BUS 111: Chapter 4

What is part of 5. The Financial Projections in a feasibility study outline?

1. Assumptions 2. Summary financial table 3. Three-year detailed financials 4. Start-up budget

What are the 11 boxes in the business model canvas?

1. Customer segment 2. Problem - pain and gain 3. Solution 4. Value proposition 5. Channels 6. Customer relationships 7. Revenues - freemium 8. Key resources 9. Key activities 10. Key partners 11. Costs

Which boxes are part of the market desirability portion in the business model canvas?

1. Customer segment 2. Problem - pain and gain 4. Value Proposition (50%) 5. Channels 6. Customer relationships

What is part of 3. The business in a feasibility study outline?

1. Description of the entrepreneur (or team) 2. Stage of development 3. Legal issues 4. Insurance Requirements

What is part of 1. The business idea in a feasibility study outline?

1. Description of your business 2. Your Customers 3. Trends related to the product or service

What are the four steps for a casual model?

1. Feel: Decide you have a great idea and want to start a business 2. Check: Assess resources, get help if needed, then assess feasibility 3. Plan: If feasible and there is interest, keep going, if not - go back to Check 4. Do: Make product and the company to sell it and get it into the market

What are the four steps for an effectuation model?

1. Feel: Recognize you want to start a business 2. Check: Assess what you know and who you know to determine your product or service and your customers 3. Plan: Offer your product or service to your customers and see if you get any sales 4. Do: If you get enough sales, keep going. If not, go back to the check step

What are the 5 main pit-falls when a business owner tries to become more innovative?

1. Identifying the wrong problem 2. Judging ideas too quickly 3. Stopping with the first good idea 4. Failing to act 5. Obeying rules that do not exist

What are the 3 elements that an IDEO screen looks for

1. Market desirability 2. Technical Feasibility 3. Business Viability

What are the four steps for organizing creative thinking?

1. Preparation - explore the problem/opportunity from all directions. 2. Incubation - think about it in a "not-conscious" way. 3. Illumination - bring ideas together to spark new insights. 4. Verification - test the idea and reduce it to its most exact form.

What is part of 2. The product/service in a feasibility study outline?

1. Product/Service description 2. The competition 3. Competitive advantage 4. Market penetration

What are some techniques to practice the business of innovation?

1. Read magazines or trade journals outside your area. 2. Invite someone new to a meeting where you are solving a problem or searching for a new opportunity - try a supplier or a friend. 3. Have a "scan the environment" day to discuss trends. 4. Try a mini-internship, spending a day with a colleague at their work. 5. Put yourself in the customer's shoes to see what frustrates them. 6. Redesign your work environment to give you a new outlook.

What is part of 4. Future Action Plan in a feasibility study outline?

1. Summary feasibility evaluation 2. Next steps (this depends on the previous step: if feasible, start working on a business plan and if there are questions, address them) 3. Start-up capital (list money needed, including cost of goods sold, marketing and administrative expenses, and additional costs like rent and utilities 4. Sources of start-up capital (Consider all sources - personal savings, family and friends, bank loans, investors, and so on)

What are the 5 key points in a feasibility study outline?

1. The business idea 2. The product/service 3. The business 4. Future Action Plan 5. The Financial Projections

What is feasibility?

1. The extent your idea is viable and realistic. 2. The extent you are aware of internal and external forces.

What is the screening process for a casual model of entrepreneurship?

1. The goal is to start with many ideas and narrow them down to a few. 2. Test ideas with an IDEO screen, a business model canvas, or a feasibility plan. 3. Develop a business plan for the most promising ideas.

What does Pet Élan's business model canvas encompass?

1. To analyze feasibility using the canvas, we compare the fit by customer segment to the value proposition, problem, and solution. 2. The four should strongly reflect one another and reflect something the customer will buy. 3. If the customers do love it, we analyze the market factors, everything from value proposition to the right edge of the canvas, for their fit 4. Constantly question factors and fits

What are the 10 sources of business Ideas?

1. Work/personal experience. 2. A similar business. 3. Chance - retail arbitrage. 4. Family and friends. 5. Education or expertise. 6. Magazines. 7. Idea sites. 8. Side gigs. 9. Make and sell, locally or online. 10. Going online to spot trends.

Which boxes are part of the technical feasibility portion in the business model canvas?

3. Solution 4. Value Proposition (50%) 8. Key resources 9. Key activities 10. Key partners (80%)

Which boxes are part of the business viability portion in the business model canvas?

7. Revenues - freemium 10. Key partners (20%) 11. Costs

What is the customer segment box? [Osterwalder and Pigneur]

A group or subgroup of potential purchasers that can be approached in a coherent manner

What is a target market?

A marketing term (also called serviceable obtainable market, or SOM) that refers to the group of customers in the are you plan to serve who would be likely to be interested in your product, or those of competitors. Target markets can refer to individuals or market groups called segments

•Typically two or more versions are running - called ____.

A/B testing

____ are ways to identify and organize key information on organization and how they achieve their goals

Business models

What question does technical feasibility ask?

Can the solution really solve the problem, and can we make it? (High-end products can be readily obtained. Comparable-level services can be done—limited competition for high-end curated goods and services)

What question does business viability ask?

Can we make the solution and make money doing it? (Experience in the industry and area and a passion for pets. Risks manageable, profit margins good.)

What are the percentages for the types of entrepreneurs according to PSED when asked" what led to your business idea?"

Casual (36%), effectual (23%), both (41%)

Track the number of visits, get their demographics, and those who provide an email for more information is your ____.

Conversion rate

A pioneer in the field of ____, who first coined the word ____, invented ____

Creativity, brainstorming, SCAMPER

What question does market desirability ask?

Do people really want the solution being offered? (Market of 30,000 pet owners in Lakeview, IL with interest in high-end pet products high and little direct local competition)

What is the next step after the IDEO screen?

Feasibility

The ____ consists of investigating five primary areas: the overall business idea, the product/service, the industry and market, financial projections, and the plan for future action.

Feasibility study (Within each area, examine the strengths and weaknesses of your business opportunity)

What is freemium? [Osterwalder and Pigneur]

Free version, then users have the option to pay for a paid version

What is the costs box? [Osterwalder and Pigneur]

General costs (salaries, filing fees, inventory or manufacturing costs, etc.)

What is the channels box? [Osterwalder and Pigneur]

How you get your products or services to your customers. Selling directly is great, but is often expensive or hard to get going. So if you're selling through others, how do you arrange to be heard and seen by your customers? (Think of small hotels that use their websites (direct selling) but also sell through Expedia, Trivago, AAA, AARP, and others to get you to buy a room).

What is the revenues box? [Osterwalder and Pigneur]

How you make money solving the problem and selling to your customers, how you use different ways to get revenues.

What is the solution box? [Osterwalder and Pigneur]

How you plan to handle the problem-solving pains or create gains for your customers

What is the customer relationships box? [Osterwalder and Pigneur]

How you will take care of your most important resource: your customers. The best customers are ones that buy again and recommend you to their friends.

What is a simple and fast way to screen ideas?

IDEO screen

The ____ hails from the creators of ____

IDEO screen, design thinking

Doing the same thing as others, is pursuing an ____

Imitative strategy

An ____ offers a slightly better way to do something

Incremental strategy

A ____is a legal agreement granting you rights to use a particular piece of intellectual property

License

In return for receiving a license, you (the ____) are required to pay the owner of the license (the ____).

Licensee, licensor

What is the key activities box? [Osterwalder and Pigneur]

Most important activities in your business-the ones most central to your doing the job right and making the firm successful

The ____ assesses whether the situation is traditional or unexpected

Opportunity identification

____ and ____ help identify good opportunities

Opportunity recognition, entrepreneurial alertness

Another variant to organize creative thinking is to use ____ and ask people for pains or aggravations they face in a situation you choose

Painstorming

A low-cost, low-risk approach to testing feasibility is an online ____

Pilot test •Deploy an information website and start advertising. •Make changes according to feedback.

What is the problem (pain) box? [Osterwalder and Pigneur]

Problem/pain: Any sort of problem, annoyance source of aggravation, shortcoming, or suboptimal situation customers or potential customers face. It is one of two driving forces of creating new products or services, with the other driving force being pain.

A ____ presents a different way to do things

Radical innovation strategy

A license can also be an up-front payment, an annual fee, or a ____ per item sold

Royalty

What is the value proposition box? [Osterwalder and Pigneur]

Small business owners' unique selling points (also known as benefits) that customers can expect from your goods or services, including benefits that differentiate your offering from those of the competition

What does SCAMPER stand for?

Substitute, combine, adapt, magnify/modify, put to other uses, eliminate, rearrange

What is the key partners box? [Osterwalder and Pigneur]

Team is the starting point for your partners-well-regarded suppliers of your raw materials, corporate partners that inspire confidence (e.g. IBM, Amazon), a well-connected attorney or accountant, an advisory board member known and respected by all.

What is the key resources box? [Osterwalder and Pigneur]

The resources your firm has that no one else does

What are some powerful, national sources of ideas?

Universities and government agencies develop new technologies and offer them free to small businesses to develop. •Federal Labs is a centralized location for over 700 federal programs. •If a university is near you, contact the technology transfer office.

What question does the R in SCAMPER ask?

What can you rearrange in how your product or service appears or how businesses in your industry usually look or are decorated or located?

What question does the A in SCAMPER ask?

What could you adapt from other industries?

What question does the E in SCAMPER ask?

What could you get rid of that would eliminate something the customer has to do?

What question does the M in SCAMPER ask?

What could you make more noticeable or different in some way from competitors?

What question does the S in SCAMPER ask?

What opportunities result from substituting or replacing something that already exists?

What question does the P in SCAMPER ask?

What other uses might there be?

What question does the C in SCAMPER ask?

What separate products, services, or businesses can you combine to create a distinct business?

What do you do in a casual model approach when thinking about opportunities/business creation ideas?

You think about what you need to do to cause your new product or service to come into existence. That may mean you have to learn new skills or find others to help you achieve your end, and doing that will probably take some additional time, perhaps some additional funding, and overcoming two risks-the risk that your new product or service can't be created and even if it is created, that it isn't something that customers are willing to buy

Traditional problems facing new products or services include:

•The idea cannot be economically made into a product/service. •The resulting product/service works, but lacks a large market appeal. •The product/service works, has a market, and could be profitable, but you need to get additional people, funding, or other resources.