Bus3Ent : Individual Business Assessment Answer

MAS5517

Business Management:

Questions:

1. Market Feasibility (where possible, please support this session with relevant facts and figures)
1. What is the size of the market?
2. What is the growth rate of the industry?
3. Is the market at full capacity?
4. Who and Where are the customers?
4. Where are customers getting the product now?
6. How many would purchase from you?
7. What external factors come to bear? Government, Industry Dynamics
8. What keeps new competition from entering this market? (Barriers to Entry)
4. Technical Feasibility (where possible, please support this session with relevant facts and figures)

Major questions to be addressed:
1. What are the options for developing the technology (customer, off the shelf, design yourself, subcontract)?
2. What are the options for producing the product or service?
• In House
• Subcontract
• License
• Joint Venture or Partnership
• Combination
3. What are the options for Sales and Distribution?
• In House
• Whole Sale
• Distributors or Sales Representatives
• License
• Joint Venture or Partnership
• Combination

4. What resources are required for development and are they available to you (skills, raw materials, components, suppliers, facilities & equipment)?

5. What are the laws and regulation relating to the business?
• Industry Standards or Regulations
• Personal Certifications
• Intellectual Property (Patents, trademarks, copyrights)
• Environmental Liability

6. Has the research discovered any moral or ethical issues that you are uncomfortable with?

7. What technological changes are changing or emerging that may affect the business?

5. Financial Feasibility (where possible, please support this session with relevant facts and figures) Major questions to be addressed:

1. What are the projected Revenues from the sale of your product or service?
• From the Market Research, what is the projected sales volume in "units sold?" and in "dollars sold"?
• From the Market Research, what is the selling price per unit?
• What is the total expected revenue?
2. How much is the start-up costs and equipment/capital costs?

3. Prepare the Profit and Loss statements for the first 3 years.

.4. What are the possible sources of financing?
• Where is the money from?
• Chances of getting the money?
• What will you have to give up?
Note: General Financial Numbers that would indicate attractiveness of Venture
• Gross Margin 20 – 30% plus
• Net Profit Margin – 10 to 15%. Plus
• Return on Investment – 15% plus
• Payback – 3 years or less.
• Break even – 2 years or less
These numbers must not be looked at in isolation over a one-year period. You need to look at the numbers over a 3-year period and as a whole, not just individually. Industry averages can be quite different.

6. Human Resource Feasibility (where possible, please support this session with relevant facts and figures) Major questions to be addressed:
1. What is technical and management experience required?
2. Who are the owners and what are their roles? (Entrepreneur, Manager, Technical Expert)
3. What is the ownership structure?
4. What are the manpower requirements?
a)  How many employees will you need in the 1st, 2nd and 3rd years?
b) How will you find the right employees?
c) How will you compensate employees (pay for time, for production, for knowledge, or a combination)?
d) How will you motivate employees?
e) What training will they need on an ongoing basis?

5.What is the company’s growth strategy?
a)How will quality be managed and maintained?
b) How will organizational structures change with growth?
c) What career paths will employees have available?