All businesses, whatever the scale, need resources to operate. Business resources or factors of production allow organizations to create outputs, whether these are products or services. Resources are important because it allows businesses to achieve their target objectives. Having a clear picture of your business resources makes planning and management much more efficient and transparent.
The four main types of small business resources are:
In this article, learn about the four types of small business resources. We’ll give you a brief overview of how you can manage these resources to scale your business.
To put it simply, business resources are an organizations ‘inputs’ or ‘assets’ that are used to produce an outcome, whether it’s a product or service. Assets can either be tangible or intangible. Tangible assets include finances, human assets, equipment, real estate, tools, and machinery. Intangible assets include technology, patents, partnerships, databases, software, skills, culture, and expertise.
Businesses need to build strategies to manage and balance available resources to achieve an objective. Business resources are considered valuable if it ensures a better customer experience compared to competitors. Availability, depreciation, and appropriability also make resources more valuable for a business.
Businesses need assets and resources to produce an output. True enough. Business resources are considered the “basic building blocks” of a company.
Having a clear picture of your business resources will give you an overview of all the processes that make up your operations. This will help you optimize planning and management strategies to build your brand.
Compared to large businesses, a small business is privately-owned, a sole proprietorship, or a partnership. Generally, small businesses have fewer human resources, fewer financial assets, and less annual revenue.
To give you a better idea, these are the key differences between small vs. large businesses:
These are the four types of resources that are critical for business growth.
Financial assets are used by businesses to buy raw materials and pay salaries. To put it simply, financial resources are the funding a company uses to spend.
Types of funding include cash and bank assets, venture capital, shares, checks, promissory notes, and checks that can be converted into cash.
Effective financial resource management is critical to achieving a business’ target objectives. In case of a shortage of financial business resources, operations of the business are halted.
Sources of financial assets include:
Material business resources are physical or tangible assets that are used to produce an output or improve performance.
Material assets are constantly subject to change and innovation as technology progresses.
Important material assets include:
Employees and their skills are critical assets to an organization. Humans are considered the foundation of a successful business, regardless of company size. Because of this, human resource management is considered one of the most important sectors in a business.
Human resources in businesses are responsible for recruiting, screening, and training job applicants that will help the organization achieve its goals. Human resource management also deals with company culture, knowledge, skills, and expertise.
Aside from maximizing employee productivity through training and development, the HR department is critical for employee well-being by administering employee benefits and compensation.
Intellectual resources are intangible assets. This means that they can’t be seen or touched. Unlike material resources, intellectual resources appreciate with use. It is developed through learning and coaching. Intangible assets include copyrights, partnerships, patents, brands, and intellectual properties. These also include customer knowledge, product reputation, customer service reputation, and brand reputation. Intellectual business resources also include technologies that make business operations easier and more streamlined. These include softwares and customer databases.
Whether you run a small or large business, shipping and logistics services are critical to growing a business. The supply chain is a network of businesses that produce and distribute goods. It involves all four main types of business resources that need careful management for streamlined operations.
Logistics involves warehousing and transportation, but many small businesses don’t have enough resources to improve their logistics operations. Thankfully, there are companies that offer logistics resources to small businesses at an affordable price. Now, the only problem is how to find the best logistics partners to work with.
Researching freight services and logistics partners can be complicated. Aside from contacting each company, you also need to engage in tough negotiation battles before comparing prices.
Small to medium-sized business owners should use an online freight shipping marketplace to find affordable and reliable truckload and less-than-truckload freight shipping services.
GoShip.com is a self-service platform that makes it easy to find and work with domestic freight carriers. There’s no need to talk with a freight broker and negotiate prices.
All you have to do is enter your shipping information, and you’ll get a free instant quotation. GoShip.com also offers easy booking and reliable customer support for small businesses.