Saint Leo University Supply Chain and Inventory Management Essay

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Business Finance

Saint Leo University

Description

Part 1 Business plan

Physical facility

Include a description of the physical facility location for your business. Discuss the zoning and parking

requirements.

Supply chain and inventory management

If application, provide a description of how your business will manage and distribute its inventory.

The attachments are for the business plan all you are doing is just doing this part.

Part 2(a)

Some small business fails when they don’t do the proper viability study containing a market research before getting into the venture. The lack of research and planning puts the small business in total disadvantage. Lack of research about potential market price and market participants can induce the entrepreneur to enter in crowded niche making competition very difficult. On the other hand, if the entrepreneur carefully researches and invests in a viability study, he can learn about the market price and market participants because there is a limited amount of business that succeed. “According to the Bureau of Labor Statistics, about 20 percent of new businesses fail in their first two years. Within five years, about 45 percent have closed up shop. Just over a third of new businesses make it past their first decade.” (Wolstenholm 2020) No matter what the market is where the entrepreneur plans to compete in, there is only a limited number of businesses. Therefore, the entrepreneur must evaluate who is already getting the business and decide if he will succeed in getting customers to switch to the prospect venture and if the study indicates the venture can grow the entire size of the market. The entrepreneur needs to make sure there is enough demand for the service or product the venture will offer.

Even if viability study projects success, the entrepreneur can fail if he does not prepare an effective business plan. The business plan is essential for the success of the venture. “Without this detailed roadmap, the entrepreneur may not discover until it’s too late that: the barrier to entry in the market is higher than you anticipated; the business structure and processes are inefficient and creating too much overhead; the product mix doesn’t fit the market he is trying to reach, and he does not have enough capital to keep the venture going until it generates enough cash flow.” (Wolstenholm 2020)

The business plan must contain a company description, the organizational structure, market analysis, detail of products and/or services, sales and marketing strategies, distribution, funding needs, and revenue and profit projections. Any information missing may result in a very high probability of failure.

Another way an entrepreneur can fail is by not having an effective digital marketing plan. Times now, make digital marketing strategies very important. These techniques include but are not limited to learning proper on-page search optimization techniques, publishing regular blog content on your website, as well as other websites relevant to your industry, regular social media presence, including targeted ads, on the platforms its potential customers likely use pay-per-click advertising, in which you purchase, via an auction format, high search engine ranking ad space for specific keywords and phrases, collecting email addresses from customers and sending recurring e-newsletters with company updates and special offers, encouraging customers to leave online reviews to build credibility and social proof, and developing a mobile app to provide a better customer experience.” (Wolstenholm 2020).

A website or a Facebook page is not sufficient for people to find a business. The prospect business has to captivate potential customers through search activity. Failure to accomplished this will result in diverting visible customers to competitors.

To avoid failure, every business plan and strategy has to include a digital marketing plan. Failing during these pandemic times, digital marketing is the only channel to some customers. The digital marketing strategy includes online visibility, that can succeed or break the business in today’s digital world. Failure to stay updated and adapt to new trends is a frequent reason why small businesses fail. “While it’s never a good sign for any small business owner, failing at time management is particularly problematic for service providers. A number of providers charge by the job, not by the hour. This is fine, except when the business owner starts crunching the numbers.” (Wolstenholm 2020).

Another problem with time entrepreneurs faced into is spending too much of it on tasks they are effective. Instead of contracting a professional website designer, they try to do it themselves and fail because they are not experts. While they believe to be saving money on outsourcing now, inefficient work will cost the venture in the long run. Sometimes paying twice because they end up paying again for the inefficient task in the best scenario. The chances are the inefficient work led them to failure. The time waste includes the time the entrepreneur spends on these tasks.

The time you spend on these tasks is time you’re not doing what you do bet to make money for your business. If plying your trade earns you, say, $100 an hour, then the six hours you spent trying to build a website just cost you $600 (and probably left you with more frustration than results). Chances are, you could have put that towards a professional web designer for less the investment and time you put into doing it incorrectly.

To avoid this waste in time and money, entrepreneurs should analyze and measure the time in dollars to determine how long it will take to complete the job, then charge an appropriate amount based on how much the entrepreneur skill and expertise are worth. If after that analysis the entrepreneur feels is charging too much, then he should find a way to finish jobs faster or outsource it. “When it comes to outsourcing, compare how much you’ll spend on a third-party professional to what you’ll lose in revenue by not focusing on your customers. Perhaps above all though is the need to optimize your online calendar”. (Wolstenholm 2020).

Even if the entrepreneur did all the above, unexpected things still happen. A good example is the challenges and forced changes the pandemic did to the market. Other unexpected occurrences include property loss uninsured; liability claims uninsured or a natural disaster.

Other reasons for failure are no vision, no niche, no action , no commitment to learning and innovation, no follow up, no consistency, lack of desire to invest the required time. “Failure to understand customer behavior, inventory mismanagement, unsustainable growth, lack of sales, trying to do it all, underestimating administrative tasks, poor management, refusal to pivot and lack of data.

To avoid falling into any of these failure possibilities, the entrepreneur has to build a contingency fund or credit availability to cover for the business interruption of any potential shutdown. The entrepreneur must make sure the business is adequately insured in case the unexpected happens and property, content, and liability insurance. An entrepreneur must also analyze professional liability, workmen compensation to employees, and others.

The entrepreneur should also be prepared from injury and illness to protect you and your business against the risk of injury and illness,

“Business overhead expense (BOE) disability insurance, as its name suggests, is designed to cover your monthly business overhead expenses if an injury or illness impacts your ability to work. This includes everything from employee salaries and benefits to utilities, supplies, services, and taxes. Your BOE policy will quite literally keep the lights on for your business if you become too sick or hurt to work for an extended period of time.” (Wolstenholm 2020)

Additionally long-term disability insurance coverage can be designed to replace a major portion of your income if the entrepreneur is unable to work for an extended period of time due to injury or illness.

Although external factors can affect a small business, most failures result from failure to plan. “Entrepreneurs often get so caught up in the excitement of running a business that they don’t take the time to plan their operations, marketing, and finances.” (Wolstenholm 2020)

The entrepreneur needs a clear mission, and a business plan to be the map to success.

References:

Wolstenholm Marketing, J. (2020, October 5). 5 reasons why small businesses fail (and how to avoid each of them). Calendar. https://www.calendar.com/blog/reasons-why-small-businesses-fail/.

Ellevate. (2021, January 8). Eight common reasons small businesses fail. Forbes. https://www.forbes.com/sites/ellevate/2019/10/24/eight-common-reasons-small-businesses-fail/?sh=49ef7f54fbb5.

Lightspeed 2021-03-15, Lightspeed, Lightspeed, 2021-03-15, Written by Lightspeed , by, W., & Lightspeed is a cloud-based commerce platform powering small and medium-sized businesses in over 100 countries around the world. With smart. (2021, May 11). 10 reasons why small businesses fail (and how to avoid them). Lightspeed HQ. https://www.lightspeedhq.com/blog/why-small-businesses-fail/.

Part 3(b)

Entrepreneurs have ideas that they hope will allow them to one day operate their own businesses. Yet, many new businesses often fail. According to Zen Business ( Schaefer 2020 ), the top 8 reasons businesses fail are the following:

  1. Getting into business for the wrong reasons: A lot of people want the perks of having money, but fail to consider how hard the task to get there may be. Additionally, they lack the passion for what it is they are selling. A person who has a true love in what they do will naturally try harder.
  2. Not considering the market : In order to sell items or offer services, consumers must have a demand for what is being offered.
  3. Poor management: A successful business needs to have a leader with a vision and employees who understands the mission of the company and has a follow through.
  4. Not enough money: Underestimating what is needed to run a business is a quick way to get shut down.
  5. Picking the wrong location: Traffic, traffic, traffic! Having a product in demand does no good if there are no consumers to purchase it. Researching the area, surveying potential customers, and having a game plan in advance can prevent slow traffic and get more customer reach.
  6. Improper planning: Even if a business has a business plan, it has to be well executed. Understanding the risk of the business, the strengths, and opportunities for success is a must.
  7. Attempting to grow too fast: Some businesses appear as if they popped up over night and are generating funds. Many get excited and try to expand, yet do not consider if the income that is being generated will still be the same in the long-term.
  8. No social media presence: Staying local will only generate local income and potentially a bit of word-of-mouth. Expanding the business presence online will help drive income and gain new customers.



References


Schaeffer, P. (2021, August 11). Why Small Businesses Fail: Top 8 Reasons for Startup Failure. ZenBusiness Inc. https://www.zenbusiness.com/blog/why-small-businesses-fail/

For part 2(a) and 2(b) it must be 150-200 words with references that are based in the United States and only use websites.

Unformatted Attachment Preview

The Final Business Plan Project is a group project. Students will have to work together in groups of 3 and decide together on a business venture. The names of group members should be submitted to your instructor no later than 11:59 PM EST/EDT Sunday in Module 2. The complete and final version of the business plan is due in Module 8 no later than 11:59 PM EST/EDT Sunday. The final business plan should include the following sections and be submitted to the appropriate assignment folders in the modules in which they are due no later than 11:59 PM EST/EDT Sunday. Executive Summary (Due with the Final Plan all in one Word file in Module 8) I. Introduction (Due in Module 2) This section provides a strategic overview of the company and describes how the company is organized. Name of business Nature of business What products and services will your business offer and what are the company’s unique qualifications in serving its target markets. Name of principals This section identifies the owners of your business. Statement of financing need This section should include an estimate of the financing you will need in order to start your business. You will likely revise this number after completing the plan. II. Industry Analysis (Due in Module 3) This section evaluates the market in which the company will be competing, and includes well-structured answers to address the following: Future outlook and trends This section should identify the issues and trends that are or may impact the industry. SWOT Analysis This section identifies the internal Strengths, Weaknesses, and the external Opportunities, and Threats for your business. Analysis of competitors This section defines the competitive landscape of your business. It identifies who the direct and indirect competitors are, assesses their strengths and weaknesses and describes your company’s competitive advantages. Market segmentation This section describes your potential customer’s demographics, behaviors, and characteristics. Industry forecast This section describes the overall future outlook for your particular industry. III. Description of Venture (Due in Module 3) Product/Service This section provides a detailed description of the product or service that your business will provide. Mission/Vision Statement Include a unique mission and vision statement for your business. Equipment and personnel needs This section will include a detailed description of the equipment and personnel that your business will need. Background experience of entrepreneur IV. Marketing Plan (Due in Module 5) This section will describe your overall marketing strategy and how you will price, promote and distribute your products or services. Pricing This section will include the calculations and pricing methods used to price your product or service. Distribution This section should outline how you intend to sell your product or service. Will you use retailers? Trade shows? Or in-person distribution channels? You are not limited to one. Promotion This section will describe the plan for marketing and advertising your product or service. V. Organizational Plan (Due in Module 5) Form of ownership This section will describe the legal form of ownership for your business i.e. sole proprietor, LLC, or Corporation. Include a description of the tax and profit implications of your decision. Management team This section will identify the management team for your business, including an overview of their experience. Role and responsibilities This section will identify the roles and responsibilities of your management team. VI. Operating Plan (Due in Module 7) Physical facility Include a description of the physical facility location for your business. Discuss the zoning and parking requirements. Supply chain and inventory management If application, provide a description of how your business will manage and distribute its inventory. VII. Financial Plan (Due in Module 7) Pro forma income statement This section should detail 3-5 years of projected income and expenses for your business. Pro forma balance sheet This section should detail 3-5 years of projected assets and liabilities for your business. Sources and uses of capital This section includes the sources of capital i.e. where will the money come from? And the uses of capital i.e. what will you spend the money on? The sources and uses should equal each other and include the purchase price of your business plus any transaction costs. Eric Darling July 11, 2021 MGT 320 Prof. Markham Business Plan A Introduction The name of the company is Darling Investment Group, LLC. The owner of the business is Eric Darling. He has about 6 years experience in selling and leasing homes and short-term rentals. The company is based in Tampa Bay, therefore, serving the Tampa community and surrounding areas. What we do with the company is purchase homes to rehabilitate them and then list them on the market to sell. The company has many investment opportunities, and its owner and employee are dedicated, hardworking, and experienced. On the financing need, a real estate company requires around 20% of the after-repair value (ARV) to secure a loan from a hard money lender. Eric Darling July 11, 2021 MGT 320 Prof. Markham Business Plan A Business Plan Introduction The name of the company is Darling Investment Group, LLC. The owner of the business is Eric Darling. He has about 6 years’ experience in selling and leasing homes and short-term rentals. The company is based in Tampa Bay, therefore, serving the Tampa community and surrounding areas. What we do with the company is purchase homes to rehabilitate them and then list them on the market to sell. The company has many investment opportunities, and its owner and employee are dedicated, hardworking, and experienced. On the financing need, a real estate company requires around 20% of the after-repair value (ARV) to secure a loan from a hard money lender. Industry Analysis Darling Investment Group, LLC stands to get affected by the changing climate risks and weather-related issues. Generally, the difficulty of deciding to build in certain areas is a scope that stands to face the organization's professionals. The organization presents significant strengths that include an effective and productive real estate team. The availability of resources and well-defined individual competencies are the critical attributions that the firm enjoys. Some of the weaknesses that Darling Investment Group inclines to experience include gaps in the organizational leadership and low adaptability to changes. It is essential to solving these challenges to enjoy the opportunities that include strategic real estate visibility and implementation of new technologies effectively. Darling Investment Group, LLC inclines to experience threats such as changes in the real estate market, buyer preferences, and the shift in the real estate positioning environment. The real estate industry is vibrant and highly competitive. For startups, well-established real estate organizations are the primary competitors. Well-established real estate such as South Tampa Real Estate and Beyond has the advantage of resource accessibility compared to Darling Investment Group, a startup. The weakness of South Tampa Real Estate and Beyond is that it experiences difficulty in adapting to changes. It is essential to address this gap as a startup to increase the dynamic of servicing the Tampa Bay demographic and beyond as taste and preference reflect to change (The Buyguys, n.d). Darling Investment Group targets individuals aged 21 to 65 as this category inclines to buy and sell homes. It is critical to address the larger demographic as Americans want to own homes as early as possible. The real estate industry presents endless opportunities with the growing demand for better residential, commercial, and hospitality spaces. Description of Venture Darling Investment Group, LLC will engage in selling and leasing homes and short-term rentals. It will involve the active purchase of homes and consider their renovation to suit the clients' tastes. Real estate investment is an area that constitutes the stance of endless opportunities as people buy and sell homes daily (Santarelli, 2020). Others want their homes rehabilitated to suit their fresh tastes and preferences. Darling Investment Group will consider the satisfaction of its clients as this project a lucrative investment. The firm’s vision and mission incline to work towards providing the best for its clients and stakeholders. Mission Statement. Engage in positive collaboration to modernize and create progressive experiences among the homeowners. Vision Statement. Exploring new ideas and technology to be a leader in providing professional real estate services. Darling Investment Group, LLC will require an office central to conducting its activities. It will be necessary to have a warehouse for keeping materials for construction and rehabilitation. This is necessary to consider the safety of the assets of the enterprise. Professionals will be required from making critical decisions and conducting renovation activities. The professional must have the abilities and skills necessary for real estate development. The firm will also attract investors considering the development of the firm. The entrepreneur has various certifications such as a real estate license, business degree, management experience at local real estate agencies, among other hands-on skills and abilities. It projects good organizational administration as the leader will involve the participative style. References Helping you buy and sell. (2009). Helping you buy and sell: south Tampa real estate and beyond. Retrieved from https://www.mikeandmichelleteam.com/ Santarelli, M. (2020). Reasons why Tampa is the best place for real estate investment. Retrieved from https://www.noradarealestate.com/blog/tampa-investment-properties/ The Buyguys. (n.d). We buy houses in Tampa. Retrieved from https://thebuyguys.com/locations/florida/tampa/?utm_source=google&utm_medium=cpc &utm_campaign=Google+-+TBG+-+FL+-+Dynamic+Search++Main+Site&utm_content=All+Pages+Excluding+Blog&utm_term=All+Pages+Excludi ng+Blog&gclid=CjwKCAjwos-HBhB3EiwAe4xM9y_dvafVI4TIEiDXWdI1dntCqRVBlMYBxPcC0UQ_dnIaJFjAZHRchoC-5wQAvD_BwE Eric Darling August 1, 2021 MGT 320 Prof. Markham Business Plan C Pricing As a new company in the market, growing market share has been prioritized over profits at this time. This is why we will a penetration pricing strategy. This means that the company will purchase homes at a low price but sell them at relatively lower prices compared to the prevailing market price. To differentiate themselves from the competition, the firms will rely on distinct and compelling differentiators. Nothing simplifies a consumer's purchasing choice more than pricing. A penetration pricing strategy is built on this concept. Distribution Penetrating the Tampa Community market will be easy with the extensive distribution. According to Porter (1997), this strategy shapes how the product will be received in the market. The strategy aims to spread awareness of one specific product to different people. The Tampa community is complex. The good thing about extensive distribution is that we will target several delivery channels of housing for maximum results. This is because the company wants to target the highest number of clients possible within the shortest time. Promotion Building brand awareness and increasing customer traffic is the main objective of the company's marketing strategies. We aim to execute pipedream’s company marketing efforts to build on traffic. The mix of strong creative advertising and collaborations with traffic-generating sites is intended to generate many visitors who will become loyal, repeat clients (Norman, 2014). To increase traffic, the company plans to employ a range of marketing methods, including guerilla/grassroots marketing, Web advertising, and affiliate marketing networks, public relations, and important strategic relationships. References Norman, G. (2014). Penetration Pricing. In Dictionary of Industrial Organization. Edward Elgar Publishing Limited. Porter, M. E. (1997). Competitive strategy. Measuring business excellence.
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Explanation & Answer

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1

Operating Plan

Student’s Name
Affiliation
Course Name
Instructor’s Name
Date

2

Operating Plan
Physical Location of the Business
The headquarters of Darling Investment Group, LLC will be located in Tampa Bay. The
real estate industry in the area is vibrant even though highly competitive due to well-established
realtors such as South Tampa Estate (The Buyguys, n.d). Darling Investment Group can tap the
enormous opportunities.
Darling Investment Group will be carrying out its activities in Tampa Bay and its
environs. The HQ offices will be located at the International Plaza and Bay Street. A company
needs to be established in a commercial-zoned location to conform with zoning ordinances and
land use regulations. Commercial zoning laws usually dictate a company's activities in a given
area (FindLaw’s Team, 2018). This location is suitable for the business offices as the building’s
offices are executive and proximity to warehouses where the company can store rehabilitation
and construction. Also, it will be easier to use the physical address of the building rather than
renting a private address which can mislead city authorities when conducting a physical
inspection of the business premises. Therefore, having offices and warehouses at International
Plaza and Bay Street will streamline obtaining the city business license for Darling Investment
Group. There are significant signs to direct clients to the offices. More importantly, the location
has...


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