BA260 Fall 2024 Introduction to Entrepreneurship Lecture 6 (PDF)

10/22/2024 Good fun while doing great Lecture 6 work Merit, Excellence, Initiative (MEI)...

10/22/2024 Good fun while doing great Lecture 6 work Merit, Excellence, Initiative (MEI) BA260 Introduction to Entrepreneurship Larry Martin Oregon State University College of Business Good fun while doing great work Tue and Thu: 1pm – 2pm and by Office Hours: BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Merit, Excellence, Initiative (MEI) Housekeeping & News BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Merit, Excellence, Initiative (MEI) As a thank-you for Bursts’ Candies active participation with my BA260 sections and to encourage you to visit the store, each student will earn a one-time 5-point bonus by emailing me a picture of the sales receipt with your name and class time. You have until the end of Dead Week to visit his store, make a purchase, and email me a picture o the sales receipt. BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Merit, Excellence, Initiative (MEI) PT Presentation Template Introductio n (PT) Key PT1: Pitch Competition Template - LOGO, TEAM NAME, PRODUCT NAME, TARGET CUSTOMER DESCRIPTION, PRODUCT DESCRIPTION, SOLUTION, & TECHNOLOGY - Slides 1, 2, 3, 4, 5, 6 PT2: Pitch Competition Template - CUSTOMER DISCOVERY - Slide 7 PT3: Pitch Competition Template - POTENTIAL MARKET SIZE, COMPETITORS - Slides 8 and 9 PT4: Pitch Competition Template - BUSINESS MODEL: Promotions and Distribution - Slide 10 PT5: Pitch Competition Template - BUSINESS MODEL, Business Development and KEY FINANCIALS - Slides 11 and 12 PT6: Pitch Competition Template - TEAM FIT, CLOSING SUMMARY - Slides 13, 14 BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Problem – Solution Target Market Business Model & Key Team Merit, Excellence, Initiative Presentation Fit Customer Feasibility Financials Fit (MEI) Quality Today’s Discussion Assignments, Quizzes, Lecture PT Form Assignments Exams Feasibility – Industry PT3 - Slide 8 Orange Beaver Exam: PT3 - Slide 9 Analysis o Thu, 10/24 Trends to Demand Midterm Peer Review: Competitor Analysis Form Assignments 10/28 - 11/2 PT1 Presentation Feedback Assignment PT3: Slides 8 Review & Modification – In &9 class o Mon, 10/28 Industry and Target Market Quiz 3: 10/30 - 11/1 Research Assignment PT4: Slide 10 Other o 10/22 o Mon 11/4 - Trends to Demand worksheet BA260, Fall 2024 o 10/28  10/22/2024 Good fun while doing great Lecture 6 Problem – work Solution Fit Merit, Excellence, Initiative (MEI) PT1 Presentation Feedback Review & Modification BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Merit, Excellence, Initiative (MEI) BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Merit, Excellence, Initiative (MEI) Market Feasibility BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 PT work Merit, Excellence, Initiative 3 (MEI) Slide Slide 8 9 BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 Problem – work Solution Fit Merit, Excellence, Initiative (MEI) Feasibility - Industry Analysis BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Merit, Excellence, Initiative (MEI) Feasibility – Industry easibility Analysis: Process of determining if a business idea is viable Analysis. Copyright ©2016 Pearson Education, Inc. BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Product/Service Feasibility Analysis Merit, Excellence, Initiative (MEI) Feasibility Initial feedback from the market – Industry Analysis Product/Service Desirability Product o Does it make sense? o Form-Fit-Function? o Timeliness to demand trends o Solving a problem worth solving? o Concept test (worth considering) – Keep top of mind internally as you move forward with your idea  Product/service description  Intended target market  Benefits  Positioning relative to competitors and/or competing materials  Roles and responsibilities Copyright ©2016 Pearson Education, Inc. BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Industry / Target Market Feasibility Analysis Merit, Excellence, Initiative (MEI) Feasibility – Industry Industry / Target Market Feasibility Analysis Industry o Industry – A group of firms producing similar products o Target Market – A sub-set of the industry that you are targeting  The more focused you are in defining your target market the better Characteristics of attractive industries o Young rather than old o Early rather than late in their life cycle o Fragmented rather than concentrated o Growing rather than shrinking o Selling products/services that customers must have o Are not crowded o High rather than low margins o Not dependent on historically low price of a key raw material Copyright ©2016 Pearson Education, Inc. BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Industry Feasibility Merit, Excellence, Initiative (MEI) Feasibility Characteristics of attractive industries – Industry Analysis o Young rather than old Industry o Early rather than late in their life cycle o Fragmented rather than concentrated  Many contributors to the “pie” and all are approximately the same size. o Growing rather than shrinking o Selling products/services that customers must have Concentrated o Are not crowded o High rather than low margins o Not dependent on historically low price of a key raw material Not Crowded Fragmented I'm Big Inc I'm 2nd Co Trying to stay LLC 1 2 3 4 5 7 1 2 3 4 5 6 7 8 BA260, Fall 2024 8 10 11 13 14 9 10 11 12 13 14 15  10/22/2024 Good fun while doing great Lecture 6 work Merit, Excellence, Initiative Market Feasibility (MEI) Feasibility – Industry Analysis Smaller target markets or niche applications help you avoid Market head-to-head competition against market leaders. Need to make sure the resulting revenue is large enough to support your business idea. Focus on introducing a new product or application into an existing target market or introducing a new target market with an existing product Garmin GPS golf hole and distance o WhichThe https://www.weather tech.com/products/? WeatherTech of these floor mats categories does your product fall in? gclid=Cj0KCQiAt8WO BhDbARIsANQLp961 https://www.ga czJ6RfQSYwdorREty_J rmin.com/en-U i5dMyACwXqv38wgV S/ DRe9rLdpiNUw882Ya AneNEALw_wcB https://www.youtu be.com/watch?v= _cdhSMt36OY&list =PLCC911317B91 56A7F&index=3 BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Industry Analysis Merit, Excellence, Initiative (MEI) Feasibility Business research that focuses on the potential of an industry – Industry Industry: A group of firms producing similar products or services Analysis Three questions before starting a firm Market 1. Is the industry accessible?  Government, product, other industry-entry requirements? 2. Does the industry contain markets ripe for innovation? 3. Are there positions in the industry that will avoid some of the negative attributes of the industry as a whole?  The founders of HEVI-Shot® were long-time waterfowlers ….. decided to launch a company to commercialize a revolutionary nontoxic tungsten-nickel-iron alloy. https://www.hevishot.c Sweet Home Oregon om/ Environ Metal, doing business as Hevi- Shot https://www.hevishot.com/about-us/the-hevi-sh You need to consider your firm’s position ot-story/ relative to other companies in your market space and your product’s position relative to competing products. Copyright ©2016 Pearson Education, Inc. BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Merit, Excellence, Initiative Organizational Feasibility Analysis (MEI) Feasibility – Industry Analysis Management Prowess Organizati on o Important factors: Passion for the idea and understanding of the target market o Also, very important to understand the product deliverable Achievement motivated Optimistic disposition Persuasive Alert to opportunities Promoter Creative Resource assembler/leverager Decisive Self-confident Energetic Self-starter Has a strong work ethic Tenacious Is a moderate risk taker Tolerant of ambiguity Is a networker Visionary Lengthy attention span Resource Sufficiency o Can your idea garner additional resources to help it move forward?  Equity financing?, Loans?, Grants? Copyright ©2016 Pearson Education, Inc. BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Merit, Excellence, Initiative Financial Feasibility Analysis (MEI) Feasibility – Industry Analysis Startup Cash Needed Financial o Anticipate capital and expense purchases and where will the money come from?  Prepare a budget with revenue, cost of goods sold, income, and profit  Break even analysis! o List the non-financial resources you will need Compare similar and already established businesses financial performance o Utilize primary and secondary market techniques including helpful websites referenced in the text  Annual Reports, Financial Services Overall Financial Attractiveness of the Proposed Venture o Capital required to start and survive through the initial phases o Risks assumed (competitors, competing materials, new technology required, etc  Very important to consider and address o Alternatives to the partners for their money and time Copyright ©2016 Pearson Education, Inc. BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 Market Feasibility work Merit, Excellence, Initiative (MEI) Secondary Market Research – Industry & Target Market BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work What Industry and Target Market Merit, Excellence, Initiative (MEI) Secondary Market Research Industry – A Industry ? are you in? Target Market? Target Market – A group of firms sub-set of the Education - producing industry that you are similar Electronics targeting products Food Products Health Hospitality Industrial Transportation The industry and Target Market Personal Safety must be sizable enough to find Personal Travel secondary data such as size, trends, …. Sporting Goods The Environment Tourism Travel Etc. Etc. Etc. BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work What Phase of the Industry Lifecycle? Merit, Excellence, Initiative (MEI) Secondary Market Research 1. Introduction Supply and demand 2. Growth changes as industries age 3. Shakeout Each stage requires 4. Maturity different competencies 5. Decline BA260, Fall 2024 Frank Rothaermel, Strategic Management  10/22/2024 Good fun while doing great Lecture 6 work Introduction Stage Merit, Excellence, Initiative (MEI) Secondary Market Research Core competency: R&D Strategic objective: market acceptance & future growth Emphasis: uniqueness & performance Capital-intensive o Trying new ideas o Producing small quantities Initial market size: small Growth: slow Remember that there will nearly always be a Product Barriers to entry: high Development stage and that most innovative ideas come with a net cost during this and the Introduction BA260, Fall 2024 phase. Frank Rothaermel, Strategic Management  10/22/2024 Good fun while doing great Lecture 6 work Demand increases rapidly. Growth Stage Merit, Excellence, Initiative (MEI) Secondary Market Research o First-time buyers rush to purchase. o Proof of concept completed Competitive rivalry: muted (due to growth) Product / service standards emerge o A common set of features and design choices Basis of competition: process innovation o Finding new ways to get things done Core competencies: o Manufacturing o Marketing BA260, Fall 2024 Frank Rothaermel, Strategic Management  10/22/2024 Good fun while doing great Lecture 6 work Shakeout Stage Merit, Excellence, Initiative (MEI) Secondary Market Research Firms begin to compete more intensely. o Weaker firms forced out o The industry consolidates o Only the strongest competitors survive. Biggest competitive weapon: low price BA260, Fall 2024 Frank Rothaermel, Strategic Management  10/22/2024 Good fun while doing great Lecture 6 work Maturity Stage Merit, Excellence, Initiative (MEI) Secondary Market Few large firms remain. Research o They enjoy economies of scale. Additional market demand is limited. Market has reached maximum size. Competitive intensity: increases For example Airplane Manufacturing Boeing AirBus BA260, Fall 2024 Embraer Canadair Frank Rothaermel, Strategic Management  10/22/2024 Good fun while doing great Lecture 6 work Decline Stage Merit, Excellence, Initiative (MEI) Secondary Market Research Demand falls, often rapidly. Strong pressure on prices Four strategic options to pursue: o Exit: bankruptcy / liquidation o Harvest: reduce further investments o Maintain: support at a given level o Consolidate: buy rivals BA260, Fall 2024 Frank Rothaermel, Strategic Management  10/22/2024 Good fun while doing great Lecture 6 work Merit, Excellence, Initiative (MEI) BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 Market Feasibility work Merit, Excellence, Initiative (MEI) Trends to Demand BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Merit, Excellence, Initiative (MEI) Trends to Demand BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Merit, Excellence, Initiative (MEI) Form Assignment BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Merit, Excellence, Initiative Slide (MEI) 8 COMPL ETE BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 Market Feasibility work Merit, Excellence, Initiative (MEI) Competitor Analysis BA260, Fall 2024  10/22/2024 Good fun while doing great Rivalry Among Existing Firms Lecture 6 work Merit, Excellence, Initiative Porter’s Five Forces (MEI) Competit Number and balance of competitors or Analysis o Price cutting if competitors are all roughly the same size with no clear market leader o Market consolidation may occur when one or more companies try to acquire their competitors to grow in size and reduce competition  Example is the aerospace industry where major airlines are acquiring or at least developing strong partnering agreements with smaller airlines. (United-Continental, Delta-NorthWest, American-USAir, Alaska-Virgin, etc.) Degree of difference between products o Price cutting if there is no appreciable difference between competing products  Example is products from the commodities industries Growth rate of an industry o Competitor rivalry is stronger when the rate of growth is stagnant or slow  Often occurs in industries whose products are on the mature side of the Product Life Cycle curve Level of fixed costs o Firms with high fixed costs must sell at high volumes to remain profitable and will be willing to reduce prices in order to keep their factories running at efficient levels Copyright ©2016 Pearson Education, Inc. BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Competitor Analysis Merit, Excellence, Initiative Competitors want to “eat your lunch”! (MEI) Competit or Direct Competitors Analysis o Businesses offering identical or similar products  Try to predict the competitor’s reaction to your company entering their market space. Direct competitors will often try to convince the buyer to not purchase a competitor’s product due primarily to its poorer quality Ford vs Chevy Indirect Competitors o Businesses offering close substitutes products o Also, competing materials fall into this category  Factors are usually price, performance, and availabilty Future Competitors o Businesses that are not yet direct or indirect competitors but could be at any time  Companies producing products that could see your market as an adjacent market to theirs Copyright ©2016 Pearson Education, Inc. BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Merit, Excellence, Initiative Ford Truck and the (MEI) Competit or aluminum Builtbed “Ford Analysis Challenges for Ford: Steel vs Aluminum 4 to 5 times stronger Tough”? 3 times heavier 10% the cost 7 to 10 times more probable suppliers o ~14 to 17 vs ~2-3 A quality compariso n! Chevy was attempting to convince potential buyers not to purchase Ford’s F150 truck due primarily to its poorer quality Chevrolet Silverado vs. Ford F 150 Aluminum bed - OSU MediaSpace BA260, Fall 2024 (oregonstate.edu)  10/22/2024 Lecture 6 Competitor Good fun while doing great work Analysis Merit, Excellence, Initiative (MEI) Competit or Direct Competitors Analysis o Businesses offering identical or similar products  Try to predict the competitor’s reaction to your company entering their market space. Ford vs Chevy Direct competitors will often try to convince the buyer to not purchase a competitor’s product due primarily to its poorer quality Indirect Competitors o Businesses offering close substitutes products o Also, competing materials fall into this category  Factors are usually price, performance, and availabilty Future Competitors o Businesses that are not yet direct or indirect competitors but could be at any time  Companies producing products that could see your market as an adjacent market to theirs Copyright ©2016 Pearson Education, Inc. BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 Slide work 9 Merit, Excellence, Initiative (MEI) COMPL ETE BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Merit, Excellence, Initiative (MEI) Assignments BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Merit, Excellence, Initiative (MEI) BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Merit, Excellence, Initiative (MEI) Slide Slide 8 9 BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Merit, Excellence, Initiative (MEI) This is a confidential, individual assignment. BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Merit, Excellence, Initiative (MEI) BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Merit, Excellence, Initiative (MEI) Slide 10 BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Merit, Excellence, Initiative (MEI) Term Remaining BA260, Fall 2024  10/22/2024 Lecture 6 Class Good fun while doing great work Schedule Merit, Excellence, Initiative (MEI) All classesrequire an approved email if you can't attend or lose 10pointsfromyour grade 2024Fall BA260 Last Update: 10/21/2024 PP/PDF Possible Week Lecture FormAssignmentsand Team Report Date Prest'n %of Bonus Color Codes Date # # Lecture Topic Activities PT FormAssignments Assignmentsand Quizzes to Canvas Date Points Grade Points ORANGEBEAVER 55questions, 220points In class,duringnormal class Thu Oct 24 4.2 220 22% Student / TeamMisc EXAM time Pitch Competition Graded Assignments, Exams Teambonus tests BusinessModels PT4- Slide 10 Tue 10/29 Quizzes Marketing& Communications Guest Speakers Your Accessories PT4- Slide 10 Tue 10/29 Tue Oct 29 5.1 7 MarketingMix (4Ps) PT4- Slide 10 Fri 11/1 Quiz3: 10/30- 11/1 Fri 11/1 30 3% MidtermPeer Review: Sat 11/2 10/28- 11/2 PT Slides COBMBA Program: Anna Holt, Grad ProgramsStudent PT1: 1- 6 Coordinator Thu Oct 31 5.2 8 Strategic Alliances PT2: 7 SupplyChain & Operations PT3: 8, 9 New Product Development PT5- Slide 11 Mon 11/4 PT4: 10 BusinessModel: Promotions& Assignment PT4: Slide 10 Mon 11/4 PT5: 11, 12 Distribution PT6: 13, 14 Tue Nov05 6.1 9 NO CLASS BA260, Fall 2024  10/22/2024 Lecture 6 Class Good fun while doing great work Schedule Merit, Excellence, Initiative (MEI) BA260, Fall 2024  10/22/2024 Lecture 6 Class Good fun while doing great work Schedule All classes require an approved email if you can't attend or lose 10 pointsfromyour grade Merit, Excellence, Initiative 2024Fall BA260 Last Update: 10/21/2024 (MEI) PP/PDF Possible Week Lecture FormAssignmentsand Team Report Date Prest'n %of Bonus Color Codes Date # # Lecture Topic Activities PT FormAssignments Assignmentsand Quizzes to Canvas Date Points Grade Points BA260PITCHCOMPETITION Student / TeamMisc Fri Nov 22 ASSIGNMENT 7 Pitch Competition Assignment 7: BA260Pitch Thu 11/21 Fri 11/22 100 10% GradedAssignments, Exams PITCHCOMPETITION Teambonustests Quizzes Executive Director, Innovation and Entrepreneurship: Karl Guest Speakers Mundorff LECTURE 11 Globalization LECTURE 12 Tue Nov 26 9.1 12 The BusinessPlan Assignment 8review Tue 11/26 TeamBonusTest - Test 4- Report Instructionsreview Tue 11/26 5 Lectures10, 11, 12 A QuickReview: Teamwork Assignment 8Roles& Quiz5: 11/27- 11/29 Fri 11/29 30 3% Expectations Responsibities End of TermPeer Review: Sat 11/30 11/25- 11/30 Thu Nov28 9.2 THANKSGIVING PatrickMagee, Owner, Bursts Candies Tue Dec 03 10.1 13 TeamCompetition Awards Gray Beaver ExamPreview Assignment 8: BusinessPlan Thu Dec 05 10.2 NO CLASS Assignment 8Report Preparation Written Proposal Fri 12/6 100 10% 8amClass: Wed Dec 11at 9:30am FINALSWEEK GRAYBEAVEREXAM 55questions, 220points 10amClass: Mon Dec 9at 6pm 220 22% ClassContribution 50 5% BA260, Fall 2024  10/22/2024 Good fun while doing great Lecture 6 work Merit, Excellence, Initiative (MEI) GO BEAVS! BA260, Fall 2024