Omitting Social Capital from Enterprise Education: A Reflection

Enterprise Education and Business Start Training. 55 (8/9). pp. 899 – 910.

(Online Business for Children retail products)

TABLE OF CONTENTS
EXECUTIVE SUMMARY 1
COMPANY DESCRIPTION 1
PRODUCTS AND SERVICES 5
MARKETING PLAN 5
OPERATIONAL AND RESOURCE PLAN 14
PERSONAL FINANCIAL STATEMENT 16
START-UP EXPENSES AND CAPITALIZATION17
FINANCIAL PLAN 18
LIMITATIONS/ RISK ANALYSIS 21
CONCLUSION 22
REFERENCES 23
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LIST OF FIGURES
Figure 1: Porter five forces model.................................................................................................10
Figure 2: Team of new venture......................................................................................................15

EXECUTIVE SUMMARY
With a rapidly ageing population and wider changes arise in the market, UK customers
shopping habit is also influenced. In order to meet the population’s changing needs, enterprises
are concentrating towards delivering of quality of retail products to their customers at affordable
price. In the context of meeting expectation of customers, new online business start-up will be
set-up to deliver online retail products such as toys, games, books, equipment’s and software etc.
to children in a proper manner. It will provide facility of great selection of toys for kids at
amazing prices. Looking at the present era where children are surrounding with latest
technologies, toys, games and books. Their positive contribution on day to day life of children
can be seen in different terms such as boosting memory, developing cognitive skills, foster social
interaction, and better able to react and change tactics etc. In the present case, new generation
retro game zone (hypothetical company) was taken which offers toys, games, books, equipment’s
and software for children at affordable price. The business will be started by putting personal
capital of owner and al the legal and regulatory aspects will be followed. It will provide
opportunity of an easy and effective way to reach out to millions of potential buyers within
stipulated time. From the sales projection made it is predicted that online sales of company is
going to increase by 10% in a year. Product, market and industry feasibility were conducted by
using porter, SWOT and PESTLE models. It can be said that new business is viable and helps in
increasing market share in long term aspects effectively.
COMPANY DESCRIPTION
For the present case scenario, new generation retro game zone (hypothetical company) has
been taken which offers toys, games, books, equipment’s and software for children at affordable
price. The main business idea behind opening online retail for children is to deliver quality of
toys, software and many more products to them at lucrative prices. The current business plan has
been prepared by considering some unique ideas such as 360 degree rotation of products at each
angle, educational software and games and wide product portfolio to attract wider population in a
significant manner. There are several online retailers present in UK market and offer varieties of
products and services (Online Retailing: Britain, Europe, US and Canada , 2015). But they are
lacking somewhere to maintain their logistics and meeting needs of each age group range of
consumers effectively. Business owner can promote its products and services through creating
awareness among community, quickly respond to client request and maintain quality and
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reasonable prices while doing business. After getting success in online retail store and for
meeting the specific needs of our clientele, mobile apps can be launched.
Mission: The main mission of the new generation retro game zone is to offer toys, games, books,
equipment’s and software for children at affordable price. Business plan has been made by
considering some unique ideas such as 360 degree rotation of products at each angle, educational
software and games and wide product portfolio to attract wider population in a significant
manner.
Vision: The main vision of business plan is to promote out products through emerging as a
market leader in online retail gaming segment.
Aim and objectives: The main aim of the business is to open a online store for selling products
such as Toys, Games, books, equipment’s, software etc. that are used by children.
 To investigate current market trends that can influence business idea of new start-up
 To enhance customer shopping experience by providing order placing and tracking
convenience in website by effective use of advance technologies
 To explore positive contribution of gaming products on day to day life of children and
society
 To judge feasibility of online retail store in term of market, economic conditions and
profitability in modern arena
 To enhance sales and customer loyalty by creating positive image of products and
services in the minds of customers
Values of the company:
The main values of the company are their assets, stakeholders and their involvement. In
addition, customer loyalty, market situations, human capital and financial perspectives can
highly contribute in creating business values of new venture in cut throat competitive era. The
business will be started by putting personal capital of owner and al the legal and regulatory
aspects will be followed. Business will be set-up completely new.
Milestones and goals
 New venture games, toys and software products will positive contribute on day to day life
of children in terms of boosting memory, developing cognitive skills and foster their
social interaction in modern era.
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 Uniqueness in our product portfolio and different strategies such as 360 degree rotation
of products at each angle, educational software and games will help organization to
secure its position.
 Entire business idea will be implemented by effective use of human and finance capital.
Overview of current market trends and business idea
17.3 % population of UK under age of 15 years and 66.2% percentage of population
between 15 and 64 years old (UK population, 2015). Davidson (2015) stated that UK is only one
country in the world where parents spend more on toys and other retail products for their
children. From the statics, it is clear that in 2013, the average British shopper spent £508 on toys
and games for their children. On the other side, Australian consumers were spent £555 per child
in 2013. According to statement of E-bay, 12,623 frozen products sold in UK each day between
July and January in which demands of children games are high (Davidson, 2015).
Table 1: UK customers spending on children
(Source: Barford, 2011)
Children (In year) Average spending
1
£9,491
1-4 £53,586
5-10 £56,856
11-17 £47,820
18-21 £43,094
Hence, on the basis of figures spending by customers for online retail stores for selling Toys,
Games, books, equipment’s and software are very high. Demographic profile of children and
parent spending on toys and games items are the positive indicators of the market which
encourages business owner to spend money in opening retail store for children in UK. Business plan
has been written on the basis of secondary data collection and literature review (Sambuchino, 2011).
The report has more than 80% of data comes from qualitative research in a significant manner. In the
context of materialize opportunities that exist at market place and meeting expectation of
customers effectively, the present venture will be established. Business and market opportunities
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can be grasped through creating awareness among community and maintaining balance between
quality and prices factors while doing business in a proper manner.
Potential customers
Our business idea is to open a online store for selling products that are used by children
such as Toys, Games, books, equipment’s, software etc. The consumers of our products will be
children ageing from 0-12 years. The target market of online children store will include four
major sections i.e. kids themselves, parents, Educational institutions for children of the upper
class and Self-teaching families. The products include the advances of technology in the teaching
sectors and will include the features of teaching aid. The middle and upper class families who are
willing to spend money on their children with the aim of improving learning and upbringing of
kids. The parents who are willing to buy toys and technical gadgets for their children will be the
major customers of proposed business. The parents who are having busy schedule and prefers to
have online shopping for affordable product will also be the customers of such products. The
play schools and lower secondary schools will also be counted as potential customers of this
proposed business. The company will provide services regarding information of products to the
customers and a strong customer online support (Sambuchino, 2011). The consumers of the
products will be divided in the different age group that are explained in following points.
Table 2: Targeted group
Age group Products
0-12 months Toys
1-2 years Toys and Games
3-5 years Games, books, equipment’s
6 years & older Games, books, equipment’s, software etc.
The business idea will be practically implemented after a strong market research that
can be conducted in UK market. The present business plan begins with market research in which
detail investigation about online industry, companies which offers similar types of services have
been considered. The specific need of children regarding toys and games will be identified so
that the best suitable products to theory needs can be satisfied. The financial resources will be
required to put in the online business so a in-depth investigation will be done in order to identify
the available financial resources and their relative cost. The business will be started by putting
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personal capital of owner and al the legal and regulatory aspects will be followed. The business
will be thoroughly online where the customers will order the products and company will send a
order placed ID to them. The products of company will be shown with a proper specification and
pricing. The website will be reinvents itself every three months of faster. In addition, more
emphasized will be given on developing logistics to deliver products and services to their
customers in a quick manner. A well maintain and user friendly website will be developed in
which all information about products, its prices, discount and return policies clearly mentioned.
Besides that, it provide feature of online game and other products facilities so that customers will
be able to book their order and providing feedback to company about their services. Further, in
this regard, talented and skilful employees will be recruited and training will be provided to them
to interact with customers (Bauknecht, Madria, and Pernul, 2000).
PRODUCTS AND SERVICES
The main uniqueness in this business idea is 360 degree rotation of products; video
training to run technology related gaming software, return policy and taking help of strong
logistic chains to deliver products to consumers in frequent manner. In addition, product
portfolio of enterprise will be developed by considering ethical business concept. This new retail
start-up will not sell abusive and other software which promotes violence and creates bad or
negative effect on life of kids. In addition technology aspects, in-house knowledge base team,
recruiting SQL™ server and ColdFusion™ programming expertise and team to handle website
and other online medium will be the major characteristics of our products and services. Despite
of that, free collect and click feature will provide on firm website to provide order placing
convenience to its clients in a proficient manner. Besides that, easy to use and quickly viewable
features of new start-up business will help in promoting business and meeting expectation of
children, parents, educational institutions and self-teaching families effectively. Hence,
emphasizing on product portfolio, making uniqueness in products, and build lucrative websites
will be important part of new start-up set-up idea. It will provide opportunity of an easy and
effective way to reach out to millions of potential buyers within stipulated time.
MARKETING PLAN
Marketing Plan
The most attractive feature of online retail store business plan is its marketing strategies and
plan.
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Market research: In the context of analysis overall online retail market store, secondary data
related to current trends and gaming and toy industry have been taken. With help of applying
PESTL, SWOT and Porter Five forces, external and internal factors have been identified
(Araujo, Finch and Kjellberg, 2010).
Market research
Situation analysis can be done in order to target the right customers and identifying the
entire market and competitors present in the market in a significant manner.
Macro and Micro analysis
For analysis macro market, PESTLE and SWOT Analysis have been applied. On the other side,
for analyzing entire industry, porter five forces model has been applied. These market analyse
techniques will help researcher to check viability of online retail business idea and increases
market share in long term aspects effectively.
Macro market:
 New venture will operate in the retail market of UK where preset growth rate is 0.6%.
 The average British shopper spent £508 on toys and games for their children in toy and
gaming market of country in UK in 2013.
 17.3 % population of UK under age of 15 years and consumptions of these kinds of
products are expected to increase from $1.5 billion in 2012 to $2.3 billion in 2017
(Takahashi, 2013).
 These characteristics and market trends will offer enormous growth potential for new
start-up.
 Growth of the tablet and PC market and increase in the amount of leisure time enjoyed by
consumers are the major factors which encourages business owner to open new online
store for selling game products.
In the context of analyzing macro market, PESTLE analysis is used that can be explored as
follow.
Table 3: PESTLE Analysis
Factors Descriptions
Political  Stable Political system
 Government regulations and legal
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issues
 Favorable polices to encourage the
online game industry‘s development
(Zikmund and Barry, 2006).
Economic  UK is a leading industry for games
development in Europe (Harvard
Pocket Mentor Series, 2007)
 Creative economy in the period 2011 to
2013
 Best source of games than 10 year ago
 This sector contributes more than £10m a
week of Gross Value Added in economy
(CI UK to the world, 2013)
 Expansion of gaming market and high
spending in economy (Araujo, Finch,
and Kjellberg, 2010)
 Learning games market grow from
$3.9 billion to $8.9 billion in 2017
(Takahashi, 2013)
Social  Highly acceptance of games, software
and toys socially or within a culture
 Organizes video-game tournament
indicates the growth of e-sports
 7 in 10 Britons have played some form
of video games and use software in last
6 months
 33.5 million gamer audience
 Enhance in the amount of leisure time by
customers (CI UK to the world, 2013.)
 Gamer spends around 11 hours gaming a
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week (Thomas and Derammelaere,
2013)
Technological  400-plus games professionals across
Europe
 Apps and Smartphone’s are most
popular format (Sambuchino, 2011)
 Early technology adopter environment
 Huge investment in emerging
technologies including cloud computing
and data centre sectors (Nikolai, 2006)
 Acceptance of learning apps on mobile
devices promotes education software
Environmental  Strict environmental regulations and
increasing environment concerns
 Strict policies against packaging and
waste for example, carrier bags are
considered as a chargeable item
Legal  Favourable trade and tariff policies
 More than 95% of UK games
companies sell products
 Copyright and intellectual property rights
 Privacy and security (Kotler, Bowen
and Makens, 2006)
Explanation: On the basis of PESTLE analysis technique, it is clear that political stability,
economic conditions and increasing spending of customers in gaming, toys, software and other
products are favourable for new start-up. In addition, technology advancement and increasing
craze of children and whole society provides business opportunity to new venture to open online
stores and meeting their gaming and quick delivery desire in a quick manner. However, strict
laws and regulations related to intellectual rights and privacy and security can also influence
business of new start-up (Cravens and Piercy, 2008). On the other side, technology advancement
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and more than 400-plus games professionals across Europe are the major contributors of gaming
industry. They can play a crucial role in developing and delivering software’s and gaming tools
that can create positive impact on day to day life of children in terms of various terms such as
boosting memory, developing cognitive skills, foster social interaction, and better able to react
and change tactics etc.
SWOT analysis
Table 4: SWOT analysis
Strengths
 Uniqueness in business idea
 Video training module to run
technology related gaming
software
 Simple product return policy
 Strong logistic to deliver products
to consumers (Bridge, 2013)
 Wide product portfolio
 Price penetration scheme
 Good network of entrepreneur to
various sectors
 Recruit talented employees
(Drucker, 2014)
Weakness
 No prior experience in
gaming industry
 No reputation
 Lack of awareness among
customers
Opportunity
 Increasing spending of customers
 Rising acceptance of online retail
stores
 High demand of education
software and games
 Growing needs of learning
software and types which
enhances memory, developing
cognitive skills, foster social
Threats
 High competition present in
the market
 Changing lifestyle and
behaviour of customers
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interaction (Sambuchino, 2011)
By effective use of its strengths which include latest technologies, talented team, increasing
spending of customers and quick deliver of toys, software and many more products, new start-up
would be able to overcome challenges. By overcoming its weaknesses, management of new
venture will be able to promote its products and services and increasing awareness among wide
community in a proper manner (Online Retailing: Britain, Europe, US and Canada , 2015). From
the internal analysis, it is clear that increasing spending of customers, growing demand of
education software and games as well as current and future trends are favorable for new business
venture to open new online store in UK. However, high presence of competitors and changing
lifestyle and behaviour of customers can create threat for enterprise in modern arena.
Porter five forces model
It can be applied for the purpose of evaluating industry attractiveness.
Figure 1: Porter five forces model
(Source: Pinson, 2008)
 Supplier power: The supplier power is high for new start-up because there are high
competitors present in the UK market. However, on the basis of its unique product
portfolio and talented team, power of specialist suppliers present in market can be
reduced. But high prices and margin related constraints are also associated with the
suppliers and can affect growth of firm (Nikolai, 2006).
 Buyer power: Bargaining power is extremely high and acceptance of games, software
and toys socially or within a culture are also growing. Variety of online stores including
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HTC (Scotland LTD), Headphone centers, Jackpoyjoy Bingo, The Motion monkey and
Heading family which are successfully runs their business in European market (Euro
pages, 2015). If buyers will unhappy with quality of products and price charge by
enterprise then they will switch to other brand that can affect growth and sales of
enterprise.
 Rivalry: UK game and retail stores is dominated by large online retail enterprises and
they have large customer base and provides variety of services at reasonable price.
However, uniqueness in products, 360 degree rotation of products at each angle,
educational software and games are the major strengths of new start-up which will help
enterprise to better compete with other retailers.
 Threat of new entrants: Presence of small to large retailer, government supportive nature
and economies of scale enhance chances of threat new entrants in cut throat competitive
arena (Bridge, 2013).
 Threats of substitutes: Chinese companies are offering toys and game software to its
customers in cheap rate. In addition, availability of substitutes makes threat of substitute
high for new venture. However, at initial level, by considering price penetration strategy
enterprise would be able to attract new customers in a proper manner.
Marketing strategy:
Table 5: 4 P's of marketing
Four P’s factors Explanation
Price In order to attain competitive advantage, price
penetration strategy will be used.
This strategy will be considered because
tough competition present in the market and
to create owns position in mind of customers,
earlier cost of products and services offered
by new venture are kept low and after getting
success it will increase (Pelissier, 2008).
Product The firm will deliver quality of toys,
educational software, gaming software and
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many more products at reasonable price.
Place The retail store is going to establish online.
Support and corporate office is developed in
Cutty Sark, Greenwich site, UK for storing
inventory and communicating with customers,
suppliers and investors.
In addition, firm will take help of strong
logistic chains to deliver products to
consumers in frequent manner (Zulkifli-
Muhammad and et al, 2009).
Promotion Both social media marketing and traditional
media marketing techniques will be used in
order to promote products and deliver quality
of services to its customers at reasonable price
(Pinson, 2008).
Pay per click and SEO techniques will be
used to increase ranking of website and earns
revenue.
Segmentation, targeting and positioning strategies
Segmentation strategy:
Table 6: Segmentation strategy
Base Segment
Changing life style of people and
increasing attractiveness of children and
society towards game and software
Both middle and upper class customers
Targeting: New venture will consider lucrative website and new emerging technologies to attract
wide population by considering uniqueness in products and services.
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Table 7: Target group
Age group Products
0-12 months Toys
1-2 years Toys and Games
3-5 years Games, books, equipment’s
6 years & older Games, books, equipment’s, software etc.
Positioning strategy: With help of positioning strategy, exact location of new online retail store
in UK market can be identified easily.
Table 8: Positioning matrix
High Quality
HTC (Scotland LTD)
Headphone centers The Motion monkey
Expensive New venture Cheap
Jackpoyjoy Bingo Heading family
Poor Quality
From the above positioning matrix, it is clear that new venture should be positioned in high
quality segment of market. It main motto is to deliver unique services which is slightly lower as
compared to other online retailers such as Jackpoyjoy Bingo, Heading family and many more.
Table 9: Marketing newsletter
Home Service About us Contact us
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Welcome to The new generation Retro game zone
Kids an family corner Education software Toys and gaming software
Services we provide:
Lucrative website
Return policy
Trained and talented staff-member
Training manuals for software and technology
products Connect with us
Return policy
Website security
Preorder
Pre-owned
Terms and conditions
About the new generation Retro game zone
Support office and Corporate office:
Cutty Sark, Greenwich site, London, UK
OPERATIONAL AND RESOURCE PLAN
In new start-up firm, total 10 people will be appointed on the basis of variety of functions
and knowledge level. In order to quick delivery of product to its customers in UK, enterprise will
take help of different supply chain agencies because it is not viable for company to quick deliver
its products to wide population of UK within stipulated time (Pinson, 2008).
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Figure 2: Team of new venture
 Owner: He is responsible for monitoring over all activities including marketing, financial
and managing human capital.
 IT specialists: Two IT specialists will be appointed for the purpose of maintaining
website and on the basis of knowledge of different technologies such as SQL™ server
and ColdFusion™ programming expertise.
 Marketing manager: For effective use of both traditional and modern media marketing
channel, one marketing person will be recruited (Bridge, 2013).
 Technical support: In order to solve online queries of customers and handle feedback
and other activities, 2 persons will be hired.
 Operation manager: One operation manager will be appointed to handle all activities
within store.
 Staff members for managing inventory: Three staff members will be hired for managing
inventories and update to IT specialists about stock status.
Resources required for supporting busienss
Staring online retail for children can seem like a daunting task. In order to achieve success, it
is essential for entrepreneur to effective utilization of resources that contribute to the success of a
new venture.
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 Financial resources: Funds will be required for carrying out different business activities
such as registering a business name, developing an e-commerce website, set up, license
fees and miscellaneous charges etc.
 Human resources: Talented employees and experienced professionals will be required to
perform several activities such as Web site monitoring, customer feedback solving,
executing operation activities and managing inventories and update to IT specialists at
right time etc (Havard, 2013).
 Physical resources: In the context of successfully runs the business, different resources
will be required which include adequate information system, a small business resource
center, a well prepared website, warehouse, working telephone line and business
development resources (marketing and promotion tools) and collaboration with logistic
firm to deliver product and services to customers within stipulated time (Kerth, 2008).
 Technological resources: Lucrative website with having different features such as a
good secure payment option, shopping cart and order tracking feature and considering
some unique ideas such as 360 degree rotation of products at each angle etc.
 Other resources: A strong product portfolio including educational software and games to
attract wider population in a significant manner. In addition, business owner can
consider traffic drivers that fuel the online retail store business which include pay per
click, search engine optimization, affiliate and relationship marketing to raise customer
attraction.
PERSONAL FINANCIAL STATEMENT
The financial feasibility of a business plan is the most required aspect that should be
taken into consideration at the time of starting a new venture. The report section presented
herewith is deals with preparing financial plan for identify capital requirements initial expenses
and future incomes. In addition, a cash flow statement and income statement is designed with a
specific sales forecasting. This plan is based on certain assumptions that are explained in
following section:
Assumptions:
Bank loan will be taken of £15000
 The revenue from online business will increase by 10% every year.
 Rent of warehousing and corporate office will increase by 5 %
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 Interest rate on business loan will be 7.83%.
 Marketing and promotional expenditure will increase by 10% p.a.
 Salary an wages will increase by 7%
 Loan repayment will be done in three years.
 Website development and maintenance charges £1500
 Delivery and packaging will of 5% of sales
 logistic charges 10% of sales
 Tax rate 10% assumed.
 Utilities expenses (electricity, telephone etc.) increased by 12% every year.
 Insurance of warehouse £1000 per annum
 Miscellaneous expenses 5% increase
 Cost of sales 20% of overall revenue.
START-UP EXPENSES AND CAPITALIZATION
Table 3: Start-up expenses
Market Research
Marketing and promotional
Utilities (Electricity & Phone)
Rent of warehouse
Insurance
Salary
Miscellaneous Expenses
Website development and maintenance charges
Delivery and packaging
Logistic charges
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FINANCIAL PLAN
Sales projection
Year 1 (£) Year 2(£) Year 3(£)
Units of
products sold
1500 1650 1815
Average price 1000 1000 1000
Revenues 1500000 1650000 1815000
The sales projection made in above section represents that the online sales of company is
going to increase by 10% in a year.
Table 10: Cash flow statement
Cash flow statement Pre-Operating
Year
Year 1 (￡) Year 2 (￡) Year 3
(￡)
CASH INFLOW
Opening Balance 0 -15000 1008953 2147455
Sales 0 1500000 1650000 1815000
Owner's fund 50000
Bank Loan 90000
Total Cash Inflow 140000 1485000 2658953 3962455
CASH OUTFLOW
Working Capital 40000 0 0 0
Legal and Registration Charges 15000 0 0 0
Market Research 50000 0 0 0
Marketing and promotional 30000 33000 36300 39930
Utilities (Electricity & Phone) 0 25000 28000 31360
Rent of warehouse 0 20000 21000 22050
Website development and
maintenance charges
0 15000 15000 15000
Delivery and packaging 0 75000 82500 90750
Logistic charges 0 150000 165000 181500
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Interest on loan 0 7047 4698 2349
Salary 0 100000 107000 114490
Miscellaneous Expenses 20000 20000 21000 22050
Insurance 0 1000 1000 1000
Tax 0 0 0 0
Loan Repayment 0 30000 30000 30000
Total Cash Outflow 155000 476047 511498 550479
Closing Balance -15000 1008953 2147455 3411976
Table 11: Income statement
Particulars Year 1 (￡) Year 2 (￡) Year 3 (￡)
Revenue 1500000 1650000 1815000
Less: COGS (40%) 600000 660000 726000
Gross Profit 900000 990000 1089000
Operating Expenses
Legal and Registration
Charges
15000 0 0
Market Research 50000 0 0
Marketing and promotional 33000 36300 39930
Utilities (Electricity & Phone) 25000 28000 31360
Rent of warehouse 20000 21000 22050
Insurance 1000 1000 1000
Salary 100000 107000 114490
Miscellaneous Expenses 20000 21000 22050
Website development and
maintenance charges
15000 15000 15000
Delivery and packaging 75000 82500 90750
Logistic charges 150000 165000 181500
Total Operating Expenses 504000 476800 518130
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Operating Profit 396000 513200 570870
Less: Interest 7047 4698 2349
PBT 388953 508502 568521
Less: Tax 38895.3 50850.2 56852.1
Net Profit 350057.7 457651.8 511668.9
In near future the company is going to have increased profits in all 3 years. However, the
profits are going to increase continuous basis. Along with this the operating expenses are also
going to increase on an accrual basis.
Breakeven point
Table 12: Fixed expenses
Fixed cost
Legal and Registration Charges 15000
Rent of warehouse 20000
Website development and
maintenance charges
15000
Salary 100000
Insurance 1000
Total fixed expenses 151000
Table 13: BEP
Average selling Price 1000
Variable Cost 400
Contribution 600
Total Fixed cost 151000
Contribution 600
BEP (Units) 251.6666666667
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On the sales of 251 units in year, the company is going to have the situation of no profit
and no loss.
In order execute business in a proper manner; new venture will follow different
legislations such as expressed and implied contract terms, warranty, intellectual property rights
and online selling regulations. In addition, firm will also follow ecommerce regulation 2002 and
data protection act to enhance privacy and security of website (Kerth, 2008).
LIMITATIONS/ RISK ANALYSIS
Risk and limitation of idea
Along with several advantages of online retail store, different limitations are associated
with retail business such as economic conditions, competition & consolidation in retail sector,
fail to execute business strategy and privacy and security related issues etc. In addition,
availability of finance, transparency and confidentiality kinds of factors influence way of doing
business of enterprise in future.
Table 14: Business risks
S/N Risk event Likelihood Impact Response
1 Shortage of
inventory
Low Low It can be
mitigated.
2 Increasing
competition
High High Accept
3 Injuries
(customers from
toys and
unethical issues
while using
software)
Medium Medium It can be
mitigated.
4 Privacy and
security issues
High High Accept/Mitigate
5 Recruitment and
retention of
talented staff
High High Mitigate
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Price setting strategies, changing the preference of customers, labor market regulation,
children safety and counterfeiting of toys related risks also attached with the business idea of
new venture (Kotler, Bowen and Makens, 2006). Besides that, present business ides is
implementing using website. However, this limitation can be overcome by developing mobile
apps and emphasizing on promotions techniques in a proper manner.
CONCLUSION
Opening a business of Online Retail Store for Children is a crucial task. In the context of
opening store and successfully runs several things including hard, work dedication, good
relations with both staff and suppliers and paying attention to market and competitors are
needed. In present era, demand of games is increasing continuously. Besides that, easy to use and
quickly viewable features of new start-up business will help in promoting business and meeting
expectation of children, parents, educational institutions and self-teaching families effectively.
From the sales projection made it is predicted that online sales of company is going to increase
by 10% in a year. By considering these legislations, firm would be able to increase transparency
in entire process and attracting customers in a proper manner. On the basis of product, market
and industry feasibility, it can be said that new business is viable and helps in increasing market
share in long term aspects effectively.
22

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