Entrepreneurship in Business

This report discusses the challenges faced by a company while launching a new product in the market. It focuses on the innovation of a new ceramic tile and covers topics such as market research, operational requirements, costing and pricing strategies, financial forecasting, and contingency plan. The report also provides insights into the owner's experience and background, as well as the products of the new venture.

ENTREPRENEURSHIP
IN BUSINESS

EXECUTIVE SUMMARY
A company needs to face a number of difficulties while launching a new product in market.
In the following report company deals with ceramic products and is innovating a new tile. This
tile requires a number or technologically advanced procedures to be followed. With the help of
this company can increase its revenues and profits. Market research is conducted by company in
order to understand and construct all the strategies required by company to prepare. The costing,
pricing, operational requirement etc. will help company in achieving its goals and objectives.

Table of Contents
EXECUTIVE SUMMARY.............................................................................................................2
INTRODUCTION...........................................................................................................................4
OWNER’S EXPERIENCE AND BACKGROUND.......................................................................4
PRODUCTS OF NEW VENTURE.................................................................................................4
MARKET RESEARCH...................................................................................................................4
OPERATIONAL REQUIREMENT................................................................................................4
COST AND PRICING STRATEGY...............................................................................................4
FINANCIAL FORECASTING.......................................................................................................4
CONTINGENCY PLAN AND EXIT STRATEGY........................................................................4
CONCLUSION................................................................................................................................4
REFRENCES...................................................................................................................................4

INTRODUCTION
Daniel Platt Ltd is 170 years old company manufacturing natural clay floor tiles. The company is
highly competitive and has been innovating a number of tiles since its existence. This company
tries to make their innovations real as well as defective. They have plenty of engineers who are
capable enough to bring in new products for the company. In the following report Daniel Platt
Ltd is proposing new potential product which is non-destructive, antibacterial tiles (Jones and
Sakong, 2020). The company is proposing this to their investors in order to secure funds from
them for their new venture.
OWNER’S EXPERIENCE AND BACKGROUND
This is a private limited company with share capital situated in United Kingdom. The
company started trading from 2002 in the British market. Major business activity followed by
these companies manufacturing of tiles and flags. Eugene Groeger, David Smart and Colin Potts
are the directors of company. All its directors are British citizens.
PRODUCTS OF NEW VENTURE
Through this new business venture by company the company is innovating a new ceramic
tile. This is a high-quality tiles which has many features such as non-destructive, anti-bacterial
coatings, anti-starch and self-cleaning. This is the first of its type ever to be launched in the
market. Companies using a norm in which all these features will be present in a single tile.
Although there are a number of innovative tiles already introduced in the market but no other
tiles have all these qualities at once. With the help of these tiles company can easily gain a large
customer base and increase its revenue as well as profit. This innovation will also help
companies to grow in foreign markets.
MARKET RESEARCH
Company conducted PESTLE analysis on the industry in order to research about all the
factors that have an effect over business functioning and operations. It is also a kind of secondary
research.
Political factors: The political factors which may affect the company include trade regulations
and tariff is related to Raw Material, risk of military invasion, mandatory employee benefits,
taxation, pricing regulations, favoured trading partners and many more.

Economic factors: economic factors which might affect functioning of Daniel Platt Ltd.’s new
venture is Government intervention in the market, exchange rates as well as stability of the
currency, infrastructure quality, inflation rates in the economy, interest rates, economic growth
rate of economy, labour cost and productivity of employs and so on.
Social factors: There are many such factors in the society which have various effects on
functioning of a business. The factors in society which affect this new venture our demographics
of the population, structural hierarchies and power structure in the society, culture, education
level of the society, the changes in perception of customers, attitudes and so on.
Technological factors: It is important for every business in an industry to make sure that they
are up to date with all the new technologies knowledge in market. For this new venture the
technological factors needed to be taken care of our impact of technology on product offering,
technological diffusion, value chain structure affected by new innovation and so on (Kickul and
Lyons, 2020).
Environmental factors: The environmental factor affecting our business is different from market
to market or environmental standards which are set up a different nations or different areas. In
order to start a business in ceramic industry the environmental factors need to be analyzed by any
company are climatic changes, laws regarding pollution, recycling, waste management,
regulation of air and water and so on.
Legal Factors: Actors are all the factors which are introduced by government. In order to
produce tiles in market following are the laws which Daniel Black Ltd need to follow,
discrimination know, data protection law, employment law, health and safety law, copyrights,
patents, consumer protection and e-commerce.
OPERATIONAL REQUIREMENT
Every company to operate leads a number of establishments in order to produce its product.
There are many requirements in order to produce this tile too. In order to maintain a balance in
the organisation company needs both tangible as well as intangible requirements. It is a
possibility of management To keep on doing continuous research as well as analysis in order to
understand the trends in market and set up its requirements for the company. While venturing
into a new market company needs to identify all the resources which are required to run a
business. The tangible as well as in tangible resources which will be required in order to produce
these tiles are mentioned below:

Tangible requirements: tangible requirements all those resources which can be seen in the
physical form such as raw materials, inventory, buildings, machinery, furniture etc. The tangible
resources help to attract customers. They can basically be described as eye-catching (Hong,
2020). For the production of the styles the tangible resources which are required by the company
includes human resource, financial resources, physical resources such as building, factory,
machineries, raw materials, tools, transportation vehicles etc.
Intangible requirements: Intangible resources consist of call those assets for a company which
are not existing in its physical form. These may include goodwill, franchisee, brand image,
copyrights, trademark, patents and so on. The customers are attracted towards the company with
the help of these resources through the quality, innovation etc. For the innovation of the tiles
with the company would require intangible resources such as trademark, patent rights in order to
make sure that the process and technology used to produce these tiles cannot be copied by any of
its competitors.
Legal requirements: Company working in the industry requires to follow a number of legal
norms and laws. Some of these are set up by the government of the country itself. The others are
requirements of the industry in which the company operates. For the production of the tiles
company requires to follow a number of laws which are introduced by govt. of UK and UN.
Special norms to be followed by this company is EN 14411. It contains all the requirements
which include good practice, cleaning, maintenance recommendations as well as guidance which
ensure the appearance of the tiles.
COST AND PRICING STRATEGY
Costing Strategy: A perfect cost strategy which is accepted by any company is the one which
provides high-quality and make sure that the cost at which the product is developed by the
company is lowest (Kolb, 2020). For the tiles Daniel Platt Ltd is using low-cost strategy by
making sure that they use the raw materials which can easily be attained by company and they
also don’t need to deal with any quality issues. For this the company has to choose between a
range of suppliers available to it. In order to attain this strategy company also focuses on
economies of scale.
Pricing Strategy: Pricing strategy is the method through which company decides prices of the
product and services provided by them. In order to decide on the price various factors such as
production cost, labour, advertising expenses etc are taken into consideration.Daniel Platt Ltd is

using premium pricing as the strategy for its new venture. The company is providing a product
which no other company can provide in this industry and this product also includes a number of
features which are very new and innovative (Kimball and Lussier, 2020). Due to this the
company is using premium-pricing strategy. Due to the features provided by this product
customers don’t hesitate in paying some more for it.
FINANCIAL FORECASTING
Pre-launch cash budget
Cash Flow budget
Particulars Jan Feb Mar Apr May June July
Cash inflows
Investment 10000
Credit sales 3000 3000 3000 4500 1500 3500 4200
Total inflows 13000 3000 3000 4500 1500 3500 4200
Cash outflows
Fixed: Equipment’s 2000 2500 1500 2000 1200 1500 800
Variable: Direct material 500 300 400 300 150 500 300
Total outflows 2500 2800 1900 2300 1350 2000 1100
Net cash flow 10500 200 1100 2200 150 1500 3100
Opening balance 0 7700 7900 9200 11400 11500 13000
closing balance 7700 7900 9000 11400 11550 13000 16100
August Septembr October Novembr December Jan Feb
1000 2000 800 1200 1500 2600 3000
1000 2000 800 1200 1500 2600 3000

200 300 100 600 300 2000 2500
400 500 100 100 400 300 300
600 800 200 700 700 2300 2800
400 1200 600 500 800 300 200
16100 16500 17700 18300 18800 19600 20900
16500 17700 18300 18800 19600 19900 21100
Mar Apr May June July
3000 4500 1500 4500 7200
5000 4500 1500 3500 4200
1500 2000 1200 1500 800
200 300 150 500 300
1700 2300 1350 2000 1100
3300 2200 150 1500 3100
21100 22400 24600 24750 16250
24400 24600 24750 26250 19350
Post launch cash budget
Particulars Jan Feb Mar Apr May June July

Cash inflows
Investment 11000
Credit sales 1200 2000 8500 3000 5000 6500 1200
Total inflows 12200 2000 8500 3000 5000 6500 1200
Cash outflows
Fixed : Equipment’s 2500 1000 1500 2000 2100 1600 1300
Variable : Direct material 3500 300 250 100 100 500 100
Total outflows 6000 1300 1750 2100 2200 2100 1400
Net cash flow 6200 700 6750 900 2800 4400 -200
Opening balance 0 6350 5850 11600 11950 15750 20250
closing balance 6350 5650 12600 12500 14750 20150 20050
August September October November December Jan Feb Mar
3200 2500 8200 1250 3210
120
0 5000 2500
3200 2500 8200 1250 3210
120
0 5000 2500
600 600 500 3000 500
600
0 2500 1500
150 450 450 1500 500
300
0 300 200
750 1050 950 4500 1000
900
0 2800 1700
2450 1450 7250 -3250 2210 - 2200 800

780
0
19750 22100 22650 30100 28850
308
60
3216
0
3236
0
22200 23550 29900 26850 31060
230
60
3436
0
3316
0
Apr May June July
4500 3500 3500 4200
4500 1500 3500 4200
2000 2500 3000 400
250 360 250 700
2250 2860 3250 1100
2250 -1360 250 3100
33660 35860 36010 37510
35910 34500 36260 40610
From the budget given above it could be concluded that setting up this new venture is
profitable for business. This budget makes it clear that company will have liquidity while
manufacturing this product. It is therefore a good option for business to venture into this market.
In this cash situation and budget in the company for both pre-launch as well as post launch can
be seen.
CONTINGENCY PLAN AND EXIT STRATEGY
Contingency Plan: A contingency plan is a plan which is designed in order to take care of all the
possible future events what circumstances which can have a negative effect on the company. The

contingency plan derived for the new venture by the company consist of disaster management,
environment management, infrastructure and facilities, talent management of employs, any
political instability which may affect the supply chain in the country or region, plans for any
trade war which may result in decreased revenue, any price war arising in future, Plans regarding
any loss of major partners such as suppliers and so on (Discua Cruz, Hamilton and Jack, 2020).
Exit Strategy: Exit strategy is also a contingency plan itself which are taken in action by a
trader or a venture capitalist in order to dispose of or liquidate all the financial assets as well as
the business assets in a manner which is already pre-determined. The best exit strategy which can
be adopted by Daniel Black Ltd is management buyout. In this strategy all the resources and
assets of the company are combined together. All these resources are then liquidated by the
management of the company. The advantage of this exit strategy is that the business will remain
with the shareholders itself and they can use the profits and rewards of the efforts made by them
towards the business. The disadvantage of this exit strategy is that the securing of assets may
take months as well as years. It requires immediate debt repayment as well as a lot of cost cutting
in order to make sure that this exit strategy reaps profit for the company which is very difficult
for any management team to execute.
CONCLUSION
From the following report it can be concluded how can company set up a new venture with a
new product. It also explains all the strategies and functions which are required by the company
to follow in order to make its product a success. There is also financial plan for company made
which ensures there will be no losses faced by company in near future.

REFRENCES
Books and Journals-
Jones, L.P. and Sakong, I., 2020. Government, business, and entrepreneurship in economic
development: The Korean case. Brill.
Kickul, J. and Lyons, T.S., 2020. Understanding social entrepreneurship: The relentless pursuit
of mission
in an ever-changing world. Routledge.
Hong, J., 2020. The financing of alliance entrepreneurship. Journal of Business Venturing. 35(1).
Kolb, B., 2020. Entrepreneurship for the creative and cultural industries. Routledge.
Discua Cruz, A., Hamilton, E. and Jack, S.L., 2020. Understanding entrepreneurial opportunities
through
metaphors: a narrative approach to theorizing family entrepreneurship.
Kimball, D.C. and Lussier, R.N., 2020. Entrepreneurship Skills for New Ventures. Routledge.