Forming an Innovative Business - Essay Example

Forming an Innovative Business Describing the innovative idea In the last three decades, the laundry services have adequately expanded and developed. It has further evolved from staff laundry services to self-service laundry services. Further, the companies in the laundry business today not only offer the laundry service to their respective client but also offer free transport and delivery services to their door step. This has adequately instilled competition in the laundry service industry. Following the continued growth and advancement in technology witnessed by the world today, most service industries have integrated technology in the day to day running of operations in the different parts of the world. Soft drink companies such as Coca-Cola and Pepsi have integrated the use of vending machines in delivering their products to the market something that has largely enhanced the sales of the two companies and further enhanced the level of revenues (Andrew, 2010). The Banking sector of the world is today dominated by use of the ATM cards. My idea is to start self-service debit card laundry services in Wales. The laundry machines will be operated by use of the credit cards and will be situated in strategic public areas in the city of Cardiff. The bigger part of Wales is dominated by the coin laundry machines. Business structure Since it is a new venture, I will choose a business structure that is simple and with less departmentalization. In this regard, I will go for a general partnership form of business. Different scholars and authors of the world have defined a partnership type of business as simply as a business that is created by two or more individuals. The number of partners is limited to between two and twenty (Cole, 2011). In a partnership, every partner has to contribute to the capital that is used in the business. The partners further share the profit or losses in the profit sharing ration. In this regard, there a number of key reasons as to why I will go for a partnership form of business. Such reasons include the fact that a partnership form of business does not pay income tax and instead the shared profits or losses are reflected on the personal gains of the partners when remitting tax. Nevertheless, any partnership business is required by law to present its annual information in form of reports on gains, deductions, income and even losses per annum (Allen and Sherer, 1995). Starting a partnership form of business easier in terms of finance since the different partners contribute money inform of capital to be used to start the business (Allen and Sherer, 1995). A partnership has lesser legal requirements as compared to limited companies and cooperatives. All that is required to start running a partnership is only a partnership agreement between the parties to the business. The profits are shared equally by the partners and also the losses. Therefore, unlike in sole proprietorship partners share losses together hence no one suffers a total loss. The partners share the roles and responsibilities of the business. The task of running the business is further simplified. Different individuals have different skills, talents and expertise. This means that bringing different persons together is like converging talents, skills and expertise together. This creates more room for innovations and generally boosts the quality of service and products produced by the business. Also, availability of partners in a business enhances the quality on business roles and responsibilities since every partner is assigned to the role or responsibility he or she is best in. Stages in the entrepreneurial process Idea generation Every new business venture begins with just an idea. Different scholars and researchers of the world suggest that even the great companies of the world such as the Becton Dickinson Company, Google Company and even Apple Company began with just a simple idea from an individual. An idea is therefore a very strong element in the field of business. Business ideas are adequately generated in relation to an existing needs or prevailing market gaps that certain persons feel the need to satisfy in a particular market or capitalized on. In this case I feel that the laundry industry in Wales is dominated plainly by the coin-laundry machines offering standardized laundry services. Integration of the debit card laundry machines in Wales has the potential of dominating a substantial market proportion. The particular businesses operating in the laundry industry in Cardiff have largely invested in the coin-laundry machines and bearing in mind that the city of Cardiff is not only a business centre but also a sport center and not forgetting the number of universities present in the city. In this case, the only resources I need is a pen, a paper and my brain. Opportunity evaluation After generating the business idea, it is always important for the entrepreneur to ask himself or herself questions such as ‘is the underlying opportunity worth an investment?’ in this phase, the entrepreneur conducts a market research on the established business opportunity. Some of the tools needed to assess my opportunity in this case include SWOT analysis and PESTEL analysis. The SWOT analysis (Strengths, Weaknesses, Opportunity and Threat Analysis) will be important in this case in establishing the business’s key strengths and weaknesses and adequate in outlining the key opportunities and threats the business may face in Dubai. PESTEL (Political, Economic, Social, Technological, Environmental and Legal) analysis will also be vital in establishing the different political, economic, social, technological, environmental and legal factors in relation to the business idea of the business. The vital resources in this stage are financial and human resources. Planning In this stage, it is considered that the entrepreneur is already decided on investing in the underlying opportunity. A plan is therefore needed to capitalize on the particular opportunity. Such plans may begin as just some simple ideas from the entrepreneur or the other partners to the business. Normally for any business, both long-term and short-term objectives are vital. The idea initiators therefore develop both operation plans strategies. The operation plan in this case is to provide quality coin-less self-service laundry service to the residents of Cardiff. The strategy is to become the largest coinless self-service laundry provider in Cardiff City and in other parts of the Country in the next seven years. The resources required in this case include capital, human resource and time. Other assets such as the intellectual property, physical assets as well as the personal relationships will as well be required. Planning tools are also significant in this stage. Business Launch After establishing that a compelling opportunity exists and having developed sufficient operation plans and strategies, the plans are normally put into actions. Having established General partnership as our core business structure, partnership agreement will be the first thing to sign so as to commence the laundry service operations in the Cardiff city. Secondly, it is also of great importance to seek other legal formalities in relation to start of business. Business start-up legal formalities tend to differ across different nations of the world. Capital contribution is vital in this particular stage. Therefore, the resources needed to excel in this stage include the human resource, financial resources and physical assets required to launch the business operations. Growth After the launch of the business, the management and the employees work towards making the business or the company a success. With the sale of the coinless self service laundry to the residents of Cardiff, we aspire to grow the business further from revenues from the business operations. At this stage, Human resource and revenues are critical for the growth of the business. Further, performance analysis tools such as benchmarking tools are important in measuring and analyzing the performance of the business. The market for the innovative idea The growth of the laundry service industry in Cardiff can today be estimated to be approximately sixty percent in the last five years with very few new players coming into the industry (AS/NZS, 2000).There has not been any advancement in the nature of laundry services offered to the key consumers. The laundry service customers to our business are expected to be both male and females of ages between twenty and thirty years. It is also expected that the most of our customer will be not married since most married people own their own laundry machines. The customers are expected to be beyond the basic education since they will be operating the laundry machines on their own. We will therefore be targeting the rising number of students in Cardiff City. Also, most of the laundry service customers we wish to target in the city are business men and women and football fans from different regions of the world. Further, the customers targeted by our laundry business are expected to be both residents and no-residents of Cardiff City who have rented houses with small families and mostly with no children. Our business aspires to make the coinless self-service laundry affordable to the medium and low income earners whereas our competitors provide laundry services to only the few who are able and in a position to pay for the services; laundry and delivery services. Competitors who already exist in the Market The business will be competing directly with other laundry service companies such as Drift in, Top Hart Cleaners and Launderers, Penylan Launderette, Fabricate and Johnson Cleaners amongst others. Most of the laundry companies based in Wales have more than one outlet in Cardiff City and across Wale. These are the type of companies who have dominated the laundry business in Wales and recorded sales of million garments per year. Our business is yet to begin its operations in Cardiff hence it has no share of the laundry market in city. Our business wishes to earn at least a twenty percent share of the Cardiff market within the first three years of its operations. Our business will be competing directly with the pick-up and door to door delivery services offered by some of the laundry companies in Cardiff which has seen them grow at a high rate and even expand their operations outside Wales. Since our business will be new, we will be competing locally with the likes of Drift in Company and Top Hart Cleaners and Launderers. Since these companies have been in existence for more than five years, they not only compete locally, nationally but also regionally with other laundry service companies in UK. The demand for the laundry services in Cardiff is perceived to be constant following the continued existence of laundry firms in the business. The state of both the local and the national economies are expected to affect the laundry services in the country since the better the economies; local and national, the better the profits accrued from the business. Action plan to the unforeseeable barriers As trade partners, we will adequately be assessing our performance quarterly and yearly. This is to ensure that our business sticks to the stated goals and objectives. The business will also be conducting customer assessment in regard to the self-service laundry. This will be geared towards ascertaining the customer satisfaction. The performance assessment will be mainly based on the number of customers to have accessed the coinless self-service laundry in the specific timeframe; a month, three months or even one year as well as the revenues to the business in a certain period of time. This way we will be able to ascertain the direction that the business is taking. The partners will therefore be in a position to provide remedies on realizing that the business is not doing well in a certain field. For example, if the business will have failed in its marketing strategies, the business will develop and integrate new market strategies so as to continue operating in the particular market. References Allen, Franklin and Peter D. Sherer. (1995). The Design and Redesign of Organizational Form. In Redesigning the Firm, E. Bowman and B Kogut, editors. Oxford University Press. Andrews, W. (March 2010). Finger vein vending machine: e-money at your fingertips. Japan Trends. Retrieved from http://www.japantrends.com AS/NZS 4146. (2000) Laundry practice. Strathfield New South Wales and Wellington New Zealand. Standards Australia International and Standards New Zealand. Pp. 59 Cole, Rebel, A. (2011). How Do Firms Choose Legal Form of Organization? Retrieved from https://www.sba.gov/sites/default/files/files/rs383tot.pdf Read More