N.imanipour,fall2008 The Successful Business It is not enough merely to survive; The goal is to...
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Transcript of N.imanipour,fall2008 The Successful Business It is not enough merely to survive; The goal is to...
n.imanipour,fall2008
The Successful Business
It is not enough merely to survive;
The goal is to succeed
n.imanipour,fall2008
Factors of a successful BusinessThe Business ConceptUnderstanding the market Industry Health and TrendsConsistent Business Focus and clear
strategic positionAbility to attract, motivate and retain
employees
n.imanipour,fall2008
Factors of a successful BusinessFinancial controlAnticipating and adapting to changeCompany's value and integrity
n.imanipour,fall2008
The business concept
Thomas Edison:“Anything that won’t sell, I don’t want to
inventSource of Business Idea:
Previous work experienceEducation or trainingHobbies, talent or other personnel interestsRecognition of an unanswered need or
market opprtunity
n.imanipour,fall2008
The business concept
The successful business has at least one of these elements:Something newSomething betterAn underserved or new marketNew delivery system or distribution channel Increased Integration
ŹŚƧƹŜƀƧƾƬƇřƭƺƸƠƯ
ƵŵźųƕƺƳŻřŚưƃŹŚƧƹŜƀƧŚƿōƾƯƾŤƳźŤƴƿřŚƿƹƖ ƿŻƺţ Ŷǀƫƺţ ƾţŚƯŶų ƾƃƹźƟ� � �ŶƃŚŝ�
ƾƯƍƺŝźƯƾŤƘƴƇƶģƶŝŶƃŚŝ�
ƾƯƾţŚƯŶųŚƿƹšLJƺƈŰƯƶģŶǀƃƹźƟ�
ŶƴŤƀƷƾƳŚƀƧƶģŚưƃƵƺƤƫŚŝƱŚƿźŤƄƯ�
ƽĦţřźŤſ ř .ŶǀŗŚưƳŮƿźƄţřŹŵƺųƁƹźƟƾŝŚƿŹřŻŚŝƾƬƧƽŚƷ
ƾƯŵƺųŜǀƣŹƱřƺƴƗƶŝřŹŚƸŤƧźƃŻřƕƺƳƭřŶƧŚƿƹŚƸŤƧźƃƶģŶǀƴǀŝ�
ƶƴǀƯŻŻřƭřŶƧźƷŹŵřŹŵƺųƾŤŝŚƣŹƽŚƿřżƯ :ŶƿŹŚưƄŝŵƺūƹšŹƺƇŹŵźƿŻƽŚƷ
:ŶƿŶūšŚƯŶų /šLJƺƈŰƯ
:ƵŵƹżƟřƁŻŹřƹšŚƯŶų /ƶŤƟŚƿŵƺŞƸŝƽŚƸǀĭĦƿƹ
ŶƿŶūƽŚƷŹřŻŚŝ :ƵŶƄƳƲǀƯŚţƾƟŚƧƵŻřŶƳřƶŝŚƿ
:Ɩ ƿŻƺţŚƿƩŚƜŤƃřƶŤƟŚƿŵƺŞƸŝŚƿŶƿŶūƽŚƸƃƹŹ
źŤƄǀŝƾĮģŹŚĜƨƿƽŚƸƃƹŹ :
n.imanipour,fall2008
Understanding the market
A great idea or new invention is not enough, you need a market that is:LargeaccessibleResponsive
e.g. ATM machine
n.imanipour,fall2008
Industry Health and trends
Your business does not operate in a vacuum!
If your business is in a healthy and expanding industry, investors are likely to be more receptive.
n.imanipour,fall2008
Clear strategic position and consistent business focus
A crucial factor is development of a clear strategic position that differentiate you from your competition, and then maintaining focus on that position
E.g. 4 companies are making jeans:Company A: selling work clothesCompany B: a sportswear manufactureCompany C: selling youth clothesCompany D: just selling jean!!!!
n.imanipour,fall2008
Clear strategic position and consistent business focus
A second aspect: developing a company style or corporate culture
E.g.: two restaurants with the same business mission: “providing good , fast food, priced at only a few dollars a meal”The A restaurant: a national burger chain.The B restaurant is a diner
n.imanipour,fall2008
Capable Management
Some of the common traits by successful managers:ExperienceRealismFlexibilityAbility to work well with people.
Do the key members of management team posses these characteristics?
n.imanipour,fall2008
Ability to attract , motivate and retain employees
A company is as good as its people!Unhappy employees are less motivated
to do excellent work.
n.imanipour,fall2008
Financial control
Key to any business is how it handles money! Make sure you have the information to
understand your financial picture on an ongoing basis. What does it take to open your doors each month? Where is your real profit center? How much expansion do you need to maintain
growth? What are the consequences of your credit policies? ….
n.imanipour,fall2008
Anticipating change and adaptability
The sources of change:Technological changesSociological changesCompetitive changes
n.imanipour,fall2008
What motivates you?
4 C:ControlchallengeCreativityCash
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n.imanipour,fall2008
Getting your plan started
5 steps of the business plan process:Laying out your basic business conceptGathering data on the feasibility and
specifics of your conceptFocusing and refining the concept based on
the data you compile.Outline the specifics of your business.Putting your plan in compelling form
n.imanipour,fall2008
Start your research by asking questions
How much information is enough?Suppose you are planning to open a dry
cleaning, what information do you need?What are the basic questions you have to
answer?
n.imanipour,fall2008
How many dry cleaners now serve the neighborhood? How profitable are the current dry cleaners in the
neighborhood? Are the residents satisfied with the current dry
cleaners? Is there more business than current dry cleaners can
handle? What are the trends in the dry cleaning industry
nationally? What are the demographic trends in this area? …
n.imanipour,fall2008
Suppose you recognize an opportunity to provide a family counseling services via the internet, what are the key questions you have to answer?
The research questions
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n.imanipour,fall2008
Historical performance of your companyPast sales records, broken down by product
line, time period, region,..Past trends in costs of sales.Overhead expense patterns.Profit margins on product linesVariation from budget projections…..
n.imanipour,fall2008
How to conduct your own market research
Personal observationInterviewsSurveyFocus groupLearn from other businessTalk to your competitionGetting help
n.imanipour,fall2008
Evaluating the data you’ve collected
Use the most recent data you can findTranslate data into units rather than
dollars.Give the most reliable source Integrate data from one source to
another in order to draw conclusion.Use the most conservative figures!!!
n.imanipour,fall2008
Now is the time to ask yourself some hard questions:Can the business be viable?Does a real market exist? Is there too much competition already?How does the financial picture look?
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n.imanipour,fall2008
HOW YOUR BUSINESS PLAN IS READ
The most asked question: Is the business idea solid? Is there a sufficient market? Are the financial projections healthy, realistic,
and in line with the investor’s or lender’s patterns?
Is the key management described in the plan experienced and capable?
Does the plan clearly describe how the investors or lenders will their get money back?
n.imanipour,fall2008
Getting your facts right. Length of the plan What period of time should the plan cover? The language of the plan:
Be careful with superlative? E.g. not to have say: “our service will be the best on
the market, clearly superior to all others” instead say “ our service will not only handle all the functions of existing services, but will also add features x, y and z and sell for at least w $ less than our closest competitor’ s services”
n.imanipour,fall2008
Use positive comments from third party sources :“ ترشه من ماست گه نمی بقالی “هیچ
Use business termsPoints of style:
Use numbers for impactUse bullet pointsUsing visual in your planavoid repeating a matter with in the same
section