Entrepreneurial Development: A Business Plan for Away with Kids Spa

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Entrepreneurial Development
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Table of Contents
Section 1: Introduction...............................................................................................................3
Section 2: Opportunity Formation.............................................................................................4
Section 3: Opportunity Development.........................................................................................8
Section 4: Conclusion..............................................................................................................13
Reference List..........................................................................................................................14
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Section 1: Introduction
Entrepreneurial development is one of the most important aspects of developing a business
idea and ensuring that the idea is implemented in the business process. Entrepreneurs make
use of different types of entrepreneurial ventures for developing their business and meeting
with the demands of the market. It is necessary for the entrepreneurs to make sure that they
are developing their services and products in order to cater the needs of the customers in the
market. Hair dressing saloons have become a craze amongst people from different age
groups. However, there was a notable diversification amongst the entrepreneurs and business
owners, as they developed saloons and spas for both men and women. The study will be
developed to cater the requirements of kids or minors, as there are no such spas for meeting
with the requirements of children.
The proposed business idea is formed for developing spas that provide services to kids. The
name of the company is “Away with Kids Spa”. The spa will look to provide services to
children in the form of free childcare and other kids programme. Besides this, the company
will look to provide quality services to the consumers. This will in turn allow the company to
increase their profit generation in the market. It is necessary for the entrepreneurs to make
sure that they apply relevant theories of entrepreneurial development so that they can
understand the opportunities that are available in the market.
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Section 2: Opportunity Formation
Opportunity formation is ideally the most important stages of entrepreneurial development. It
is important for an entrepreneur to identify opportunities in the market so that they are able to
make use of the same and develop their business. However, it is necessary for entrepreneurs
to select the right entrepreneurial venture in the process of business development (Morris et
al., 2018). In order to develop Away with Kids Spa, it is essential for the entrepreneur to
make use of small business entrepreneurship. This will allow them to ensure that they are
able to conduct their business in an authentic manner. Moreover, it will help them to increase
their profit generation in the market and cater the needs of the customers that they are
serving. The spa will be developed with the aim to generate profit and make sure that they
can sustain their business in the market and develop in a stronger business (Brooks et al.,
2014). Enhancing the quality of their services and products will allow them to meet with the
demands of the market.
Problem Statement
According to the CEO of the company, it was noted that hair dressing spas and saloons were
never a major problem in the United Kingdom. However, saloons that could meet the
requirements of kids did not evolve in the country. As a result, the entrepreneur was able to
identify the problem and made it a point that a saloon could be developed that would help to
cater the requirements of kids. Moreover, female customers were used to visiting the beauty
parlour almost every month. Due to this, it became evident for the entrepreneur to develop
the saloon named Away with Kids Spa. This will allow them to increase their profit
generation in the market and operate in a successful manner.
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Figure 1: Historical Growth of Saloon
(Source: salontoday.com, 2019)
Available Opportunity
Due to the problem stated above, the entrepreneur was able to see an opportunity in the
market for developing a saloon that would focus on providing quality services for kids. The
entrepreneur has to work on the available opportunity to make sure that they are able to meet
with the market needs and earn revenues at the same time. As a result, it becomes important
for them to implement adequate theories related to entrepreneurial development.
Theories relating to Entrepreneurial Development
Selecting the right theories is of utmost importance for the entrepreneurs. This allows them to
identify the opportunities existing in the market. As a result, it provides them with enough
scope for developing their business in the right manner. It will help them to make use of the
existing opportunities and implement them in their business process. This section discusses
two of the major theories relating to entrepreneurial development. These theories have been
discussed below in a precise manner:
Entrepreneurial theory of uncertainty bearing
Frank Knight initiated this theory in the year 1957. The theory stated that there are uncertain
risks in the development of a completely new business. It is necessary for the entrepreneurs to
make sure that they have a clearer idea about the risks that they could be facing in the process
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of developing their business. The theory further stated that entrepreneurs should be most
likely to bear risks in order to gain rewards from their business. There are mainly two types
of risks faced by entrepreneurs in their business. They are non-insurable risks and insurable
risks. Well, it is important to understand the significance of these two types of risks (Espíritu-
Olmos and Sastre-Castillo, 2015). There are times, when individuals are unaware of the
intensity of the risk that might have a negative impact on their business. These risks cannot
be diminished easily and no estimation can be made on their intensity. In most cases, it has
been noted that rise in prices of goods and commodities or changes in the supply or demand
might create hindrance in the business operations. However, there are instances, when the
entrepreneurs are able to calculate the risks by developing an estimated plan. This will help
them to ensure that they are taking all the necessary measures to overcome the risks. Such
risks may include the theft of a certain commodity or a huge fire in the premises of the
company (Fayolle and Liñán, 2014). The intensity of these risks and challenges can be
calculated in the business and entrepreneurs are able to deal with them in a precise manner.
The opening of Away with Kids Spa will be highly based on the use of this particular theory.
This theory will allow the entrepreneur to understand that they might face high risks in the
market because of some already developed saloons and spas. However, the entrepreneur
should take this up as a challenge and make sure that they are able to find new opportunities
in the market for the development of the entire business process. They have to understand
that if they are facing risks in their business, it provides greater scope for earning profit in the
market. However, there are certain drawbacks that the theory caters. The role of the theory is
not just limited to bearing risks in the market. It fails to explain the role of an entrepreneur in
a detailed manner (Bylund and McCaffrey, 2017). Earning profit in the course of the business
is not as easy as it appears to be. This theory simply states about bearing risks and increasing
the profit income. Therefore, the entrepreneur should implement the theory with proper
understanding so that it does not create any hindrance in their business development.
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Figure 2: Entrepreneurial Theory of Uncertainty Bearing
(Source: Bylund and McCaffrey, 2017)
Entrepreneurial Theory of Economy
Economy is one of the key factors that instigate the growth of entrepreneurial activities in
their business. It has been observed that entrepreneurs in most of the cases look to analyse the
economic support that they might be receiving in the market. The theory states that
entrepreneurs are able to make use of their entrepreneurial skills for economic prosperity. As
a result, it helps them to manage their profit generation in the market. Besides this, the
implementation of the said theory allows them to increase their urge gaining profit in the
market (Teece, 2014). They are able to make use of different techniques to analyse the
conditions and know whether they are favourable enough for the prosperity of their business.
It allows them to make the right decision in their business and ensure that they are enhancing
the quality of their services and products.
There are instances when the organisation might face issues in terms of making use of their
available resources in the process of business. It becomes important for the entrepreneurs to
ensure that they are using their resources in the right manner so that they can maintain their
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service and product quality. Having a considerable amount of economic gain allows
entrepreneurs to stay motivated and meet with their organisational requirements. In the case
of Away with Kids Spa, their entrepreneurs should be able to aim for generating greater
amount of profit so that they can enhance their service quality. They should aim to provide
certain childcare to attract customers in the market (Aspromourgos, 2014).
Formation of Entrepreneurial Idea
Forming the entrepreneurial idea is important for the individual because it supports their
theory to gain control over their business objectives. After the problem was identified in the
market, the entrepreneur took the initiative of developing child-centred spa. This will allow
them to cater kids and provide them with their adequate needs. However, it was important for
them to implement the selected theory and idea in their business formation, as it will assist
them to gain a competitive advantage in the market (Welter et al., 2015). Their main business
idea revolved around the fact that they were aspiring to develop their own products in the
market. It will assist them to gain more customers in the market.
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Section 3: Opportunity Development
After the process of identifying the opportunity in the market, it is important for the
entrepreneurs to develop the opportunity by working on them. It is necessary for the
entrepreneurs to make sure that they are developing their own specific products so that they
can meet with the expectations of the customers in the market of operations. They have to
ensure that the prices of their products and services are lower that their competitors. This will
provide scope for their opportunity development. The proper development of opportunity for
Away with Kids Spa can be done with the help of certain steps as follows:
SWOT Analysis
The management of Away with Kids Spa use SWOT analysis for gaining a proper
understanding of the different internal factors that could have an impact on the development
of their business.
Strengths
One of the major areas of strengths for the saloon is their Unique Selling Point (USP).
Besides this, the entrepreneur should make sure that they are able to provide adequate
services to the customers in the market. They will look to provide additional services, without
asking for extra charges from the customers. This will help to develop their customer base in
the market (Sandlin, 2014). Moreover, their products will be developed in a manner that it
does not harm the users in a negative manner.
Weaknesses
While operating a spa business, there are certain threats that is faced by the company in the
market. One of the major threats that they face is related to the high cost of setting up their
business. Apart from this, it is quite challenging to provide a wide range of services under the
same roof. They might not get cheap workforce in their operating market. As a result, it will
add up to their expenses in the business. It is therefore, important for the business owner to
gather funds so that it could be used for enhancing their process of business operation.
Opportunities
Away with Kids Spa should be able to make use of different opportunities in their business
process. There are certain events, where they can provide a discount to their regular
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customers. This will further help to increase their customer loyalty for the company.
Moreover, this will help to gain the attention of the customers in the market (Autio et al.,
2014).
Threats
The management of the saloon are most likely to face certain threats in their business. One of
the major threats that the company could face is extensive competition from the other spas
and saloons in the market. They will also face considerable amount of threats from
companies that have newly entered the market. This could impose a serious threat to the level
of customer loyalty towards Away with Kids Spa.
Idea Screening
This is an important step required for development of opportunity. It is necessary for the
entrepreneur to ensure that they select the right location for conducting their business. This
will allow the customers to reach out to the company easily. Initially the company will be
developed in the central part of London and gradually it will expand to different parts of the
country (Bocken et al., 2015). They have to gain the response of the customers in the market
and its analysis will help them to implement the idea in their business.
Testing of the Concept
In order to test the concept of the idea, the entrepreneur will conduct a sample that will help
him or her to understand about the response of the service users towards the development of
their business. Knowing the perception of the customers will allow them to make the
necessary changes in their business to suit their needs in the market.
Business Analytics
This portion will help to understand the ways in which some of the most important business
metrics could be analysed. They have to understand their expenses in the business and the
revenue turnover on a monthly basis. They have to focus on their techniques to develop
customer retention and meet with their satisfaction level (Holsapple et al., 2014). As a result,
they will have a better understanding of their business and the ways in which financial crunch
could be resolved.
Commercialisation
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The management of Away with Kids Spa will have to make use of different ways and means
by which they will be able to gain the attention of the customers and commercialise their
business. They could take recourse to a grand opening of their saloon so that it catches the
eyes of the customers.
Market Testing
This process is done after their business has opened in the market. The response of the
customers is gained based on their usage of the services and products that are offered to them.
They have to target the section of market that looks to get refreshment from their busy routine
and make use of services and products at lower price. Away with Kids Spa should ensure that
they are able to make the customers understand about their services and products.
Introducing the Services and Products
This important step of the opportunity development allows the saloon to introduce their
services and products in the market. They will gather the response of the customers and
understand whether their service users will accept their services and products.
Figure 3: Product Development Pathways
(Source: created by the learner)
Segmentation
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The company will segment the market based on the age, income and lifestyle of the
customers. The age group of the target market ranges from five years to forty years.
However, people of different age group are welcome. The income of the service users should
be that of upper middle class to upper class margin. People who are mostly concerned with
the treatment of their hair and skin will be targeted (Dietrich et al., 2017). This will allow
Away with Kids Spa to cater the extensive competition that they face in the market.
Marketing Mix
It is important for the management of Away with Kids Spa to make sure that they are able to
make their product promotion in the market. As a result, they take recourse to using the 4Ps
of marketing mix. The detailed discussion about the 4Ps has been done below:
Product
In case of Away with Kids Spa, their sole product is their service that they have offered to the
customers. The company aims to develop their services in such a way that it helps them to
provide better customer experience. Additional services alongside the regular ones will help
to enhance their product quality. They will have professionally trained employees in the
workplace so that it allows them to cater the services of the different departments (Huang and
Sarigöllü, 2014).
Price
The marketing mix will help them understand that the prices of the products are neither too
high nor too low. As a result, they will be able to ensure that they are earning profit in the
market. Lower prices of their services would mean that they are about to incur losses in their
operation (Londhe, 2014). Therefore, having a proper strategy will allow them to maintain
their profit margin.
Promotion
Away with Kids Spa will take recourse to promotional activities for making their customers
aware about their services and products. This acts as a means to gain the customer’s attention
and they will be able to provide for their requirements in an authentic manner. They can get
help from different social media sites and other websites to post their advertisements. As a
result, reaching out to the target customers becomes easier (Armstrong et al., 2015).
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