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Fundamentals of entrepreneurship are basically about entrepreneurship which is involving the ability to transform an idea to the creation of new enterprises where the entrepreneur is a founder. This assignment focuses on the fundamental of entrepreneurship and is split into four parts where the first part will be focused on the review and performance of a company. The second part is concerned about the strength and weakness of a company. The next part would be about the steps which can be done to overcome the weakness and recommend a plan will capitalise company strength. The final part is about way to maintain strength and existing performance.
For the first part of the assignment, Jerry's company will be utilizing a few element to review his company performance which would include market share, product life cycle, time management, sales and management skill. For the second part of this assignment, SWOT analysis is used with the purpose to find out what are the strength, weakness, opportunity and threat of the company. For the third part which is about overcoming his company's weakness and to capitalize his company strength to bring out the competitive advantage to compete with competitor. For the fourth part, it is about the ways to maintain if not improve Jerry Company current performance and strength.
2.0 Jerry business
Jerry business is about smart phone retailer shop and his company name is KK phone & accessories Sdn Bhd. Jerry first stated his business on the 2nd of February 2010 and his company is located in a shopping lot in Penang centre city.
2.1 Review the performance of business
According to Willis et.al (2008, pg 267) from the book name as Understanding the Aust Health Care Syst had mention that "the function of management is summed up as plan, organize, lead and control." Planning, organizing, leading and controlling a part of the management skill where Jerry is able to use these four elements to manage his company. By using these elements, Jerry will know how to plan his resources, and to organize or allocate his resources in a way where he can utilize his resource in a effective and efficient way. By doing so, Jerry will be able to not only minimize input but to also maximum output to increase his overall profit.
According to Longenecker et.al (2006, pg 312) from the book name as Small Business Management: An Entrepreneurial Emphasis, Volume 1 mention that "an important concept underlying sound product strategy is the product life cycle, which visualizes the sales and profit of a product form the time it is introduced until it is no longer on the market." The product life cycle will help the Jerry company analysis the product stay in which stage such as introduction, growth, maturity and decline. The product life cycle plays an important role in a product because it identifies how affects the products where it can be improved or show decline. By doing so, Jerry know use which type of strategies will be best to implement for his company based on the four stages. At the current moment and stage, Jerry's company is at the growth stage of the product life cycle as his company reputation is starting to grow right after the introduction stage.
According to Lamb et.al (2008, pg 41) from the book name as Marketing mention that "the measure of market share used in the portfolio approach is relative market share, the ratio between company's share and the share of the largest competitor." Based on the definition above, market share is the percentage of an industry or market's total sales which are earned by a particular company over a specified time period. The market share can be calculated by taking the company's sales over the period and dividing it by the total sales of the industry over the same period. This metric is used to give a general idea of the size of a company in comparison to its market and its competitors. The current market share of Jerry company is 10 percent over 100 in the local market because his working states has so many competitor compete with him and his company still in its growth stage.
Sales or sale is the act of selling a product or service in return for money or other compensation for the selling of that particular product or service. Sales will influence the overall company benefit because it is about the transaction between good and service to the consumer. The sales of a company can be increased by carrying out promotions and offers to the consumer to ensure that they are satisfied with the products or services which are offered by the company. By doing so, the consumer will spread out the information about good news and it makes the performance of the company increase as the company will be known to a wider range of potential customers.
According to Roberts (1998, pg 1) from the book name as Time Management mentions that "time management is considered a very important business skill. It is essentially about spending the hours and minutes in the day as effectively as possible." Based on the definition above, time management is an extremely important element as it is about the management of time of the company. For example, Jerry Company needs to have good time management so that he will be able to give the stock to his customer on time. By doing so, his can management his improve and increase the product input and output well.
2.2 Learning outcome
As a summary, it can be said that Jerry Company performance and review is based on the management skill, marketing skill and operation management skills which is used by Jerry to manage his company effectively and efficiently.
3.0 SWOT analysis
According to Pahl et.al (2009, pg 27) from the book name as Swot Analysis - Idea, Methodology and a Practical Approach mention that " SWOT analysis is a beneficial tool for decision making and understanding dependencies between a company and its environment." Based on the definition above, the SWOT analysis can be described as a tool which is used to understand the dependency of a company and the environment so that it can help the company make good decisions making based on its own strength, weakness, opportunity and threat.
3.1 The strength of Jerry Company
According to Jain et.al (2009, pg24) from the book name as Business Environment mention that "the strength of a business organization refers to the capacity by which an organization can gain advantage over its competitors." Based on the definition above, the strength of a company or business organization can be determined by analysing the internal competitive advantage of a company and comparing it with the competitors. In other words, the strength of the company will determine what does a company does best. So by Jerry knowing his own business strength where he can place emphasis on them when the time comes to implement an effective marketing program. A SWOT analysis is done to identify the strengths and weaknesses of Jerry's company. The strengths portion of the SWOT analysis is used to determine what does a person's business does best. By focusing on Jerry's business' strengths he can place emphasis on them when the time comes to implement the right marketing program. For instance, if Jerry knows that he can make a product much cheaper than anyone else in his market can, he will be able to list that as his strength. By doing so, Jerry does not need to be the best in the industry at something to list it as strength as his company's strengths are based on internal and external performance.
3.1.1 Being able to provide good customer relationship and service
Customer service nowadays is extremely important as customer experience is a major factor in determining whether the customer will want to come back to the same company for their services. By providing a good customer experience and service, Jerry will be able to focus on customer complaint and feedback so he can immediately deal with the complaints. For example, when a customer is complaining about a product which is not functioning well, Jerry's company can provide the customer with a choice to replace a new phone or to service the defective phone for free. Besides that, Jerry company will look forward to hearing and receiving feedback as well as paying attention to the customer feedback so he can make a correction from the complaining and give a improve to his company. By doing so, Jerry's company will be in a position where his business is able to reap the benefits of good customer service.
Besides that, Jerry Company also will be helpful even though no immediate profit in it. Jerry's Company will do this action because he feels that as a phone dealer it is his responsible are to spread out all the phone news to his customer and help them when customers faces a problem with their phones.
Specialist phone repair service
Jerry Company has employed and hired a number of specialist in phone repair so that he is able to solve a multitude of technical problems which are faced by different brands of phone problem without go through to the supplier. By doing so, he can skip multiple stages and charges a much lower cost to the customer.
3.1.3 Offers a wider range of products
By the offering of a wider range of products, Jerry enables his customers to choose from a larger choice of products. Since beginning operation a few years ago, Jerry's Company has sold different brand of product such as Samsung, Apple, Motorola, and Sony and so on. With the large choice for consumer so they have many opportunity can choose their lovely brands and purchase it. Besides that, he also sells the branded phone accessories such as handset, headphone, and phone cover for customer. If the customer after purchase phone and the customer want to upgrade headphone so customer can direct buy a good quality headphone such as best headphone available and so on.
3.1.4 Use attractive payment, bonuses and incentives
Jerry Company has provided attractive pay such as bonuses and incentives to his employee because he is using two factor theory which is motivator factor to motivate his employee and satisfaction his employee needs. By doing so, he can reduce the turnover rate of employee and increase performance of employee. Besides that, Jerry Company is using recognition to his employee by give bonus. So, it will make his employee has high spirit to get a sales and get a bonus
3.1.5Growing Market Share
Jerry Company is still in the stage of growth so there is still a lot of potential for his company's market share to increase by the selling of many product of his company. So, if the marketing employee is successful in selling his products where his sales will keep increasing, thus improving the company reputation to let other people more know about the company details then the market share will increase rapidly.
3.1.6Allowing employees to fail in learning and guide them to success
Jerry Company is a company who let employee learning from their mistakes as he wants to train his employee to be daring to risk and improve themselves to a much higher level.
According to Jain et.al (2009, pg24) from the book name as Business Environment mention that "weakness of a firm refers to limitation of a business firm. It results in significant disadvantage for a firm in comparison to its competitors." Based on the definition above, the weakness of a company or firm will show or expose the limitation and flaws of a company. It is able to show that the disadvantage of a firm in comparison with its competitors. Knowing your business' weaknesses through a SWOT analysis is critical to the success of the company. Anything that your business struggles with or lacks is considered a weakness. For instance, the limited production capacity is a major weakness as Jerry would not be able a mass-market a new product as he is not able to meet a large demand should it materialize. If Jerry knows his business' weaknesses, he is able to avoid using an ineffective strategy on those said weaknesses.
3.2.1No online purchase methods
Jerry Company is a company which carries out and practices face to face sales transaction and direct cash sales. So, many consumers need bring a bulk if they want to buy phone but it is dangerous for consumer because they will be at risk when bring a lot of money. It might be robbery or lost the money. Besides that, it is not as convenient for customer because they need come to shop physically to purchase their products.
3.2.2Unable to provide 24/7 service to customers
Jerry Company has a current operating time which is from 10am to 8pm. As his company not using online business format due to not having enough financial resources, hence customers will find it difficult to consult him at times to get information about phone and accessories. As compared with other competitors using internet technologies, Jerry is unable to compete as effectively in this particular area.
3.2.3Low customer awareness
Jerry's Company is still in the growth stage so not many people will come to purchase as not many people are aware of his company. This in fact will affect his company performance in a negative way as there wont be much sales to improve his company profit.
According to Jain et.al (2009, pg24) from the book name as Business Environment which mentions that "the availability of opportunity is a favorable condition in the organization environment. If a company has enough strength to avail opportunity, it can generate extra profits." Based on the definition above, the opportunity is an external chance to generate profits. Hence it can be said that opportunity is an external factor which affects the profitability of the company.
3.3.1 Offer additional service
Jerry company will offer additional service to his customer such as if the phone purchased has any problem and under warranty so his company will help customer deliver to the centre and help them fix it without any extra additional charges.
3.3.2 Product variety more than other competitor
Jerry Company has different brands of product which are much more than what other competitor offer. This is a major opportunity where consumer will be able to come here to buy and choose from a wide range of different brands.
According to Jain et.al (2009, pg24) from the book name as Business Environment which mentions that "threat is an unfavorable condition in the organization environment. Threat can be in the form of growing competition, change in fashion, unfavorable change in government policy, and so on." Based on the definition above, threat is not a good condition in the organization environment. The threats to a company can be influence by different types of external factors.
3.4.1 Low price competitor
Jerry Company is still in the growing stage so he has not much of financial resources to allow him to purchase economic of scale from the phone supplier. Hence he is unable to offer a very cheap price as compared with large firm.
3.4.2 Hard to maintain market position
Jerry Company has to maintain his current market position because so many large firm competitors and his company population is not as strong as his competitors.
As a summary, this task is about SWOT analysis which includes the strengths and weaknesses of Jerry's company and the opportunity and threat to his company.
4.0 Capitalize on the company strength
Jerry Company needs to identify specifically what strength having now and use it for purpose in order to capitalize the strength of the company.
In order to capitalize on the strengths of his company, Jerry will have to first know what and identify his strengths are and for the purpose that he is intending to use them for. Hence Jerry will need to identify specifically what are the strengths of KK Phone & Accessories Sdn Bhd.
4.1 Having Specialist staff which can train others
Jerry Company can consider opening a class with the sole purpose of training his new intake employee to learn about the technical side of phones and the knowledge on how to repair phones and hone the skills of the employees to become expert technicians.
4.2 Using feedback form to maintain the customer service standard
Jerry Company is a company pays a lot of attention and care towards customer service because he knows that customer satisfaction is very important to retain his customers. He can apply the feedback which he receives form to his customer to fill out and find out how to serve them better in the future. Besides that, he also can recognize the employee who has gathered the higher rate given by customer by give that particular employee a bonus to motivate him or her. Thus Jerry will be able to maintain his company customer service.
4.3 Overcome its weakness
Jerry company main weakness is not having internet technology to supports his online business and services. Hence the best solution to overcome the weakness is to start using his money to invest in an online business to enjoy an advantage and make it more convenient for customer by enabling online payment, listing out price range and categories product, virtual capacity, information sharing and exchange, connecting and interactive when using internet technology in this business and how it bring up the business population.
4.3.1 Implementing an Online payment method
Nowadays, it is much more convenient for the customer purchasing something online as it is very fast and safe compare with traditional payment because consumer no need go to bank to withdraw money and bring a lot of money to purchase in computer shop. Besides that, consumers no longer needs to waste time go to bank withdraw the money and decrease the percentage give people rob and cause the consumer loss the money. The online payment system is available 24 hours a week; this allows the consumer to purchase in any time so it can increase the overall sales in the company.
4.3.2 List out the price range and categories product
Jerry company can create a webpage which is able to list out all the price range of the entire product by using information management which will make it much easier for the consumer to figure the price range product and no longer needing to worry about choosing a higher priced product. Besides the advantage of knowing the price of the product much more convenient, it will allow the consumer the ability to find the product in a much faster and easier way.
4.3.3 Virtual capacity
Virtual capacity is an advantage which is provided by internet technology where it makes it possible to put much more information inside the system without sacrificing physical space and layout of the shop or store. For example, online business can be display their product by uploading a photo to attract picture without having to set up a special display area in the shop which will waste a lot of space.
4.3.4 Information sharing and exchange
Information sharing and exchange can be achieved in almost any place and everywhere as long there is internet technology. Hence, Jerry Company can use internet technology to share the information or exchange information between the customer and his company.
4.3.5 Connectivity and interactive
E-business enables the company to make a direct connection with the customer by utilizing internet technology. The connectivity and interactions that the internet allows will be able to help Jerry's company to share the information about the product, customer information, distribution goods with low cost and so on.
4.4 Learning outcome
As a summary in this task is about how Jerry will be able to capitalize on the strength of his company and the ways for him to overcome his company weakness.
5.0 The way business existing performance could be maintained and strengthen.
The ways to maintain the existing performance of Jerry Company can be checked in the vision and mission of the company. Hence Jerry Company must check out the strategy whether it is either related to his company and how does strategy bring out the competitive advantage to compete with recent competitor. Furthermore, he can rely on the feedback from the customer to further improve his service to customers.
5.1 Vision, mission of Jerry Company
According to Swansburg (2002, pg 81) from the book name as Introduction to Management and Leadership for Nurse Managers mention that "mission of an organization describes the purpose for which that organization exists. Based on the definition above, the mission of a company is the purpose for which the organization exists. Jerry Company has 2 core missions which is to develop good customer experience and to globalize his phone shop. Develop good customer experience is meaning every customer come Jerry Company purchase phone they also provide good advice and service to their customer.
According to Mooij (2009, pg 2007) from the book name as Global Marketing and Advertising: Understanding Cultural Paradoxes mention that "vision of a company states where the company wants to be sometime in the future." Based on the statement above, the vision of a company shows that what the company wants and aims to be in the future. For Jerry company, the vision is to be able to bring the best customer service experience and global cheaper phone retailer shop. This is because Jerry Company is focusing on his customer service and emphasizes on the satisfaction of the customer when buying his product. Besides that, he also wishes that he can become cheapest phone of retailer shop in order to gain his company reputation.
5.2 Competitive strategy and competitive advantage
According to Rainer et.al (2010, pg45) from the book name as Introduction to Information Systems: Enabling and Transforming Business mention that " competitive strategy is a statement that identifies business strategies to compete, its goals and the plan and policies that will be required to carry out those goals." Based on the definition above, the competitive strategy of a company focuses on the usage of the strategies which enables a company to be more competitive than the competitors. In this assignment, Jerry Company is using customer service as a competitive strategy because it can make the customer satisfaction and come back purchase again. Besides that, Jerry Company has friendly customer service, so the consumer can ask all the details from the product and it will save the time compare with the bad customer service because consumer need find the information by their self.
According to Ogbar (2009, pg 253) from the book name as Entrepreneurship in Sub-Saharan Africa mention that " competitive advantage is the aggregation of factors that sets a business firm apart from its competitors and gives it a unique position in the market superior to its competition." Based on the definition above, a competitive advantage is a unique advantage which enables a company to successfully compete against the competitor and is able to bring out the company to higher and more superior position in the market. Jerry company competitive advantage is his company has different brand of phone and accessories to allow his consumers a larger selection to purchase and choose from. Besides that, he is able to target low level income, medium income level and high income level of consumer. By doing so, Jerry will have different types and levels of income of consumer to be able to purchase mobile phones from his company.
5.3 Follow the feedback and complaint from the customer to improve service part
Feedback and complaining are very important in the improvement of an organization because it can help an organization to improve the performance and provide better service to their consumer. Jerry Company pays a lot of attention to the consumer feedback and complaints as by doing so will help him to improve the company performance and to correct mistake had been done from his company. By doing so, Jerry will be able to keep on improving his company's strength to compete more aggressively with his other competitors.
5.4 Learning outcome
As a summary for this task, the ways that an existing business performance could be maintained and strengthen based on the vision, mission of a company, strategy and the feedback or complaints that are given by the customer.
In conclusion, this assignment focuses on Jerry as an entrepreneur to make his business which goes by the name of KK phone & accessories Sdn Bhd and the explaination on how to analysis his performance of his company based on the element of SWOT analysis and overcome the weakness. Besides that it also discusses on how a business existing performance could be maintained and strengthened. In my opinion, mobile phones are extremely important nowadays especially for smart phones where it plays a vital role in businesses as it makes things so much more convenient for the users, hence by carrying out a business selling smart phones, Jerry will be able to generate high profits and income by using the right marketing strategy.