GSLC MARCH 5, 2020 INDIVIDUAL ASSIGNMENT

Andrea Christopin 2201767333 LB28

1. Which primary and secondary information will tell you whether the industry is growing
and favorable to new entrants?
The primary and secondary information are industry observers and analysts (people who
study particular industries and regularly report on them in newspapers or through the media),
suppliers and distribution, customers, employees, professionals from service organizations (such
as lawyers and accountants, trade shows, using Porter’s Five Forces framework to determine the
industry’s competitive advantages, and also the industry should understand their industry life
cycle stages (progressive change, intermediating change, radical change, or creative change)
because it is important to identify the which stage an industry is in so that they are able to
analyse the growth of the industry.

2. What kinds of information can suppliers and distributors provide?

Suppliers and distributors are the people who are in charge of demand for products and
services, as well as the financial strength of the industry. Suppliers source raw materials to help
with the production and supply the industry with the materials and services that are needed. They
provide the products from a manufacturer at a good price to a distributor for resale. Distributors
provide information to the industry such as providing engineering support and sales, reduce
costs, and manage inventories.

3. How should a market entry strategy be determined? What factors should be considered?
A market entry strategy is determined when the costs for the firms to enter the market are
low and there are only a few existing economics of scale, then competitors can easily enter and
disrupt the competitive strategy. However, if the barriers to entry are high it will discourage
competitors from entering the market, so the market entry strategy is choosing the market where
the barriers to entry are high and threat of new entrants is low. The factors to be considered are:
economics of scale (cost to produce goods and services), brand loyalty (new entrants to an
industry face existing products and services with loyal customers who are not likely to switch
easily to something new), capital requirements, switching costs for the buyer, access to
distribution channels, or other proprietary factors such as technology and processes.

4. What is the value of defining a market niche?

The value of defining a market niche is to focus on a particular or a specific area within a
field. This has two benefits. First, businesses with a market niche can provide more value to their
clients because they have honed expertise in an area relevant to them, and second, they can limit
the competition. Businesses pursue niche markets as a way to build loyalty and revenue with a
largely-overlooked audience.
5. Suppose you are introducing a new type of exercise equipment to the fitness industry.
What would your strategy for research with the customer look like?
 First, my strategy would be to analyse the market industry and to identify the trends in the
society, especially for body builders, athletes, fitness trainers, anyone who goes to the gym or
likes to exercise. Once I know that my exercise equipment has sufficient interest and has high
potential for it to sell well in the market, I will start to make a prototype. After that, I will test the
product to a few people such as athletes or body builders, and receive feedback from them.
Finally, I will improve the exercise equipment according to the feedback I received. Through this
method of researching with the customer, I’m able to know what are the things needed to be
improved in order for it to be a better product.

6. Given the definitions of direct and indirect competitors, provide an example of each for a
product of your choosing.
Indirect competitors are competition between companies that make slightly different
products but target the same customers, while direct competitors are competition between
companies who not only target the same customer group, but also sell the same type of product.
Example product: McDonald’s
Direct competitors: KFC, CFC, A&W
Indirect competitors: Pizza Hut, Burger King, fast foodrestaurants

7. What is the purpose of the business model and why do business models typically fail?
The purpose of a business model is for planning to make a profit by identifying the products
or services that will be sold, target the market that has been identified, and the expenses that are
needed. The first reason why business models typically fail is because the business is solving an
irrelevant customer job where there is no significant value proposition for customers to care
about. The second reason is because the business fails to establish customer relationships and
customer base sustainability. Another reason may be caused due to neglecting external threats in
the environment such as direct/indirect competitors or shifting in technological, cultural, social
trends in the society.

8. What are the characteristics of an effective business model?

The characteristics of an effective business model is a business model that contains the
foundation of identifying and targeting primary audience/customers, able to determine key
business activities, record key business activities, develop a strong value proposition, determine
essential business partners, develop a strategy and always keep in mind of future innovation.

9. What is the purpose of feasibility analysis?

The purpose of a feasibility analysis is to determine the viability of an idea, such as ensuring
a project is legally and technically feasible as well as economically justifiable. It examines the
market including potential customers, competitors, potential business costs and revenues, and
options for product development. A feasibility analysis helps to develop a plan on what steps that
should be taken and help to execute the plan by finding out the actions and methods that should
be done to achieve success.
10. What are some ways to innovate in a business model?
Some ways to innovate in a business model are:
- Focus by appealing to distinct market segments with clearly differentiated needs
- Create portfolio to minimize risks
- Deliver and capture value of products to customers
- Produce a minimally viable product along with business model canvas
- Creating a sustainable competitive advantage