Post Use the Timmons opportunity/people/resources framework from B to evaluate this new venture. Would you invest in this venture? Why/why not? Yes, I would like to invest in this venture due to the following reason The analysis from Market research indicates clearly that there is a customer segment who wants to buy through mail-order, so business opportunity exists. People like Dicken Addis, Director of Finance and Elizabeth Preis, Director of Marketing are worth enough to be invested.
They have valuable experience in their respective fields and their business plan demonstrates a clear understanding of the product. The first competitive advantage is being the first in mail-order. The break-even analysis and cash flows are convincing, and the associated risk factor is minimal.
What are the purposes of this business plan? Does it fulfill these purposes? What would Sahlman (How to Write a Great Business Plan) think of it? Sahlman might consider this business plan to be straightforward, with minimal unnecessary information.
The business plan covered The People, The opportunity, and Risk&Reward but did not address The Context. It neglected crucial factors like inflation, demographic trends, interest rates, and the determinants of success or failure. However, it did acknowledge break-even concerns and positive cash flows. Can you propose any enhancements to the business plan? Moreover, it failed to emphasize the benefits of an online business. Hence, I suggest including a few advantages of being an ecommerce product such as utilizing a “Just-in-time” procurement system for increased inventory turnover and reduced working capital. Additionally, there are endless possibilities for automation in an online business.
You can streamline your order and payment procedures, manage your inventory, and handle customer support tasks. However, there are drawbacks to consider. The cost of IT infrastructure and security can become significant as your business grows. Additionally, establishing credibility may require a high initial investment as customers may perceive a risk of fraud. This can make it challenging to acquire customers and build a brand. On the positive side, online collaboration and networking offer opportunities for global expansion and partnerships with other businesses. Amazon serves as a successful example of collaboration using an online business model.
Direct Cost Savings: These are savings in expenses other than labor, such as print, paper, telephone, and travel costs. These savings can be directly attributed to the implementation of online collaboration.
Labor and Productivity Savings: These refer to the savings in time needed to complete tasks as a result of implementing online collaboration.
Are the founders realistic about fund raising? Yes, the founders truly believe in raising funds for this venture. They consider themselves to be ‘first-movers’ and have a response rate of 85% for a ‘hit rate’ of 33% who are interested in purchasing tights through mail-order.
If they fail to raise 110,000 pounds in the next 30 days, there may be consequences. However, market research data can support their efforts to achieve this target. In the event that the team is unable to raise the desired amount, they should concentrate on developing the business with the available seed money while also searching for startup financing opportunities. Investors prefer to invest in operational businesses, so it is essential to focus on business development instead of solely fundraising for the next six months. It is advisable to adopt a proactive approach and gradually build value in the business.
