Starting a Business and Fundamentals of Marketing

This document provides insights on starting a business and the fundamentals of marketing. It includes a business plan, evaluation of the external environment, discussion of competition and competitive advantage, and suggestions for the target market. The document focuses on the launch of a DIY workout Gym in the UK.

Starting a Business and
Fundamentals of
Marketing

Table of Contents
INTRODUCTION...........................................................................................................................1
BUSINESS PLAN...........................................................................................................................1
1) Overview about the business idea...........................................................................................1
2) Evaluation of external environment........................................................................................2
3) Discussion of competition and what is the competitive advantage........................................4
4) Suggestions for the proposed target market............................................................................5
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
An entrepreneur is a person who have an innovative ideas and concepts which will be
introduced in order to fulfil the needs and wants of customers or market requirements. For
launching a new business enterprise a person requires to do a market research in order to identify
the dynamic requirements and preferences of society (Hopp, 2018). This will assist to
entrepreneur and motivates them towards the development of their skills and capabilities in order
to start a new entity and successfully sustain in the competitive market for a long period of time.
The present business plan is based on the Gymnasium that will be launched “DIY workout Gym”
in UK. This will provide huge range of activities related to the exercise such as yoga, muscle
strengthening and aerobics. Under this report discuss in detail about the whole business plan that
considers business description, evaluate external business environment, discuss about
competition, competitive advantage as well as target market.
BUSINESS PLAN
1) Overview about the business idea.
The business idea of launching “DIY workout Gym” in London, United Kingdom which
is an organisation that provides wide range of workout and fitness exercise and activities that
includes aerobics, flexibility as well as muscle strengthening exercises that will be required for
the population of UK in order to remain fit. A person who research towards the market and
identified the needs of people of London regarding the requirement of join Gym for maintaining
their healthy lifestyles. The main reason behind the feasibility of “DIY workout Gym” is the
segment of population of UK especially London as they are highly affected through diseases like
obese as well as diabetes so that the demand of healthy lifestyle is increased and people moves
towards the daily routine exercises and workouts (Kochkina, 2019).
In order to analyse all conditions the owner of “DIY workout Gym” decided to introduce
new Gym business venture in London city of UK where several people are willing to acquire
Gym membership. In United Kingdom, London becomes the largest populated city due to that an
entrepreneur pre determined to attain high growth, success as well as sustainability in that kind
of marketplace. Introducing a new business venture is a complex tasks as it needs many
resources and more support from several members in order to get sufficient resources. For this,
the entrepreneur decided to establish a new business of Gym in the form of partnership by
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attracting people who have effective skills and knowledge regarding to the use and
implementation of marketing tools and techniques so that they can get high level of sustainability
within a short period of time (König, 2019). In addition, sharing or jointly roles and
responsibilities helps in improving the efficiency as well as effectiveness of decision-making
process that guides the success and growth of an organisation.
The owner of new venture acquired over 1200 square feet in London in order to operate
their business with 5 years lease with a main objective of establishing venture and running in
future without any kind of troubles. The partners of “DIY workout Gym” invest 2200000 dollar
in respective ratio that are shown in the partnership deed. There are many areas in which funds
has been allocated that are mentioned below:
Estimated Initial Investment
Name of Fee Low High
Initial Franchise Fee $32,000 $40,000
Travel and Living Expenses During Training $4,000 $7,000
3 Months' Rent $26,250 $367,500
Security Deposit for Lease $9,000 $225,000
Leasehold Improvements and Construction Costs (assuming no pool) $1,750,000 $2,800,000
Selectorized Equipment and Free Weights $125,000 $500,000
Cardiovascular Equipment $150,000 $500,000
Signage $35,000 $85,000
Initial Inventory, Other Equipment and Supplies $12,000 $56,000
Computer System and Gym Management System $20,000 $35,000
Advertising and Marketing $25,000 $170,000
Miscellaneous Opening Costs $10,000 $65,000
Additional Funds - 3 Months $20,000 $150,000
TOTAL ESTIMATED INITIAL INVESTMENT* $2,218,250 $5,000,500
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2) Evaluation of external environment.
While launching a new business organisation every businesses an idea requires to do the
analysis of external environment as it helps in identifying the several factors and their influences
on the present conditions and future growth and success (Ratten, 2018). In order to that the
owner of upcoming business named John Smith conduct external environmental analysis by
using PESTLE analysis for examine the factors and their impacts on the new business venture
that named “DIY workout Gym”. Several external factors are considered as follows: Political factor: In this factor, the fitness industry of UK's have a huge amount of
influences and has many laws such as health and safety regulations which must be
followed by all gyms to remain in that sector (Savage, 2019). DIY workout Gym must
maintain clean establishments as well as timely conduct the maintenance of machines that
will be used in the company. The upcoming venture must require regular inspection that
ascertain that gym runs their operations and activities as per the set standards. Economic factor: It is highly impact on the health and wellness sector of UK in this
several factors are includes such as unemployment, recession, cost of living and wages
and so on. Increased growth rate affected this sector in a positive manner as they
formulate their expansion strategy and raise revenue. Whereas, low rates of
unemployment negatively influence in this sector as it is hard to find workers with
appropriate qualifications (Scardovi, 2019). Social factor: This factor is related to the society as it is classified on the basis of values,
demographics and norms of people as it is impacted on the health and wellness sector in
order to have desire towards the live healthy lifestyles. In London city of UK, diseases
are increases so that people moves towards the maintain their lifestyles in order to that
they join Gym as well as regular membership as the trends regarding working out,
exercising and remaining healthy and better increases rapidly (Timmons, 2018). The
upcoming venture DIY workout Gym require to ensure that they can effectively meet the
needs of people which belongs to the different cultures. Technological factor: It is rapidly changing in all sectors as in health and wellness
industry technologies are increases especially mobile technology. This will affect
upcoming venture because people have to expect the technological adaptations. Within
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the DIY workout Gym they may involve being able to insight classes and pay for
membership by using mobile techniques or applications (VAHDATI, 2018). Legal factor: In this health and safety regulations are considered in businesses that must
be followed by upcoming venture as well as regular maintenance of machines and
equipments, effective training to staff members and insurances. Gym's are needed to
maintain their workplace clean as well as safe in order to minimise or reduce the chances
of injury and sickness of customers.
 Environmental factor: It involves the natural environment as there have been trends for
companies to become environment friendly as well as minimise the carbon emissions.
This would be impact how upcoming business in that sector run their operations and
activities and save natural resources such as electricity and water (Villani, 2018).
3) Discussion of competition and what is the competitive advantage.
Competitive analysis: While launching a new business venture which named “DIY
workout Gym” an entrepreneur can face difficulties regarding the presence of competitors who
facilitates same kind of activities in London over several years. There are the presence of
numerous competitors that are already exist in London that includes Muscles Bull Gym, Hybrid
Fitness, Fight city Gym and so on. That may facilitate tough and hard competition to “DIY
workout Gym”. It has been identified that there are immense competition in the UK market
especially in London so that an entrepreneur formulate effective plan and strategies related to
their offerings that should be required unique and offer for the first time in the market (Grit,
2019). As this will help in increasing the chances of sustainability of upcoming business in
London within a small period of time. In order to take competitive advantage upcoming business
named “DIY workout Gym” can focus on fitness issues in order to that they focus on daily
routine workout activities to remain fit which includes exercises related to the aerobics,
flexibility exercise and muscle strengthening training like stretching, dancing, yoga, lifting
weights and so forth. This will assist individual to stay fit and healthy by properly engaging in
gymming activities on a regular basis.
In order to get better competitive advantages an entrepreneur of upcoming venture which
named is “DIY workout Gym” needs to use some theories and concepts for better understanding
towards the pursues competitive advantages across its chosen market scope. For this, they use
Porter's generic model of competitive advantages that are considered as follows:
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 Cost leadership: In this, a upcoming venture sets to become a low cost service provider
in health and wellness sector as cost advantages are differed on the structure of company
or industry (Watson, 2018). “DIY workout Gym” may involve economies of scale, raw
material, technologies and so forth things in their Gym. A low cost service provider or
membership provider must find the sources of cost advantages if a venture achieve this
strategy then it will be termed as the above performers in the market as it will results in
low prices also. Differentiation: In this, an upcoming business venture seeks to be facilitates unique and
innovative products and services along with the dimensions which are highly valued by
the buyers. The company can use this strategy by supplying unique sets of exercises and
activities to their customers (Dadzie, 2019).
 Focus: This kind of generic strategy emphasise on the choices of narrow scope of
competitive marketplace. A business owner of upcoming venture can select a segment in
a particular industry and tailored their strategy to helping them to the exclusion of others.
In this, a upcoming venture can adopt either cost focus or differentiation focus by looking
advantages in their target market.
From the above strategic model it has been viewed that differentiation strategy is more
suitable for upcoming venture that named “DIY workout Gym” as they focused on low prices
but along with facilitating unique products and services as it will help in attracting large number
of customers.
4) Suggestions for the proposed target market.
A new business venture grow and succeed in the new marketplace only if they identified
and analyse the needs as well as requirements of the target people. In order to target a specific
area or customer range an entrepreneur segments the market as it will help in knowing about the
actual customers that can be targeted by the new business (Aronowitz, 2018). For this, the owner
of “DIY workout Gym” segments the market of London on the basis of three factors of
segmentation that includes demographical, psychographic and geographic. Demographic: In this kind of segment, market is targeted on the basis of people age,
gender, religion and so on. After analysing in detail by conduct appropriate research in
this field, it has been viewed that most of the youth opt Gym option to keep their
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lifestyles better and healthy. So the youth of the city will be targeted by “DIY workout
Gym”. Psychographic: In this, market is targeted on the behalf on income group of people as
among entire population higher and middle level of income group prefers healthy and
better quality lifestyle for this, they engaged in workout activities everyday in order to
remain fit. An entrepreneur of new venture named “DIY workout Gym” will be targeted
these two group of people who have high and middle level of income.
 Geographic: It is associated to the geographical location of market segmented where the
demand is more. In UK, London is the largest city which is targeted because of the
maximum population and among all most of the persons are Gymholic in comparison of
other cities.
CONCLUSION
It has been concluded from the above report that to launch a new business venture an
entrepreneur plays an important role as they creates a new and innovative ideas in the
marketplace in order to get sustainable competitive advantages as well as long term
sustainability. For this, they requires to discuss about the business description that includes about
their business in detail as well as evaluate the external environmental factor that impacts on the
business of health and wellness sector. In addition analyse the competition and identify the
competitive advantages by using Porter's generic model as well as analyse target market by
considering demographic, psychographic and geographic factors.
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REFERENCES
Books & Journals
Aronowitz, J.G., 2018. Optimize Your Fitness, Optimize Your Business: The Balanced
Scorecard, Analysis and Application for the CrossFit Affiliate.
Dadzie, M.E., 2019. Operations plan for Gym Ike Fitness Centre.
Grit, R., 2019. Making a business plan. Routledge.
Hopp, C. and Greene, F.J., 2018. In pursuit of time: Business plan sequencing, duration and
intraentrainment effects on new venture viability. Journal of Management Studies.
55(2) pp.320-351.
Kochkina, N., 2019. DYNAMICS OF PESTLE FACTORS OF UKRAINIAN MARKET
ENVIRONMENT. Sustainable development under the conditions of European
integration. Part I, p.250.
König, M. and et. al., 2019. Different patterns in the evolution of digital and non-digital ventures'
business models. Technological Forecasting and Social Change. 146. pp.844-852.
Ratten, V., 2018. Perspectives of Sport Entrepreneurship. In Sport Entrepreneurship (pp. 63-77).
Springer, Cham.
Savage, L., 2019. Building Union Muscle: The GoodLife Fitness Organizing and First-Contract
Campaign. Labour/Le Travail. 84(1). pp.167-197.
Scardovi, C., 2019. 6 Case study in credit workout. Banking, Lending and Real Estate. 15. p.102.
Timmons, J.A., 2018. New Venture Creation with New.
VAHDATI, H., NEJAD, S.H. and SHAHSIAH, N., 2018. Generic Competitive Strategies
toward Achieving Sustainable and Dynamic Competitive Advantage. Revista
ESPACIOS. 39(13).
Villani, E., Linder, C. and Grimaldi, R., 2018. Effectuation and causation in science-based new
venture creation: A configurational approach. Journal of Business Research. 83.
pp.173-185.
Watson, K., McGowan, P. and Cunningham, J.A., 2018. An exploration of the Business Plan
Competition as a methodology for effective nascent entrepreneurial learning.
International Journal of Entrepreneurial Behavior & Research. 24(1). pp.121-146.
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