. Charging a price also makes sure that only motivated people attend. The price of KSh 100 was chosen because it is approximately the local price of the physical things the participants get: three lunches, a note book, a pencil and a rubber. This provides a simple way to justify the price. Page 24 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Background Business Training f o u n d a t i o n The Business Club The need to Follow Up The Business Club might start with half an hour of teaching, a guest speaker talking about his/her experiences, an new business idea, etc. 15 hours of training is not a lot, and people will need to learn more. The Business Club can be arranged as a regular halfday follow up learning A Community of Practice sessions for everyone who have attended the business training. As more people attend the trainings, the Business Club can be an im The Business Club portant element of the training program. It serves the purpose of creat ing a community around entrepreneurship. It will remind people of their The intention is to create a simple structure for peer support and con tinued learning. The Business is a selforganizing group process, where commitment and encourage peer support. The Business Club can help the aspiring community of entrepreneurs build a shared identity, con people chose topics themselves, discuss, help each other and share nect the participants from separate trainings, sustain an influx of inspira learnings at the tables. tion and knowledge and keep a learning focus. Because it is very simple First, everyone gets the chance to announce a topic they would like to in structure and doesn’t require much facilitation skills, it can also serve discuss. Anything can be a topic, for example how to fill out a money as a platform for locals to step up and start inviting guest speakers, fa plan, how to grow bananas, the possibility of producing bricks locally, cilitating the session, arrange meeting dates, etc. In this way it can help sales technique, how to deal with family issues, etc. But encourage top people stand on their own feet without support from outsiders, which ics related to the theme of entrepreneurship, since this is the Business should be the goal of any attempt to truly help people. Club Each person announcing a topic then hosts a dialog on the topic at a table. Everybody else is free to walk to a table with a topic they’re inter ested in. Yon can always change between tables, or even go for a walk outside. You can be like a bee, going from one table to the text. Or you can be like a butterfly, going at random or even going for a walk outside. The rule of the two feet says that whenever you feel you’re not learning anything, or can’t contribute, you’re free to go somewhere else. At the end, each host can present highlights or insights from the dialog they hosted. The process might seem very loose, but it works well and ensures that topics are relevant. You can read more about this kind of group process on: http://www.openspaceworld.org Page 25 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Materials Materials Here’s the materials you need during the training: • A timetable for hanging on the wall. • A flip chart with paper and pens. • Pieces for moving around on the flip chart. • Tape or other ways to hang things on the wall. • Big beans or seeds. (At least one for each participant.) • A handful of smaller beans for each table. • A printed set of papers for each participants, including timetable, business tree, money plan, business plan. • A ball pen, pencil, pencil sharpener and rubber for each participant. • A questionnaires for each participant. • A personalized certificate for each participant for handing out at the end of the training. • Lunch and water for the participants and yourself. Page 26 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Background Business Training f o u n d a t i o n Further Reading Books Malcolm Harper (1996): Empowerment through Enterprise. Intermediate Technology Publications Fritjof Capra (2002): The Hidden Connections. Anchor Books. The Grove Consultants International (2004): Principles of Facilitation. The Grove. David Sobel (2004): Placebased education: Connecting Classrooms and Communities. The Orion Society. Jeremy Seabrook (2003): The NoNonsense Guide to World Poverty. New Internationalist Publications. Lotte Hughes (2003): The NoNonsense Guide to Indigenous People. New Internationalist Publications. Richard Swift (2002): The NoNonsense Guide to Democracy. New Internationalist Publications. Articles Fritjof Capra: Ecology and Community Fritjof Capra: Creativity and Leadership in Learning Communities UNEP: Exploring the Links Human Wellbeing, Poverty and Ecosystem Services ACCIÓN InSight Nr 14: Practical Skills for MicroEntrepreneurs Ernestina Coast: Maasai socioeconomic conditions: Cross border comparison Michael Thompson and Katherine Homewood : Entrepreneurs, Elites, and Exclusion in Maasailand Page 27 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Three Day Training Length Outcomes On the next page is the suggested way to combine the modules into a The program is structured so that the participants can fill out a business three day training. plan template during day 2 and 3 of the training. Each question in the business plan template corresponds to a topic in the training. When it’s Days relevant to provide time for working on the business plans, it’s men Suggested day of time is from 11 am to 5 pm on weekdays because par tioned in the module descriptions. ticipants might have to work in the morning and evening. Avoid market days. In the weekend most people go to church, so avoid this too. Target Groups The program can be used both for the Rural Maasai who want to start up a business, and for the current Business Owners who want to im prove their existing business. The reason that the same program can be used for both groups, is that most owners of micro businesses lack basic business skills. But it’s best not to mix the two groups in the same class. Overview Each day has a main theme: • Day 1 is about the basics of business. The business tree is the main tool • Day 2 is about planning the business. The busines plan and money plan are the main tools. • Day 3 is about running the business in a sustainable manner. Page 28 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Program Business Training f o u n d a t i o n Day 1 Day 2 Day 3 Understanding Business Planning your Business Running your Business Welcome The Business Plan 30 min 30 min Keeping Records 1 hour Business Ideas 30 min What is a Business 1 hour Marketing Business Activities 1 hour 1 hour Profit and Loss 1 hour The Money Plan Sustaining Life 1 hour 1 hour Credits 30 min Lunch Break Lunch Break Lunch Break 1 hour 1 hour 1 hour Money for Living What you Learned 30 min 30 min What you Need 1 hour Avoiding Failure Your Next Steps 30 min 30 min Business Community Loans Goodbye 1 hour 1 hour 1 hour Page 29 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Welcome Goal Creating a good learning space. Providing participants with a clear over view of the training, and give them a chance to say hello to each other. Prepare Create a big visual timetable and hang it on the wall. Include drawings, so those who can’t read can understand the timetable. Prepare printed material for the participants, including business plan, money plan and timetable. If you want to hand out certificate at the end of the training, bring the registration list and use the lunch break to note who attends each day. Focus Attention Make it clear when the class starts, for example by ringing a bell. If some participants does not show up on time, you might not unsure whether you should start the training on time or wait for them. It can be a good idea to ask the participants who have already arrived what they would like to do. Welcome Welcome the participants, and tell them you're looking forward to the training Explain the Purpose When a group meets for the first time, people try to find out what’s going on and if it’s the right place for them to be. Depending on the participants, explain that the purpose of the training is to learn to either start up or improve a business. Page 30 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Business Training f o u n d a t i o n Hand out Material Make sure everyone understands the rules. Hand out the materials for each participant. Start the game You should participate youself. You can tell the other Provide an Overview person what you hope will happen at the training, and what you dream the participants will achieve after the training. Provide an overview of the training by going through the timetable. Keep it brief, and try to use simple words. Focus on the overall goal of When it looks like everyone has meet everyone else, ask for the each topic. Don't start to explain the content yet. group's attention. Encourage Questions Ask how it felt to exhange hopes for the training Why What did Make it clear that you want to create the most useful training possible, they learn Make sure only one person talks at the same time. and encourage questions and comments regarding the timetable. Game: Sharing Hopes The purpose of the game is to say hello to each other and create energy and motivation for the rest of the training. You need a place with enough space for all participants to walk around amongst each other, and a big bean or seed for each participant. Using seeds or beans is nice because they symbolize possibilities, dream and new beginnings. Make everyone stand up somewhere with enough space for walking around. If needed, you can move chairs or go outside. Hand each participant a seed. Explain that even big trees start as small seeds, and all businesses starts with a dream. Explain how the game works: Walk around and find another person to say hello to. Tell the person your name, and your hopes and dreams for the training. What do you hope to learn What do you dream about achieving after the training Then hand your seed to the other person. Then the other persons tells you his/her name and hopes and dreams for the training, and then hands you his/her seed. (Now you have exchanged seeds, and still have one each.) Then find a new person and do the same, and so on, until you have meet with all the others. It’s a good idea to show what you mean by example. Page 31 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n What is a Business Goal Create Work Groups Understanding what a business is, and how the basic process of buying Make sure participants sit in small groups of 35 people. and selling works. Ask each group to choose a type of tree as their group name. (Acacia, Using the business tree to understand business better by looking at Mango, Baobab...) You can then use the group names to when asking sources and uses of money. groups for answers, etc. Prepare What is a Business Draw a simple business tree on the flip chart. Then cover it with a blank Ask participants what a business is What makes something a business paper. All businesses provides something that others want to pay for. Some businesses buy things and sell them again at a higher price, for example Business Tree Simple a shop. Other businesses produce things, for example by growing fruits or making furniture out of timber. Another type of business provides a service which others need, like building a house or grinding grain into flour. Trees and Business A tree starts from a small seed. If you choose a good seed and a proper place to plant, it can grow into a healthy tree over time. In a similar way, a business starts with from an idea. If you choose a good idea, it can grow into a healthy business. A tree must have water to survive. The roots draw up the water from the soil, so the branches can be healthy and grow. A business must have money to survive. Money can come from different sources, like your own pocket or loans, and can be used for things like stock, cash or tools. If you take care of a tree, it can give nice fruits. If you take care of your business you can give good results. Page 32 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Business Training f o u n d a t i o n The different roots and branches of the business tree show the differ ent sources and uses of money in your business. At each branch and root, you note the value. You can place a number of beans or pieces, or write a number. It’s the value that you should show, not the amount of animals or other goods. For example, if we have some vegetables they might have a value of five, and we would place five pieces (or write five) on the business tree. When using the business tree, it’s not necessary all the branches and roots are in use. A trees starts small with only a few branches. Explain that you're now going to use the business tree on the flip chart to understand Timanoy's business. You’re going to place pieces on the business tree to show how money has been spend, and where it came from. Cash On the business tree, Cash shows the amount of cash in the business. Timanoy Cash is the money you have in coins and bills. Introduce Timanoy, by showing the drawing of her, and reading the fol Is there any cash in Timanoy’s business Not anymore, because she used lowing story aloud for the participants. them all for buying beads. Timanoy is a young Maasai woman. She has a husband and two “ children. One day Timanoy is walking home from the market, thinking about how to get money for paying school fees for her Stock children. ‘Maybe I could sell beadwork at the market’ she wonders. On the business tree, Stock shows the value of the stock in your busi ‘Many people here wear beadwork. I could buy some beads and ness. Stock is the things you’re going to sell, like vegetables, beads, etc. make earrings and necklaces. Then I could bring them to the Note that it’s not how much you can get when you sell the stock, but market and sell them’. After talking to a good friend about her idea, what you paid for it. she decides to try. She has 2 (hundred KSh) to start with, and uses Is there any stock in Timanoy’s business Yes, she used the cash of 2 for them for buying beads. buying beads. We place 2 pieces on the Stock branch. ” The Business Tree The business tree is a way to understand your business better, by look ing at the money in your business. What have you spend money on, and Owners Cash where that money came from On the business tree, Owners Cash shows the money you have invested in your business from your own pocket. Once you have placed money on this root, you will not need to move it again. Page 33 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Where did the money in Timanoy’s business come from From Timanoy’s Remember that there should never be money on both Profit and Loss at the same time. If Timanoy looses money, start by removing money from pocket. So we place 2 on Owners Cash to show that Timanoy invested the Profit root. 2 into the business. Timanoy invested 2 and used them for buying beads. Stock:2 / Owners Cash:2 Profit Timanoy creates beadwork from all the beads, and then sells the On the business tree, Profit shows the amount of money the business beadwork for the price of 2. (Profit of 1) has made since it started. If you buy something for 3, and sell it for 4, Cash:3 / Profit:1 Owners Cash:2 you have made a profit of 1. In the same way, if you buy something for Timanoy buys new stock of beads for 2. 5, but sell it for only 3, you have a loss of 2, and the profit goes down Cash:1 Stock:2 / Profit:1 Owners Cash:2 by 2. When you make a profit, more money come your business and make it grow. Profit is root on the business tree because it’s a source Timanoy sells beads that cost her 1 for the price of 2 (Profit of 1) of money. Cash:3 Stock:1 / Profit:2 Owners Cash:2 Is there any profit in Timanoy’s business Not yet It hasn’t made any Work at the Tables money yet. You can now read the following events aloud one at a time, and ask par Balance between Roots and Branches ticipants to work together in the groups to update the business tree by You cannot spend more money than you have. Big branches require big moving beans around on a printed version of the tree. After a while, ask roots. The business tree is always balanced in this way. If you count the a table what conclusion they reached, and explain anything they didn't total amount at the roots, it must be the same as the total amount at understand correctly. the branches, no matter what has happened in your business. This is no Cash:3 Stock:1 / Profit:2 Owners Cash:2 mystery, because it’s just the same money we’re describing in two ways. Timanoy sells beads that cost her 1 for the price of 1. We’re explaining where the money came from, and what they’re being Cash:4 / Profit:2 Owners Cash:2 used for. Timanoy buys new beads for 1. Show how this is true in the example with Timanoy. There’s 2 at the Cash:3 Stock:1 / Profit:2 Owners Cash:2 roots, and 2 at the branches. Timanoy sells all her beads for 2. (Profit of 1) Demonstrate the Business Tree Cash:5 / Profit:3 Owners Cash:2 Now read the following events one at a time, and move the pieces Timanoy uses all her cash to buy more beads. around on the business tree on the flip chart to reflect the situation in Stock:5 / Profit:3 Owners Cash: Timanoy's business. Explain everything you do carefully, and make sure everybody understands. This module is the foundation for the rest of the training Remember that adding and subtracting can be difficult for many, so use counting. Page 34 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Business Training f o u n d a t i o n Invite Participants to the Flip Chart When participants seem a little more confident, you can ask volunteers to help you at flip chart. Read a story event, then ask someone to up date the business tree at the clip chart by moving the pieces. Be sure to have extra pieces available in case Timanoy makes a profit Use the fact that roots and branches always balance as a way to help participants check if the tree has been updated correctly. If something is not right, you can ask if the tree balanced. If not, what’s wrong Stock:5 / Profit:3 Owners Cash:2 Timanoy sells all her beads to a friend for 3. (Loss of 3) Cash:3 / Profit:1 Owners Cash:2 Timanoy buys new beads for 2. Cash:1 Stock:2 / Profit:1 Owners Cash:2 Timanoy sells them again for 4. (Profit of 2) Cash:5 / Profit:3 Owners Cash:2 Timanoy uses 2 to buy beads. Cash:3 Stock:2 / Profit:3 Owners Cash:2 On the way to the market, Timanoy looses beads that cost her 1. (Loss of 1) Cash:3 Stock:1 / Profit:2 Owners Cash:2 Need more Story Events If you make up more examples yourself, you might want to avoid situa tions where Timanoy’s profit goes below zero (turns into a loss), just to keep things simple at this point. On the simple business tree, there’s no branch showing loss. Reflect Ask participants what they learned How can it help them Did anything surprise them Page 35 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Profit and Loss Goal The Profit or Loss of a Business To understand what causes profit and loss, and when it happens. Profit means the money a business has made. When we talk about the profit or loss of the business, we mean how much money the business To learn the difference between making profit and the total profit in a has made or lost in total since it started. We can also talk about the business. profit or loss made from a particular sale. To understand the relation between profit and loss, and how a profit turns into a loss, and a loss turns into a profit. Profit or Loss not both Profit and loss are two ends of the same thing. A loss is like a hole in Prepare the ground if we start throwing soil into it, the hole gets smaller and Draw a business tree on the flip chart. Prepare pieces for moving around smaller, and then turns into a heap which gets bigger and bigger. Business Tree Simple (with Loss) on the tree. If you have lost money, but then start to slowly make money again, the total loss gets smaller and smaller. Then it turns into a growing profit. If you have made a profit, but then start to slowly loss money, the total profit gets smaller and smaller. Eventually it turns into a growing loss. When we use the business tree, there should never be money at profit and loss at the same time. A heap on the ground can’t also be a hole in the ground at the same time The profit root and the loss branch show the total result of the business since it started. You might have made both profit and loss along the way, but in the end, the total result is either a profit or a loss. Profit On the business tree, Profit shows the amount of money the business has made since it started. Loss On the business tree, Loss shows the amount of money the business has loss since it started. Page 36 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Business Training f o u n d a t i o n Page 37 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Story Read the following story aloud: Timanoy put 2 into the business when she started, and has made “ 1 in total profit since she started. She has a stock of beads that she paid 3 for, and no cash. She now works to turn the beads she bought into nice necklaces for selling, and then goes to the market. But she can’t get a good price for her beadwork that day. However, she needs money for buying food, so she has to sell them, even though the price she gets is not very high. She sells all the beadwork for 1. ” Ask participants whether Timanoy made money, or lost money Why Timanoy lost 2 because she bought the beads for 3, and sold them for only 1. The previous profit in the business of 1 disappears and turns into a loss of 1. Invite a volunteer to help you update the business tree accordingly. Page 38 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Business Training f o u n d a t i o n On the way to the market, Timanoy looses all the beads, and never Practice using the Business Tree Now read each event below aloud, and work together with participants finds them. (Loss of 2) to update the business tree, either at the tables or by bringing volun Cash:1 Loss:1 / Owners Cash:2 teers to the flip chart. Timanoy uses the last cash of 1 to buy beads. Make sure everyone understand that the tree is always balanced, even Stock:1 Loss:1 / Owners Cash:2 when we have a profit or loss. The total amount at the branches is al Timanoy have a good day at the market, and sells all the beadwork ways the same as the total amount at the roots. Remember that there for 2. (Profit of 1) shoul never be money on both Profit and Loss at the same time on the Cash:2 / Owners Cash:2 business tree. Timanoy buys new beads for 2, and sells them for 3. (Profit of 1) If you make up new story variations, avoid situations where Timanoy Cash:3 / Profit:1 Owners Cash:2 has no cash or stock left. In that situation she would have to put more Timanoy buys new beads for 3, and sells them for 5. (Profit of 2) of her own money into the business or take a loan. That’s covered in Cash:5 / Profit:3 Owners Cash:2 another module. Timanoy buys new beads for 4. Timanoy has been running her bead business for a little while. Cash:1 Stock:4 / Profit:3 Owners Cash:2 Cash:1 Stock:1 / Owners Cash:2 Timanoy sells beads she paid 2 for, but gets only 1. (Loss of 1) Timanoy buys beads for the cash of 1 she has left. Cash:2 Stock:2 / Profit:2 Owners Cash:2 Stock:2 / Owners Cash:2 Prices are still low at the market, and Timanoy sells the rest of the Timanoy sells all the beads for a price of 2. stock and gets 1. (Loss of 1) Cash:2 / Owners Cash:2 Cash:3 / Profit:1 Owners Cash:2 Timanoy buys new beads for 1, and sells them for a nice price of 2. Timanoy uses 3 for buying beads, but can only get 2 when selling (Profit of 1) them. (Loss of 1) Cash:3 / Profit:1 Owners Cash:2 Cash:2 / Owners Cash:2 Timanoy buys a bigger amount of beads for 2. Cash:1 Stock:2 / Profit:1 Owners Cash:2 Timanoy sells stock worth 2 and gets 3. (Profit of 1) Cash:4 / Profit:2 Owners Cash:2 Timanoy buys a new stock of beads for 3. Cash:1 Stock:3 / Profit:2 Owners Cash:2 Timanoy sells all the beadwork, but only gets 2. (Loss of 1) Cash:3 / Profit:1 Owners Cash:2 Timanoy uses 2 of the cash to buy new beads. Cash:1 Stock:2 / Profit:1 Owners Cash:2 Page 39 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Credits Goal What is a Credit Understanding what credits are, and how they influence the business. What is a credit When you allow a customer to pay later, we say you have given the customer a credit. The customers now owes you money. Understanding when the profit or loss occurs, and the difference be You 'own' the right to be paid later. You can also get a credit from a tween customer credits and supplier credits. supplier. This happens when you get some goods but are allowed to pay This module does not explain loans and interests. That’s covered in the later. module ‘Loans’. Giving a Credit Prepare Timanoy buys beads for 3 and creates some beautiful earrings out Draw a Business Tree on the flip chart. Prepare pieces for moving “ of them. Then she goes to the weekly market to try to sell them. A around on the tree. Business Tree Credits woman Timanoy knows well comes by and likes the earrings very much. She is interested in buying, and after some negotiations, she agrees to pay 3 for some beadwork that cost Timanoy only 1 to make It’s a good deal for Timanoy. However, the woman tells Timanoy that she will only buy them if she can take the beads now and pay next week. Timanoy accepts, because she knows the woman and the price is good. ” Ask participants if Timanoy has more cash than before No Did she make a profit Yes She made a profit of 2, even though she didn’t get the cash yet. The profit is made in the moment you make the sale, because you know you’re supposed to be paid later. Show how to update the business tree to show the customer credit Timanoy gave. Timanoy invests cash of 3 to start her business. Cash:3 / Owners Cash:3 Timanoy uses the cash of 3 to buy beads. Stock:3 / Owners Cash:3 Timanoy sell beads of 1 for the price of 3, on credit. (Profit of 2) Owed by Customers:3 Stock:2 / Profit:2 Owners Cash:3 Page 40 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Business Training f o u n d a t i o n Credits to Customers Credits from Suppliers On the business tree, Credit to Customers is indicated by a small draw On the business tree, Credits from Suppliers is indicated by a small ing of a customer at one of the branches. Credit to Customers shows drawing of a supplier at one of the roots. Credits from Suppliers shows the total value of credits the business has given to customers. the total value of credits the business has gotten from suppliers. Page 41 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Timanoy sells all her beadwork for the price of 4, on credit. (Profit Getting the Money The next week Timanoy goes to the market again. She waits for of 2) “ the woman who owes her 3. In the afternoon she shows up, pays Credits to Customers:4 / Profit:2 Owners Cash:2 Timanoy the 3 and says she’s happy about the beadwork. The customer pays the 4 she owes Timanoy. ” Ask participants how much profit Timanoy made It's a trick question Cash:4 / Profit:2 Owners Cash:2 Some might answer that she made 2, but explain that she did not make Timanoy buys stock for 3, on credit. any profit, because she already made the profit in the moment the cus Cash:4 Stock:3 / Profit:2 Owners Cash:2 Credits from Suppliers:3 tomer agreed to pay 3. Timanoy sells stock of 1 for the price of 3, on credit. (Profit of 2) Show what happens to the business tree. Cash:4 Credits to Customers:3 Stock:2 / Profit:4 Owners Cash:2 Credits from Suppliers:3 Getting a Credit The customer who owed Timanoy 3 dies. (Loss of 3) After some good days at the market, Timanoy needs to buy more Cash:4 Stock:2 / Profit:1 Owners Cash:2 Credits from Suppliers:3 “ beads. She goes to where she usually buys her beads, to buy new Timanoy sells the rest of her beadwork for 2. (Profit of 1) stock for 2. But when she wants to pay, she discovers that she Cash:7 / Profit:2 Owners Cash:2 Credits from Suppliers:3 forget her money at home She doesn’t want to walk all the way once more, so she asks if she can bring the money next time. She Timanoy pays the supplier the 3 she owes. has already bought several times, so the supplier knows her and Cash:4 / Profit:2 Owners Cash:2 agrees to let her pay next week. Timanoy buys new beads for 4. ” Work with participants to correctly update the business tree. Stock:4 / Profit:2 Owners Cash:2 Your business can also get credits. For example, you might buy goods A customer buys beads that cost Timanoy 2 for the price of 4. She from a supplier and agree to pay later. When your business buys on pays 2 in cash, and and is given a credit of the remaining 2. (Profit of credit from a supplier, it’s very much like getting a loan, except you’re 2) getting goods instead of money. Because it’s a source of value, it’s one of Cash:2 Credits to Customers:2 Stock:2 / Profit:4 Owners Cash:2 the roots of the business tree. But getting loans and credits are different Timanoy buys beads for 2 on credit. from your own money, because they must be paid back Cash:2 Credits to Customers:2 Stock:4 / Profit:4 Owners Cash:2 Credits from Suppliers:2 Practice using the Business Tree The customer pays the 2 she owes Timanoy. Use the events below, either to demonstrate, make people work at the Cash:4 Stock:4 / Profit:4 Owners Cash:2 Credits from Suppliers:2 tables or to invite participants to help you at the flip chart. Timanoy pays back 1 of the 2 she owes her supplier of beads. Remind participants that the tree is always balanced, even when giving Cash:3 Stock:4 / Profit:4 Owners Cash:2 Credits from Suppliers:1 credits to customers or getting credits from suppliers. They can use this to check if they’re updating the business tree correctly. Timanoy sells stock worth 3 for 4. (Profit of 1) Cash:7 Stock:1 / Profit:5 Owners Cash:2 Credits from Suppliers:1 Timanoy has been running her bead business for a little while. Stock:2 / Owners Cash:2 Timanoy pay backs the last 1 she owes to the supplier. Cash:6 Stock:1 / Profit:5 Owners Cash:2 Page 42 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Business Training f o u n d a t i o n Timanoy buys news beads for 3. Deposits from Customers Cash:3 Stock:4 / Profit:5 Owners Cash:2 On the business tree, Deposits from Customers is indicated by a cus tomer at one of the roots, and shows the total value of deposits the Timanoy sells stock worth 2 for 3, all on credit. (Profit of 1) business has been paid by customers. Cash:3 Credits to Customers:3 Stock:2 / Profit:6 Owners Cash:2 The customer pays 1. Cash:4 Credits to Customers:2 Stock:2 / Profit:6 Owners Cash:2 Deposits When someone gets the goods now, and pays later, we call it a credit. When someone pays now, and gets the goods later, we call it a deposit. Another way to say it is that a credit is paying later, and a deposits is paying up front. Deposits to Suppliers On the business tree, Deposits to Suppliers is indicated by a supplier at one of the branches, and shows the total value of deposits the business has paid to suppliers. Reflect Facilitate a discussion about giving and getting credits. What are the benefits and risks When should you do it and avoid it What is impor tant to remember When giving out a credit, there is always a risk that you will never get the money. For example, you might forget that the person owes you money, or the person might move away, or not be able to pay you. If that happens, you have a loss Give credits only to people you trust will be able to pay you the money. Also try to find a way to record and re member who you have given credits to. (There’s more about this in the ‘Keeping Records’ module.) Page 43 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Money for Living Goal Timanoy takes out cash of 2. (Loss of 2) Stock:2 / Owners Cash:2 Learning how profit can be either reinvested or used, and how this af fect the growth of the businesses. Timanoy sells her beadwork at the market for 4. (Profit of 2) Learning how to avoid taking too much money out of the business for Cash:4 / Profit:2 Owners Cash:2 personal use. Timanoy Buys stock for 2. Cash:2 Stock:2 / Profit:2 Owners Cash:2 Taking out Profit Timanoy takes out cash of 2. (Loss of 2) The purpose of running a business is often to make some money for Stock:2 / Owners Cash:2 yourself and your family. Taking money out your business is not a prob lem as long as you take care not to take out too much. Timanoy sells her beadwork at the market for 4. (Profit of 2) When the business is small, you need to be extra careful not to dry Cash:4 / Profit:2 Owners Cash:2 it out. It’s better to leave enough money in the business so that it can Timanoy buys stock for 2. grow. When it gets bigger, and has stronger roots, when it makes more Cash:2 Stock:2 / Profit:2 Owners Cash:2 profit, taking out money for your own use is less dangerous. Timanoy takes out cash of 2. (Loss of 2) When you take profit out, it’s like there’s another tree next to your Stock:2 / Owners Cash:2 business tree that sucks from the same water source. Did the participants see a pattern Scenario: Staying Small The same thing was happening every week: Timanoy takes out 2 for liv Work with participant to play through the following scenario. ing, and uses 2 for buying new beads. The business never grows. Timanoy has been running her bead business for a while. Each Scenario: Growing “ week she goes to the market, and sells beadwork. Timanoy usually Now play through this scenario with the participants. sells all the beadwork that she brings, and get 4 in cash. The 2 she Timanoy decides to try to make her bead business grow. To sell uses for buying new beads, while the other 2 is used for buying food “ more beadwork she needs more money for buying beads. To get for the family. the money, she tries to take out less money from the business for ” Timanoy has been running her bead business for a little while. some weeks. Stock:2 / Owners Cash:2 ” Timanoy has been running her bead business for a little white. Timanoy sells her beadwork at the market for 4. (Profit of 2) Stock:2 / Owners Cash:2 Cash:4 / Profit:2 Owners Cash:2 Timanoy sells beadwork of 2 at the market for 4. (Profit of 2) Timanoy buys stock for 2. Cash:4 / Profit:2 Owners Cash:2 Cash:2 Stock:2 / Profit:2 Owners Cash:2 Page 44 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Business Training f o u n d a t i o n Buying stock for 3. What you can Take Out Cash:1 Stock:3 / Profit:2 Owners Cash:2 When you take money out of the business for living, the total profit of the business goes down, and prevents your business from growing. Taking out cash of 1. (Loss of 1) When you keep the money in the business, it can grow. Profit is one of Stock:3 / Profit:1 Owners Cash:2 the roots of the business tree. Timanoy sells beadwork of 3 at the market for 6. (Profit of 3) To take good care of a plant, you need to look at the leaves. To take Cash:6 / Profit:4 Owners Cash:2 good care of your business, you need to know how much profit it is Buying stock for 3. making, so you can decide how much money it is safe to take out. Cash:3 Stock:3 / Profit:4 Owners Cash:2 Taking out cash of 3. (Loss of 3) Finding a Good Business Size Stock:3 / Profit:1 Owners Cash:2 A tree will grow into its natural size, and then stay at that size. If it kept growing, the branches would get too heavy and start breaking A Timanoy sells beadwork of 3 at the market for 6. (Profit of 3) tree also takes time to grow. New leaves must be supported by solid Cash:6 / Profit:4 Owners Cash:2 branches. A big tree requires many branches. Buying stock for 3. In a similar way, your business does not have to grow all the time. A big Cash:3 Stock:3 / Profit:4 Owners Cash:2 ger business requires more advanced systems for operating, which are Taking out cash of 3. (Loss of 3) often more difficult to setup and use. If your business grows too fast, Stock:3 / Profit:1 Owners Cash:2 you can get problems, because you will not have the time to learn and Timanoy sells beadwork of 3 at the market for 6. (Profit of 3) implement the required skills and systems. Cash:6 / Profit:4 Owners Cash:2 Bigger or Better Buying stock for 3. A small tree with many fruits is better that a large tree with few fruits. Cash:3 Stock:3 / Profit:4 Owners Cash:2 Instead of growing your business bigger, it can sometimes be better to Taking out cash of 3. (Loss of 3) improve it. For example, instead of just selling more, you might learn to Stock:3 / Profit:1 Owners Cash:2 get better prices, or loose less on giving our credit to people who never Ask the participants what is different about the new way Timanoy runs pay. This way, you might make more money with the same amount of her business work, or make the same amount of money with less work. By taking out less money in the beginning, the business could grow. It’s good to remember that there can be advantages to being small. For When it becomes bigger, Timanoy can take out 3 each week, instead of example, a seedling can be replanted to a new place if needed. A big tree just 2. is much harder to move When a business is small, you can quickly make Ask participants what are the benefits and disadvantages of the two decisions and changes. A bigger business is more difficult to change. ways It can be a great idea to grow your business. It can also be great to keep it at it’s current size. The important thing is to consider what skills and resources it will require, and what will benefit you, the community and the land. Page 45 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Avoiding Failure Goal Too many Expenses Learning about common ways that businesses fail, and how to avoid Even when money is flowing into your business, it might fail if too much these situations. is flowing out at the same time. This happens if you have too many ex penses, or take too much out for living. When has a business Failed Try playing trough this scenario, perhaps inviting someone to help you When is a tree dead When it can’t sprout new leaves, and has stopped update the business tree along the way: drawing water up from the soil. A business has failed when it has run out Timanoy invests cash of 3 to start her bead business. of money and can’t operate. Cash:3 / Owners Cash:3 A failure means you don’t have any choices left. For example, if you don’t Timanoy uses all the cash to buy beads. have any cash or stock left, what can you do Unless someone owes you Stock:3 / Owners Cash:3 money or you can invest more money, the business has failed. Timanoy sells 2 worth of stock and gets 3. (Profit of 1) Even if you still have stock left, running out of cash is dangerous because Cash:3 Stock:1 / Profit:1 Owners Cash:3 any unexpected expense will cause a problem. Timanoy uses 2 for her family. (Loss of 2) Why do Businesses fail Cash:1 Stock:1 Loss:1 / Owners Cash:3 Ask participants why a business might fail Do they have examples or Timanoy buys new stock for the remaining cash of 1. experiences Most reason have to do with running out of money be Stock:2 Loss:1 / Owners Cash:3 cause the expenses are larger than the income. You avoid failure by Timanoy sells 2 worth of stock and gets 3. (Profit of 1) making sure the income is big enough, and expenses are small enough. Cash:3 / Owners Cash:3 Too little Income Timanoy uses 2 for her family. (Loss of 2) If you can’t sell enough, your business will die in the end, because too Cash:1 Loss:2 / Owners Cash:3 little money is flowing in. Your tree have bad roots When this is the Timanoy buys new stock for the remaining cash of 1. problem, the business often gets smaller and smaller over time, and Stock:1 Loss:2 / Owners Cash:3 then finally dies. Timanoy sells 1 worth of stock and gets 2. (Profit of 1) How can you avoid too little sale The first step is to choose the right Cash:2 Loss:1 / Owners Cash:3 business idea. If nobody needs what you try to sell, you’re in trouble. Timanoy uses 2 for her family. (Loss of 2) The right quality, price, etc. is also important. There’s more about this Loss:3 / Owners Cash:3 later in the training. Page 46 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Business Training f o u n d a t i o n Now there’s no stock left and no cash to buy new stock for. The busi Giving out too much Credit ness has failed What happened What mistake did Timanoy make When you give out credits, there’s always a risk that you will never get the money, either because the person can’t pay, or because you forget Timanoy took out too much for living, which caused the business to dry who you gave credits to. If this happens you have a loss. If it happens to out. Each week Timanoy got 3 from selling beadwork, but they cost her often, it can ‘eat up’ all the profit you’re otherwise making. 2 to make. So actually the profit from sale each week was only 1. When she took out 2 for living, she was drying out the business. She picked Another problem with giving out too much credit is that it might cause more leaves off the tree than what had time to regrow. your business to run out of money. Then you might not be able to buy new stock, etc. Your business can fail if the value of your stock is decreasing, and you don’t realize it. In the end you will run out of stock, and might not have How can you avoid giving out too much credit You should be careful money to buy new stock. about who you give a credit, and find a way to remember who you have given credits to. This is explained later in the training. Money for living is an expense for the business. Customers who never pay back credits, bad prices, or food which turns bad are other types Keep Expenses smaller that Income Business Tree Simple of expenses. The key to avoiding failure is to make sure that expenses are never big How can you avoid too many expenses Be careful about how much ger than the income. A three is healthy when the roots are strong and money you take out of the business. It’s good to keep some kind of re big enough to provide water for all the branches. Your business will be cords, so you know how your business is doing. This is explained later healthy when the income is big enough to support your expenses. To in the training. know if you’re keeping a healthy balance, it’s important need to know what’s going on in your business, how much profit you’re making, etc. Running Dry before becoming Profitable There’s more about keeping business records later in the training. Another reason your business might fail, is if you don’t have enough money to keep it running until it starts making money. For example, if you want to grow crops, it’s very important that you have enough money for all the expenses you will have until you can sell your crops, like planting, harvesting and loan repayments. If you run dry in the middle, you will not have money for harvesting, and the business will fail. If you start a shop, it might take time before people hear about it and start buying from your shop. Sustain your Business Remember that micro loans must be repaid each week, starting the To sustain a forest, don’t cut more trees than what have time to regrow. week after you get the loan, so you will have a weekly expense even if To sustain your business, don’t take out more money than what has you’re not making money yet. time to regenerate. If your business runs out of money before it grows strong roots, it dries up and dies To plan ahead and avoid this situation, it’s a good idea to Reflect make a money plan. That’s explained later in the training. Ask participants what they learned Did something surprise them Does anyone have relevant experiences they want to share Page 47 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Business Community Goal Hand each participant a seed and explain that the seeds represent money. Understanding how different businesses depend on each other, and how a thriving community economy will benefit all the local businesses. Explain that you yourself will be a business outside the community, Learning how money in a community can either circulate or leak out, selling something (decide this before you start) that many people in and what causes this. the community buy often, but which is not produced locally. Step outside the 'community' as you explain this to make it clear. Prepare Try to identify one common type of product that is not produced lo Ask each person in turn to decide what he/she sell, (for example cally, but could potentially be. Perhaps a certain type of popular veg tomatoes, eggs, etc.) and tell the group. Nobody should sell the etable, etc. same as you. Planting in the Desert Demonstraste how the game works: Each person walks around in the You can’t plant a seed in the dessert. It would quickly die from a lack 'community', announcing their goods or service. If you have money, of water. In the same way, no business can exist on it’s own, because it you can choose to buy something from another business by handing depends on other businesses and the money that circulate. A healthy over a seed to that business. You don't get anything back because in business community will make it much easier for you to run your own this game we're looking at the money. If you don't have any money, business. you keep walking around, announcing your goods, hoping someone will buy from your. You keep buying and selling. Game: Money Leaking from the Community The purpose of the game is to learn how local businesses depend on Remind people that they can also choose to buy from you. each other. You will need a seed for each participants, enough space Make sure everyone understands how the game works. for participants to walk around amongst each other, and some chairs, benches etc, to mark the space. Start the game People should be walking around amongst each other, announcing their goods, and exchanging seeds. Once in a while Create a 'community' by placing chairs, benches, etc. in a circle with someone should also hand you a seed. If nobody is buying from you, enought space inside for all participants to walk around amongst each announce your goods more effectivly other. You might do it outside. After a couple of minutes, stop the game. Ask all participants to go inside the 'community' and stand in a circle. Explain that the circle will be the local community, and that each Ask people to stand in a circle, and ask for reflections: What participant will be a local business in the community. happened Where did the money go What did they learn Page 48 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Business Training f o u n d a t i o n This time the money was not leaking out, but was instead circulating Each time someone bought outside the community, a little money was inside the community, making business better for everyone. leaking out of the community. Less and less money was circulating inside the community, making business harder for everyone in the commu Selling to the Outside nity. If a business sells to the outside, money will flow into the community. For example, someone might grow Asian vegetables and sell them to someone outside the community. However, there can be a drawback: If it means that nobody in the community is growing cabbage anymore, everybody will then have to buy cabbage outside the community, per haps at a high price Often the community will benefit most from producing the things it need locally, before trying to sell to the outside. The Business Forest One reason that it’s moist in a forest is that all the trees help draw up water from the ground and circulates it into the air. Together the trees provide shade and prevents the water from just disappearing into the sky like it does in a dessert. In the same way, if your community can circulate money, all businesses will benefit. If a business is doing well, the owner will spend the money again to buy things from other businesses. By helping each other, to gether you can grow a healthy business forest. Reflect Ask participants what they learned What surprised them How can Game: Money Circulating in the Community they use this learning How can they help each other to make money Repeat the game above, but this time, explain that someone in the circulate in the community instead of leaking out local community now produces and sells your product. Step inside the ‘community’ to visualize it. Start the game You should walk around and spend the money you get by buying from different local businesses in the community, just like all the others. After a few mintues, stop the game, and ask for reflections. What happened Why What was different this time What did they learn about how businesses depend on each other Page 49 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n The Business Plan Goal But writing things down on paper will help you to remember what you discover and decide while you’re planning. Understanding what a business plan is, and how it can be useful. Each part of the business plan is covered in a separate module, where Overview of the Business Plan participants can work on their own individual business plans. Ask the participants to look at their business plan templates. Why is there a seedling on the front Because it’s a plan for ‘growing’ a busi Prepare ness Prepare a business plan template for each participant, including a money The plan contains questions that are useful to consider when planning a plan. You might already have done this at the start of the training. business. As you go through each question below, first ask participants What is a Business Plan to guess which drawing in their template matches the question. Then Ask participants what a business plan is What are they useful for ask participants why the question is important to consider • A business plan is a description of your business ideas, and how you • What product or service will your business provide plan to start your business. • Who will be your customers • It can help you to think ahead and avoid unpleasant surprises. • Why will your customers buy from your business, rather than from • It can help you decide if you need a loan. your competitors • It can help you see what needs to be done, and when. • Will you plan ahead in days, weeks or months • It can help you decision whether your business idea is good enough • What important equipment and supplies will be needed, and what to spend time and money on, or you should search for a better will it cost idea. • What is your best guess of the total sales and expenses each period • It's a good way to explain your business idea to others. For example, • How much money is needed to start the business and keep it if you want to apply for a microloan, you must have a business plan. running until it makes a profit If you can’t Read and Write.... • Who is going to provide this money If you can’t read and write, you can still make a business plan You can either get someone to help you write, or you can draw. The most im • Who is starting the business, and what skills do they have which portant thing about doing a business plan is thinking ahead and consider should enable them to succeed ing who will be your customers, etc. Doing this is important and useful If you can answer all these questions, you have a good plan for starting for any person wanting to start a business. your business Page 50 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Business Training f o u n d a t i o n How to fill out your Business Plan Include a Money Plan You create your business plan by carefully considering each question, Your business plan should include a filled out money play, which shows and filling in your answers. Later in the training, each questions is cov how much money you will need, when you will need the money, and ered. To answer the questions well, you might need to talk with other when you will make money. Creating a money plan is explained in a later people, find out the prices of materials and equipment, etc. If that’s not module. possible during the training you will have to fill in your best guesses. Then you can adjust your plan later. The following modules will explain more about answering each ques tion. When a tree grows, the different roots and branches all grow at the same time, adjusting to the stones and other obstacles they meet. In a similar way, when you work on your business plan it’s fine to go back and forth between the different questions, adjusting your answers as you discover new things and change decisions. For example, if you change your mind about how you want to attract customers, you might need to go back and adjust your money plan. In the end, you should have answered all the questions, and your an swers should fit well together and form a plan that you believe in. You should be able to answer any relevant question people might have re garding how you plan to start your business. When you can do that, you will also feel confident yourself Explaining to Others Because an important use of your business plan is to show it to others, you should take care to explain things in a way that is easy to under stand for other. Remember that things which are obvious to you might be new to the person you’re explaining it to. It’s good to explain your choices. For example, instead of just saying that the location of your vegetable business is important, it’s more convinc ing to explain that the location is important because people don’t want to walk far to buy vegetables. Page 51 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Business Ideas Goal • Perhaps you’re good at something, which could be turned into a business Understanding the importance of choosing the right business idea. Learning new way to get business ideas. • Perhaps you can introduce an idea to your community which comes Filling out the first question in the individual business plan. from a different place Maybe someone told you about a new way of using materials, a new way to produce something or a new way to Choosing the Right Seed solve a problem A good idea often combines wellknown things in Choosing the right seed to plant in a particular place is very important. a new and surprising way. For example, did you know that elephant Once you have planted it, it is difficult to move or change. In the same dung can be turned into paper Or that sunlight can be used to cook way, finding the right idea and plac for your business before you start is water important. • You can also think about what many people buy from outside Good Business Ideas the community. If you can provide it, people might buy from you Considering a business idea is like holding a seed in your hand and think because your business will be closer by. ing about planting it. Can that type of tree grow well here When can I harvest for the first time Do I know how to take care of such a tree • You can help other businesses. For example, if you’re good at writing Do many people like that kind of fruit How much water will it need and drawing attractive signs, perhaps you could turn that into a What else could I plant here business where you get paid for creating signs for others businesses. Your business plan can help you tell how good your business idea is, • It’s good to talk with many different people, and listen carefully to because you look at your seed from different angles. It should look good their ideas and needs. If you each share an idea, you will leave with from all sides two each Facilitate a discussion about what makes a business ideas good Turning Waste into Value Ways to Get Ideas Sometimes you can make a business out of turning waste into some Ask participants how you can get ideas for business thing useful. If you’re creative it’s possible In nature nothing is wasted. Dead leaves are eaten by worms, and dead animals are eaten by ants. • Solve a problem many people have. Remember that not everything valuable is something you can hold in your hand. A tree provides Everything is reused. We should do the same For example, old car tires shade, which is very valuable, even though you can’t hold it in your can be made into sandals and old beer cans be turned into toy cars. hand. In the same way, a business can provide a service, like building If you find a way to turn waste into something useful, you might make a house, or transporting goods. a good business because you can get your material very cheap, or even for free, because other people think it’s useless. You’re also helping the community, because less material will have to be bought outside. Page 52 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Business Training f o u n d a t i o n If your community does not reuse waste, more things must be bought Work on Business Plans from the outside, and waste can start to build up and make your com It’s time to start creating business plans Participants should answer munity look ugly. For this reason, it’s good to use materials that can the first question in their business plan, which is about the business be reused by others whenever possible Natural materials are good, idea. The table should work together to fill out everyone’s plan those because they can always be reused by plants and animals and will then who can write should assists those who can’t write. If none of the par turn into fruits, timber and other useful things. ticipants can write, they should draw something that will make them Game: Map of Ideas remember what they decided. The purpose of the game is to see what ideas the others have. You need You should walk around at the tables, answering questions and assist as a big piece of paper and pens for the participants. needed. Place a big piece of paper on a table and some pens on a table. Everyone should draw something to represent the idea they have for a business. For example, a vegetable, a goat, a dress, etc. If a similar business is already drawn on the paper, you should draw your business next to it. If there's something on the map you don't know what is, you can ask the others. Ask a participants to step back and look at the paper. What do they see Are there some ideas that many people have What are the advantages and drawbacks of having the same ideas Discuss Ideas in the Groups Ask participants to work in the groups with their business ideas. Each person should present their idea. The group should then discuss the advantages and possible drawbacks of the idea. Can they find better ideas, or ways to improve their ideas Or do they want to stay with their original idea Reflect Ask participants what they learned What was new Page 53 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Marketing Goal • How the product is promoted (signs, special offers, sales talk, etc.) Learning how to attract customers. Together, the mix of these four is called the Marketing Flower. Learning to choose a marketing mix for their specific business, prioritiz Price ing price, product, place and promotion. Price is often not as important as we think. You might buy something Prepare because the shop was near or you like the atmosphere, or because your On four pieces of paper, draw the symbols for the four elements of the wanted a well known brand, and not because of the price. If you think Marketing Flower: price, product, place and promotion. about successful brands, they are often not the cheapest. A lower price will often attract customers, but not always Sometimes a low price will make people think that your product is of a low quality. Rather than just a low price, most people actually want best value for their money. Product The product itself is very important. A good quality will make custom ers come back to buy again. You can also think of how to add value by providing something extra or a special service. For example, if you make beadwork, you might offer to create beadwork in colors that the customer selects. Introduce the Marketing Flower Ask participants why plants have flowers They attract insects In the Place same way, your business needs to attract customers. Place is where the business is located. For example, when you need Draw a big Marketing Flower on the flip chart, but don’t draw anything something you buy often, like food, you don’t want to walk far, and will inside the four petals yet. Explain there are four main ways to attract often choose a business close by. So the place of the business is impor customers. Ask participants if they can guess what they are As partici tant. When you buy expensive things, you might be willing to travel far pants guess them, draw the corresponding symbol in one of the four to get a good price, or a special quality. petals on the flip chart. Promotion • The product itself, it’s quality, etc. Promotion is how you make people aware of your product and business. Promotion might include signs in front of a shop, or explaining the ben • The price of the product efits of a product to your customers. It also includes specials offers. • The place of the business Page 54 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Business Training f o u n d a t i o n Each participant should now go to one of the four tables, according What’s most Important Price, product, place and promotion are all important ways to attract to what they think would be most important for them. customers. However, it’s difficult to be the best in all four areas It’s Go around at the different tables, and ask someone why they stand hard to offer the best quality, at the lowest price, in the best location at that table with the best promotion, all at the same time It’s better to find out what’s most important and focus on that. Try again with different types of products, for example: a haircut, a cow, beans... Start by deciding which of the four are most important in your business. Then second, third, and finally what is least important. Ask participants what they discovered during the game What did they learn The game can show how people buy different types of products for different reasons. Different businesses requires different Marketing Flowers. Work on the Business Plans Participants should now work on their individual business plans. Explain that they need to decide how they want to attract their customers. Choosing the right Marketing Flower will help you sell more because it will satisfy the needs and taste of your customers. Participants should work in the groups, helping each other to fill out the Marketing Flower question in their business plan. They must prioritize the four elements of the Marketing Flower: what will be most impor tant, second, third and fourth They must explain their choices, and Game: What would make you buy this write/draw it in their business plans The purpose of the game is to understand the four main reasons people As participants work, you should walk around at the tables, assisting as buy things or services. You need four pieces of papers, with drawings needed. of symbols for Product, Price, Place and Promotion. Reflect Place the four drawings on four tables with space between them, Ask participants to reflect on the Marketing Flower, and how they can preferable in different corners of the room. use it in their efforts to run a business. What was important What new Make the participants stand up. did they learn Choose a typical product, for example tomatoes. Ask participants to imagine that they're going to buy tomatoes. What would be most important to them: the quality of the tomatoes, the price, where they can buy it, or how it is promoted (how well the person selling it presents it, advertises it, etc.) Page 55 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n The Money Plan Goal Example: Selling Earrings Learning how to use the money plan to look ahead and see how money This is a simple example showing money going in, and the remaining will flow in and out of the business. money increasing each week. Only the rows that are used are shown. As participants are getting confident, you can’t invite them to the flip Learning to use the money plan to avoid running out of cash. chart to help you fill in the ‘Money Remaining’ boxes in the example. Prepare Prepare a big money plan and 30 pieces you can place on it, perhaps Weeks pieces of stickynotes, pins or magnets. The pieces should be easy to see and count for all participants, and easy to move around on the big Selling earrings money plan. Purpose of the Money Plan Ask participants what happens if a small tree dries out It can die What can happens if a business runs out of money It can fail Remaining When your business runs out of money, it’s a big problem, because you can’t buy the things you need to run your business, like new stock or Timanoy starts out with no cash. paying for harvesting. When a tree has enough water, it can grow. In the same way, keeping Each week Timanoy gets cash of 1 from selling earrings. enough cash in your business will allow your business to run well and Timanoy doesn't use any money. grow. Each week Timanoy's has one more in cash remaining. The Money Plan is a way to avoid running out of money, by looking At the end of the fifth week Timanoy has cash of 5. ahead. When you want to start a business, the Money Plan will help you Draw the example on the flip chart, and go through it. At first, don’t figure out how much money you need to start, and keep your business place any pieces. Go through each week and explain what happens to running until it makes money. The Money Plan will help you see how Timanoy. Then explain what you do as you place the pieces. much cash you will have left each week or month. The money plan can also help you figure out how much money you can safely take out of Weeks your business without drying out your business. The Money Plan shows a period of time, for example 12 weeks. This is You fill out the Money Plan by thinking carefully about all the things different than the Business Tree, which shows a situation, or moment in you will have to spend money on, as well as the things that will give you time. The Money Plan shows what we think will happen each week. money. You concentrate on the cash, because it’s worse to run out of cash than to run out of stock. Page 56 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Business Training f o u n d a t i o n The start of the plan is at the thick vertical line. There’s a full moon at It’s important to remember that the plan shows only cash, not stock. the top of the first week. As time passes, we move to the right, in the Money from Before direction of the arrow. The top row show the time periods, symbolized In the bottom ‘Money Remaining’ row, just left of the thick line, is a by the moon going from full to half to new, and so on. Each column is special field you can use if you’re making a plan for improving an existing a week, and shows what happens during that week what we spend business. In the box you can write how much cash you have before the money on, where we get money from, how much you have left, etc. first week of your plan begins. The area left of the thick vertical line is used for explanations of the dif If you invest cash the first week, don’t write in this field. Instead add it as ferent rows. The first week of the plan to the right of the thick vertical a row in the ‘Money In’ section, and fill in the amount in the first week. line. Example: Buying Beads Money Out and Money In This is a simple example showing money going out, and the remaining In the rows next to the drop flowing out of the container, we write or money decreasing until no cash is left. draw the things we use money for. For example, one row might be ‘buy ing beads’, another might be ‘transport’. Each thing you spend money on, or get money from, must be written in a separate row. Week In the rows next to the drop flowing into the container, we write or draw things we get money from. For example, one might be ‘sale’. Buying beads On the left side of the thick line, we write or draw what the row show. To the right of the think line, we note the amount for each week. For example we might buy beads regularly, and would then place pieces in each week. Remaining Some rows might show things we only do once. For example, investing our own money, taking a loan, or buying equipment might only happen once. In these cases, only one of the boxes in the row would be filled Timanoy starts out with cash of 5. out, according to which week it happens. Each week Timanoy uses cash of 1 for buying beads. Money Remaining Timanoy doesn't get any money. In the bottom row with the water container, we note how much money Each week Timanoy has one less remaining money. we have left at the end of each week. At the end of the 5th week Timanoy has no money left. You start each week with the previous week’s remaining money. Then you add the money you get during the week, and subtract (take away) the money you spend. What you end up with is the Money Remaining. If you end a week with 4, then in the next week, you would start with 4. If you then use 3, and get 1, you end up with 2, which is the Money Remaining. Page 57 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n That’s what the rows with 3 drops are used for. You can think of the Example: Buying and Selling In this example, there are money going both in and out. three drops as a reminder to count, or add together. The row with drops flowing down is for the total amount of money you get during the week, while the one where the drops are flowing up is for the total amount of money you use. Weeks Selling earrings Weeks Selling necklaces Buying beads Selling earrings Buying beads Remaining Buying string Total In Timanoy starts out with cash of 2. The first week, Timanoy uses 2 for buying beads, and gets 3 from Total Out selling beadwork. The following weeks Timanoy buys and sells for different amounts. Remaining The second week, Timanoy doesn't get any cash. The third week, she doesn't use any cash. At the end of the 5th week, Timanoy has cash of 4 remaining. Change In Money (Note: If you use only the simple money plan, you can skip this sec Totals tion.) If you spend money on several things during a week, it’s useful to know Each week we have either the same amount of money as last week, less how much you spend in total during the week. If you get money from money than last week or more money than last week. It depends on several sources, it’s useful to know how much you get in total. It’s also how much money we get and use during the week. If we get more than useful to be able to compare the total in and out. we use, we will end up with more than before. If we use more than we get, we end up with less than before. Page 58 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Business Training f o u n d a t i o n The ‘Change in Money’ row is divided by a blue wavy line, like a water Weeks surface. If get more money during the week, the water will ‘rise’, and you write or place pieces above the wavy line. If your money goes down, the water ‘falls’, and you write below the wavy line. If you have the same Selling earrings amount of money remaining as the week before, don’t write anything. Owners Money The amount of the change is the difference between the total in and the total out. For example, if the total in is 5, and the total in is 3, money Buying beads increases by 2, and you write 2 (or place 2 pieces) above the water line. If you get 1, and use 3, you have 2 less than before, and you write 2 Buying string below the water line. Remaining Weeks Each week, Timanoy must use 1 for buying beads, and 1 for buying Total In string. The first week Timanoy will not sell anything. Total Out The second week, Timanoy will get 1 from selling earrings. The following weeks, Timanoy will sell for 2, 3 and 4. Change What is the smallest amount of cash Timanoy must at least put into the business the first week, to avoid running dry (If she has no cash left, she has run dry. She must have at least 1 left at all times.) Remaining If Timanoy starts with this amount, how much cash does she have at the end of the 5th (last) week Ask participants to work at the tables to find the answer. Then ask someone to the flip chart to show their answer, by placing pieces in the Game: How much is needed ‘Owners Money’ box (first week), then updating the ‘Remaining’ row Here’s a small exercise for the participants. Draw the following money for all weeks. plan on the flip chart, but place only the pieced that are colored solid in this drawing. Don’t place the dotted pieces yet. The dotted pieces in the drawing above shows the correct answer: Ti manoy must put cash of at least 4 into the business the first week, and will end up with 3. Remember that in your business you might not want to run as low as in this example. It’s must safer to keep a reasonable amount left. In this example we’re just finding the minimum amount needed. Page 59 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n What you Need Goal In the business plan, there’s a handful of questions that relates to the money plan. The answers should sum up the conclusions from working Filling in their money plan with best guesses of income and expenses. with the money plan. Figuring out how much money is needed to keep the business running until it is profitable. At each step, the participants should fill in their own money plan to show when and how much they think they will have to spend on the Filling in the relevant questions in the business plan. different items. After doing this, they can answer the corresponds ques Example: Growing Vegetables tions in the business plan. Explain that the participants are now going to put their skills to use, When working, the participants should help each other at the tables, filling in their own money plan. To help them, you will go through an ex and you should walk around, assisting as needed. ample of Timanoy growing vegetables. Start by drawing an empty money plan on the flip chart, and explain as you fill in the rows. Each step is Weeks or Months explained in the following sections. After each step, the participants When using the Money Plan to think ahead, the first thing to do is to should have time to fill out they own money plans. You should end up decide whether’s it’s best for you to plan ahead in months or weeks. with a plan looking something like the one shown here. Planning in months is better for businesses like growing bananas or fat tening animals that takes months. Planning in weeks might be better Weeks for businesses like shops or selling vegetables where the time from you start your business until it’s profitable is shorter. Investing cash Weeks Selling vegetables Investing cash Buying seeds Timanoy is planning ahead in weeks. Buying fertilizer Selling vegetables You should note clearly on your money plan whether you’re using weeks Money for living Buying seeds or months. If you’re not using the advanced plan, it shows weeks by de fault. If you want to use months, you can fill out all the moons in the top Buying fertilizer Total In row to show that each column is a full cycle of the moon (a month). Total Out Money for living If you’re using the advanced plan, there’s two boxes in the top row where you can tick either weeks or months. Remaining Total In Total Out Page 60 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. RemainingModules Weeks Business Training f o u n d a t i o n Investing cash If you need more weeks or month, you can choose to continue your Selling vegetables plan on another piece of paper. Just remember to number the pages, or attach them together. Buying seeds Buying fertilizer Equipm Weeks ent and Supplies When you start a business, you often have to spend money on things to Money for living Investing cash get started, like buying important equipment, seeds, initial stock, etc. Total In In weeks five and seven, Timanoy buys fertilizer for 1. Selling vegetables Every w Total Out eek Timanoy takes out cash of 1 for living. Buying seeds The third week, Timanoy can start harvesting and gets 1 from Remaining Buying fertilizer selling vegetables. From the fourth week, Timanoy can get 2 from selling each week. Money for living Timanoy buys seeds for 2 the first week. When you fill out the money plan, you try to look into the future. Some The participants should now consider what important equipment and Total In things, like how much you are going to sell, is impossible to know for supplies they will need in their business, and add it to their money plans. sure. So you should make your best guess, based on your experience. Total Out Each thing that they will have to spend money on should have it’s own To improve your guess, you can talk with other people who have rel row in the plan. evant experience. For example, if you plan to grow vegetables, talk with Remaining someone who have already tried to grow vegetables. Income and Expenses When you make your money plan, it’s very important that you remem As you run your business, you will hopefully start to get income from ber all the things you will have to spend money on, and don’t put in selling. But you will also have some expenses along the way. For example, numbers that are too small. It’s better to be realistic. It’s also important you might have to transport goods, or buy new stock. To make a good that the numbers for what you can sell is not too high. It’s better to sell plan, you must remember everything. Expenses might include things like more than you planned, than less That way it will be a pleasant surprise, buying stock and paying for fertilizers, harvesting, transport, etc. If you instead of a bad surprise plan to take money out for living, you must remember to add that to the It’s important that you believe in the numbers you put in your money plan. If you think you are going to have losses, for example from giving plan. Otherwise it’s not helpful, and you might get into trouble when out credits that are never paid back, you should add that too. you start your business. It’s better to be realistic. The participants should now consider what income and expenses they will have in their business and add it to their money plan. Each expense and income should have it’s own row in the plan. Remember to place income in the section with the drop flowing down, and expenses in the section with the drop flowing up. Page 61 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Remember that businesses which make more money often take longer When will the business be Profitable When you plant a seed, it takes a while before you can harvest. In the to become profitable same way, it often takes a while before a business makes money. For How much money is needed example, if you grow vegetable, it might take weeks or months before Few business are profitable right away. If your business is not profitable the vegetables are ready to harvest. If you start a shop, it might take a right way, it will cost money to run until it becomes profitable. while before people learn about it and start buying from it. If your business runs dry before it becomes profitable, it might fail. In At some point, the income must become larger than the expenses. It’s fact, this is one of the most common reasons why small businesses fail. important when this happens, because all the way up to this point, your So it’s very important to figure out before you start how much money business looses money. After this point, your business is profitable, and you need until the business is profitable. is making money. Being profitable means that the income is bigger than the expenses. It’s not enough to have money to start you must have enough money Weeks to keep your business running until it makes money By looking at your money plan and the numbers you have filled in so far, you can tell when your business will be profitable. It’s the point where You can use your money plan to figure out how much money is needed, Investing cash Weeks the income becomes bigger than the expenses. by using the ‘Remaining Money’ row. One way to do it, is to start out Selling vegetables with an amount that you think will work, and then update the ‘Remain Investing cash ing Money’ row according to the expenses and income you have filled Buying seeds in. If you see that you will run dry, you must start with a bigger amount Selling vegetables and try again Buying fertilizer Buying seeds Weeks Money for living Buying fertilizer Investing cash Total In Money for living Selling vegetables Total Out Total In Buying seeds Remaining Total Out Buying fertilizer In the fourth week, the income from selling is bigger than the expenses. So the vegetable business is profitable from week 4. Remaining Money for living Timanoy invests her own cash of 5 the first week. In the fifth week, the expenses is the same as the income. In the sixth week, the business is profitable again. Cash o Total In f 5 is enough money to start the business and keep it running until it is profitable. Timanoy can start the business without taking Ask participants to look at their plans, to find out when their business Total Out a loan. But Timanoy will be close to running dry, with only cash of 1 will be profitable. After some minutes of working at the tables, ask dif left in the second and third week. ferent tables what result they reached. Try asking people with different Remaining types of businesses. Page 62 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Business Training f o u n d a t i o n The participants should now find out how much money they need to start their business and keep it going until it is profitable without running dangerously low on cash. They should help each other at the tables. If our Money Plan shows you will Run Dry The reason for making a Money Plan is to look ahead and see if there’s a risk of running out of cash. If you run dry, your business can die. If your plan shows that you might run out of money, you must change your plan Ask participants what they can do if their Money Plan shows they will run out of money Here are some possibilities: • Reduce expenses • Take out less for personal use • Invest more of your own money • Take up a bigger loan • Increase sale • Find a new business idea Facilitate a discussion about the benefits and drawbacks of each way to change the plan. If the plan shows you something you don’t like, remember that it’s actu ally a help, because you are being warned of potential trouble, and has a chance to change your plan to avoid it Work on Money Plans Participants should have time to work on their money plans. Page 63 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Loans Goal Loan Groups Understanding loans, interests and repayment. To get a microloan, you must be in a loan group. If anyone in the group cannot repay their loan, the others will have to repay instead. So you Learning how to use the Money Plan to plan taking and repaying a loan. must choose carefully who you want to be in a group with if the per Prepare son doesn’t repay his/her loan, you will have to repay instead Choose When discussing loans, interest rates will often be a hot topic. You only people you trust. should prepare by knowing the precise offers, interest rates and condi Security tions of the loans your organization offers. Often you will need to place something as security, for example animals. If you want participants to work with real interest rates and numbers, In case you can’t meet your loan repayments, the animals will be sold to instead of rough estimates, you need to know how to calculate a loan cover your loan. Security is a way for the lender to be sure to get the and the size of the regular repayments, and should remember a calcula money back. tor. An alternative is to bring a list of precalculated examples of loans and their repayment. Or you can choose only to work with approxima Repayment tions. When you take a microloan, you must make a repayment each week, Be prepared for tough questions on why the rates are so high starting the week immediately after you get the loan. There is no ‘grace period’ until you start paying back. Interests It’s very important that you remember not to use all the money right Unless you have enough money yourself to start the business, you need away, for example for buying stock. If you do, you will not have any to find other sources. One way is to take a loan. However, you will of money left for your loan repayments, and might be in big trouble. ten have to pay back more that what you borrowed this extra amount If you can’t meet your weekly repayments, your security might be sold, is called interests. For example, if you borrow 5, you might need to pay your loan group might have to repay the loan, and you might be denied back 6. You then paid an interest of 1. any loans in the future. The longer time you borrow the money, the more interest you need to pay. For this reason it’s better to borrow money for as short a time as possible. Don’t borrow the money until you need it, and pay them back as soon as you can. Calculating the interest is often complicated, because it depends on many things, like the size of the loan, how long you have borrowed the money, how much you have already repaid, etc. Page 64 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Business Training f o u n d a t i o n You should not borrow the money until you need it, because you start Example: Repaying a Loan This example shows how a loan is repaid in weekly payments. You can paying interests as soon as you borrow the money. It might feel nice to have the money in the beginning, but if you don’t put them to use in your simply explain it yourself, or let participants help you update the ‘Re business, you will end up in a situation that’s worse than before maining’ row. Example: Using a loan to Grow Vegetables In this example, Timanoy plans to take a loan for growing vegetables. Weeks Getting Loan Weeks Investing cash Getting loan Repaying Loan Selling vegetables Buying seeds Remaining Buying fertilizer Money for living Timanoy starts out with cash of 2. Repaying Loan The first week, Timanoy gets a loan of 3, agreeing to pay back the 3 plus 1 in interest. The repayment period is four weeks. Total In Each week Timanoy makes a loan repayment of 1. Total Out After 4 weeks, Timanoy has repaid the loan and the interest. Remaining Because Timanoy paid 1 in interest, she ends up with one less than the 2 she started out with. Was it a good idea for Timanoy to borrow the money In this case, Timanoy takes a loan of 4 and invest 4 of her own money the first she didn’t use the money for anything, but still had to pay the interest. week. There’s a cost of borrowing money. You should only borrow money The loan plus 1 in interest must be repaid over five weeks, 1 each when you have a plan for how to use them for making more money than week. the price of borrowing them. After the fifth week, the loan plus interests is paid back. The first week, Timanoy uses cash of 2 for buying seeds. Each week, Timanoy takes out cash of 1 for living. Page 65 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Every second week, Timanoy uses 1 for buying fertilizer. • Women groups often use a merrygoround to give out loans without interests, but you might have to wait until it’s your turn. Vegetables are ready for sale in the third week, where Timanoy gets 2 from selling. • If you saved up money, you can even ‘borrow’ from yourself That From the fourth week, Timanoy gets 3 from sellling vegetables way you can choose to use the money for starting a businss when every week. you want. And if your business makes money, you will get the At the end of the seventh (last) week, Timanoy has cash of 5. ‘interests’, not the lender Because Timanoy used lher oan to make money, she ends up in a situation that's better that how she started. Finish the Money Plans The example shows how a business often has a ‘dip’ in the remaining The participants should now work at the tables to finish their money money until the business becomes profitable. Because it takes a while plans. They should discuss whether they will need a loan to start, and before the vegetables are ready for harvesting, the remaining cash goes where they might borrow the money. down in the first weeks. It’s important to have enough money to start If they think they need to take a loan, they should add two rows to their out with so the ‘dip’ does not cause your business to run out of mon money plan: ‘Getting Loan’ and ‘Repaying Loan’, and add the relevant ey. numbers. They should remember to update the ‘Remaining Row’ and Different types of Loans make sure that the business does not run dry at any point. Ask participants what different places or ways you can borrow money The participants should also finish their business plan by answering the Facilitate a discussion about the benefits and drawbacks of each. corresponding questions about loans. • A regular bank loan often has lower interest rates than microloans, You should walk around the tables and assists as needed. but you have to borrow larger amounts. The banks often don’t want Reflect on the Business Plan to give out small loans. You also have to go to a city to get it, and The participants have now filled out the main parts of their business often you must present an advanced business plans and have a house plan, expect the part about their own skills and next steps. The main or a car to place as security. business planning is now done. • Microloans often have higher interests than regular bank loan, Ask participants how they did How was is What have they learned but can be given in the local village, and you can take a small loan. What was difficult and easy How can it help them You must often be in a loan group of 57 people and repay a small amount every week. You can often use animals as security. You often have to present a business plan. • Sometimes you can borrow from someone in your familiy. You might even get the loan without paying interests. Because you most often don’t have to show a business plan, there can be a risk that you use the money without proper planning. Page 66 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Business Training f o u n d a t i o n Page 67 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Keeping Records Goal One way to do it is to keep a collections of cards, one for each person you give a credit. On the front of the card, draw the person in a way Understanding why and when keeping records can be helpful. that is easy remember. You can add the persons face, clothes , family or Learning simple ways to keep business records. house as ways to remember. On the back of the card, place marks ac Don’t walk in the Dark cording to the amount of credit you give the person. When the person If you don’t know how your business is doing, you can’t make good pays back, you can remove or cross out marks. If you give the person decisions. It’s like your walking in the dark you can easily fall over more credits, you can add new marks. To make it easy for yourself, For example, you might be taking too much money out of the business you can count in tens or hundreds, and only give and get back whole without knowing it. amounts of tens or hundreds. Keeping business records is a way to remember what has happened, and You could also keep a small glass or box with the drawings inside, and get an overview. It can show you whether you’re following your plan, use pebbles or beans to keep track of how much the person owes you. and help you take good business decisions. When you give a credit, place some pebbles in the glass. When the per son pays you, remove some pebbles. Keeping records can be done in many different ways. The important thing is to find a way which works for you. It should not take too much Keeping records might also help to avoid disagreements with the person time, or be too difficult. You should also know how to use the records about the amount owed to you. otherwise it’s a waste of time to keep them Keeping records should be a help. If you can’t Read and Write Ask participants how a person who can’t read and write can keep re cords Do they already use ways of keeping records Instead of using numbers we can count things. For example, using a jar with beans in, adding knots to a string, or placing marks on a card are all different ways to keep records. Remembering who you gave Credits If you forget who you have given credits to, or how much, you can loose money. Keeping records of credits can help you avoid this. Page 68 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Business Training f o u n d a t i o n Keeping track of Money for Living If you don’t know how much money you’re taking out of the business, you risk drying out your business. Keeping track of the money you take out can help you avoid this. If you made a money plan, you should keep track to not take out more for living than what you planned. For example, if you want to be sure not to take out more than 50 each month, you can fill a jar with 50 pebbles. Each time you take out money for living, you remove the same amount of pebbles. When the jar is empty, you know that you should not take out any more money that month. Another simple way to know how much you’re taking out of the busi ness is not to take out any money at all until the amount of money in the business reaches a fixed amount, for example 1000. At that point you take out a certain amount for yourself, like 100, and use the rest for buying new stock. Following your Money Plan When you filled out your money plan, you made your best guess about how things would go, how much you would sell, take out for living, etc. To make sure you’re following your plan, it’s helpful to keep some re cords. You can then compare and see if you’re following your plan. If things are not going as well as you planned, you have a chance to do something before you run out of money. A way to do it is to make another money plan. This time, you fill in how much you actually spend, sell, take out for living etc. That way it’s easy to see if you’re following your money plan, or need to make adjustments to how you’re running your business. Sometimes we need to change our plans. But try to do it as a result of a decision, instead of something that just happens. Page 69 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Daily Records To know how much you sold during a week, you need to record each Daily Records Simple sale as it happens. To know how much you took out for living, you need to record each time you take out money. Monday Tuesday Wednesday Thursday Friday Saturday Sunday To do this, many businesses keep daily records. At the end of the week, or month, the daily records are then added together to see what hap Day pened in total during the week. A simple way to keep daily records, is to use jars with beans in. For example, you could have tree jars, one for counting how much you sell, one for counting expenses, and one for counting how much money you take out for living. At the end of the week, you count the beans. If Sales you’re keeping a business history, you write the numbers there. Then you empty the jars, so you’re ready for a new week. Another way is to use the Daily Records paper, and draw marks or numbers. At the top row you can see the sun, symbolizing days. Each column is a day. The first day is Monday. The black dots are for counting the days. When you sell place marks to show the amount. Do the same when you have expenses, or take money out for living. At the end of the day or week, you can count the marks to see the total of the day or week. If you can Write IF you can write, you can use a more advanced way of making daily Expences records, where you write the date, item and value of each thing in sepa rate rows. You then use different columns for different types of items. For example, you can mark different rows with ‘buying stock’, ‘trans port’, etc. or use small drawings. The bottom row can be used for add ing together the total of the period. You can also buy special notebooks Daily Records for keeping business records. Date Sales Expenses Money for Living Money for Living Page 70 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. TotalModules Business Training f o u n d a t i o n Business History To tell how a tree grows, you can look at the leaves to see if they’re Business History healthy. But to really tell how much it is growing, you need to be able to remember how the tree looked like a week ago, a month ago or a Week year ago. Then you can tell the history of the tree, and how it was de veloped over time. For example, you might be able to tell that the tree Cash has stopped growing bigger, or that it will soon have fruits. In a similar way, looking at your business as it is right now can tell you Credits to Customers many things. But remembering how it has changed over time can tell you other important things that you cannot learn just by looking at your Stock business as it is now. Seeing the history of your business can help you take good business decisions. Loss You can use the Business History to get an overview of how your busi ness is changing over time. Each week or month you record the situ Size of ation of your business. How much cash do you have Stock Loans In Business the Sources and Uses sections, you will find the same things as on the Profit business tree. In the middle is a row called ‘Size of Business’. Here you can write the sum of all the sources, which must be the same as the sum Owners of all the uses. The tree is balanced, remember Cash If there’s not a balance between sources and uses, it’s either because Deposits from you forgot something, made an error, or simply because you have made Customers a profit or loss. At the bottom is a section called Activity. It’s used for recording the Loans Sales, Expenses and Money for Living during each week. The last row named Result shows the profit or loss of the week. You calculate it by subtracting Expenses and Money for Living from the Sales. Sales If the result was a profit, write above the dotted line. If it was a loss, write below the dotted line. For example, if sale was 6, expenses was 3 Expences and money for living was 1, the result is that you made a profit of 2. Money for Living Result Page 71 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Activitiy Sources Uses Business Training f o u n d a t i o n Business Activities Goal As the participants guess the areas, draw the symbols. (The four areas are: Products, Customers, Money and The Business.) Getting an overview of the important activities involved in running a business, and brief tips on each. When participants have guessed all four, tell them that there is one Discussing ways to learn more. more thing to take care of. What is it Game: Areas to Take Care Of You also need to take care of yourself. To run your business successfully, you need to take care of a number of important activities. If you do them all well, they will support each other, just like the roots and branches of a healthy tree. Business Activities There are four main areas to take care of. Main areas to take care of Draw a person with four lines going out on the flip chart. Ask particpants to guess the main four areas that needs to be taken care of when running a business Page 72 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Business Training f o u n d a t i o n Taking care of the Products Taking care of the Customers Why is it important to take care of the products What activities are Why is it important to take care of the customers What activities are needed needed Customers want good value for money. You will be able to provide good When you satisfy your customers and give them a good experience they value for money by taking care to produce quality products or buy qual might come back. If you do not take of the customers, they might not ity products without spending too much money. If you do not take care want to buy from you. of the products, customers might not want to buy them, or you can’t get a good price. • Learning about customers needs and tastes • Choosing the right products • Attracting customers • Producing a good quality • Maintaining an inviting shop • Buying supplies at a good price • Transporting products to where the customers are • Making up new products or solutions • Choosing the right prices for selling • Maintaining good relationships with your suppliers • Explaining the benefits of products to customers • Being friendly and helpful towards customers Page 73 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Taking care of the Money Taking care of the Business Why is it important to take care of the money What activities are Why is it important to take care of the business What activities are needed needed By managing the money in your business well, you can make good deci You should also take care of the business itself. Caring for the business sions about how to spend money, and increase your profit. If you do includes all the activities that are not directly related to products, mon not take care of the money, you might loose money or even run out of ey or customers, but are still important for your business. For example, money without warning. if you are a group running the business, it’s important to learn how to work well together and solve conflicts. Managing the different activities is also part of taking care of your business. If you do not take care of the business, it might be inefficient, you might forget things or take bad decisions. • Finding money for starting • Keeping business records • Making sure you're making a profit • Working well together • Repaying loans on time • Thinking ahead • Remembering who you gave credits to • Taking good decisions • Managing money for living • Finding easier ways to do things Page 74 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Business Training f o u n d a t i o n Taking care of Yourself Why is it important to take care of the yourself What activities are Game: Learning Maps needed The purpose of the game is to make participants aware of the areas Don’t forget to take care of yourself. You’re the one who takes care of where they feel they need to learn more, and to give each other ideas all the other things. When you’re healthy and learning new things, you and suggestions for how they can learn it. can take care of your business well. When you’re sick or don’t learn the right skills, it’s difficult. Each table should have a paper with a map of the main business activities. • Learning new skills Each person should now place a bean somewhere on the drawing, • Learning from experience to show where he/she feel a needs to learn more. For example, if you feel you’re not sure how to keep records, place your bean on • Staying healthy the drop. • Joining groups or clubs Each person should explain the placement of their bean to the others around the table. Learning More about Business Activities There’s more to learn about all of these different activities. Now it's time to give each other suggestions for how to learn. Each Ask participants how they might learn more about the activities Here person around the table gets suggestions in turn. The other persons are some ways: around the table should each give the person a suggestion for how to learn the skills they feel they need. For example, if someone feels • Going to other trainings unsure about how to keep records, you might suggest talking with an • Talking with experienced people more experienced person, attending a business club, etc. • Asking for help You current Skills • Attending the Business Club Participants should now work to fill on the questions ‘Who is starting • Learning from your own experiences the business’ in their business plan. Their should help each other in the groups. • Reading books, articles or internet pages Page 75 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Sustaining Life Goal Game: How many Trees Understanding what makes a business sustainable or not. The purpose of the game is to broaden the time horizon of the partici pants, and to let them think about the ‘long journey’. Learning how business, community and environment are interlinked and support each other. Ask participants if they remember how many trees were in the Exploring how we can learn from nature when we want to make things community when they were children sustainable. Ask the oldest person in the room to tell how the community looked like when he/she was a child Were there more or less trees What it means to Sustain Life When you start a business you would like to keep it alive instead of fail If things continue as usual what will your grand children see How ing after a while, so that it can keep on providing you with money for many trees will be left living. To sustain your business, you need to take care not to take too We might not think about how many trees are left in our community, much money out, provide good products, etc. There is a connection because the number changes slowly. In the same way, you might not between what you do to sustain your business, how well it runs, and notice if the value of the stock in your business decreases slowly. But what benefits (or troubles) it will provide you. If you depend on your suddenly you will wonder why your business failed business, you should learn how to sustain it. To sustain the life of the business, the community and the land, and keep But we can’t eat money. We depend on the land and it’s plant and ani them all healthy, we must understand both the small steps and the long mals. For example, trees provide us with shade, fruits, medicine, timber journey. and food for animals. They even clean the air and create soil, although not everybody knows this If we keep cutting a little more trees than Many small steps in the right direction will eventually get you to where what grows up, eventually there will not be any trees left. Suddenly we you want to be. Many small steps in the wrong direction will create a will wonder why we’re living in a dessert So we also need to learn how problem. to sustain the land and it’s life. We should look back to see how things have changed, and look forward The life of the community also provides you with many benefits, for ex to see what might happen. When we remember the long journey, and ample places for meeting people, shops and schools. So it makes sense adjust the small steps, we can get where we really want to be. to sustain the community too. Just like different businesses depend on each other, different plants and tree also depend on each other. In fact, we are all part of a big ‘web of life’. But sometimes we forget it, and stop sustaining the life of things we depend on, or even destroying it. Page 76 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Business Training f o u n d a t i o n Connections Connections help to sustain life. The foot is only useful because it’s con nected to the leg, which is connected to the body. Roots are only useful because they’re connected to the branches. In a similar way, a business has different activities that must all be con nected to the idea of your business, and support each other. For ex ample, a good relation with your suppliers will allow you to buy qual ity goods and make your customers happy. A good relation with your customers will allow you to learn more about their needs and tastes, so you sell more. When you sell more, you can invest in good tools, and so on. Planning can guide your actions. And experience can guide your planning. On the other hand, if you keep records but don’t use them to adjust how you run your business, it’s not helpful. Then it’s more like a branch that has broken of the tree. A tree starts small with only a few branches. As it grows bigger it gets more branches. All the time, every branch is connected to the stem. In the same way, you should grow your business from the business idea, and start with the most important activities. As your business develops, you can include more activities, keeping them all well connected. If you start too big, you might not be able to keep all your activities con nected. The community will also be healthier when there are many connections between people and businesses. When people talk together, help each other and use local businesses, knowledge and money will circulate for the benefit of all. Just like a tree is centered around the stem, and a business is centered around a business idea, a healthy community is centered around the shared wish for a happy life for everyone. When things are connected, they can work together. Page 77 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n It’s often easier for you to sustain your business when it offers some Exchanging Exchanging things help to sustain life. A business is alive when it ex thing different than everybody else in the community. That way you have a way to attract customers apart from just a low price. change goods for money with your customers. Animals exchange food for manure with the plants. There are many ants in the bush. But an ant does not live very long. So why is it that the bush is not already filled with dead ants It’s because dead ants are eaten by birds or used by plants as fertilizer. In this way, nothing is wasted. Everything is reused and exchanged over and over. An exchange will only continue when it’s for the benefit of both sides. If you spend money in a shop, but don’t get anything back or it’s a bad quality, soon you will stop spending money in that shop. You can sustain your business by making sure your customers feel that the exchange is fair, and that you provide good value for money. When both sides feel they benefit from the exchange, you can build a good partnership, and will want to help each other. The more you exchange, the more you receive. If you produce some thing that nobody can use, who will you exchange it with To sustain life, we should not produce things that cannot be reused or are poisonous. The community is also more alive when people exchange stories, expe riences and knowledge. Diversity Diversity helps to sustain life. A variety of plants help a forest stay healthy. If a field has only one type of crop, and a pest comes by that likes that particular kind of crop, all of the crops can suddenly be de stroyed. In a forest with many different plants, the pest can only eat a little bit. In a similar way, a variety of businesses help a community stay healthy. If everybody in the community have cows, and the price suddenly drops or there’s a drought, the entire community will suffer. If we had only feet, we couldn’t grab things. If we had only hands, we could not walk. Having both is much better. In the same way the com munity will be stronger if there are different types of businesses, serving different needs of the community. Page 78 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Business Training f o u n d a t i o n The goal is now to draw connections to the things your business de Game: Drawing Connections pends on. It might depend on supplies, animals, plants, timber, people This is a game that illustrates how things are interconnected, You need who help you, transport, loans, a weekly market day, tools, etc. For a big piece of paper, and pens for the participants. example, a vegetables business might depend on water from the riv er, a business selling fertilizer, someone transporting the vegetables, advice from an experienced person, good soil, a loan, etc. If the thing your business depends on is already on the paper, con nect your business to that thing by drawing a line. Otherwise, draw the thing first, and connect it to your business with a line. Each things that you depend on, depend on other things. Draw them too For example, fertilizer business might depend on chickens, and the river depend on rain, Everybody can works at the same time, filling in more things and connections. If the participants have difficulties getting started, help them by ask ing questions. For example, you might ask where they get their seeds from Or how they get money for starting Or how they transport they vegetables Or what the goats eat Or what the plant requires to grow After a while when many things have been drawn, make the partici pants stand back, and look at the drawing, and ask for reflections. What do they see What did they learn What surprised them Place a big piece of paper on a table or wall, and some pens. Every participant should make a small drawing somewhere on the paper representing their business. For example, if someone wants to grow vegetables, he/she draws a vegetable. Or if somebody plans to sell used clothes, he/she might draw a pair of trousers. If the partici pants already drew a map of ideas, you might use that as a starting point. Page 79 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Your Next Steps Goal Perhaps you don’t know what your first step should be. If you’re trying to get to a specific place, but you don’t know the way, what can you Creating a simple personal action plan. do You might look around and ask other people. In a similar way, if you The First Step don’t know what your first step should be, it’s often useful to investigate Every journey starts with a small step. The training is only one step of possibilities and talk with other people. longer journey towards running your own successful business. Finding your Way It’s nice to dream about starting a business, and also useful to talk about You don’t have to know every step of a journey before you start. how to do it. But if you don’t take the first step, you will never reach your goal. At some you need to stop talking, and start walking. As you start walking, you can find your way or ask people for directions, as long as you know where you want to end up. Sometimes the first step of a long journey is the most difficult. It might In a similar way, running a business requires learning and getting help be difficult to leave home. You might be unsure if you can find your way, or other people might tell that you can never make it especially if they along the way. Perhaps you can find others who are also starting a busi ness, and share your experiences. Maybe you can find an experienced don’t dare themselves business person who can provide some insights and guide you in your If the first step seems difficult, it might be helpful to divide it into smaller decisions. Or perhaps there are other trainings or books where you can steps. Nobody starts a journey with a jump to the other side of the vil learn more. lage The first step just needs to take you across the doorstep. For example, getting a loan might include smaller steps like creating a Your Next Steps money plan, talking with someone who have tried getting a micro loan, The participants should now work in the groups. Each person should or joining a loan group. Learning to write might include smaller steps chose three steps each that he/she want to take to start their business. like asking someone in your family to teach you or learning to read just Remember that what seems like a small step to one person, might be the numbers. big to another person. It’s all about what is most helpful to each person. Try to find steps that are not too big, and not too small. They should They must also decide when they want each step to be completed. be big enough to get you somewhere, but not so big that you risk falling For example, a step might be to join a loan within two weeks, finish the over. money plan within one week, or talk with a shop owner tomorrow. Finding your First Step The participants should work together to make sure each person has Important steps might be to buy stock, join a group or get loan. It can three clear steps. If the person is not sure, the others should help by also be to investigate a possibility, learn a skill, talk with an experienced asking questions and giving suggestions. person, take a decision, or deal with a family issue. It depend on your They should now write the steps into their business plan. situation. You’re the best person to decide what steps you need to take. Page 80 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Business Training f o u n d a t i o n Game: Stepping into the Circle The purpose of the game is to give participants a chance to present their steps in front of the group, to share with each other, and make their decisions feel real by taking a physical step. You need enough space for the participants to stand in a circle. Make participants stand in a circle. Each person can now choose to step forward and present their first step. They must keep it short, like 'i will talk with a shopowner tomorrow' or 'i will finish my business plan this week'. Otherwise the game might take too long. You should not let participants present in turn around the circle. Instead, each person should step forward when they wish. But only one person at a time should step forward and present. It's okay if there are moments of silence until someone steps forward. If there seems to be a group in the end that does not wish to step forward, you can ask if anyome else wishes to step forward. If nobody answer, you might then end the session. Ask participants to honor each other by clapping Page 81 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n What you Learned Goal Reflecting over what they learned, and sharing it with each other. Filling out a questionnaire with feedback about the training. Talking about Learning The participants should now spend some time in the groups to talk about the training. The goal is to become aware of what they have learned, and share it with each other. It’s not a goal to agree on what was good or bad. What was important might be different from person to person. • What was the most important thing they learned • Why was it important to learn • How will they use what they learned • What surprised them • What inspired them Page 82 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Training Questionnaire Simple How useful do you think each training topic was Please rate each topic by circling a face. Day 1 Day 2 Day 3 Keeping Records Welcome The Business Plan Business Activities What is a Business Business Ideas Sustaining Life Profit and Loss Marketing Training Questionnaire Simple Your Next Steps Credits The Money Plan How useful do you think each training topic was Please rate each topic by circling a face. Day 1 Day 2 Day 3 What you Learned Money for Living What you Need Keeping Records Welcome The Business Plan Avoiding Failure Loans Business Training Business Activities What is a Business Business Ideas f o u n d a t i o n Business Community At the bottom to the left, participants can circle either the man or the Filling out Questionnaires Sustaining Life Profit and Loss Marketing Explain that you’re also learning as a teacher, and is always looking for woman according to their gender. ways in which the training can be improved and made more helpful and Are you a woman or a man Please circle one. Please circle the topic that was most important for you, and cross the least important. relevant. Your Next Steps Credits The Money Plan Hand out a questionnaire to each participants and explain they you What you Learned Money for Living What you Need would appreciate if they would fill it out, but that it’s their own choice. Explain that it not them that are being tested, it’s you as a teacher The questionnaires is a way of helping you to improve the training. They Avoiding Failure Loans don’t need to put their name on the paper. Business Community At the bottom right, the participants can the most useful topic, and If enough of the participants can read and write, you can use the ad cross out the least useful. vanced questionnaire. Otherwise, you can use the simple one that is based on drawings. Are you a woman or a man Please circle one. Please circle the topic that was most important for you, and cross the least important. The Simple Questionnaire On the simple questionnaire, the big boxes at the top shows all the dif ferent topics covered during the training. Next to each are five faces, from sad to happy. The participants can circle one of the faces according Training Questionnaire Simple to how useful they feel the topic was. How useful do you think each training topic was Please rate each topic by circling a face. Day 1 Day 2 Day 3 Make sure participants understand what to do, then give them time to Keeping Records Welcome The Business Plan fill out the questionnaires. You should try to be in the background, per haps even go outside, so they feel free to give honest answers. Business Activities What is a Business Business Ideas Answer are personal, and they should not feel they have to agree in the Sustaining Life Profit and Loss Marketing group. Your Next Steps Remember to collect the questionnaires at the end and thank the par Credits The Money Plan ticipants. What you Learned Money for Living What you Need Avoiding Failure Loans Business Community Are you a woman or a man Please circle one. Please circle the topic that was most important for you, and cross the least important. Page 83 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Goodbye Goal Make sure everyone has understood the rules. Ending the training in a nice way by wishing each other good luck. Start the game You should not participate youself. Sharing reflections about the training, and handing out certificates. When it looks like everyone has meet everyone else, end the game Prepare and say thank you. You should have formallooking certificates for each participant ready for handing out. Be sure to doublecheck spelling of names, and sign Sharing Reflections them personally. You might want to fill in the number of days each It’s important to share learnings, insights, etc. The final reflection round person attended on the certificate. Try to do as much as possible in is a chance to do this. It can be very inspiring and helpful to hear what advance, because it might take some time. other participants have learned and experienced during the training. Put enough tables together to form a single table, big enough for Game: May your Business be Healthy everybody to sit around, including you. The purpose of the game is to end the training in a nice way, a wish each other good luck. You need a big bean or seed for each participant, and Explain that you are now together going to share reflections about enough space for everybody to walk around. This is the last game, and the training. it’s good to make it a little important/emotional Explain how the 'talking bean' works: You can only talk when you Make everyone stand up somewhere with enough space for walking have the bean. When you're done, you place the bean back on the around. If needed, you can clear chairs to the side or go outside. table, so someone else can choose to take it. Speak from the heart Hand each participant a seed. and listen with the heart. There is no right or wrong. You are all learning together. Tell them that the training is almost over, but it is only the first step in a longer journey. Pose the question: "What is the most important thing you have learned during this training" then place the bean on the table. Remind them that even big trees start as small seeds, and all businesses starts with a dream. If participants start to discuss or talk when they don't have the, remind them of the rules of the talking bean. Explain how the game works: Walk around and find another person. Say 'May your busines be healthy' and hand your seed to the other Periods of silence are okay. person. Then the other persons tells you the same and hands you When you feel that there's no more important reflections, pick up his/her seed. (Now you have exchanged seeds, and still have one the bean and thank the participants for their reflections and their each.) Then find a new person and do the same, etc. until you have time and energy during the training. meet with all the others. Page 84 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Modules Business Training f o u n d a t i o n Hand out Certificates Hand out certificates to each participants, one at a time. Remember to shake hands and say congratulations End the Training Make it clear that the training has now ended, for example by ringing a bell, etc. Stay around for a little while It’s often good to have a little after the training just for talking with the participants. Perhaps someone has suggestions for you, or has an im portant question or need information about other trainings or practical issues. Page 85 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Energizers Game: Catch the Customer Game: Walking Triangles The game is a fun way to be reminded that it requires an effort to get The game is a fun way to be reminded how we all have an effect on each customers to buy your products or services. It has a lot of movement other. You need enough place for everyone to walk around amonst each and can lift the energy. You need enough space to for the participants other. You might do it outside. to form a big circle holding hands and run around on the outside of the Everyone should pick to other people in their mind, but not tell circle. anyone. The game is like the children's game called 'Cat and Mouse', except Explain the rules: You now have to walk so that the three of you that instead of a cat catching a mouse, it's a business catching a form a triangle where all three sides are of equal length. The triangle customer. must be 'perfect'. Because the other two have picked other person, Particpants stand in a circle, holding hands. One person is the they will be walking too. So you constantly have to keep walking to business and starts inside the circle. Another is the customer and try to keep the triangle shape. starts outside the circle. Start the game The business and the customer can only pass from the inside to the After some time, stop the game outside, or the other way, when two people in the circle chooses to 'open a door' by raising their arms together, forming an opening. Ask for reflections What can we learn from this game about how we effect each other The people in the circle should create enough openings to make the game fun not too easy, and not too hard Play the game. Ask participants what the game can teach us about marketing For example: You have to be smart and make an effort to catch the customers Page 86 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.Energizers Business Training f o u n d a t i o n Game: Singing a Gospel Game: Clapping Circle Most Maasai are christian and like to sing gospels. This can be a great The game requires the participants to focus and help each other.. idea for a short break that lifts the energy in the class. Stand in a circle. You might ask participants to chose a lead singer. Send a clap around you look at the next person in the circle,, get Make everyone stand up. eye contact, and clap. Get the participants started, and sing/clap along The person then turns to the next persons, gets eye contact, claps, etc. You can only pass the clap when you have eye contact. When participants learn to do it well, you might ask them to to it faster. You can try sending two claps around, one in each direction. Page 87 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Templates About the Templates On the following pages, you will find templates and models you can copy and give to the participants, or just use as inspiration. Levels Some of the templates you will find in different version, from simple to advanced. You can then choose the one that fits the needs of the par ticipants best. Page 88 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Timanoy Page 89 Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Business Tree Simple Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Business Tree Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Business Tree Advanced Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Marketing Flower How will you attract your customers Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Money Plan Simple Weeks Money In Money Out Money Remaining Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Money Plan Simple (Continued) Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Money Plan Weeks Total Money In Total Money Out Money Remaining Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Money Out Money In Business Training f o u n d a t i o n Money Plan (Continued) Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Money Plan Advanced Weeks Months Total Money In Total Money Out Change in Money Money Remaining Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Money Out Money In Business Training f o u n d a t i o n Money Plan Advanced (Continued) Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Daily Records Simple Monday Tuesday Wednesday Thursday Friday Saturday Sunday Day Sales Expences Money for Living Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Daily Records Date Sales Expenses Money for Living Total Business Training f o u n d a t i o n Business History Simple Week Sales Expences Money for Living Result Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Business History Week Cash Credits to Customers Stock Loss Size of Business Profit Owners Cash Deposits from Customers Loans Sales Expences Money for Living Result Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Activitiy Sources Uses Business Training Manual f o u n d a t i o n f o u n d a t i o n Training Certificate is hereby awarded to: to certify the completion of the business training course: Granted: For and on behalf on Lorika Foundation Head of Projects Teacher Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Training Questionnaire Simple How useful do you think each training topic was Please rate each topic by circling a face. Day 1 Day 2 Day 3 Keeping Records Welcome The Business Plan Business Activities What is a Business Business Ideas Sustaining Life Profit and Loss Marketing Your Next Steps Credits The Money Plan What you Learned Money for Living What you Need Avoiding Failure Loans Business Community Are you a woman or a man Please circle one. Please circle the topic that was most important for you, and cross the least important. Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Business Training f o u n d a t i o n Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Training Questionnaire Please help us improve the training, by answering the following questions. Thank you WHO ARE YOU What gender are you Man Woman Which languages do you speak Maasai Swahili English How old are you What tribe are you Did you ever own a business Yes No Do you currently own a business Yes No THE BUSINESS TRAINING How useful do you feel the following training topics was: What was the most important thing you learned What is a Business Profit and Loss Credits Why was it important Money for Living Avoiding Failure Business Community What was the most useful topic The Business Plan Business Ideas Why was it useful Marketing The Money Plan Loans What was the best game Record Keeping Business Activities Sustaining Life Why was it good Your Next Steps What you Learned Business Training f o u n d a t i o n Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. HOW CAN WE IMPROVE What topic was missing What topic could we leave out What topic should we spend more time on What topic should we spend less time on How could we improve the training What should we remember next time WHAT SKILLS DO YOU HAVE NOW How confident do you feel about the following task: I know how to fill out the business plan No Not sure Yes I know how to fill out the money plan No Not sure Yes I know how to repay a loan No Not sure Yes I know how to take out money for living No Not sure Yes I know how to choose my marketing mix No Not sure Yes I know how to make my business sustainable No Not sure Yes I know how to start a business No Not sure Yes HOW FAR DID YOU GET How far did you get with your business plan Not started On my way Completed How far did you get with your money plan Not started On my way Completed Do you plan to apply for a micro loan No Maybe Yes What is your greatest challenge to starting a business How do you think the training will benefit you in the future Business Training f o u n d a t i o n Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. BUSINESS PLAN Business Training f o u n d a t i o n Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. What product or service is your business going to provide Who will be your customers Why will your customers buy from your business, rather than from your competitors Marketing Mix: How will you prioritize between low price, quality product, nearby place and attractive promotion Business Training f o u n d a t i o n Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. Is is best to think ahead in weeks, month, or some other pe riod What important equipment and supplies will be needed Where and when will they be obtained How much will they cost What is your best guess of the total sales and expenses in each period When is the business expected to be profitable Business Training f o u n d a t i o n Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence. How much money is needed to start the business and keep it going until it starts to make a profit Who is going to provide this money If you need to borrow money, how will you pay it back, and what security will the lender have Who is starting the business What skills and experience do you have, which should enable you to succeed What will be your next three practical steps • • • When will these steps be completed Business Training f o u n d a t i o n Checklist For each participant Flip chart pens Flip chart with paper Two big beans Ballpoint pen, Flip chart pieces pencil, pencil sharpener and rubber Clock Questionnaire Business plan Tape Big timetable Money plan Certificate Training Manual Small beans Timetable Business compendium Big beans Drinking Water Lunch Revision 1.0.1. Published under the Creative Commons AttributionNonCommercialShareAlike 2.5 licence.