Sim Venture Business Planning and Developement
In hypothetical terms, the firm was bound to go into losses in the first few months of establishment. The objective we had prioritised was to establish the company quickly with minimal losses, which then could be easily recovered over a short time period.
We firstly did the essential market research. This would give us a market audit, allowing us to precisely plan both short-term and long-term strategies, ensuring that we don’t have any confusion and see exactly what our goal is. Along with the research, we decided to build a premium website. This was our first step into advertising, organising and brought up a channel of communication between stakeholders and us.
Our next step was competition research. This should us what we were up against and how to establish our own USP, accordingly, we set our product specifications and price as well as an introductory promotional discount to attract customers if they enquired. We then did negotiations with distributors to establish channels of distribution. The reason for this is that a company needs revenue, but more importantly, profit to survive, which can only be established with sales.
By the third month, we had successfully established a channel of distribution, which was in our budget and produced good profits. We mistakenly forgot about the 30-day credit. We had consumed a majority of our capital, leaving us in money being owed to the bank. We therefore decided to apply for an overdraft to allow us a margin for error. Also as a reassurance as well as necessity, we needed to raise capital, so we borrowed surplus from friends and family.
Customers continued not to pay money owed to us, leading in Microvault going in to debts of thousands of pounds. This was not acceptable so we set up credit control to regain money owed to us. We had to take drastic measures to ensure the company’s survival. We were left with no choice but to take out a £10,000 loan from the bank to sustain our losses and maintain a working capital
We firstly did the essential market research. This would give us a market audit, allowing us to precisely plan both short-term and long-term strategies, ensuring that we don’t have any confusion and see exactly what our goal is. Along with the research, we decided to build a premium website. This was our first step into advertising, organising and brought up a channel of communication between stakeholders and us.
Our next step was competition research. This should us what we were up against and how to establish our own USP, accordingly, we set our product specifications and price as well as an introductory promotional discount to attract customers if they enquired. We then did negotiations with distributors to establish channels of distribution. The reason for this is that a company needs revenue, but more importantly, profit to survive, which can only be established with sales.
By the third month, we had successfully established a channel of distribution, which was in our budget and produced good profits. We mistakenly forgot about the 30-day credit. We had consumed a majority of our capital, leaving us in money being owed to the bank. We therefore decided to apply for an overdraft to allow us a margin for error. Also as a reassurance as well as necessity, we needed to raise capital, so we borrowed surplus from friends and family.
Customers continued not to pay money owed to us, leading in Microvault going in to debts of thousands of pounds. This was not acceptable so we set up credit control to regain money owed to us. We had to take drastic measures to ensure the company’s survival. We were left with no choice but to take out a £10,000 loan from the bank to sustain our losses and maintain a working capital