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Assignment on Start Up A New Business

   

Added on  2021-02-21

13 Pages1956 Words71 Views
NEW START UPBUSINESS (REPORT)

Table of ContentsINTRODUCTION...........................................................................................................................3MAIN BODY...................................................................................................................................3MARKET ATTRACTIVENESS.....................................................................................................3INDUSTRY ATTRACTIVENES....................................................................................................5CONCLUSION................................................................................................................................6REFERENCES................................................................................................................................7APPENDIX......................................................................................................................................8

INTRODUCTIONRent A Car is a car rental company that is based in London and has recentlyentered the industry. They are planning to launch their services in areas surroundingLondon like Kensington, Brixton, Westminster, Dulwich Village, Canterbury etc.(Velazquez Abad, 2017). This will expand their business operations and also help inestablishing them. In this report market analysis and industry analysis has been maderegrading the industry and the market in which company intends to operate. The idea isan extremely innovative one and will add a value in the market as the concept of luxuryrental cars is not a common one and it is a highly differentiated product as it will offeraddituional services of providing luxury wedding vehicles as well.MAIN BODYMARKET ATTRACTIVENESSDetermining market attractiveness is a very important aspect in evaluating thepresent market scenario. Rent a car Company based in London, UK is a new venture incar rental industry which intends to establish their business successfully and thereforeneed to evaluate various factors associated with attractiveness of the market like size,structure, growth etc. which have been supported with adequate figures and data.Themain purpose of Rent A Car company is to provide luxury vehicles for rent like Bentley,Rolls Royce etc. and it has been supported by data accordingly.Market Size:- As per the reports of car rentals in UK, it has been published that for theyear 2019, there have been 5.1 million active users of rental cars. Further, it has beenestimated that this the users in this market are expected to rise from 7.6% in 2019 to8.1% by the year 2023 (Car Rentals, 2019). Therefore, it can be argued that this marketis regularly growing and venturing in this market appears to be a profitable option forRent A Car Company. Further, on a global level, the luxury car rental market in UK isestimated to be 29% of the entire world and it is further expected to reach £18.3 billionby the end of year 2022.Market Growth:- In respect to the car rental industry, the market is expected to growby 2.7% CAGR at an annual rate and the volume of the market is expected to grow

from 1418m in 2019 to 1578m till the year 2023 (Car Rentals, 2019). On a global level,the CAGR is expected to grow by 20% where the luxury car rental market has alreadyattained its maturity level in UK.Market Value:- On an average while commuting in London or in surrounding areas,major factor is the type of car booked and distance travelled. However, the pricescharged are a bit expensive and if Rent A Car company somehow charges a little lowerthan its competitors, it will be extremely easy for them to penetrate the industry (Searchfor car hire in London, 2019). An estimated car rental figure chart based on car type andlocation has been attached in the appendix. The market value of luxury car rentals isexpected to reach 40050 million euros by the year 2022 at the global level since themarket is growing rapidly (Luxury Car Rental 2019 Global Market, 2019).Market Forecast:- It can be sufficiently evidenced that in future, with increasingmaintenance cost of cars, the demand of rented cars would increase and hence this is agood market to enter. Overall, the luxury car rental market in UK is already developedand therefore it is easy to enter it where at initial level the company can incur profits.PEST Analysis:- By assessing various factors relate to the external environment, it ispossible to create a better view on the performance and impact of various factors onoperation of the industry.Political Factors:- Political leadership determines the tax, industry regulations etc.which help in deciding that whether political environment is in support or not and atpresent, UK's political market is in support as it encourages less fuel consumption.Economical Factors:- The growth trend and rate are a huge factor in determiningwhether investment in new business should be made or not and at present the economyof UK even after Brexit has shown a positive attitude of dealing with crisis and therefore,it is safe to start-up a new business. However, fuel prices, environment regulation etc.impact negatively on company (Moreno-Izquierdo, Ramón-Rodríguez and Perles-Ribes,2016).Social Factors:- The better and expensive the car in which a person travels, morewealthier he is assumed to be. Therefore, hiring of expensive cars for occasional

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