Explain the Factors Affecting Business Establishment and Performance
Answer the discussion question post, it has to between 200-250 words including 2 references. You have to agree or disagree with the statements in the discussion post.
here is the discussion post:
With any company, such as “The Swim Sensor”, when first starting out raising money is the key to becoming a business. Entrepreneurs must raise money to develop their company. Having investors that give the company money is one of the main concerns of the entrepreneur. There are several ways to appeal to investors. Writing a business plan is one of the main ways and best ways an entrepreneur can reach out to investors to try and appeal to the investor to raise money for their company. Many entrepreneurs will make a few mistakes when writing a business plan and pitching the business plan to investors. With my company “The Swim Sensor,” the two main business plan mistakes that”The Swim Sensor” has made that will impact the ability of The Swim Sensor to raise money are having an underestimating of the different competitors in the market and setting a market valuation.
The company, “The Swim Sensor,” believes that it produces a “unique” product that similar competitors do not offer. Underestimating competitors and their products are one of the main mistakes an entrepreneur can make (DocstocTV, 2011). Investors are thrown off when a company over-hypes products as being a “unique” product that no other competitor can offer (Tempest, 2021). There is no such thing as a “unique” product and no competitors (Tempest, 2021). There will always be a company that has a similar product (Tempest, 2021). Additionally, investors are thrown off when business entrepreneurs put too much emphasis on their competitors and the competitor’s product (Tempest, 2021). When too much emphasis on the competitor is shown, investors are less likely to give money to that entrepreneur (Tempest, 2021).
The Swim Sensor believes that it is the only company that offers the unique product of giving an athlete their biomechanical break down via an app. The company believes having this unique feature will appeal to consumers. Which would make consumers want our product over competitor’s products. To eliminate this business plan mistake, The Swim Sensor will assess the competitor’s product more in-depth to analyze whether or not the product is truly setting us apart from other competitors. Not boosting about a “unique” product and less about The Swim Sensor competitors in the business plan will allow investors to give money to The Swim Sensor.
Secondly, the other main mistake that The Swim Sensor company is making in the business plan is setting a valuation. Setting a valuation instead of letting the market decide the valuation of a specific product will turn off investors (DocstocTV, 2011). Putting the product on the market and experimenting with what price appeals to consumers and benefits the company is the best way for investors to invest in a company (DocstocTV, 2011). Setting one price for a product and not changing the price is the consumers do not purchase the product will not appeal to investors (Tempest, 2021).
The Swim Sensor company will fix this mistake by adjusting the price for the product by how the consumer reacts to it. Re-analyzing the price of competitor’s products, will allow the price of our product to compete better in the market. After the product has been on the market for a few months, re-analyzing both the competitor’s prices and how the consumer is reacting to our product will determine how the product price adjusts. Adjusting the prices of the product will appeal to investors because they know the company is trying to make the most income to make the investor money.
References
docstocTV. (2011). 6 Business Plan Mistakes that Will Turn Off Investors. YouTube. YouTube.https://www.youtube.com/watch?v=J4FbP6lcQpw&t=154s&ab_channel=docstocTV. (Links to an external site.)
Tempest, G. (2021, March 8). 10 Common Business Plan Mistakes. Small Business BC. https://smallbusinessbc.ca/article/10-common-business-plan-mistakes/.
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word limit:245