Prelim Examination: Essay

In your own words, answer the following questions comprehensively.

1. Explain the different ways in identifying "market gap" in the industry.
Here are several methods for determining the gap in the market.
1. Make Modifications to an Existing Good/Service - if you don't want to think about new,
unique goods and services in the market business, you can still recreate old products and
services - with a few tweaks, they might be transformed into even more significant
resources. A smart method to do this is via thorough market research, after which you can
consider if you might launch a comparable concept or a revised variation of their methods
and include it within the company.

2. Location of the business - one of the first considerations for every company owner should
be the establishment of a business that will appeal to the demography of the surrounding
area. A lack of traffic indicates that the people who reside there have little desire for a
certain kind of business. Effective site selection may have a significant impact on a
company's long-term performance and profitability, as well as its overall strategy.

3. Size of the business – by determinizing the "sized" of an organization is one of the most
essential in entrepreneurial decisions since it has an impact on the firm's performance and
the success of commercial endeavors. Furthermore, large corporations have a significant
amount of money and resources to spend in order to develop their operations. Therefore,
they get the benefits of economies of scale, which helps them to run their businesses
more effectively when it comes to interacting with customers and suppliers.

4. Timing - When it comes to business, timing is critical since it allows you to do more in a
shorter period of time.  Furthermore, time is critical for companies since it is a critical
component of striking the correct balance between minimizing costs and capitalizing on
chances to increase revenue.

2. Discuss the Michael Porter's Five Forces Theory of Industry Structure.

1st Five Theory (Vulnerability to the counterfeits from another firm’s)
Alternative’s commodities that may be utilized in replacement of a firm's merchandise
are considered a danger to the organization. Therefore, customers have the choice to skip
purchasing a company's goods if similar replacements are accessible, resulting in a reduction in
the firm's influence. However, those businesses who provide a unique product or service will be
able to demand higher pricing and secure in advantageous conditions in the marketplace.
2nd Five Theory (The potential threat of another entries)
It is also possible for the strength of a firm to be affected by the intensity of incoming
competitors entering the market. In general, t the shorter energy and expense it takes a rival to
join and become a strong contender in a company's market, the less unlikely it is that a founded
business's standing will be considerably affected. Since, established businesses in an economy
with strong barriers to entry have benefited from this position because they have been able to
demand higher prices and obtain better terms and condition than they would have been able to in
a less restrictive environment.

3rd Five Theory (Suppliers' ability to negotiate)

This model examines in which suppliers may hike up overall value of basic commodities.
As the number of providers to the market decreases, the greater the dependence a company will
have on a certain source. As a consequence, the supplier has additional leverage and has the
capability of driving up inflationary pressures while still advocating for other economic gains. It
is impossible for an organization to keep its input costs as high as possible while simultaneously
raising its profits when that firm has an excessive number of suppliers or low switching costs
between competitors.

4th Five Theory (Purchasing powers of buyers)

Consumer buying power, as well as their effect on product performance and pricing, are
the driving forces behind this pattern. Customers have more negotiating power when there are
more of them; nevertheless, when there are numerous providers in the market, consumers find it
easier to move to new, lower-priced alternatives, which may eventually push down costs. On the
other hand, when consumers purchase items in small quantities and the seller's providing differs
greatly from that of its competitors, the buyer's buying power is limited. As a result, when a firm
has a limited number of notable buyers, they are typically able to exert influence over the terms
of the transaction.

5th Five Theory (Competition from the industry world)

In a competitive business environment, firms compete for customers by aggressively
lowering costs and increasing marketing efforts to get people to purchase their products.
Consequently, if the consumers believe that they are not receiving a reasonable bargain from
you, you may find that they take their business elsewhere.
3. "The two essential ingredients for success in any new venture are a good proposition and
the right people to turn that idea into a business." Explain the meaning behind this
statement.
 In addition to having a detrimental influence on the other workers in their immediate
vicinity, a poorly functioning individual may cause sales to decline and cause a company to incur
substantial unneeded costs. Hiring high-performing people, on the other hand, will ensure that
your company never goes down the wrong path. These individuals will assist the company in
raising the profile of the firm in order to achieve success in an increasingly competitive industry.
Therefore, the organization should never underestimate the significance of selecting the right
person since they pave the route for your company to achieve success.

4. What do you mean by having "SMART objectives" in preparing a business plan?

Elaborate further.
Having goals in life is vital for us to strive for success. It focuses on your energy and
makes effective use of your time and resources so that you can get the most out of your life,
more specifically, it gives meaning, destination, direction, and the purpose that keeps you from
gouge Hence, we need to conceptualize that our goals must be specific, measurable, achievable,
realistic, and time-bound that will allow you to boost your chances of attaining your future
endeavor and life goals. You will quickly assess potential obstacles once you have that smart
goal setting.
S (Specific) – in order to establish a clear aim, the organization should address the six
"W" information posed. These goals should be clearly stated and disseminated to all other
members and employees of the organization.
M (Measurable) – a objective must include criteria for determining whether or not
progress has been made. The absence of criteria makes it impossible to measure the company
development and assess whether or not they will be able to achieve their objective.
A (Attainable) – a objective must be both attainable or reachable. This will assist the
firms in identifying methods for achieving their objective and putting up the necessary effort to
achieve it. While challenging, it must also be attainable in the most basic sense. Setting a
realistic goal might lead to the discovery of previously undetected opportunities or resources that
can aid a firm in achieving its goals.
R (Realistic) – In order for a goal to be regarded realistic, the company's objective must
be achievable within the constraints of existing means and time availability. Just because a firm
has set a lofty objective for itself does not always imply that it is unattainable. It is possible to
attain their objective as long as they have the necessary time and energy to devote to it.
T (Time bound) – when a goal is set, it has a beginning and an end date. As a result, there
will be less urgency and less incentive to accomplish the objective if the goal is not time-bound.
Furthermore, no objective can be achieved if you lack the time to do it. Hence, all objectives
must be met within a clearly defined time period.