women empowerment through micro finance

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women empowerment through micro finance

  1. 1. Planning An Entrepreneurial Venture<br />Prof.B.D.Gupta<br />IIPM,Kolkata<br />
  2. 2. Garage-to-big business model of entrepreneurship<br /> If you want to become reasonably big in this country, you have to start something new,<br />Do things that have not been done before!<br />
  3. 3. Bachelor of Economics and Political Science. <br />A first generation entrepreneur, he started his first business in 1976 at the age of 18, with a capital investment of Rs 20,000 borrowed from his father. <br />His first business was to make crankshafts for local bicycle manufacturers. <br />In 1980 he sold his bicycle parts and yarn factories and moved to Mumbai.<br />first Indian entrepreneur to identify the mobile telecom business as a major growth area and launched AirTel<br />In November 2006, he struck a joint venture deal with Wal-Mart, the US retail giant, to start a number of retail stores across India.<br />Sunil Bharti Mittal<br />
  4. 4. Crank shaft manufacturing<br />Example: Opportunity scanning and identification<br />
  5. 5. Example: Opportunity scanning and identification<br />
  6. 6. What made Sunil Mittal successful?<br />Personality traits: innovations, perseverance<br /> and risk-taking<br />Place of work : <br /> Ludhiana : Bed rock for small scale <br /> industry<br /> Mumbai: Power house for big business<br />Business tie up: with large companies e.g., Suzuki.AT&T,Siemens,Lucky Gold Star,British Telecom,<br />Experience of Marketing, Brand management,International Trades<br />Family: The son of a politician,<br />
  7. 7. Business model<br /> Visit International Trade fair<br /> Import & sell products<br /> Develop Indian market<br /> Manufacture import substitutes <br />(Example: push button phone from International<br /> Trade Fair in Taiwan)<br />
  8. 8. International Trade Fairs: Sept 09<br />Electronics India,Bangalore<br />Productronica India, Bangalore<br />Water-Sewage-Refuse-Recycling<br />Munich,<br />Analytica,Shanghai<br />Trade Fair for Golf Sport,Munich<br />
  9. 9. Profile of an entrepreneur:Sunil Mittal<br />Do things yourself: Open LC,Clear customs, Truck your product to the market,<br /> Learn how to deal with the Government and systems;<br />Be first in the market ( Speed);<br /> Speed or perfection? Always chose speed;Perfection will follow<br /> Be passionate about your business ( only one business at a time!);<br /> Be close to the customer,knowing what the customer wants <br /> Learn Import Policy, Custom laws,Exciselaws,Income tax laws, etc.,<br />
  10. 10. Sunil Mittal launched India’s first:<br />Mobile phone<br />Push Button Phone<br />Portable generator<br />First mover’s advantage<br />
  11. 11. Has technological leadership that can lead to cost advantages and economics of scale;<br />Can obtain and secure scarce resources before crowding<br />Can impose switching costs on buyers<br />What are the First mover’s advantages?<br />
  12. 12. Inertia makes it difficult to abandon or change the business strategy<br />Others can try different resource combinations<br />The underlying business concept may be revealed<br />What are the First mover’s disadvantages?<br />
  13. 13. How do the entrepreneurs generate a new business idea or select a new project ?<br />Ans: New business idea generation and final selection consists of three main steps:<br />Step 1. New business identification<br />Step 2. Preliminary Research<br />Step 3. Final selection.<br />Entrepreneurial idea/ opportunity<br />
  14. 14. Step 1. New business identification<br />New business ideas can be discovered from various internal and external sources.These may include:<br />1.Knowledge of potential customer needs<br />2.Watching emerging trends in demands for certain products<br />3.Scope for producing substitute product<br /> ( import substitute)<br />4.From professional magazines of certain industry e.g., computer,consumer electronics,music industry,fashion industry,games,food and entertainment industry,etc.,<br />
  15. 15. Step 1. New business identification<br />5.Success stories of known entrepreneurs or friends or relatives<br />6.Making visits to local and international trade fairs or exhibitions<br />7.Research organizations: Meeting with Govt. agencies e.g. CSIR,DBT,Research Institutes,etc<br />8.Ideas given by the knowledgeable persons<br />9.Knowledge of list of products reserved for small scale industry<br />10.A new product introduced by the competitor.<br />
  16. 16. 11.Past work experience ( without breaking the confidentiality agreement with your employer)<br />12. Hobbies and interests<br />13.Travel<br />14.The web<br />15.Published list of imported products,e.g., chemicals and pharmaceuticals<br />16.Research & Development of new products in the company R& D lab.<br />Step 1. New business identification<br />
  17. 17. Step 2. Preliminary Research<br />Once we have the outlines of a few business ideas,it is time to start researching those ideas for the followings:<br />1.Cost structure: What are the main costs involved for marketing and manufacturing?<br />2.Market structure:Selling price trends in the market,competitors etc.<br />3.Technology:Will the technology change in the near future.Any patent or exclusive right for the product?<br />4.HR issues: Is the industry depending on highly skilled labor?<br />5.Government regulations; Will it take long time get certain clearances e.g., pollution ?<br />
  18. 18. Step 3. Final selection<br />Before we make the final selection,we must perform<br />1. Porter’s five forces analysis for industry assessment:<br />A)Bargaining power of Suppliers<br />B) Bargaining power of customers<br />C) Threat of new entrants<br />D) Threat from substitutes<br />F) Competition within industry <br />
  19. 19. 2. SWOT analysis<br />Strengths:<br />Weaknesses<br />Opportunities<br />Threats<br />Step 3. Final selection<br />
  20. 20. Step 3. Final selection<br />3. Break even analysis<br />Selling price (SP) : Rs.10/piece<br />Variable Cost (e.g., cost of raw materials) <br /> (VC): Rs. 6/piece<br />Profit contribution per piece: Rs. 4/piece<br />Fixed costs ( Rent for office space,salary);<br /> (FC) Rs.5000./month<br />Break even quantity to be sold per month: <br /> Rs 5000/Rs 4= 1250<br />Conclusion: The company should sell 1250 pieces every month to recover its cost.This is called break even quantity.<br /> When the sale is more than 1250,the company starts making profit.<br />So, before final selection of the business proposal,the company should discuss,can it sell 1250 pieces per month?<br />If the answer is YES,the business should be selected for implementation.<br />
  21. 21. Conclusion:<br />Porter’s five forces analysis for industry assessment: the result should be favorable for the business proposal;<br />SWOT analysis should clearly identify the business strategies.<br />Break even analysis :<br /> The company should sell 1250 pieces every month to recover its cost.This is called break even quantity.<br /> When the sale is more than 1250,the company starts making profit.<br />So, before final selection of the business proposal, the company should discuss, can it sell 1250 pieces per month?<br />If the answer is YES, the business should be selected for implementation<br />Step 3. Final selection<br />
  22. 22. Book reference<br />Entrepreneurship; Rajeev Roy (Chapter 2: Growth of a business idea.)<br />

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