New Business Venture Project

This project examines the feasibility of launching a new business venture focused on bath loungers designed specifically for sports persons. It analyzes the opportunity, value proposition, and business model canvas, addressing challenges and potential solutions. The project also examines funding options and market research strategies for a successful start-up.

NEW BUSINESS VENTURE

Table of Contents
INTRODUCTION...........................................................................................................................1
SECTION 2......................................................................................................................................3
2.1 Opportunity formation - problems........................................................................................3
2.2 Value proposition, its canvas diagram ................................................................................4
2.3 Business model canvas..........................................................................................................5
SECTION 3......................................................................................................................................7
3. Opportunity development for a new start-up..........................................................................7
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................11

INTRODUCTION
Lean start-up can be defined as methodology that helps business to develop their products
and raise profitability of organisation to great extent. This aims to develop a product in shorten
duration and rapidly discover opportunities by proposing viable business model. Most of the
companies adopt suitable strategies and concentrate on hypothesis-driven experimentation in
order to accomplish the goal of firm significantly. Lean start-up method assumes that if
companies invest their amount and time in order to iteratively building products for meeting
needs of consumers then it always aids in reducing market risk. This enhances opportunities for
organisation to get more funds to launch new valuable good and services in market(Schaper and
et.al., 2014).
Lean start up methodology is beneficial in order to minimise wastage and increasing
value producing practices so that enterprise can gain success. It is very important for
organisation that to gather feedback from end users in order to ensure whether investment of
company is viable or not. Most of the companies evaluate their business plans by involving key
performance indicators and other strategies. This makes them able to know actual progress and
analysing continuous development process for achieving business goal.
Entrepreneur is planning to provide bath lounger products to consumers that will be
placed inside baths. This is beneficial for addressing neck and back issues. There are many
competitors such as Careshop etc. which are targeting to elder people. But if entrepreneur targets
the same group of people then it might create issue for the business because it would not be able
to gain attention of mass audience. Thus, business owner is planning to target sports persons
such as rugby players; they would be suitable in order to raise profitability of company. Bath
lounger will not be universals thus, it would emphases on particular market. Bath loungers
includes various products such bath pillows, bath chairs, bath lifts, wave bath etc., all these
provide value to the consumers as these are directly related to comfort, relaxation, hygiene and
most importantly health. Entrepreneur is planning to develop a bath lounger which will be place
in the bathtub to solve the neck and back issues which the people generally complains while
taking bath in the bathtub. Venturer decided with the sport people segment of the market as the
opportunity was there to earn high profits because this segment is prone to the muscle pains
issues. Targetting this market segment will prove beneficial to the entrepreneur stiffness and
tiredness sport people have after their workouts and games, experiencing a good bath along with
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furnished bath loungers will give them the ultimate comfort and pleasure(André, Cho and Laine,
2018).
However, just identifying the opportunity is not enough for the venturer to establish a new
lean start-up, it takes up a lot of research through primary and secondary sources, company's
existing business standings are found out whether it will be able to pull off the new venture
efficiently, will be it be able to generate funds for the new business etc. Opportunity formation
comes with several challenges such as competition in the market, customers specific needs, right
choice of target market, communication style which will be followed by the entrepreneur for
marketing its products, effective value proposition will have to be created in order to create a
value for the produce not the just the price but an impression of consumers that they will have of
products by using them. Customer satisfaction will be the ultimate outcome of the value
proposition of the entrepreneur. The entrepreneur is thinking of offering its product to different
segment for avoiding the clash with the already established firms producing the similar products
in the industry(Schaper, 2016).
Entrepreneur planning stage goes forward towards the opportunity development where
financing of the proposed project is analysed and evaluated. All the resources are analysed for
running the business operations such as location for the stores, online selling channels, human
resources will be done by the venturer. Various alternatives will be identified by the entrepreneur
regarding the available and each of the alternative will be analysed and evaluated and the
alternative with the most cost effective benefits will be choose by the venturer. Entrepreneur will
collect his data from market researches;by conducting the surveys and asking the questions to the
target audience which will assist the new venturer to know what the consumers actually wants
and what the consumers will likely to pay for the product. The door to door survey will help the
entrepreneur know the tendencies of target customers of trying such lifestyle products which also
provide them the health benefits. Different marketing channels will be considered to find out the
most effective way of increasing the sales; retail stores, online selling of the products through
their own website, marketing strategies of maximising the customers' satisfaction in the new
market. Entrepreneur only after such feasible studies will go ahead with the implementation
stage of opening the new venture of producing a new bath lounger product for the new segment
in the market(Khuong and An, , 2016).
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SECTION 2
2.1 Opportunity formation - problems
Opportunity refers to the events or circumstances that makes possible to do something. In
business environment, organisations gets the various opportunities like spreading the business,
introducing new product range, grabbing of more customers and different target audiences, new
technologies, acquiring highly experienced workforce.
However, there are many problems also while forming the opportunities. Opportunity
formation means stimulation of aspirations of the entrepreneurs by considering the economic and
financial conditions supporting the idea of making a new product, or entering into new markets,
changing the target segment in the same markets or changing the markets with the same target
audience(Rhoads, 2016).
Bath lounger, a product that is placed in the bath tubs to solve the neck and back
problems for its customers especially rugby players. The product is useful for the athletes to give
them relaxation during taking the bath. Entrepreneur producing this product is faced with many
problems in making a new venture into the market. Like not all the people uses bath tub for
which this product will be beneficial to them. Customers do not find the product worthy enough
to pay for because of lack of its popularity. Establishing a new venture will come with problem
of lack of trust in the products. Bath lounger is mainly targetted to the sports' persons only which
restricts the possibility of making it renowned brand's product among the masses. Wealth gap
may cause problem for the new venture as the product is for the bath tubs which are expensive
and cannot be afforded by the all in the market.
` Competitive brand Complete Careshop producing similar product can harm the new
venture. However, the competition's target market is elder people whereas the entrepreneurs is
focussed on targetting the sport persons. Although it will not be a cut throat competition for the
entrepreneur as the competitor is dealing in different market. So the operations of Complete
Careshop will not affect the profitability of the bath lounger venture of the entrepreneur. But
ruling out the competition completely is nightmare for the venturer's future. Complete care shop
at any can decide to enter the market of the entrepreneur if it sees the profitability ratio in the
market is high and this can create problems for the new venturer(Wang and et.al., 2017).
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2.2 Value proposition, its canvas diagram
Value proposition is a marketing vision and statement of the new venturer which tells
why the consumers should use its product. It is basically a pact offered by the company to its
market segment. Bath lounger product value proposition should provide how the product will
resolve the neck and back issues of the athletes and tell the target market that why the
entrepreneur's bath lounger is better than its rival firms products. Focussing on the value
proposition when venturing into new business becomes even more important because catching
the attention of the target market and convincing them to try its products is a very big task for
any firm and that too when the product is of luxurious in nature(McKelvey and Zaring, 2018).
The value proposition of the venturer of bath lounger will focus on the benefits the
consumers will derive by using its product, in the sense that how much it will have an impact on
its customers lives.
It can be created by determining the needs of the customers and communicating them in
their voice. This will help in making an effective value proposition for the venture in its business
strategy. It will gain the attention of its market segment by addressing them the benefits
customers expect from the bath lounger product.
Importance of value proposition for the new entrepreneur is such that it will decide the
fate of the new venture. Value proposition will help the venturer to make differential impact
from its competitors. It will grab the right target customers in both quality and quantity wise. It
will help in capturing the large market share than its competitors and will chance the overall
efficiency of the business(Schläger and et.al., 2018).
Value proposition diagram:
Value proposition
customers needs benefits to the customers how differential is the
product from its competitor
 comfort during bathing
 value from the
 will relax the neck and
back pain to the sport
 cheaper than its
competitors
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production
 reasonable price of
bath lounger
 convenient in use
persons
 Will improve the health
issues such as
improvement in the
blood circulation and
relaxation in muscles
pain after games and
practise sessions of the
sport players(Langer
and et.al., 2016).
 the product will be of
high quality and of
superior designs
 Will be easy to use the
product.
Table 1: value proposition
The market segment of the proposed venture is demographic in which the group of
athletes is focussed in the business plan. Entrepreneurs bath lounger products such as bath chairs,
bath lifts, bathtub pillows etc., will make the bathing sessions of the sport players more
comfortable, relaxing and enjoyable. The products will have impact on athletes' health like good
blood circulation, relaxation in the muscles will be a of great value to this particular segment
because they follow rigorous workouts, training and practice sessions which makes their body
stiff and tired so these bath loungers will relax the muscles in their bodies.
2.3 Business model canvas
Business model canvas is considered as strategic tool that helps business in order to
develop new products or improve existing services. There are many big organisations those
which are taking support of this model in order to structure their activities and conducting
operations in tangible manner.
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Key partners Key activities Value proposition Customer relations Customer
segments
 Investors
 Payment
processors
Key suppliers
 Material
suppliers
 Marketing
 Operations
 Product
development &
manufacturing
department
Key resources
 Talented
employees
 Brand
 Technical
resource
 Manufacturing
specialists
 Platform to
make
connection with
sport persons
 Low cost luxury
bathing
equipments
 Conformable
Bath lounger
 Rating system
 Word of mouth
generation
Channels
Facebook, Twitter,
mobile application
Sport
persons
who like
to take
bath
without
having
neck or
back
issue
Cost structure Revenue streams
 Legal fees
 Product
development
cost
 Employee
payroll
 Purchasing
cost
 Sales
 Discount gain
by supplier
 Advertising
sales
Table 2: business canvas model
If company provides bath-lounger product to the sport persons then it would be able to gain more
profit and maintain the competition in market. If business takes support of social networking
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sites and mobile application then it would be beneficial for the firm in order to creating value for
consumers. By this way, it will be able to gain attention of mass audience. Advertisement will
support in increasing sales of the products. Entity will be able to generate sales and revenues,
that would create value for the organization(Vladušić and Lalić, 2015).
Revenue, Cost and Margins calculation
Revenue
Sales £5000
Discounts by supplier £3000
advertising sales £2500
total revenue £10500
Cost
legal fee £800
product development cost £2500
employee payroll £2000
purchasing cost £3500
Total cost £8800
net profit £1700
Break even analyses
total fixed cost 8800
variable cost per unit 100
Sales price per unit2 200
desired profit 200000
BEP 88
SECTION 3
3. Opportunity development for a new start-up
Recognising the opportunities available in the environment is not enough for the
entrepreneur but turning the opportunity formation into the opportunity development is the real
thing for it. Financing is the key of opportunity development for the venturer to open a new
business. Arranging the funds for the start-up is the main task in moving the start-up from paper
to reality. Entrepreneur could arrange funds through various sources such as :
 Retained earnings of the existing business of the entrepreneur could be used for the
expanding the business. These are the profits which are ploughed back in to the business
for expansion and development plans. The entity can use these funds which will be of
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free of cost as this money is not raised from the external source, therefore no interest will
be payable in such financing. This type of financing the venture will decrease the cost of
setting up of a start-up(Gichohi, Onyancha and Dulle, 2017).
 Entrepreneur can raise money through bank loan. This is the easiest way of financing the
proposal. However, it will create a charge on the venturer's assets and will be obliged to
pay interest periodically in addition with principal amount. This source is costlier and is
under the control of banks in case of failure to pay the obligations by the venturer after
starting the operations.
In the event of lack of sufficient resources various alternatives can be used. Some alternatives are
given below:
 Crow funding :This alternative could be used by the entity to finance the proposal where
the funds are obtained by the public through selling the shares of the new venture
business. This is time taking process of financing the proposal and the costlier one than
retained earning and bank loans as the issuing of the IPOs costs very high.
 Friends and families : Entrepreneur can arrange the funds by making its friends and
family investing in the proposal. This method is however, not very reliable in arranging
funds when the amount involved in the proposal is very huge. It is useful when the large
part of the proposal is financed by some other method and the remaining part that needs
to be financed could be done by this method.
 Incubators : The start up setter can go for the incubator's services which the helps the
entrepreneur to establish a new ventures by providing the necessary funds for the setting
up. Incubators also provide necessary management trainings, provide the office space to
the venturer and other services like giving the useful insights of the proposed market
conditions, competition's strengths and weakness etc(7 Awesome Opportunities for
Entrepreneur, 2018).
Use of more social media will create more brand awareness of the bath lounge product.
Using social sites like Facebook, Instagram will create the awareness of the entity's offering in
large number. This type of adverting channel will be effective for the entrepreneur as this costs
less and almost all uses the social networking sites these days which will help in communicating
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the product's information in masses. Entrepreneur will also consider the using the online
distribution channels for selling the bath lounger. It can create an official website where it can
sell the products according to the consumers needs and specifications by directly interacting with
them. This will make the consumers more satisfied with entity's products and services and will
result in increased sales and increase in consumer satisfaction.
Entrepreneur could arrange its information through conducting various surveys and asks
the specific questions to the target segment in the market. The survey results will give useful
information about the preferences of the consumers, their habit of trying a new product launched
in the market, their bathing preferences like if the consumers prefer taking long relaxing baths,
then it will favour the decision of opening of the start-up. If the consumers say that they do not
like the ideas of spending too much time in the bathtub because of some reasons, then ask why
they don't and explains them the benefits' bath lounger will provide especially give customers a
relief from the back and neck pains.
Entity can use secondary sources for obtaining the market situations in the industry.
These primary and secondary sources could be used by the entrepreneur if it has the enough time
and fewer funds. Secondary sources provide the information from the online sites, already
published journals and reviews of bloggers a business journalist about the competition in the
market. If the entrepreneur has adequate funds, it can go for the services of the market research
specialists who will conduct the survey on behalf of the entity and gather other market related
information from other sources and will make a complete detailed market research report and
submit it to the entrepreneur and the important conclusions will be drawn from it. The business
strategy will form taking this report as base(Günzel-Jensenand Holm, 2015).
CONCLUSION
From the above project report, it has been summarised that planning a start up and
entering into new market involves lot of market research, funds, time and energy. In the present
report, it was seen that bath lounger product's introduction in the new market can be proved by
profitable for the venturer as the product' s aim is to provide relief from neck and pain issue,
people have while bathing in the bathtub. Entrepreneur saw the opportunity of exploring this area
and formed an idea of offering such product which could resolve such issues. Entity also
reviewed about the competition in the market that is Complete Careshop which is an established
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firm producing bath loungers products which mainly offers it products to the elder people.
Entrepreneur decided to go for the other segment of the market which was sport people. It
wanted to avoid the competition in the initial stage of the proposed venture. It was also seen that
entrepreneur can raise its funds various sources and if the available resources are not enough to
start the operations, alternatives were also discovered in the project report. The report showed the
information could be gathered from various sources such as surveys and secondary sources like
online referrals, published reports etc., for taking the decisions regarding various aspects of the
business strategy.
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REFERENCES
Books and journal
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Routledge.
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students of Vietnam national university—a mediation analysis of perception toward
entrepreneurship. Journal of Economics, Business and Management. 4(2). pp.104-111.
Rhoads, K., 2016. Stepping Stones or Stumbling Blocks: Psychological Capital and Overcoming
New Venture Failure. Journal of Management. 4(2). pp.11-21.
Wang, M. and et.al., 2017. A strategy prepared for the UBC Alma Mater Society.
McKelvey, M. and Zaring, O., 2018. Co-delivery of social innovations: exploring the
university’s role in academic engagement with society. Industry and Innovation. 25(6).
pp.594-611.
Schläger, C. and et.al., 2018. Enabling Cyber Sovereignty: with Knowledge, Not with National
Products. In Digital Marketplaces Unleashed (pp. 895-904). Springer, Berlin, Heidelberg.
Langer, J. and et.al., 2016. Intentions and Perceptions of the Entrepreneurial Career Among
Croatian Students: Initial Results of a Longitudinal Empirical Study. In Contemporary
Entrepreneurship (pp. 213-228). Springer, Cham.
Vladušić, L. and Lalić, N., 2015. Corporate entrepreneurship as a function of organizational
transformation. Strategic Management. 20(4). pp.26-33.
Gichohi, P. M., Onyancha, O. B. and Dulle, F. W., 2017. How public libraries in Meru County,
Kenya, address the business information needs of small-scale enterprises. Information
Development. 33(4). pp.418-435.
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Günzel-Jensen, F. and Holm, A. B., 2015. Freemium business models as the foundation for
growing an e-business venture: a multiple case study of industry leaders.
Online
7 Awesome Opportunities for Entrepreneur.2018. [Online] Available through
<https://www.inc.com/jessica-stillman/why-ubers-ipo-is-for-suckers.html>
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