chapter 14 business ideas Flashcards
what are internal sources
own strengths
own weaknesses
list internal sources for new entrepreneurs
1 skills and hobbies
2 experiences
list internal sources for business
1 R and D
2 Intrapreneurship
3 Brainstorming
4 sales personnel
what are external sources
opportunities in the outside market
threats in outside market
list external sources for new entrepreneurs
1 family and friends
2 media
3 import substitution
4 state agencies
list external sources for business
1 media 2 import substitution 3 competitors 4 customer feedback 5 use a market research company
explain skills and hobbies internal for new entrepreneurs
turning a talent into a profitable business
Bill Gates had an interest in software- at 13 was developing software- led to Microsoft
explain experiences internal for new entrepreneurs
learn from life in a diff country
Richard Branson had bad experiences on other airlines so set up Virgin Atlantic Airways
explain R&D internal for business
develop new products
improve existing products
Coca Cola come up with new flavours and products to maintain sales against competition
explain intrapreneurship internal for business
ideas from employees though suggestion schemes or boxes
a good idea may be rewarsed by a bonus
managers need to he open to new ideas
Sony playstation was a worldwide success so microsoft employees proposed their idea for the Xbox to Bill Gates
explain brainstorming internal for business
thisbinvolves people from diff areas of the business coming together and creatively thinking up new ideas
the diversity of the team assists in the creativity process
all ideas are called out
leader writes down ideas
all ideas are viable
every idea is examined using SWOT
worthwhile ideas go forward
explain sales personnel internal for business
market research or feedback from sales representatives is a major source of product innovation and new product ideas
explain family and friends external for new entrepreneurs
complaining about a product
lack of a product
Bistro two wives complained to husbands about making gravy
explain media external for new entrepreneurs
following trends eg on instagram
explain import substitution external for new entrepreneurs
replacing an imported product with a home produced product
explain state agencies external for new entrepreneurs
LEO and enterprise Ireland mentor and give their market research to help entrepreneurs
explain media external source for business
seeing something on TV
reading an article
lack of a product
reports on men’s grooming- grooming rooms ‘Males’ opened in Dublin
explain import substitution external for business
Joe Murphy ‘Tayto’
Geoff Read ‘Ballygowan’
explain competitors external for business
monitoring competitors and copying some of their product ideas, while being mindful of patent and copyright law
Samsung and Apple
Coca Cola introduced Deep River Rock
explain customer feedback external source for businesses
customer complaint/feedback could result in changes or in further developments of existing products
Pizza Hut introduced four for all pizza for families
McDonalds introduced salads and fruits
explain use a market research company external for businesses
to identify gaps in the market and market trends
companies can then exploit these gaps or niche markets
list development process of a new product
1 idea generation 2 product screening 3 concept development 4 feasibility study 5 prototype development 6 test marketing 7 product launch
1 idea generation
as many suggestions possible
internal sources
external sources
brainstorming
2 product screening
all ideas are vetted and the impractical and unworkable ideas are dropped leaving the most viable ones for further examination and development
SWOT
careful screening helps businesses avoid huge expenses in developing ideas that str subsequently not marketable
ensures that good opportunities aren’t lost
3 concept debelopment
what will the product do
what will the product look like
what is its USP
concept development gives the business s specific plan to follow to develop the product further
4 feasibility study
breakeven point
cash flow forecast
state agencies provide grants for this research
this is carried out to assess if a product has potential
it looks whether it can be produced technically (production feasibility)
if it will be profitable (financial feasibility)
it seeks answers to questions such as what will it cost to produce and can the business afford it
5 prototype debelopment
developing a sample or model of a product
it’s produced to see what materials are required to make it
it can be used to test the product to see if it conforms to certain standards
to determine what adjustments/ improvements have to be made before deciding to go into full production
6 test marketing
it involves doing a small scale trial to identify possible faults
to assess customer reaction
the product is tested on a sample of potential customers
product may be refined based on responses
reduces risk of failure
7 product launch
full scale production sale in market engage in a marketing campaign consumers aware of product consumers desire for product
skoda kodiaq 1 idea generation
employees in R and D
brainstormed ideas
Skoda Kodiaq 2 product screening
new car
considered the market segment they were in
but decided a gap existed for a large sport SUV
Skoda Kodiaq 3 concept development
develop a large and affordable 7 seater SUV
attract new customers
USP would be windscreen ice scraper and umbrellas at front doors
Skoda Kodiaq 4 feasibility study
production feasibility it could be made
financial feasibility sufficient sales to generate a profit
Skoda Kodiaq 5 prototype debelopment
made 47 prototypes
covered 700,000 km
Skoda Kodiaq 6 test marketing
roadshow to show Irish customers
feedback was collected
Skoda Kodiaq 7 product launch
extensive advertising campaihn
pre orders for 50% of their projected sales
stakeholders that use the business plan
employees- job security and wage increases
shareholders- ROI and dividend
financial institutions- ability to repay loan
managers- bonus for reaching targets
suppliers- creditworthiness, sells goods in credit
state agencies- grants
