The Recommendation Report Briveni

Running Head: BRIVENI 1

The Recommendation Report – Briveni

Student’s Name

Institutional Affiliation

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Briveni

The company

Briveni is a financial institution that is designed to provide accounting and financial

services to business that need expertise in accounting and financial services. In the beginning,

Briveni targeted small-scale businesses that could not afford a full-time accountant to provide

services such as monthly statements reporting and statutory accounting. The company also was

able to advise its clients of statutory requirements needed to conduct business in different states.

Also, they would provide services that would inform business owners their business risk ratios

and financial statements analysis, future forecasts and budgeting for growth and expansion.

Introduction

Just as per any business owner expectation, Briveni business was forecasted to grow.

Therefore, like businessmen who wish to expand and outgrow their limits, planning and

analyzing the prospects is important to the business and the security of clients (Ransom, 2014).

The company started with ten employees who were paid an average salary of CPA's and CFA's.

Their main function was to conduct visits to clients who needed our services across Florida and

neighboring states. We did not need a large space because most of our activities during service

were hosted by the in the clients. But with the current and future growth expectation, it is

inevitable for the company to plan strategies of running the business with a broader width of

clientele.

Location and Analysis

Currently, the company is located in Florida a state which fosters private investment and

economic growth (“Florida Economic Estimating Conference 2017”).In the past two years, the

company has managed to get a large clientele base that has seen the need to increase the number

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of employees to fifty-six. Some of these clients have started to have regular visits to our offices,

which have contributed to gaining more confidence in our services. The reason for this report is

to show you the analysis made on the need to relocate the main offices. The findings suggest

moving it to Missouri based on three critical factors which include skills, cost of living, and

demographics

Reasons for Relocation

Skills

The state of Missouri has a lower skilled workforce than the state of Florida. According

to United States Chamber of Commerce Foundation (2014) ratings, Missouri level of educated

individuals is not broad and efficient. Although Florida has no highly skilled labor workforce,

Missouri is still inferior. For this reason, entrepreneurs in Missouri State would need more

specialized assistance on how to manage their business accounts and finances. A better skilled

labor force in Florida has been promoted through the efficiency of their higher education

standards. The state has provided affordable college education that has led to a better-skilled

workforce in the state. On the other hand, Missouri has not invested much in education, and the

population has no enough skilled workforce to meet the small scale business demand in the

region.

The existence of a lesser skilled population in Missouri provides a better market for our

company. Currently, the Missouri state government is determined to support small business

growth by funding and providing easy capital for startups (Missouri Economic Report 2016). As

more capital is pumped into the state's economy the more the need for professional business

startup consultancy. As a company that provides accounting and financial services for small-

scale businesses, the services will come in handy by providing the small scale businesses with

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guidance relating to financial issues, management, and capital accounting at low costs. The

educated population in Florida would not consider hiring financial accounting services compared

to the population in Missouri. Moreover, the population is skilled enough to handle the difficult

financial decisions and accounting principles that need expertise.

Graph 1. Workforce in Missouri versus in Florida from 2008 to 2016.

Note. Retrieved from Bureau of Labor Statistics: United States Department of Labor. 2017.

The statistics above show the comparison of the number of skilled labor available in Florida vs in

Missouri. It proves there will be high demand for more skilled labor in Missouri with the

increasing growth of small and medium companies.

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Cost of living

The cost of living in Missouri is much lower than the one in Florida. The cost of living in

Florida has been substituted by the low tax rates imposed in the state for businesses to have a

good tax climate. As the state improvises a good business environment, the cost of living

becomes the cost of opportunity. As a result, these costs circulate back to the business making

the business have higher operation costs (United States Chamber of Commerce Foundation,

2014). Unlike in Missouri, the cost of living is low and skilled employees from other states can

be convinced to relocate to the region.

Currently, Missouri is the seventh in the rank of the lowest cost of living state in America

(Missouri Economic and Information Center, 2017). These statistics provide a favorable

condition for employees to survive in. As a company that is looking forward for further

expansion, setting up the main office in Missouri will be a great idea. The chances of convincing

skilled labor workforce from other states to work for our company will be easier. This will

enhance the company’s ability to serve the rising demand of its services in Missouri. See the

graph analysis below.

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Graph 2. Cost of Living in Florida versus in Missouri

Costs in Missouri that are above Florida

Costs in Missouri that are below Florida

Note. Retrieved from PayScale: Human Capital (2017). Cost of living Calculator.

0% is the actual cost of living in Florida (The graph bars compare the cost of living in Florida

versus in Missouri)

Demographics

0% is

the

cost of

living

Florida

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The demographic condition in Missouri provides a good platform for expansion than the

one in Florida. First, Missouri shares the borders with seven other states and is a docked state as

opposed to Florida which shares their border with only two states and the ocean (Missouri

Economic Report, 2016). Therefore setting the main offices in Missouri will provide a centrally

located position to expand in other states efficiently. Moreover, it will save the company legal

costs of cross-border fees to do business in different states.

Demography has been confirmed to spell financial trouble in several cities in America

(“Small Business Administration n.d.”). Florida is one of the states faced by demographic issues

that can affect the financial status of a company (Maciag, 2016). Missouri has a fewer number of

dependents than in Florida Who stretch the economic services thin. A large population in

Missouri depends on themselves and has to work to earn a living. Although the workforce may

be unskilled, it will provide the company with available casual workers to run daily operations at

cheaper costs.

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Graph 3. Rate of Dependency in Florida versus in Missouri from 2008 to 2016..

Note. Retrieved from Bureau of Labor Statistics: United States Department of Labor. 2017.

The graph above proves the dependency rate in Florida is higher than in Missouri over the recent

years.

Challenges

The challenge the company is likely to encounter in moving to Missouri is the

unfavorable tax climate in the state. The encouraging factor is that there is a virtual assumption

that the customer’s turnover expected will set off the excess taxes charged in the state compared

to Florida. Another challenge includes the lack of skilled workforce, which will force the

company to employ workers from other states. The cost of convincing these workers will

increase the costs of operating and hence a disadvantage to the business.(“Small Business

Administration n.d.”).

Conclusion

Conclusively, setting up the main business offices in Missouri will assist the company to

grow to the next level. The state provides enough demand market for our services. It is centrally

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located, which means expanding to other states will be easier and quickly compared to Florida.

In general, the gains outweigh the challenges expected in setting up the main offices in Missouri.

Therefore, shifting the main offices to Missouri is an advised business decision that will help the

growth of the business.

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References

Bureau of Labor Statistics: United States Department of Labor. (2017). Rate of Dependency in

Florida versus in Missouri from 2008 to 2016. (Graph 3) Retrieved from

https://www.bls.gov/home.htm

Bureau of Labor Statistics: United States Department of Labor. (2017). Workforce in Missouri

Versus in Florida from 2008 to 2016. (Graph 1) Retrieved from

https://www.bls.gov/home.htm

Florida Economic Estimating Conference (February 21, 2017). Retrieved from.

http://edr.state.fl.us/Content/conferences/fleconomic/floridaeconomicsummary.pdf

Missouri Economic and Information Center. (2017).Cost of Living First Quarter 2017.

Retrieved from https://www.missourieconomy.org/indicators/cost_of_living/

Maciag, M. (2017). Demographics Can Spell Trouble for a City's Finances. Governing.com.

Retrieved from http://www.governing.com/topics/finance/gov-census-demographics-

cities-fiscal.html

Missouri Economic Report (2016). Missouri Economic Research and Information Center –

Missouri Department of Economic Development. Retrieved from

https://www.missourieconomy.org/pdfs/2016_MO_Economic_Report.pdf

Ransom, D. (2014). America’s Coolest College Startups 2014. Inc. Retrieved from

https://www.inc.com/diana-ransom/coolest-college-startups-2014.html

Small Business Administration. (n.d.). Tips for Choosing Your Business Location. Retrieved

fromhttps://www.sba.gov/starting-business/choose-your-business-location-

equipment/tips-choosing-your-business-location.

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PayScale: Human Capital (2017). Cost of living Calculator. Cost of Living in Florida versus in

Missouri (Gragh 2). Retrieved from http://www.payscale.com/cost-of-living-

calculator/Florida-Missouri

United States Chamber of Commerce Foundation. (2014). Enterprising States Dashboard.

Retrieved from https://www.uschamberfoundation.org/enterprisingstates/map/T/WY/

U.S. Small Business Administration. (n.d).Starting and Managing. Retrieved from

https://www.sba.gov/starting-business/how-start-business/business-types

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