Small Business Management Hierarchy

Small business, as its name suggest is an enterprise which is small in size, in its capacity of production, its investment of money and its employee capacity. The size of the business however varies from country to country. Thus in Australia a business which employs not more than 15 people is categorized as a small business while the European union considers a business small if  50 or less people are employed in it. Franchise business is an important part of the small business type.

small business management hierarchy

The Owner

The owner is either proprietor or the franchisee of a small business unit. If the business is an independent one, that is not a franchise of a bigger enterprise, then they are also the decision makers, because unlike big industry or corporate houses, they do not have a board of executives at their disposal. As they use a small amount of capital, the profit scale is also less, but so is the risk. But, if the small business in question is actually a franchise, then the owner enjoys lesser freedom in decision making.

The Manger

The next in the management pyramid is the manager. Depending upon the size of the business, their numbers may vary, but usually one or at the most two managers handle the work of the company. They are in charge of the proper execution of the decisions, overseeing the production process, arrange for product promotions, and additionally, manage an inventory, which is essential for a small business.

The Accountant

In place of a team dedicated to handling finance in the large corporations, it is the accountant who handles the monetary affairs in the small company. It is his job to keep an account of the company’s investments and profits. In the present times, some companies use accounting software too, which can make the job of the accountant easier, or at times, even redundant. The accountant also looks after the taxpaying part, which is essential for any company, large or small.

The Production Staff

Even if the business is a franchise of another bigger enterprise, the production team is very important. One needs specific expertise to work as production stuff. Generally the most experienced or most qualified person from the team works as the team leader, and are often paid incentives for good performances.

The Marketing Team

Another important team, though they do not get enough autonomy if it is not a sole-ownership venture. In the case of franchise, they are supposed to follow the instructions given to them by the franchisors. Indeed, some smaller companies hardly have a marketing team.

  • The small business generally could not spare too much capital for advertisement. Their advertisements remain more local in nature. However if it is a franchise of a big company, it is taken care of by the franchisors themselves.
  • The small business can have a store where the products are sold. In that case store management also becomes important, and generally a store manager is employed who oversees the day-to-day running of the store.