Entrepreneurial Opportunity - Assignment Solution

Entrepreneurial Opportunity

Table of Contents
INTRODUCTION...........................................................................................................................1
2. Entrepreneurial themes............................................................................................................3
3. Business idea development ....................................................................................................4
Conclusion.......................................................................................................................................7

INTRODUCTION
Our business idea is to clean whether we are doing housecleaning, janitorial work, or
providing any cleaning service, we clean like we are cleaning our own house or office. For every
function our business create systems like; laundry, cleaning, customer services, customer
complaints, management and accounting. Our aim is to build strong relationship with our clients,
as the quality of our cleaning is important.
Recently our company has launched a new product for cleaning hotels, homes etc. to
clean windows, floors, carpets etc. The new product is Backpack Vacuums. Backpack Vacuums
are lightweight and are designed with an emphasis on ergonomics. Its wand and hose
characteristic help to reduce stress on user's wrist. Backpack Vacuums can weight less than 10
pounds, and it reduces the time and efforts needed to vacuum. Following are the reasons to use
Backpack Vacuums: in an hour we can clean almost 2875 sqft of floor, they are more efficient
while cleaning, they reduce cost, they have more health benefits. Over the years these vacuums
have improved a lot, including battery power, HEPA filtration technologies and overall user
comfort by reducing its size and weight. Backpack Vacuums are gaining popularity because of
the flexibility and maneuverability. It cleans carpets, stairwells, air ducts, walls, under furniture
or behind book selves.
Our uniqueness is that we focus on customer's health, its 10 quart super HEPA converts
the vacuum into on air blower which allows user's to clean their house in less time. Its 7 piece
sidewinder tool kit cleans under furniture or corners. The ergonomic side-to-side sweeping
action and various tools with storage improves operator productivity. It is great for use in
schools, hotels, gyms, buildings, hospitals and also traffic areas. Its practical design and it
compact size by which it can be converted into a canister vacuum by fitting a kit of 4 pivoting
wheels which suck up dust and dirt, usually from floors, and from other surfaces such as
upholstery and draperies (Brunette, 2017)..
Our company is targeting two primary target market groups: one is consumer and other is
commercial. Consumer group consist of residential services, with carpets cleaners, window
cleaning, and other cleaning services. The commercial arena includes janitorial services, with
cleaning companies, such as carpets and window cleaning that target businesses rather than
individual consumers. Our company provide wide range of services to a very limited clients. Our
1

company have refined our customer base to a group so that we can serve them better which allow
us to maintain those customers permanently (Vellas, 2016).
To give a strong value proposition to or product we follow a pricing structure considering
these factors:-
 Labour and material: for value of our product we need to estimate the costs of labour and
materials. Labour cost includes wages and benefits we pay to our employees. It is usually
explicit in an hourly basis.
 Overhead :overhead cost includes all the indirect expenses and non labour expenses for
operating business (Derudder and Witlox, 2016). . It is calculated on the basis of
percentage f our labour and materials. Total expenses for a year excluding labour and
materials.
 Profit : it is the difference between total cost of services we provided and what we actual
charge to the customers. It is estimated by applying a percentage of profit factor which
combines cost of labour, material and overhead.
Our business conducted market analysis which includes our costs to serve that market. A densely
populated market allows us to serve a greater number of customers. Our company build a very
successful cleaning business on referrals. Our customers live in a dual income household with
combined earnings. (Mwesiumo, Halpern and Buvik, 2017). These families have enough income
for spending for services. The second segment is targeted is two income family. Over years, the
number of two income households have increased and their annual income is $125'000. These
families don't have the time to clean, can afford a cleaning service and choose to hire a service
because they don't waste time cleaning their house as their opportunity costs are too high. Their
age is 32 to 35 and live in $250'000 valued houses. It is this section that has potential for
mother's. According to our research 80% of dual income households use an outside cleaning
service for cleaning their houses.
Our customers seek consistency in delivery from our company. Our team is always
consistent with the release of company information and it helps to gain customer interest in our
product and services (Wang, Weaver and Kwek, 2016).. Our company release information on a
timely basis. We make our customer's services and products unique. These factors help to better
2

sell the customers. Testimonials are the best way to reach to the customers. Different markets
adopt different strategies, knowing our customers needs, wants and demands will make the
relationship more effective. This can establish a trust between the company and our customers.
To know what our customers want our company understand our customer's range of
choices. Our company send our customer team to meet customers and develop understanding of
how to serve them better (Laws, 2015). . Our company focus on what customer will want in
future and try to improve our products and services accordingly. Our company get to our
customers on call regularly and encourage them to share their thoughts. All our company need is
to fulfil customers wants is to provide them what they pay for, and create a friendly relationship
with them.
2. Entrepreneurial themes
Entrepreneur is a person who creates his own business venture and takes risk. He founds
and runs a small business. He is an innovator of a business venture. He is a person who organises
risk activity of any kind. He practices initiatives by organising a venture to take benefits of an
opportunity. To create a new venture, entrepreneurs uses 3 types of Entrepreneurial themes i.e.
Opportunity creation, opportunity recognition and opportunity discovery. Entrepreneurial
opportunities are usually defined as situations where products and services can be sold at a price
greater than the cost of their production(Chen, Schuckert and Chon, 2016). To be successful
entrepreneur, it is important to continually develop and oversee for growth opportunities within
the business. There are different ways through which our company can identify opportunities.
Apart from this, one of the best idea for an entrepreneur is to supervise their existing products
and services. For an entrepreneur it is important to collect funds from vrious sources available in
market.
Opportunity recognition, refers to individuals who look at the same situation differently
as everyone. Opportunity recognition theme thinks outside the box and stretch the limits.
Successful entrepreneurs are opportunity recognizer. I recognised that it is a good opportunity to
sell backpack vacuum to dual income households (Alegre, and Sard, 2015).. Opportunity
recogniser look at the situations as a bigger picture which allow them to turn their idea into
reality. Moreover, our venture recognised that customers want what they pay for, for this we try
our best to give them timely customer services, improved quality product and better pricing.
3

Listening to our clients and past customers, listening to their needs, wants and challenges,
looking at the competitors, overseeing industry trends, all these activities help to identify
opportunities.
Opportunity discovery is the process of converting problems into future solutions. Our
company take these issues as an opportunity to create new business or to create a new idea.
Opportunity discovery or opportunity identification consist of skills like technical, financial
analysis and market research. Or company discover some opportunities about how our business
will operate (Chen, Schuckert and Chon, 2016).. After market research, one of the opportunity
our company discovered is to make more better cleaning equipments for restrooms, malls, hotels,
etc. Another opportunity our company discovered is to offer gift vouchers, free coupons, etc. to
build better customer relation. Our company will focus more on customer's feedback received
through emails to discover more opportunities of the consumes demand and tools to resolve their
complaints. Our company focuses more on opportunity creation rather than opportunity
discovery. Our company can discover something that already exist.
3. Business idea development
As I have mentioned before that our business idea is to clean every house or office as we
are cleaning our own offices and homes. To develop our idea our business builds a strong
network whether our company is dealing with suppliers, clients, or customers. Making
connections through networking helps our company to grow. Before developing our business
idea, I will conduct a primary research regarding backpack vacuums to know and understand the
customers needs and demands. Our team will collect information through phone calls, online
feedbacks and questionnaires. After gathering the information on customer experiences, our
company will accept all changes from customers and improve our product accordingly.
An operational plan is a process prepared by an organisation which defined actions they
will take to support strategic objectives and plans of upper management. It describes the physical
necessities of our company such as physical location, facilities and equipments. Activities like
how our product or service will be made, identifying the problems that may occur in the
production process are there (Alegre, and Sard, 2015).
The three main important resources required for businesses to run are land, labour and
capital, and other resources are energy, information, management and time. Our company first
4

decides that whether they want to clean residence, businesses or both. Restrooms and offices are
much larger than rooms in houses. We consider all these factors while buying cleaning
equipments. A vacuum cleaner and even a carpet cleaner is necessary for residences or
businesses. Money makes the business grow and it is one of the most important resources
necessary for our business. It includes costs like rent, utilities, taxes, brochures and so on.
Another is human resources, this element in our business helps to achieve business goals. If there
are no human resources there will be no work. Education resources can provide us a better
knowledge of our competitors and make us a better business person. Our company take
advantage of the wealth of information available on the internet as well. Marketing research is
the complete study of consumers, suppliers, competitors, etc.
Our marketing plan and marketing strategy:-
 The first step is identifying our marketing objectives. It takes time to figure out how any
customers our marketing efforts will attract.
 Second step is to focus on the target market. As our service is residential cleaning, then
what type of clients our company would like to market towards, since we can't focus on
everyone at once.
 Third step is to find what customers are interested in, that our company tend to offer.
 Forth step is promoting our product to achieve marketing objectives.
Marketing mix refers to the tools (product, price, place and promotion) which the company used
to target its customers. It helps in influencing the customers to buy their product.
Product
The product is the item that company offer to its customer. The cleaning company has launched
bag pack vacuum which is best in quality with longer duration. The product is having unique
feature : lightweight, durable, convenient to use and it is portable and also consumes very low
electricity.
Place
5

Place refers to how the product will be available to the customers. It describes the channel of
distribution which is most suitable for the product. The company can decide target market on
geographical basis.
Price
Price is the amount paid by the customer for any product or service. The price affects the sale of
the product. Initially the company is charging low price because product is new to the market. By
keeping low price the company can attract more customers which will help in increasing their
sale and initial cost of the product can also be covered.
Promotion
Promotion helps in creating public awareness about the product. Promotion includes
advertisement, schemes, offers, discount which helps in increasing the sale of the product.
Competitors analysis in marketing is identifying the strengths and weaknesses of
potential competitors. By knowing competitors strengths and weaknesses, helps our company as
an opportunity to change accordingly. There are different types of competitors such as direct
competitors who sell the same product and services like we do and indirect competitors sell
substitute products or item that can be used in place of our company's product.
Financial plan is the process of calculating the actual capital required, framing financial
policies, investment of funds required. Financial planning is important to know adequate funds,
helps in ensuring a balance between outflow and inflow of funds to maintain stability, it ensures
that investors of funds are easily investing in our company, reduces uncertainties with regards to
changing market trends, helps in making growth and expansion programmes which helps our
company a long term survival and helps in reducing the uncertainties which can be barrier to
growth of our company.
To create more profit our company will go to supplier and ask them for a better price,
will start talking to our customers about what they expect more from our product after using it as
a result will improve our sales performance Laws, 2015). . Run a customer survey by simply
talking to the existing and past customers, will generate more business, offer discounts, up sells
and cross sells on popular products to increase profit. Expand our reach to bigger market.
6

The break even point represents the sales amount in terms of either unit or revenue. It is a
level at which a business earns exactly no profit and no loss. The break even point is useful in the
following situations: To find out the amount of remaining capacity after the break even point is
reached, which tells you the maximum amount of profit that can be generated, to determine the
change in profit if product prices are changed, to find the amount of losses that could be
sustained if our business suffers a sales downswing.
e breakeven point?
Break Even
Analysis
Amount (£)
Average
Selling Price
27
Variable Cost 8.09
Contribution 18.91
Total Fixed
Cost
45000
BEP (In
Units): Fixed
Cost
/Contribution
2380
Conclusion
From the above discussion, it is concluded that Backpack Vacuums are lightweight and
are designed with an emphasis on ergonomics, Recently our company has launched a new
product for cleaning hotels, homes etc. to clean windows, floors, carpets etc. Our uniqueness is
that we focus on customer's health, its 10 quart super HEPA converts the vacuum into on air
7

blower which allows user's to clean their house in less time consumer group consist of residential
services, with carpets cleaners, window cleaning, and other cleaning services. Labour and
material: for value of our product we need to estimate the costs of labour and materials.
Entrepreneur is a person who creates his own business venture and takes risk. He founds and
runs a small business
8

References
books and journal
Alegre, J. and Sard, M., 2015. When demand drops and prices rise. Tourist packages in the
Balearic Islands during the economic crisis. Tourism Management, 46, pp.375-385.
Brunette, G.W., 2017. CDC Yellow Book 2018: health information for international travel.
Oxford University Press.
Chen, Y., Schuckert, M., Song, H. and Chon, K., 2016. Why can package tours hurt tourists?
Evidence from China’s tourism demand in Hong Kong. Journal of Travel Research, 55(4),
pp.427-439.
Derudder, B. and Witlox, F., 2016. International business travel in the global economy.
Routledge.
Eid, R. and El-Gohary, H., 2015. Muslim tourist perceived value in the hospitality and tourism
industry. Journal of Travel Research, 54(6), pp.774-787
Laws, E., 2015. Health tourism. Health and the International Tourist (Routledge Revivals),
p.199.
Mowforth, M. and Munt, I., 2015. Tourism and sustainability: Development, globalisation and
new tourism in the third world. Routledge.
Mwesiumo, D., Halpern, N. and Buvik, A., 2017. Effect of Detailed Contracts and Partner
Irreplaceability on Interfirm Conflict in Cross-Border Package Tour Operations: Inbound
Tour Operator’s Perspective. Journal of Travel Research, p.0047287517746016.
Ozturk, Y., Allahyari San, R., Okumus, F. and Rahimi, R., 2017. Travel motivations of Iranian
tourists to Turkey and their satisfaction level with all-inclusive package tours. Journal of
Vacation Marketing, p.1356766717725562.
Ozturk, Y., Allahyari San, R., Okumus, F. and Rahimi, R., 2017. Travel motivations of Iranian
tourists to Turkey and their satisfaction level with all-inclusive package tours. Journal of
Vacation Marketing, p.1356766717725562.
Poletto, C., Gomes, M.F., and Vespignani, A., 2014. Assessing the impact of travel restrictions
on international spread of the 2014 West African Ebola epidemic. Euro surveillance: bulletin
9

Europeen sur les maladies transmissibles= European communicable disease bulletin,
19(42).
Vellas, F., 2016. The international marketing of travel and tourism: A strategic approach.
Macmillan International Higher Education.
Wang, Y., Weaver, D.B. and Kwek, A., 2016. Beyond the mass tourism stereotype: power and
empowerment in Chinese tour packages. Journal of Travel Research, 55(6), pp.724-737.
10