CODE:BBA 1004 SMALL BUSINESS MANAGEMENT

ASSIGNMENT

NAME NRIC STUDENT ID H/P NUMBER EMAIL ADD.

: CHOOI WAI KUAN : 910227-14-5486 : 201126 : +60176568281 : yenny_j@kimo.com

NAME OF LECTURER: MR CHONG KAR YUN ZONE NO : A 074

NOVEMBER SEMESTER 2011

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TABLE OF CONTENT

NO 1.0 2.0

TITLE INTRODUCTION Advantages and Disadvantages of Business Entity Types Sole Proprietorship Partnership Public Company Case Study of Optimax Malaysia Competitive Edge of Optimax Malaysia Conclusion References Coursework

PAGE NUMBER

3-8 9-22

3.0 4.0 5.0 6.0 7.0

23-26 27-28 29-31 32 33-36

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1.0 INTRODUCTION
There are many types of business entity defined in the legal systems of various countries. These include corporations, cooperatives, partnerships, sole traders, limited liability company and other specialized types of organization. The basics of setting up a business entity in Malaysia isnt so difficult to understand. There are three different types of business entities are Sole Proprietorship which is also known as Sole Trader, Partnership business entity and Limited Company (SDN. BHD. or Sendirian Berhad or BHD. or Berhad)

A company is a legal entity that is separate and distinct from its members and shareholders. When a company is formed, it is said to have become "incorporated". A company is capable of owning property, making contracts, employing people and being sued or of suing.

What is a Sole Proprietorship?

A sole proprietorship, also known as the sole trader or simply a proprietorship, is a type of business entity that is owned and run by one individual and in which there is no legal distinction between the owner and the business. The owner receives all profits (subject to taxation specific to the business) and has unlimited responsibility for all losses and debts. Every asset of the business is owned by the proprietor and all debts of the business are the proprietor's. This means that the owner has no less liability than if they were acting as an individual instead of as a business. It is a "sole" proprietorship in contrast with partnerships. Page 3 of 36

Like many other countries out there, the Sole Proprietorship business entity in Malaysia is owned solely by one individual, as his/her liability is unlimited. What unlimited liability means is: If a business fails or is declared bankrupt, creditors can sue the sole proprietorys owner for all debts owed to respective merchants. This means personal assets, personal income and employment income are all liable. A sole proprietor may use a trade name or business name other than his or her legal name. In many jurisdictions there are rules to enable the true owner of a business name to be ascertained. In the United States there is generally a requirement to file a doing business as statement with the local authorities.[1]In the United Kingdom the proprietor's name must be displayed on business stationery, in business emails and at business premises, and there are other requirements.

A sole proprietorship can hire any number of employees. Because the law makes no distinction between you, the sole proprietor, and the business, you are not considered an employee. Sole proprietorships may also hire any number of independent contractors.

What is Partnership?

A partnership is commonly formed where two or more people wish to come to together to form a business. The Partnership business entity is a joint-entity holder with two or more persons to carry out a legal business in Malaysia. . The Companies Commission of Malaysia requires that partnership entities must comprise of at least two members and a maximum twenty members.Perhaps they have a common business idea Page 4 of 36

that they wish to put to the test or have realised that their skills and talents compliment each others in such a way that they might make a good business team Forming a partnership seems like the most logical option and, in some cases, it is. Running a small business with a reasonably low turnover, a partnership is quite often a good choice of legal structure for a new business. The way a partnership is set up and run as well as the way it is governed and taxed often make it the most appealing form of business.

Partnerships, unlike sole proprietorships, are entities legally separate from the partners themselves. In a general partnership, however, profits and losses flow through to the partners tax returns.

Each general partner has equal responsibility and authority to run the business. Each partner should be involved in day-to-day operations of the business, and should make management decisions. Any partner may represent the business without the knowledge of the other partnersthe actions of one partner can bind the entire partnership. If one partner signs a contract on behalf of the partnership, the general partnership and each partner are responsible for that contract. The shared ownership concept that characterizes a business partnership gives it certain distinct advantages and disadvantages.

Partnerships are relatively easy to establish; however time should be invested in developing the partnership agreement. In a partnership agreement, the following arrangements, among others, should be spelled out how the business will be financed,

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who will do what work ,what happens if a partner dies and what happens if one or both partners want to dissolve the partnership.

It is strongly recommended that an impartial attorney be contacted to write the partnership agreement. Here's how to find the right attorney.

What is a Public Company?

A public company or publicly traded company is a limited liability company that offers its securities (stock/shares, bonds/loans, etc.) for sale to the general public, typically through a stock exchange, or through market makers operating in over the counter markets. A Limited Liability Company (LLC), quite simply is a company whose liability is limited. a limited company is a type of company which when set-up allows an entrepreneur to keep their own assets and finances separate from the business itself. This means that people who have invested in the business (the shareholders) are only responsible for any company debts up-to the amount that they have invested and no more. It is therefore a good way for a business to get investment and run without risk to a personal wealth. This is separate and distinct from a Government-owned corporation which might be described as a publicly-owned company. A company that has issued securities through an initial public offering (IPO) and is traded on at least one stock exchange or in the over the counter market. Although a small percentage of shares may be initially "floated" to the public, the act of becoming a public company allows the market to determine the value of the entire company through daily trading. Page 6 of 36

There are three types of companies - A company limited by shares where the members personal liabilities are limited to the par value of their shares, a company limited by guarantee where the liabilities of the members will be restricted to the amount each agrees to contribute to the assets of the company in the event of dissolution or liquidation and an unlimited company where there is no limit to the members liabilities.

Company limited by shares is the most common type of company structure in Malaysia. Companies limited by shares falls into two categories - Public limited companies and Private limited companies.

A Private limited company cannot sell shares to the general public. The name of private limited company ends with the word "Sendirian Berhad" or abbreviation "Sdn. Bhd.".

Public limited companies raise capital by selling shares and are run by a board of directors elected by shareholders. They show their status by using the abbreviation "Bhd." or the word "Berhad" after their name.

Public limited companies can only offer shares to the public if a prospectus which complies with the requirements of the Companies Act 1965 has been registered with the Registrar of Companies. Before a prospectus can be accepted for registration, the proposal for the issue or offer of shares to the public have to be submitted to the Securities Commission for approval.

Subject to the requirements laid down by the Kuala Lumpur Stock Exchange or KLSE, public limited companies have to apply to the KLSE for permission to have its Page 7 of 36

shares quoted on the Exchange. Even after a public listed company has its prospectus issued and registered, it is not allowed to commence business if it fails to obtain permission from the KLSE.

Public listed companies are listed either on the Main Board or the Second Board of the KLSE. Any subsequent issue of securities such as the issue by way of a rights or bonus requires the approval of the Securities Commission.

It can be either an unlisted or listed company on the stock exchanges. a public limited company usually must include the words "public limited company" or its abbreviation "plc" at the end and as part of its legal company name. However, certain public limited companies ,mostly nationalised concerns incorporated under special legislation are exempted from bearing any of the identifying suffixes. . The longer version is Essentially a Limited Company is seen as an entity in its own right, which can be subject to legal action. As a separate body, a limited company can even be the director of another company.

Forming an LLC is about as complicated as forming a corporation. The LLC comes into existence when the Articles of Organization are submitted to the state (and the appropriate fee is paid.) The LLC members must also have an Operating Agreement, but it is not necessary to file it with the state. In fact, in most states, it can be verbal.

Whereas,unlimited companies are no different from sole proprietorship and partnership business entities. One of the only difference is that they have a special articles of association and are free to return capital to its members. Page 8 of 36

2.0 Advantages and Disadvantages of Business Entity Types

Today, there are several business entity options available for entrepreneurs. Like anything else, each of them has advantages and drawbacks.

SOLE PROPRIETORSHIP
The sole proprietorship is perhaps the most common form of business ownership. Conducting business as a sole proprietor has distinct advantages and disadvantages.

Advantages

A sole proprietorship is an unincorporated business owned by one person. The owner of a sole proprietorship is known as a sole proprietor. If you conduct your business through a corporation, your business will not be a sole proprietorship. If you share ownership of your business with someone else, including your spouse, your business will not be a sole proprietorship.

The most important feature of a sole proprietorship is that the law makes no distinction between you, the sole proprietor, and your business. Virtually all the legal and tax consequences associated with sole proprietorships flow from this essential element.

The first advantage is avoidance of double tax. Basically, double tax can occur if you conduct your business through a corporation rather than through a sole proprietorship. Corporations pay income tax separately from their owners. Double tax can occur when you and your business must both pay taxes on the same dollar of income. We will

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examine the double tax problem more closely in the next issue of the Home and Small Business Reporter. For now, you simply need to know that as a sole proprietor, you will not pay double tax on your business income because the law make no distinction between you, the sole proprietor, and your sole proprietorship. All your business income is treated as your personal income.

The second advantage of sole proprietorships is that you can deduct your business losses to the extent of your total income that you may have from all sources, including interest, dividends, and gains from the sale of non-business property. Furthermore, if you are married and file a joint tax return, your business losses will also offset your spouse's income. Your ability to deduct losses as a sole proprietor may reduce your family's total income tax burden and may be particularly useful during a startup or downturn phase of your business.

Besides that ,a sole proprietorship is a business entity that is virtually indistinguishable from its owner. The cost to create it is frequently only a small one-time fee to the state or county officials to register a fictitious business name and the cost of placing an ad in your local paper to notify the public that you are doing business under that name .You may also need a state, county, or city business license, so check with your local authorities to ensure compliance.

Another advantage of doing business as a sole proprietor is that you don't have to prepare financial statements for anyone. Since you own 100% of the business, then you

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are not accountable to anyone. There will be no external auditing of your business account and you are under no obligation to report your business earnings or financial position.A sole proprietorship has few recurring costs. Since the business and the individual are identical, there is no special maintenance required to keep the business alive, so there should be few recurring costs beyond any state business license fees and fees to maintain your fictitious business name. As long as you continue to call yourself a business, you are one.

Most entrepreneurs love the sole proprietorship type of business entity because it allows them to freely express themselves. They can showcase their talent, skill, expertise and still get acknowledgement for it. Entrepreneurs under this category are usually called the do it yourself-ers because they love doing things their own way. Under this umbrella, you will find entrepreneurs who are barbers, hair dressers, painters, etc. In fact, they are the self employed of the society.

Often a small business, sole traders can offer a more personal service with local roots and ties. This can be more appealing to potential customers in the local community. As there is no need to confer with other decision makers, sole traders can make decisions quickly and act on them swiftly, providing for the needs of their customers.

When you are a sole proprietor, you have the ability to quickly make and implement decisions. Flexibility is the name of the game in a sole proprietorship kind of business. Page 11 of 36

When you are doing business as a sole proprietor, you have almost none or less paper work and legal restrictions. If you choose to run your business under the sole proprietorship for of entity, then you can cease to operate or close down the business without any legal formalities.

Disadvantages

The principle disadvantage of conducting business as a sole proprietorship is that you may pay higher income taxes. As a sole proprietor you report your business income on your personal tax return . While you do avoid double tax this way, if as a single person your total adjusted gross income exceeds $115,000, or as a married person filing jointly your adjusted gross income exceeds $140,000 , you may pay income tax at the highest rate. By incorporating your business, you may be able to reduce your tax rate.

As a sole proprietor, you face additional disadvantages. Starting in 1994, you cannot take any tax deduction for your health or life insurance. There is no good reason for this; the Internal Revenue Code just does not allow sole proprietors to take the deductions. A full deduction for your health insurance and a deduction for a $50,000 life insurance policy is available to corporations, so long as all employees of the corporation are offered the insurance. If these deductions will save you enough money, you may want to incorporate your business.

Every business is different. What may be advantageous to you may be disadvantageous to someone else. However, because significant tax and legal repercussions flow from your decision to conduct your business as a sole proprietor, you Page 12 of 36

should be aware of them. By being aware, you can best avoid unexpected and unintended consequences.

Furthermore, reverse economies of scale is one of the disadvantages of sole proprietorship .A sole trader will be unable to take advantage of economies of scale in the same way as limited companies and larger corporations, who can afford to buy in bulk. This might mean that they have to charge higher prices for their products or services in order to cover the costs. Sole traders are not seen as a separate entity by the law. Therefore, they are subject to unlimited liability. This means if the business gets into debt, the business owner is liable. In the worst case, this may mean a person risks their home, personal savings and any other assets they have both in and outside of the business. All decisions must be made by the sole trader. There is no room for help by others. So the success or failure of the business rests on one person.

P A RT NE R S H IP
There are some advantages and disadvantages of running a Partnership type of business. Advantages A partnership is generally easier to form, manage and run. They are less strictly regulated than companies, in terms of the laws governing the formation and because the partners have the only say in the way the business is run (without interference by shareholders) they are far more flexible in terms of management, as long as all the partners can agree.

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For tax purposes, all partners are considered self-employed and claim their share of the partnerships income on their individual tax returns .General partnerships are relatively easy and inexpensive to create and maintain, although the state where the partnership is established usually requires annual renewal filings and fees. A partnership agreement usually accompanies the formation of a general partnership, though it is not legally required. Partnership agreements generally cover topics like transferability, duration, and management control.

Furthermore, due to the nature of the business, the partners will fund the business with start up capital. A partnership occurs when you decide to pool capital and work together with at least one more person. This means that the more partners there are, the more money they can put into the business, which will allow better flexibility and more potential for growth. It also means more potential profit, which will be equally shared between the partners. . In this form of business, you and your partners are joint-owners of the business and therefore will share the business profits and risks.

Being a partnership, the business owners necessarily share the profits, the liabilities and the decision making. This is one of the advantages of partnership, especially where the partners have different skills and can work well together.

Partners can share the responsibility of the running of the business. All partners carry the same responsibilities. This means that you are liable for risks and debts of the business even if it is caused by the actions of your partners. Rather than splitting the Page 14 of 36

management and taking an equal share of each business task, they might well split the work according to their skills. So if one partner is good with figures, they might deal with the book keeping and accounts, while the other partner might have a flare for sales and therefore be the main sales person for the business. With unlimited liability, each partner is also liable to use their private resources to meet the partnership's debts.

Disadvantages

However, it can obviously present some problems. Over the years, many partnerships have turned sour. Family and friends go into business together and end up falling out on a personal or business level and it all ends badly. This is one of the major disadvantages of partnerships over other business models, but its important to be able to balance the advantages and disadvantages. Disagreements and disputes may occur among partners and this may disrupt business plans or operational efficiency.

One of the most obvious disadvantages of partnership is the danger of disagreements between the partners. . Since decisions are shared, disagreements can occur. Obviously people are likely to have different ideas on how the business should be run, who should be doing what and what the best interests of the business areThis can lead to disagreements and disputes which might not only harm the business, but also the relationship of those involved. A partnership is for the long term, and expectations and situations can change, which can lead to dramatic and traumatic split ups.This is why it is always advisable to draft a deed of partnership during the

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formation period to ensure that everyone is aware of what procedures will be in place in case of disagreement and what will happen if the partnership is dissolved. Furthermore, a major disadvantage of a partnership is unlimited liability. General partners are liable without limit for all debts contracted and errors made by the partnership. For example, if you own only 1 percent of the partnership and the business fails, you will be called upon to pay 1 percent of the bills and the other partners will be assessed their 99 percent. However, if your partners cannot pay, you may be called upon to pay all the debts even if you must sell off all your possessions to do so. This makes partnerships too risky for most situations.

One of the major disadvantages of partnership, taxation laws mean that partners must pay tax in the same way as sole traders, each submitting a Self Assessment tax return each year. They are also required to register as self employed with HM Revenue & Customs. The current laws mean that if the partnership (and the partners) bring in more than a certain level, then they are subject to greater levels of personal taxation than they would be in a limited company. This means that in most cases setting up a limited company would be more beneficial as the taxation laws are more favourable .

Moreover, partners share the profits equally. You have to decide on how you value each others time and skills.This can lead to inconsistency where one or more partners arent putting a fair share of effort into the running or management of the business, but still reaping the rewards. What happens if one partner can put in less time due to personal circumstances?

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In additional, partnerships are formed by two or more legal entities , and each of those entities are individually responsible for the partnership. This means that each partner is personally liable for the partnerships debts and legal liabilities. If one rogue partner makes an enemy of a third party, all partners will come under fire.

LIMITED LIABILITY COMPANY

A limited liability company (LLC) is essentially a hybrid of a corporation and a partnership. An LLC provides the same kind of tax and liability benefits as a corporation, but has the same management structure as a partnership. In the past, LLCs have had more restrictions on them than corporations. For example, at least two people were needed to form an LLC and an LLCs duration was specifically limited. However, in the last few years, states have started loosening these restrictions.

Advantages Publicly traded companies are able to raise funds and capital through the sale of its securities. This is the reason publicly traded corporations are important: prior to their existence, it was very difficult to obtain large amounts of capital for private enterprises. Moreover, the issue, transfer or sale of shares is a relatively straightforward process - although existing shareholders are protected via their "preemption" rights and by company legislation that seeks to protect the interests of minority investors.

The process of lending to a company is also easier than with other business forms. The lending bank may be able to secure its loan against certain assets of the business (a "floating charge") or against the business as a whole ("fixed charge". Page 17 of 36

The financial media and city analysts will be able to access additional information about the businessThe obvious advantage of a Limited Liability Company is the financial security that comes with business. As already mentioned, the Companys shareholders will only be liable for any debt the company accrues according to the levels of their own investment and no more. This can provide a comfortable feeling of security for investors in the Company.

Due to its very nature, a limited company is deemed to be a separate legal entity from its owners. This has several advantages, including the fact that the company will exist beyond the life of its members. If they retire or die, the company will continue to exist and operate. This ensures security for employees and other members and also is an advantage which other legal forms of business are not subject to. Besides, the advantage of paying yourself in dividends instead of in the form of a pay packet (in the normal sense), especially when you consider that tax on dividends is only 10% and there are no NI (national insurance) charges on them! There are complexities involved where you wish to pay a pension for your retirement, but if you consider that dividends can be paid at any time during the companys financial year actually makes this method of paying yourself and other members more preferable. It also gives you further incentive to work hard to make a profit with the company, as dividends payments are made up of distribution of the companys profit.

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Disadvantages

While a limited liability company (LLC) offers many advantages over other forms of business entity, there are also some disadvantages. First and foremost, there are more complex and restrictive rules governing the accounts and bookkeeping of Limited Companies than sole traders (for example). The Company is expected to produce years accounts incorporating a double entry format, balance sheets and other notes. With the (generally) larger nature of a Limited Companies business this can be a time consuming and costly undertaking. For Private Limited Companies, there is a restriction on the raising of capital via sale of shares. As mentioned, PLCs can gain further funding by the sale of shares, but thi ability is lost to Private Limited Companies whose shares are restricted. Furthermore, due to the nature of Public Limited Companies, sometimes disputes will arise between Directors and Shareholders as their ideas of what is best for the company vary. Sale of shares to increase company funds will further dilute the management, as more and more people have a say in how the company is run. There is also a risk (since Companies can buy shares) that a takeover might occur this way. Earnings of most members of an LLC are generally subject to self-employment tax. By contrast, earnings of an S corporation, after paying a reasonable salary to the shareholders working in the business, can be passed through as distributions of profits and are not subject to self-employment taxes.

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Since an LLC is considered a partnership for Federal income tax purposes, if 50% or more of the capital and profit interests are sold or exchanged within a 12-month period, the LLC will terminate for federal tax purposes.

A limited liability company which is treated as a partnership cannot take advantage of incentive stock options, engage in tax-free reorganizations, or issue Section 1244 stock.

In additional,there is a lack of uniformity among limited liability company statutes. Businesses that operate in more than one state may not receive consistent treatment.

In order to be treated as a partnership, an LLC must have at least two members. An S corporation can have one shareholder. Although all states allow single member LLCs, the business is not permitted to elect partnership classification for federal tax purposes. The business files Schedule C as a sole proprietor unless it elects to file as a corporation.

Moreover, some states do not tax partnerships but do tax limited liability companies.

Minority discounts for estate planning purposes may be lower in a limited liability company than a corporation. Since LLCs are easier to dissolve, there is greater access to the business assets. Some experts believe that limited liability company discounts may only be 15% compared to 25% to 40% for a closely-held corporation.

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Conversion of an existing business to limited liability company status could result in tax recognition on appreciated assets.

Privately held companies have several advantages over publicly traded companies. A privately held company has no requirement to publicly disclose much, if any financial information; such information could be useful to competitors. For example, publicly traded companies in the United States are required by the SEC to submit an annual Form 10-K containing a comprehensive detail of a company's performance. Privately held companies do not file form 10-Ks; they leak less information to competitors, and they tend to be under less pressure to meet quarterly projections for sales and profits.

Publicly traded companies are also required to spend more for certified public accountants and other bureaucratic paperwork required of all publicly traded companies under government regulations. For example, the Sarbanes-Oxley Act in the United States does not apply to privately held companies. The money and income of the owners remains relatively unknown by the public.

Public companies must meet stringent reporting requirements set out by the Securities and Exchange Commission (SEC), including the public disclosure of financial statements and annual 10-k reports discussing the state of the company. Each stock exchange also has specific financial and reporting guidelines that govern whether a stock is allowed to be listed for trading.

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Furthermore, unlike sole proprietorships or partnerships, companies have continuity of succession, as it is unaffected by the death or incapacity of one or more of its members.

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3.0 Case Study of Optimax Malaysia

The acquisition of Optimax, a franchise from United Kingdom, represents a strategic move by the Group to diversify into the fast developing Malaysian health sector. It was established in Kuala Lumpur in 1995, offering one of the most advanced laser treatments for permanently correcting the need for glasses and contact lenses. Optimax Malaysia was started with technical and medical expertise from Optimax UK - United Kingdom's Largest Provider of Laser Eye Treatment. OPTIMAX Eye Specialist is Malaysias recognized pioneer in the eye care industry in laser refractive surgery. Optimax is also the first eye specialist centre and the only one in Malaysia to establish strategic alliance with Hospital Universiti Kebangsaan Malaysia (HUKM). They are offering refractive surgery helping people reduce their dependency on corrective lenses. OPTIMAX became the first and only Eye Specialist Centre to be awarded the prestigious ISO 9001:2000 Certificate for Refractive Surgery in July 2001. To date, OPTIMAX is still the only Eye Specialist Centre to carry this certification, further reinforcing our commitment to provide only the highest quality service for all.

Optimax has invested over RM21 million in equipments and technology to date. It will continue to upgrade its technology offering and has put a lot of focus in Research & Development to offer the latest eye treatment technology to its patients. Beginning with only 1 doctor, it has now expanded with 10 panel doctors in listing, more than 20 optometrists and a team of extensively trained laser engineers and technicians. Today, they have one of the largest networks in the region with 12 OPTIMAX branches in Page 23 of 36

Malaysia and 1 in Singapore. They continue to produce excellent result, and manage a portfolio of 80,000 and growing satisfied customers with latest technology. We have been serving the Shah Alam, Subang and Klang communities for many years and felt it was the right time to move to a bigger facility to serve the growing population, said Optimax Eye Specialist Centre managing director Datuk Tan Boon Hock when he gave his speech in the opening ceremony of a new center at Dataran Otomobil in Seksyen 15, Shah Alam recently. We feel that our new facility, which is equipped with a more comprehensive range of equipment andtreatments benefits that our customers will welcome, he said. When it comes to vision care, people expect the best. Over the years, we have invested close to RM22 million in the latest ophthalmic equipment and facility to help customers improve their vision and quality of life, he said adding that the centre has over 80,000 satisfied patients. Maintaining good vision is important these days especially since we are in the digital age where a lot of reading is done from a screen mobile, smart phone or computer. The added environmental stresses such as pollution, the drying air-conditioning and heat can make our eyes very tired, said Tan.

In the year of 2007, Optimax Eye Specialist Centre has been recognized in the "Grammy Awards" for branding -The BrandLaurette Award for best brands in Health Care Eye Care .

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The Asia Pacific Brands Foundation (APBF), which initiated 'The BrandLaureate Awards program implemented 'The BrandLaureate - SMEs Chapter Award. Taking cognizance of the important role that SMEs (Small and Medium Enterprises) contribute to the development of the nation and that of brand building, the Award recognizes the best brands in the SMEs industry in Malaysia.

Optimax is proud that they have been honoured with The BrandLaurette Chapter Awards as the best in Health Care Eye Care 2007. They are humbled by the recognition that the SME community has bestowed and endeavour to continue with our achievements in eye care.

Acknowledged as the most prestigious annual business award, the Golden Bull Award honours the best of SMEs in Malaysia by giving them recognition for their successes and achievements. Presented by Nanyang Siang Pau, the award aims to provide an effective platform to benchmark successful SMEs and to encourage more SMEs to strive for excellence in today's ever-changing competitive globalised marketplace.

Optimax is proud to announce that they have been awarded the Golden Bull Award for the second year since 2003. From, inspirational flashes of brilliance to the relentless day-to-day pursuit of operational excellence, Optimax has excelled in its field with exemplary creativity and are rightly acclaimed as one of Malaysia's top achieving SMEs. With competition at maximum, Optimax has shown it continues to pioneer the eye refractive industry, as it has been chosen from the 92% of all business establishments in Malaysia.

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Optimax leverages its optics manufacturing technology for programs that benefit mankind. They have created innovative manufacturing methods and corporate culture that enable faster production of precision optics. Even with many years of experience providing production optics, Optimax remains dedicated to small volume, high quality, quick delivery.

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4.0 Competitive Edge of Optimax

Optimax Malaysia is a quality laser surgery specialist. It is Malaysias pioneer eye care specialist since 1995. Over 80,000 satisfied patients .It provides wide treatment variety ,such as Lasik, All-Laser-Lasik, Epi-Lasik & Lasek. Optimax Malaysia also is a complete eye clinic equipped with advanced facilities, offering superior ophthalmology solutions for patients with eye or vision problems.

OPTIMAX Eye Specialist Centre is the only first eye lasik centre in the country and the only eye specialist center awarded the ISO 9001-2000 certificate on refractive surgery in Malaysia. The renowned advanced eye laser treatments at Optimax has improved visions for thousands of Malaysians and enabled them to eliminate dependency on glasses and contact lenses. To date, Optimax has successfully conducted corrective procedures on more than 70,000 patients in line with its vision World without glasses and contact lenses .

Optimax Eye Specialist Centre has the largest network and currently operates 14 branches throughout Malaysia, Singapore and Brunei with nine resident consultant ophthalmologists and more than 20 optometrists. Besides Malaysia, Optimax has expanded its outlets to Singapore (2 outlets) & Brunei (1 outlet).

They provide comprehensive eye care services and utilize the latest technology to achieve the best possible results for their patients. Ophthalmologists , optometrists and Laser Engineers in Optimax have been providing top-quality care for Malaysia and Page 27 of 36

Singapore country for more than 5 years. Compared with their competitors, Optimax is better because for the same surgery, their price is cheaper by few thousand and their toll free number receptionist is patience and professional.

Moreover, Optimax has initiated The Optimax Foundation which undertakes the Charity Eye Screening project for the underprivileged where a team of consultant opthalmologists will provide free eye screening and consultation for common eye diseases. On top of that, Optimax also works with NGOs like the Taiwan Buddhist Tzu Chi Foundation Malaysia, Ti-Ratana, Jabatan Kebajikan Masyarakat Malaysia and Cempaka Buddhist Logde to provide the same free services.

Furthermore , its easier for everyone to enjoy the freedom of clear vision with hassle-free 0% Easy Payment installment up to 24 months from OPTIMAX. While Optimax offers these conveniences to their customers, they have many advantages for the customers too.

For examples, a laser consultation is free of charge, however a small refundable deposit is required to secure the appointment. The cost of treatment includes Astigmatism and Lifetime Aftercare.Caring for the customers' needs is part of Optimaxs commitment. With 24 hours careline, each customer has access to assistance with a range of issues. Things like room comfort, personal items, and help with medical issues are only a phone call away.

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5.0 Conclusion
Small businesses that are growing successfully are innovating, changing and evolving continuously through innovation processes that are essentially communication activities. Their owners require the ability to think on their feet and communicate change in a meaningful way.

Micro and small or medium-sized enterprises (SMEs) make important contributions to development. The growth of a healthy, competitive SME sector will be maximised when there is a strong enterprise culture in the society at all levels; a continuous growth in the quality stock of independent business; maximum potential for growth of existing small businesses: and a highly supportive economic, social and stakeholder environment.

Micro, small and medium-scale enterprises (SMEs) make important contributions to economic and social development. In all economies they constitute the vast majority of business establishments, are usually responsible for the majority of jobs created and account for one third to two thirds of the turnover of the private sector. In many countries they have been the major engine of growth in employment and output over the last two decades. In developing countries they are seen as a major self-help instrument for poverty eradication. In transition economies, the main target countries of this publication, they provide the best illustration of the changes in ownership structures, business culture and entrepreneurial behaviour over the past decade.

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In all economies, many micro businesses and self-employed persons operate outside the formal sector. One of the major challenges to governments in designing institutional, organisational and regulatory frameworks is therefore to encourage entrepreneurs to engage in legitimate activity. In pursuing this goal, governments have moved away from earlier, rather simplistic, approaches, recognising that SMEs not only create jobs but play a wider role in social, economic and political development. They are increasingly seen as central to creating a democratic society and developing an enterprise culture. Moreover, small businesses created the most new jobs in communities, Small firms created the most new jobs and perhaps the greatest generator of interest in entrepreneurship and small business is the widely held belief that small businesses in the United States create most new jobs. Small businesses indeed create a substantial majority of net new jobs in an average year. Local businesses provide competition to each other and also challenge corporate giants. Governments alone cannot create that enterprise culture, but their actions can destroy or facilitate it.A major difficulty is that the SME sector is always highly differentiated and that its power base, if any, is essentially local. This makes a coherent public policy approach to SME needs difficult. The aim must be to empower bottom up approaches to development within a national framework in a way that rewards and enhances enterprise culture, because in all societies the independent owner managed small business is the organisational norm for economic activity.\

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A small business can be started at a very low cost and on a part-time basis. Small business is also well suited to internet marketing because it can easily serve specialized niches, something that would have been more difficult prior to the internet revolution which began in the late 1990s. Adapting to change is crucial in business and particularly small business; it is typically easier to respond to the marketplace quickly. Small business proprietors tend to be intimate with their customers and clients which results in greater accountability and maturity. Independence is another advantage of owning a small business. One survey of small business owners showed that 38% of those who left their jobs at other companies said their main reason for leaving was that they wanted to be their own bosses. Freedom to operate independently is a reward for small business owners. In addition, many people desire to make their own decisions, take their own risks, and reap the rewards of their efforts. Small business owners have the satisfaction of making their own decisions within the constraints imposed by economic and other environmental factors. However, entrepreneurs have to work very long hours and understand that ultimately their customers are their bosses.

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6.0 REFERENCES
1. Burnett, H 2003, The influence of communication on the success of micro and small business: a case study, AGSE, Swinburne University of Technology, Hawthorn Victoria, Australia.

2. Churchill, NC and Lewis, VL 1983, The five stages of small business growth, Harvard Business Review, vol. 61, no. 3, pp. 30-50.

3. Zellner, W 2000, 'The 21st century corporation: the creative economy', Business Week, 21-28 August, pp. 72-74.

4. Australian Bureau of Statistics 2001, Characteristics of Small Business, Cat. no. 8127.0, ABS, Canberra, Australia.

5. Optimax Eye Specialist | Eye Specialist - Malaysia Cataract Lasik [online database] ,http://www.optimax2u.com

6. Your Laser Eye Surgery Patient Results Forecast [online database], http://www.optimax.co.uk/your_results_forecast.aspx

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CODE:BBA 1004 SMALL BUSINESS MANAGEMENT

COURSEWORK

NAME NRIC STUDENT ID H/P NUMBER EMAIL ADD.

: CHOOI WAI KUAN : 910227-14-5486 : 201126 : +60176568281 : yenny_j@kimo.com

NAME OF LECTURER: MR CHONG KAR YUN ZONE NO : A 074

NOVEMBER SEMESTER 2011

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1. What does IPO list for which a patent cannot be granted?

a) A scientific or mathematical discovery ,theory or method b) A literary ,dramatic ,musical or artistic work c) A way of performing a mental act ,playing a game or doing business d) The presentation of information ,or some computer programs e) An animal or plant variety f) A method of medical treatment or diagnosis g) Anything that is against public policy or morality

2. Please list out ten barriers to creativity.

a) The fallacy that there is only one correct solution to a problem b) The fallacy that logic is important in creativity. c) The tendency to be practical d) The tendency to follow established rules unquestioningly e) The tendency to avoid ambiguity in viewing a situation f) The tendency to assign blame for failure g) The unwillingness to recognise the creative power of play h) The tendency to think too narrowly and with too much focus i) The unwillingness to think unconventionally because of the fear of appearing foolish j) The lack of belief that you can be creative

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3. Burke and Logsdon argue that there are sound business reasons for following a strong CSR policy and organizations can expect six strategic outcomes. Please describe those six strategic outcomes.

a)

Enhanced customer loyalty:Certainly a strong CSR profile can reinforce and enhance brand image .Customers are increasingly drawn to brands with a strong CSR profile and CSR has become an element in the continuous process of trying to differentiate one company from another.

b)

Increased future purchases: Whilst any productmust first satisfy the customers key buying criteria-quality, price etc.A strong CSR brand can incease sales and can damage sales quite severely.

c)

Reduced operating costs:Manay environmental initiatives can reduce costs e.g. reducing waste and recycling ,having better control of building temperatures or reducing use of agrochemicals.Many social initiatives can increase employee motivation and cut absenteeism and staff turnover,and an increasing number of graduate take CSR issues into consideration when making employment decisions.

d)

Improved new product development :Focus on CSR issues can lead to new product opportunities .Innovation linked to sustainability often has major systems-level implications ,demanding a holistic and integrated approach to innovation management.

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e)

Access to new markets:A strong CSR brand can create its own market niche for an organization.

f)

Productivity gains :Actions to improve working conditions ,lessen environmental impact or increase employee involvement in decisionmaking can improve productivity.

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