Entrepreneurship Research and Practice

This assignment delves into the field of entrepreneurship, examining both theoretical frameworks and practical applications. It requires students to analyze various research articles focusing on diverse aspects of entrepreneurship, such as crowdfunding, the influence of wealth inequality, and the role of social capital in project success. Additionally, the assignment encourages critical thinking about entrepreneurial narratives in sustainable venturing and the impact of mental ability on firm performance.

UNIT 28 - Launching a New
Venture

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1. Explaining a new venture for the company and identify target markets..........................1
P2. Requirement of tangible and intangible resources in the new business...........................3
TASK 2............................................................................................................................................4
P3. Producing credible proposal to launch a new venture......................................................4
P4. Assessing skills and capabilities required for launching new venture.............................6
TASK 3............................................................................................................................................8
P5. Explaining different promotional activities and channels to launch venture...................8
P6. Promotional activities plan for launch and pre-launch of organisation...........................9
TASK 4..........................................................................................................................................10
P7. Producing itemised monthly cash budget for pre-launch...............................................10
P8. Suggesting appropriate legal form for the venture.........................................................11
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Launching a new venture is important task which needs to be planned properly and then
accordingly launched for successful operations. Present report deals with launching venture
named as Adorable Hotel in hospitality sector. It will provide goods and services to middle class
people in Tavistock locality. Affordable food and room services would be provided to attain
desired revenue. Skills and capabilities, tangible and intangible resources are explained in report.
Furthermore, itemised cash budget on monthly basis is made and promotional plan for pre-
launch and post-launch is prepared as well.
TASK 1
P1. Explaining a new venture for the company and identify target markets
New venture
The business venture is termed as the operations which is started by an entrepreneur who
has the ability and required skills to provide necessary goods and services to the society so that
customer satisfaction may be enhanced in a better way. By imparting quality products to people,
gains in the form of desired profits are attained quite effectually. This means that entrepreneur
and customers' both are satisfied simultaneously by exchanging goods with appropriate price
charged. SME (Small and Medium Enterprises) is the organisation which is operated on small
basis and operations are limited as well. In relation to this, new business venture to be launched
will be engaged in Hotel sector and named as 'Adorable Hotel'. It will be operating with nearly
50 employees because it is SME. The main objective of venture is to provide better quality
services and foods to guests at affordable cost so that they may be benefited in effective manner
and organisation may be able to garner profits in the best possible manner (Baucus and
Mitteness, 2016). Thus, Adorable Hotel will be effectively established in the market and able to
achieve desired sales and profits quite effectually.
Target market
The business is required to be established in that way by which it may be able to garner
profits quite effectually. The need arises because firm starts business with main objective to earn
revenue and satisfy customers with ease. In relation to this, target market plays crucial role in
which organisation specifically caters to demands of particular locality and customers so that
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sales may be incremented in a better way. Adorable Hotel's target market will be Tavistock town
in the city of London. It will be mainly focused on providing cultural meals to consumers and
effective room services so that they may have gratifying stay in hotel. In addressing this, chips
and fish is most likely by people of UK and is cultural food of them.
The customers will be imparted with breakfast meal having flooded with mushrooms,
beans which are baked. Furthermore, fried eggs and sausage will also be provided to customers
visiting in the hotel. On the other hand, administration and room services will be imparted which
will enhance customer' satisfaction in the best possible way (Butticè, Colombo and Wright,
2017). Target market is Tavistock and the main reason for choosing this locality as frequently
passengers arrive and firm will be benefited with increased sales. Apart from this, packages will
be provided in accordance to demands of customers and this will help business to establish
positive brand image in front of them and they will also become loyal. In all, Adorable Hotel will
be able to meet on targets and consumer satisfaction will be provided leading to remarkable
success of venture.
Competitors' analysis in the market
Competition is a phenomenon which cannot be eradicated by the company. But it can be
overcome by business with the help of implementing well-structured strategies in effective
manner. Complete analysis is required to be made so that business may be able to frame
strategies in relation to rivals' schemes to lure customers and attaining sales in the best possible
manner. The main competitors in Tavistock town are Duke of Tavistock and Tavistock House
Hotel. These businesses are earning well in the locality and meeting demands of customers up to
a high extent. Furthermore, Duke of Tavistock imparts services such as better quality meals and
top-notch rooms for providing pleasant stay in the hotel. The hotel provides free Wi-Fi to guests
and customers are imparted with good lounge as well. Apart from this, Tavistock House Hotel is
another SME built by Duke of Bedford circa in 1820 year and providing services to customers in
effective manner and as such, they have become loyal towards firm (Zane and DeCarolis, 2016).
Seeking immense competition, Adorable Hotel is required to implement well-planned strategies
and related tactics so that it may also give exotic services to guests and attain desired profits in
effective way. Thus, it can easily establish its new venture and cater to needs of customers quite
effectually.
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P2. Requirement of tangible and intangible resources in the new business
There are various sources which are needed in organisation so that it may be able to attain
operations with ease. Tangible and intangible resources both are required in the business in
injecting overall operational tasks. Tangible are those which can be touched and their presence
can be seen as well. For instance, fixed assets such as furnitures, machineries, plant fall under
this category. On the other side, intangible resources cannot be seen and even touched but it
provides efficiency to organisation quite effectually (Mullins, 2017). These are patents,
trademark, copyrights etc. The requirement of such resources will be needed by new venture.
A) Tangible resources
The Adorable Hotel will require tangible resources so that it may function properly and
attain desired goals quite effectually. Equipments, furnitures and fixtures and even place are
required by the hotel helping it to obtain efficiency in the best possible manner. In relation to
this, equipments like smoke detectors, extinguishers in case fire occurs in premises and for
ensuring security, CCTV cameras are required by the hotel which forms main elements or
resources. Furthermore, it is an obligation of business to effectively provide utmost safety to
guests and employees. In the case of any incident when fire occurs, extinguishers will be helpful
in attaining control over it and safety will be given to all people in premises. On the other hand,
kitchen equipments will be needed so that food may be prepared in the fastest way.
In addressing this, pasta machines for cooking pasta is essentially required since,
customers prefers the same. Moreover, for making cookies, droppers and doughnut glazers is
another useful techniques which will be helpful for the business in attaining increased sales in
effective manner (Huang, Henfridsson, Liu and Newell, 2017). On the other hand, modern
machineries will be helpful as lower energy consumption is made by it and food can be prepared
quite quickly. On the other side, box sweeper and electric sweepers, polishing machineries will
be required by Adorable Hotel. The rooms will be cleaned by house keeping unit. The place is
another tangible resource and would be purchased in Tavistock locality and thus, these resources
will be beneficial for business in achieving success.
B) Intangible resources
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The tangible are essentially required in the business in accomplishing operational tasks
with much ease. Apart from this, intangible resources are immensely needed in organisation for
increasing sales and loyalty of customers in the best possible manner. These cannot be touched
like tangible but have importance to business in accomplishing set targets quite effectually. One
of the main resource is customer satisfaction which are provided by company and as such, it
enhances reputation quite effectually. This produces goodwill of firm and customers' become
loyal. Furthermore, identifying demands of consumers and then producing goods and services
accordingly is the essence of intangible resources. It enhances goodwill and market share
becomes strengthened as well (Frid, Wyman and Coffey, 2016). It is essentially required that
Adorable Hotel establishes reputation in the market and outreach competitors up to a high extent.
Reputation will be maximised by providing better quality services to customers. However, since
business would be established and as such, goodwill is nil. But it can be attained by attracting
guests and then providing with exotic services and that too at affordable and discounted prices to
lure them with much ease. Marketing and promotional activities are required so that hotel may be
known by guests and they can easily utilise services. The staff of house keeping and
administration department has the responsibility and duty to provide good services.
TASK 2
P3. Producing credible proposal to launch a new venture
Proposed venture
A) Venture name-
The venture' name is Adorable Hotel
B) Location-
The proposed location is to be located in Tavistock town
C) Nature of business venture
Hotel services will be provided to guests
D) Target customers-
The middle class people are target customers of the firm
E) Marketing and Sales method
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Marketing is required so that customers may become aware of new organisation. In order
to accomplish this, internet marketing which is a modern tool will be used by uploading
advertisement on social media channels. The sales method would be utilised by hotel on selling
and online booking packages and ensuring no intervention of intermediaries in process.
F) Opportunities-
Innovative skills will be helpful in attaining competitive market share and as such,
increased sales would be achieved.
G) Sources of funds-
Debt and equity are the two sources from which funds can be raised in effective manner.
Debt is risky source and carries obligation to repay principal amount along with accrued interest.
On the other hand, equity is raised by issuing shares and carries no liability to repay to
shareholders, only dividends are paid to them. Both sources will be used in a balanced way by
business.
H) Analysis of risk-
The risk associated with business is macro and micro environmental factors. The
increased competition and change in macro factors such as economic and legal have impact on
financial viability of organisation.
I) Projected Income statement for first four years-
Projected Income statement of Adorable Hotel
Particulars Year 1 Year 2 Year 3 Year 4
Sales Revenue 187960 199087 220050 230006
Less: Cost of Sales 121355 120555 130056 135000
Gross profit 66605 78532 89994 95006
Operating expenditures
Accounting expenditures 6500 6600 6700 6800
Advertising costs 8000 8200 8300 8400
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Charges by bank 4500 4600 4700 4800
Administrative costs 5000 5300 5500 5600
Electricity expenses 17000 17500 18000 19000
Insurance 1000 1050 1100 1160
License 700 720 740 750
Telephone expenses 2000 2300 2400 2450
Utilities expenditures 5500 5550 5800 5850
Website maintenance 2500 2600 2800 2900
Total operating
expenditures 52700 54420 56040 57710
EBT (Earnings Before
Taxes) 13905 24112 33954 37296
Less: Depreciation 2000 2000 2000 2000
Operating income 11905 22112 31954 35296
Corporate Tax @ 15% 1785.75 3316.8 4793.1 5294.4
Net profit 10119.25 18795.2 27160.9 30001.6
P4. Assessing skills and capabilities required for launching new venture
There are various skills and capabilities which are required to effectively launch a
venture listed below-
1. Entrepreneurial skills-
The entrepreneur should have clear aim regarding new venture before its implementation.
Furthermore, skills of entrepreneur are to make complete analysis of risky nature of investment
and then he should invest in it. Problems should be solved in effective manner (Entrepreneurial
skills. 2018).
2. Analytical skill-
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The analytical skills should be possessed by an entrepreneur for resolving problems up to
a high extent. The skill to perfectly analyse condition, understanding complexity and finally
making decisions in the best possible manner. Critical thinking, to communicate and carry out
solutions regarding issues are the essence of analytical skills.
3. Skills of forecasting-
Perfect estimation is required to be made in accordance to the expenses to be incurred
and income to be earned so that new venture may be successfully established in the market.
Accounting skills should be enhanced because correct estimation needs to be made accordingly.
Financial statements needs to be effectively scrutinise by entrepreneur and projections should be
made in effectual manner. Hence, forecasting skills should be possessed by entrepreneur so that
he may be able to predict future course of action.
4. Identifying threats in market-
The threats prevailing in the market needs to be carried out by completely analysing
competitors' weaknesses and strengths so that Adorable Hotel may successfully accomplish set
targets in effective manner. Competitors' analysis is required so that well-structured strategies
may be implemented in order to outreach them and attain profits (Douglas, 2017).
5. Capability in competing with businesses-
The capability of competing with similar businesses in the market should be possessed by
entrepreneur. The amenities provided by organisation should be at affordable cost so that
business may flourish and customer may become loyal up too much ease. In relation to this,
effective strategies is required to be implemented so that competition may be alleviated quite
effectually.
6. Identifying target customers-
The customers need to be evaluated so that they may be provided with goods and services
and accordingly profits may be garnered. On the other hand, preferences can be accomplished of
target customers. The entrepreneur should have capability of identifying customer demand so
that goods can be imparted to them in effective way.
7. Skills in dealing with issues faced by consumers-
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This skill to effectively resolve problems and issues should be taken into account by
entrepreneur. In relation to this, there are various issues faced by customers and as such,
problem-solving skill should be possessed by him so that problems could be resolved. Hence,
issues faced by guests can be removed quite effectually (Villani, Linder and Grimaldi, 2018).
8. Capability for identifying correct tool of marketing-
There are numerous marketing tools available to company. It is required that entrepreneur
is required to successfully launch a new venture and as such, tools like social media, digital
media and traditional tools are available. In addressing this, social media marketing tool should
be used by Adorable Hotel so that maximum people may come to know regarding services
provided by the hotel. Hence, entrepreneur has the capability to correctly identify marketing tool.
9. Promoting venture-
The skills to promote new venture are required to be possessed by entrepreneur. Through
this, business will be able to flourish in the market and promotions can be attained in a better
way. Furthermore, advertising would be helpful to new venture in accomplishing objectives quite
effectually. Thus, skills in marketing and promoting venture new venture is required to be
emphasised by entrepreneur (Micelotta, Washington and Docekalova, 2018).
TASK 3
P5. Explaining different promotional activities and channels to launch venture
Product-
The cultural food will be sold by Adorable Hotel in Tavistock town and adequate services
will be provided for everlasting joy and stay in the hotel. Effective goods and services to be
imparted to customers for enhancing sales.
Price-
The pricing method plays crucial role in selling foods to customers. The consumers will
be provided meals and rooms at affordable prices. Furthermore, cost plus pricing will be
implemented to sell services to them.
Place-
The place is another important promotional activity as when raw materials are available
at nearby places, transportation costs are alleviated up to a high extent. Thus, Adorable Hotel
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will purchase materials from suppliers to eradicate expenditures (Busenitz and Lichtenstein,
2018).
Promotion-
Marketing of new venture is required so that customers may be familiar with the
organisation. In order to attain customer attention, social media tool will be used by Adorable
Hotel by which advertisement will be posted regarding newly discounted offers and thus, sales
will be achieved quite effectually.
People-
They are the main aspect of marketing mix which needs to be taken into account by the
hotel so that preferences and needs of customers may be analysed in a better way. This will
enhance customer satisfaction and thus, business will flourish in the market.
Process-
The process is related with activities initiated by hotel in the form of input and how it is
transformed in desired output. The hotel would integrate E-marketing and traditional marketing
in order to accomplish marketing objectives in the best possible manner.
Physical evidence-
The physical evidence will be provided in the form of food and room services to
customers. In relation to this, firm would enhance level of customer satisfaction in effective way.
Hence, it is justified to use marketing mix to attain common goals (Ahsan, Zheng,
DeNoble and Musteen, 2018). New business venture will require promotion so that customers
may be attracted with the help of tools used in marketing.
P6. Promotional activities plan for launch and pre-launch of organisation
The activities in Pre-launch are as follows-
 Public relations should be maintained in a better way to understand preferences of
customers.
 Regular checking of website should be done in order to know customers' buzz and
response towards firm's offers.
 Social media is to be used which means that posting short video of work-in-process is an
indirect tool for promotion.
 Branding is useful for Adorable Hotel and is required that it should analyse needs of
target customers so that sales can be injected when start-up is launched.
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Activities in Post-launch are listed below-
 Content marketing should be used to resolve queries of customers in effectual manner.
By taking into account, issues of guests and then resolving them is required for increasing
loyalty of customers (DeGeest, Seibert and O'Boyle, 2018).
 The promotional activities in the post-launch phase is to initiate direct chat with
customers and as such, marketing activities can be accomplished.
 Gifts, offers are required to be provided by Marketing Manager. This will attract
customers quite effectually.
 Advertisement can be given in magazines or newspapers which is another promotional
tool for attaining attention of customers.
TASK 4
P7. Producing itemised monthly cash budget for pre-launch
Itemised cash budget for 12 months
Particulars
Januar
y
Februa
ry March April May June July
Augu
st
Septe
mber
Octob
er
Novem
ber
Decemb
er Total
Opening
cash balance 935 891 928 895 889 939 952 927 920 909 977 926 11088
Cash
generated
from
operations 125 218 141 156 211 161 155 187 167 246 132 185 2084
Total cash
balance 1060 1109 1069 1051 1100 1100 1107 1114 1087 1155 1109 1111 13172
Less:
Capital
expenditure 113 123 113 106 102 94 114 126 133 126 119 123 1392
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Interest 20 26 24 25 21 22 27 29 20 27 23 29 293
Dividends 2 4 3 5 0 2 1 2 3 2 4 5 33
Paying off
debt 50 31 40 32 48 39 46 41 34 30 40 42 473
Total
disbursemen
t 185 184 180 168 171 157 188 198 190 187 187 187 2182
Deficit cash
balance 875 925 889 883 929 943 919 916 897 968 922 924 10990
Add:
Short term
borrowings 6 3 6 6 10 9 8 4 7 9 4 5 77
Long-term
borrowings 10 0 0 0 0 0 0 0 5 0 0 0 15
Total
borrowings 16 3 6 6 0 9 8 4 12 9 4 5 82
Closing cash
balance 891 928 895 889 929 952 927 920 909 977 926 929 11072
The above itemised cash budget is prepared for the 12 months for the firm. It can be
interpreted from the budget that Adorable Hotel will be able to generate cash from operations in
the best possible manner. This is evident from the figures that closing balance has been
increasing for each month as it was 891 in January and 928 in next month. However, with few
ups and down in cash balance, ending figure in the month of December is 929. This means that
cash budget pertains viability of business in forthcoming periods. It will inject operations with
the help of enough cash availability and adequate cash position (Munoz and Cohen, 2018).
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P8. Suggesting appropriate legal form for the venture
Legal forms of businesses are partnership, sole proprietorship and limited company. Sole
trader is the form where decisions regarding business is solely taken by owner. He has the
unlimited liability to pay for dues and in case of profits or losses, he has full control over it and
does not share with others. Partnership is mutual consent of two or more partners and they share
profits or losses according to ratio fixed in partnership deed. On the other hand, company is
different from these two legal forms. The shares are distributed to shareholders and as such,
dividends are paid in event of profit is earned (Street, Galupe and Baker, 2018). The company is
an artificial person and has separate legal entity apart from the owners. Limited liability is there
as investors are required to pay for only to the amount of shares subscribed by them. In relation
to this, Adorable Hotel will be established as limited company and will cater to the needs of
customers quite effectually.
CONCLUSION
Hereby it can be concluded that new venture is required to be launched by taking into
consideration various factors. The skills and capabilities of entrepreneur are required so that
business may flourish in the market and earn desired revenue. In relation to this, objectives
should be cleared regarding new venture so that profits can be attained in a better way. Financial
projections and related estimation regarding expenses and income should be made which will
help to estimate budgetary requirement of firm.
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REFERENCES
Books and Journals
Ahsan, M., Zheng, C., DeNoble, A. and Musteen, M., 2018. From Student to Entrepreneur: How
Mentorships and Affect Influence Student Venture Launch. Journal of Small Business
Management. 56(1). pp.76-102.
Baucus, M. S. and Mitteness, C. R., 2016. Crowdfrauding: Avoiding Ponzi entrepreneurs when
investing in new ventures.Business horizons. 59(1). pp.37-50.
Busenitz, L. and Lichtenstein, B., 2018. Faith in Research: Forging New Ground in
Entrepreneurship. Academy of Management Perspectives, (ja).
Butticè, V., Colombo, M. G. and Wright, M., 2017. Serial crowdfunding, social capital, and
project success.Entrepreneurship Theory and Practice. 41(2). pp.183-207.
DeGeest, D. S., Seibert, S. and O'Boyle, E., 2018. The relationship of general mental ability to
entrepreneurial firm performance: A meta‐analysis. Journal of Occupational and
Organizational Psychology.
Douglas, E., 2017. Perceptions: Looking at the world through entrepreneurial lenses.
In Revisiting the Entrepreneurial Mind(pp. 41-59). Springer, Cham.
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Frid, C. J., Wyman, D. M. and Coffey, B., 2016. Effects of wealth inequality on
entrepreneurship. Small Business Economics. 47(4). pp.895-920.
Huang, J., Henfridsson, O., Liu, M. J. and Newell, S., 2017. GROWING ON STEROIDS:
RAPIDLY SCALING THE USER BASE OF DIGITAL VENTURES THROUGH
DIGITAL INNOVATON. MIS Quarterly, 41(1).
Micelotta, E., Washington, M. and Docekalova, I., 2018. Industry gender imprinting and new
venture creation: The liabilities of women’s leagues in the sports
industry.Entrepreneurship Theory and Practice. 42(1). pp.94-128.
Mullins, J., 2017. The New Business Road Test: What entrepreneurs and investors should do
before launching a lean start-up. Pearson UK.
Munoz, P. and Cohen, B., 2018. Entrepreneurial Narratives in Sustainable Venturing: Beyond
People, Profit, and Planet.Journal of Small Business Management. 56. pp.154-176.
Street, C., Galupe, B. and Baker, J., 2018. The influence of entrepreneurial action on strategic
alignment in new ventures.
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.
Zane, L. J. and DeCarolis, D. M., 2016. Social networks and the acquisition of resources by
technology-based new ventures. Journal of Small Business & Entrepreneurship.28(3).
pp.203-221.
Online
Entrepreneurial skills. 2018 [Online] Available Through:
<https://www.mindtools.com/pages/article/newCDV_76.htm>
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