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Business Plan Proposal to Angel Investors: Innovative Idea

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ACTIVITY A: JOURNAL

Date of research Topic researched Time duration Brief description of research activity

activity or discussed (Days)

25th October Selection of Type 7 days In this research activity the business is

of Business selected after analysing all the factors

related to the present market

conditions. This business mainly deals

on the marketing of goods and

products. The main reason to select

this business is that todays customers

mainly rely on the new technologies.

1st November Idea Generation for 10 days By analysing the various industries

New Innovation and manufacturing firms the idea for

expansion of the business is created. In

present scenario most of the people

depends on technology. So, this

business is related to the buying and

selling of products through internet.

New innovation and technology

affects and attracts the customers to a

great level.

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11th November Collection of 18 days In order to set up a business in an

Competitive appropriate manner, a detailed analysis

Market Data is being done on the market

conditions. The data of various

competitive firms are collected in

order to gain the maximum profit. This

information is fruitful for the business

in order to compete with its

competitors and in the maximisation

of the profit.

29th November Literature Survey 12 days For better establishment of this

business, the data is gathered on the

basis of the various journals, books

and relevant sources. In the survey it is

analysed that the e- business are very

effective for the expansion of

business. Through this survey, many

views of the different authors are

collected and analysed. This is the

most significant step for the

establishment of business.

10th December Estimation of 5 days In this research activity, after the deep

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Budgetary study on the various factors related to

Requirements the marketing conditions. The data

which is occupied through the study

on various competitors proved to be

significant for generating the budget

requirement. The planning of the

budget is a very crucial step for the

establishment and the advertisement of

the business.

15th December Operational and 10 days Internet has totally changed the

Information process of business and marketing.

Technology Any business can take the benefits of

this technology for the growth of the

business. Most of the e-businesses

depend on the information

technologies in order to develop and

manage the process of e-commerce.

These information technologies also

hep in designing the framework of

many new businesses. Information

technology is considered as a solution

for the smooth running of the business.

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25th December Requirements 8 days The major requirements to establish a

business are the generation and

allocation of fund and optimum

utilisation of resources. In every

business the major concern of each

and every person is on the proper use

of the funds to maintain the profit and

loss of the businesses.

3rd January Drafting a Formal 7 days After analysing all the facts and

Report conditions, the report is prepared. In

this report all the conditions and the

data which is gathered through the

survey are presented in a well and in

sequential manner.

ACTIVITY B: PROPOSAL TO ANGEL INVESTORS

The term innovation can be defined as the process, procedure, services and produc ts which are

creative and new to the world, and are targeted to accomplish different requirements and needs

of individuals. In the context of business world, the significance of innovation enhances up to a

significant level as it leads to provide a differentiated identity to the organization among its

competitors.

Part 1: Digital Innovation:

About the Digital innovation:


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The digital innovation on which, the business idea and plan will be generated is an E-

database and Online selling and purchasing platform for buyers and sellers of second hand and

used commodities. This innovation will be an online service for the customers, with the help of

which, they can easily sell their unused commodities, such as mobile phones, television, other

electronic equipments, automobile and other household equipments. Moreover, this database also

helps the buyers to purchase second hand and used equipments at reasonable prices. In this way,

the proposed innovative service will be helpful in providing a specific platform for the meeting

of sellers and buyers of used commodities (Woessner, 2011). For availing the benefits of this

innovative digital service, the customer is required to get registered on the e-database. After this,

he can either post the advertisement of his used products for reselling or sell this product to the

company directly at negotiated prices. In the same manner, buyer, who is interested to purchase

the commodity, can either contact to seller or he can also purchase this commodity from the

company. In this way, this innovative service will be helpful for the sellers and buyers in saving

their time and efforts of selling and purchasing used products at reasonable rates.

Existing consumer problems solved by the digital innovation:

The presented digital innovation can be proved quite helpful and effective for consumers

as it will solve their problems for disposing the old household, electronic, and automobile

equipments at their desired prices. In this context, people generally cannot be able to find the

buyers of their used products due to which they cannot be able to have adequate value of their

used products. In the same manner, such kind of issues is also faced by buyers also, who are

willing to purchase the product but cannot afford the new products. They require used and

second hand products at reasonable prices and good condition. In this context, there is a no any

specific platform on which, seller and buyers of second hand products can be met and

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accomplish their needs. Along with this, the digital innovation presented will also be helpful for

sellers to have a number of different customers for the products, which directly helps them to get

the best prices of his products. Along with this from the perspective of the buyers also, the prime

problem faced is related to the quality and conditions of the used commodity, which is going to

be purchased. The digital and innovative database will be helpful for buyers to explore a wide

range of options in second hand commodities too, which helps them to comp are and negotiate on

the basis of quality and condition of the commodity. Along with this, the proposed E-database

also will be acts as a unified buyers and sellers of used products and commodities. In other words,

sellers can also sell their used products directly to the E-database and buyers can also purchase

commodities directly from the e-database. In this way, it can be considered that the presented

digital innovative services can be proved quite effective and fruitful for the both sellers and

buyers of second hand commodities to save time and efforts in find the right value of the second

hand and used products.

Competitive analysis and competitive advantage:

For the presented e-database services, limited competition is available. There are only

limited numbers of website which are providing such kind of services to customers. Although,

there are a number of different websites available, such as Amazon and Alibaba.com which

provide digital platform for the meeting of sellers and buyers, but they provide services for new

products only (Plunkett Research Ltd, 2008). The proposed e-database will be different from

such services as consumers can sell or purchase their second hand and used commodities through

such services. In addition to this, along with providing a platform for sellers and buyers meeting,

the e-database will also act as the seller and buyers of used commodities, which will also save

the efforts of sellers and buyers in finding the best valued products.

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Customer and market information:

The prime customers of the proposed E-database services will be common and middle

class household and business people, who are planning to sell their old and used commodities.

For the purpose of compelling people for availing services of E-database, the middle income

group people will be focused who cannot afford highly expensive commodities. For attracting

more customers and retaining them, the low degree cost and prices of the used products will be

proved an effective aspect and requirement. The easy availability of the products, low cost

purchasing, and easy handling of the process will be some of the crucial aspects and positive

factors associated with the innovation which will attract more customers for the innovation.

Problems and Drawbacks of the innovation:

Although, there are a number of different positive aspects of the proposed innovative

Service plans, yet still there are several critical aspects which can provide some critical

Drawbacks and issues. For instance, first and foremost issue re lated to innovation is the

acceptability of the innovation in the market. The business idea generated is one of the most

innovative and new concepts the success of which in the market place is quite uncertain. Along

with this, for the purpose of commercialize this business idea, it is essential to procure some

intensive amount of funds and technological resources, which is not an easy task for the new

company to arrange such intensive amount of sources. In addition to this, in order to undertake

this business idea in the most effective manner, there is a need of having skilled and experienced

man power in starting. Recruitment of skilled employees and gaining the trust of customers can

be seen as one of the core problems of the innovation. For the purpose of maintaining such

highly automatic and vast database, there is a need of highly expensive and responsive server,

which can be considered as one of the most critical aspects and drawback of the innovative ideas.

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The future of your innovation:

The innovation proposed will have a bright future as this idea will be proved helpful in

exploring opportunities prevailing in the industry. The innovation planned will be proved quite

helpful in resolving various issues faced by people regarding disposal of their old commodities.

In regard to this, it is expected that people will adopt this service easily as this service will be

fruitful for them to retrieve pure and maximized value of their used products. In addition to this

in future also, the company will also expand itself in selling and purchasing of old commodities

so that overall profits can be maximized up to a significant level (Plunkett Research Ltd, 2008).

Initially, the company will have only online presence, but in future the company will have a

retail outlet in the city, where customers can visit and sell, as well as, purchase required

equipment.

Measurement of the success of the initiatives:

The success of the planned initiative will be evaluated through benchmarking method. In

this method, the success and failure of an initiative will be measured with the help of specific

measurement criteria. For instance in order to evaluate the success of the initiative, number of

total registration has been taken into account as the evaluation criteria. A specific number of

registrations will be taken as benchmarked figure for evaluating the success. The actual numbers

of registrations in the database during specific months will be recorded (Stair and Reynolds,

2013). The evaluation of the success and failure will be done with the help of comparative

analysis of the actual and benchmarked number of total registration within E-database in a

specific time period.

Part 2: Description of the company

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There are several companies in the international market that are seek ing to implement

and electronic platform through which they can provide the services of buying and selling of the

new commodities or products (Andersen, et al 2003). In the same series, Digi.com will also a

new company that is seeking to have implementatio n of the new electronic platform for

providing buying and selling facilities to local as well as global customers through which it can

facilitate them to sell their products to the company and the company itself will sell the products

to the buyers on the price determined by the sellers for selling. All the operational functions will

be dealt by the company itself. The further description related to the company are provided in the

following discussion.

Company Industry:

The company will deal in online and mobile selling industry through the developments of

its portals. There are several new companies that are dealing in this industry which provides

customers wider range of facilities for buying and selling different kinds of old commodities

(Plunkett Research Ltd, 2008). Though there is not much and tough competition in this industry

as this is a new emerged industry where there are not larger numbers of players which can pose a

keen competition for its business. This industry has been becoming a centre of a ttraction for the

global customers as it is providing new kinds of services for the consumers which they could not

avail before emergence of this industry.

Key Products/Services of Company:

The company will deal in wider range of products and services to have a strong and good

business position in the international market. The company will provide both buying and selling

services to the consumers. The services of the company will be quite differentiated from the

existing companies which are providing online buying and selling of old commodities. This is

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because Digi.com will itself buy the products from the sellers and sell those products to the

interested buyers. These services will provide unique and differentiated base to the consumers as

it is will reduce to efforts of the consumers to have contact with different buyers and thus the

services will be proved quite time saving for them. In addition to this, the services of the

company will also be cost saving as the buyers will need not to contact with lar ger number of

sellers, but they directly contact to the company and the company will provide them wider range

of products in its list (Woessner, 2011). The process of negotiations will also be handled by the

company in its services. The company in its services will deal with wider range of products

including household commodities and other commercial products. The main product line of the

company will include home furniture, electronic products, automobiles (cars, scooters and bikes),

mobiles, mobile phones, etc and even real estate products. The provision of these kinds of wider

products and service base will help the company to company to capture a good market share

even at its introductory phase.

Corporate vision and mission:

Each new company while initiating its business first determine its corporate mission and

vision in order to have a good directive path for meeting its business goals and objectives (Mooij,

2009). In the same series, Digi.com will also have its specific corporate vision and mission. The

corporate mission of the company will be, Serving the global customers beyond their

expectations through easier and convenient transaction modes. This mission statement of the

company will be quite eye catching for the new consumers of the company and it will provide

the company a motivating way to provide newer means of services for the consumers. The vision

of the company will be, To attain a differentiated and unique market position in its industry to

win competitive advantage in the long run thro ugh serving customers at the best possible level.

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With the help of this vision, the company will meet its business objectives to provide improved

services than competitors in order to win competitive position in its own industry.

Business Strategy

Business strategy is a means through which is developed by a company in order to meet

its desired end goals. At the initial phase of the business, the company will adopt competitive

strategy. Competitive strategy will serve the company to accomplish business services in better

way than rivals. Under this strategy, the company will not copy the ideas of other rivals but will

implement its new innovative services in order to give competition to the rivals in an effective

way (McGrath, 2013). Under this business strategy, the company will follow two main ways.

First, the company will provide its services at lower prices than consumers in order to gain a

leading position in its related industry. Through this initiative the company will be able to win

economies of scale in the longer run. Further, the company will have differentiation strategy

under which it will provide different and improved services than competitors in order to increase

market share. In this way, follow up of this business strategy will enable the company to

establish business in a successful way.

Corporate Structure:

The corporate structure of the company will be in the form of a functional corporate

structure. This model is the most suitable for the company as it is fit for single service

organisations. This form is followed in the form of a standard business structure under which

business activities are organised under different departments (Ireland, Hoskisson and Hitt, 2008).

For new initiated business organisations, this structure is the mo st favourable and supportive to

run the business activities in longer run.

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Major business processes:

The major business process that will be followed by the company will be to develop an

online portal for consumers. This online portal will facilitate consumers to buy and sell their

products directly to the company. In the business process followed by the company, it will itself

interact with the buyers and sellers. The consumers will need not to have contact with each

others. This business process will be a time and cost saving approach. The company will directly

purchase the products from the sellers and keep them in its stock and record the entries (Brocke

and Rosemann, 2014). It will display the products on its online portal with all specifications and

features and price. The consumers who will be interested to buy any particular product from the

list of the company will contact to the company on its website. The company will operate its

business process directly without any need of interaction between buyer and seller. The business

process of the company will be followed by online interactive portal.

Relationship with External Entities

This new company will have relationship with several external entities. The first external

entity with which the company will have relationship is the investor. The company will seek to

have significant support of investment by this entity in order to flourish and accomplish the

business in a successful way (Doh and Stumpf, 2005). In addition to this, the company will also

have relationship with the government in order to meet all the governmental regulations to

conduct the business as a legal entity.

Risks

There might be some risk for the new company at the business initiation phase. The

major risks that the company can face are threat of competition, capital insufficiency, and

supportive market base. At the initial phase, the company can face the issue of competition from

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rivals and even the consumers not being familiar with these services can not support these new

services (Reuvid, 2012). To mitigate these issues, first the company should conduct a good

market research and even follow effective advertising and promotion strategies in order to make

the customers familiar with its services. To meet the capital insuffic iency the company will need

to specify the investors about the need of capital for running the business.

Part 3: Technology requirements and infrastructure

As the company needs to operate through electronic medium, it will need to have a well

supportive information system base. The information system base will assist the company to

serve the customers in the best possible way. The information system facilities will also be

required for the company to have good degree of integration with the suppliers. As the main

functional area of business of the company is to have interaction with the sellers and buyers, it

will need to maintain good operational efficiency so that customers can have faster and effective

integration with the company.

The company with the help of information system can acquire the data related to

customers and can process it and provide the relevant information to the employees of the

company so that they can serve the customers in desired way and mainta in good relationship

with them. In order to deal with the information system, the company will provide required

training to the employees so that they can be diligent to upload the information about customers

(Yip and Bink, 2007). In addition to this, it will also enable the customers to access the

information related to the company. The company can also follow Enterprise Resource Planning

(ERP) system to have integrated information.

Information Systems Requirements:

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In the information systems requirements of the company, it will need to have a

transaction processing system (TPS) which will need to have human resources in an organised

way and will need to have business procedures and databases to record the information related to

business transactions and perform the business activities in effective way (Stair and Reynolds,

2013). The use of enterprise system in the information base of the company, it will be able to

have integration among different business activities such as having integration with the suppliers,

control of inventory, taking supplies from the sellers and contacting with customers. With the

maintenance of a database, the company can maintain its operations with high efficiency.

In order to have good customer relationship management, the company should adopt

automated customer relationship management tool in which prime emphasis is given over

interaction with customers with the implication of wider information technology aspects such as

internet, computer integration, interactive service provisions, keeping track of customer purchase

patterns and advancements in information and communication technology base (Information

Resources Management Association, 2010).

Required IT infrastructure:

In order to have a well developed and supportive information system base, the company

will required to set up a good IT infrastructure that can make the implementation of the new

information system viable and workable operationally. At initial level, there should be a modern

telecommunication infrastructure that is sophisticated enough. The telecommunication

infrastructure should be realistic to make the connectivity of the all the stakeholders of the

business interacted. The number of internet service providers should also be enough and level of

broadband usage should also be extensive (Bidgoli, 2004). Broadband infrastructure facilities

improve the connectivity of the company with the sellers, as well as, buyers. In addition to this,

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the physical infrastructure of the company should also be strong enough to accomplish the e-

commerce activities in a regularised and efficient way.

The company will also require setting up a good hardware base to make the basic

business transactions simple for the consumers (Loughlin, 2010). There should be a good

compliance between hardware and software base of the IT infrastructure in order to develop a

well organised and integrated information system which helps the company to save its

operational cost and meeting the changing needs of the customers in the best possible manner.

The infrastructural developments should be quite transparent and efficient in terms of system

efficiency and accuracy and reliability functions.

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Part 4: Conclusion and key Findings

Finance: For the new company, overall projected profit and loss account for upcoming 3 years

can be presented as below:

Particulars Year 1 Year 2 Year 3 (In

(In US $) (In US $) US $)

Revenues 150000 200000 250000

Cost of services Delivered 50000 60000 75000

Anticipated Gross Profits 100000 140000 175000

Accounting Expenses 10000 12000 14000

Advertising & Promotion 25000 30000 30000

Bank Charges 10000 10000 10000

Compensation & Benefits 20000 30000 40000

Insurance 5000 5000 5000

Licenses & Fees 1000 1000 1000

Telephone 1000 1000 1200

Website Maintenance 5000 5000 5000

Total Operating Exp 77000 84000 106200

Operating Profit 23000 56000 68800

Interest Expense 5000 10000 12000

Net Income 17000 46000 56800

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For the viability of a business proposal, it is quite essential for the company to generate

intensive amount of profits and revenues with the help of which, it can be proved quite helpful in

providing adequate amount of returns to its investors. For this purpose, estimated income

statement for next three years can be projected as above.

Initially, Apart from the existing available capital funding, for the project, there is a need

of about $ 100000 which will be arranged through external investors like Angele Investors. It is

anticipated that the project will generate returns of about 20% in the first year, 25% in second

years and about 30% returns annually from the third year. In this way, on the basis of such

financial assumptions it can be considered that making investments in the new company with the

innovative idea of e-database will be a fruitful and effective decision of the investors in the long

run. In starting, due to the high initial expenses and high fixed cost in setting up a new business

venture, the returns will not be so high, but in the long run, this venture will be proved as highly

advantageous business investments for investors.

Conclusion and Key Findings:

The presented business plan has reflected some of the crucial planning and business

activities, which can be considered quite effective a nd crucial for setting up a new business

venture with innovative business ideas. For the new business organization, it is essential to have

an innovative and digital business idea, which is in accordance of the current business trends. For

this purpose, e-database can be proved an effective business idea. The presented business idea is

directed to provide a digital platform on which sellers and buyers of second hand commodity and

used equipments can be met and perform their business transactions.

This business idea can be proved quite effective and competitive in existing business

environment as this business idea is new and innovative for people. With the help of this

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business idea, problem of the disposal of used commodities faced by common people can be

resolved in the most effective manner. However, proper and effective commercialisation of the

business idea can also be considered quite essential for the purpose of making the idea more

effective and successful. In this regard, the business plan aims to undertake effective and in

depth planning for different activities related to the commencement of new business venture in

the competitive market place. In this regard, addressing effective and stiff competition prevailing

in the market place can be reflected as the first stage of new business planning. For the planned

business venture, overall competitive scenario prevailing in the market is not quite high as this

service is a new and innovative service in the market. After assessing the competitive scenario

prevailing in the marketplace, there is a need of assessing requirements of technical and financial

resources. Owing to this reason, technical specification for the project and financial requirement

of the project has been considered as some of the important aspects of the presented business

plan. On the basis of future business predictions, it can be considered that the planned business

venture can be proved quite effective and fruitful for the investors. Owing to this reason, making

investments in the proposed business venture can be proved advantageous for Angele Investors.

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References

Andersen, K.V., Elliot, S., Swatman, P.M.C., Trauth, E.M. and Andersen, N.B. 2003. Seeking

Success in E-Business: A Multidisciplinary Approach. Springer Science & Business

Media.

Bidgoli, H. 2004. The Internet Encyclopedia, Volume 2. John Wiley & Sons.

Brocke, J.V. and Rosemann, M. 2014. Handbook on Business Process Management:

Introduction, methods and information systems. Springer.

Doh, J.P. and Stumpf, S.A. 2005. Handbook on Responsible Leadership and Governance in

Global Business.Edward Elgar Publishing.

Information Resources Management Association, 2010. Enterprise Information Systems:

Concepts, Methodologies, Tools and Applications. Idea Group Inc (IGI).

Ireland, R.D., Hoskisson, R. and Hitt, M. 2008. Understanding Business Strategy: Concepts and

Cases. 2nd ed. Cengage Learning.

Loughlin, M. 2010. The Service Catalog. Van Haren.

McGrath, R.G. 2013. The End of Competitive Advantage: How to Keep Your Strategy Moving as

Fast as Your Business. Harvard Business Press.

Mooij, M. 2009. Global Marketing and Advertising: Understanding Cultural Paradoxes. SAGE.

Plunkett Research Ltd, 2008. Plunkett's E-Commerce & Internet Business Almanac 2008: E-

Commerce & Internet Business Industry Market Research, Statistics, Trends & Leading

Companies. Plunkett Research, Ltd.

Reuvid, J. 2012. Managing Business Risk: A Practical Guide to Protecting Your Business. 9th ed.

Kogan Page Publishers.

www.studentsAssignmentHelp.com Custom Essay Writing Assignment Help Services UK | US |


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Stair, R. and Reynolds, G. 2013. Fundamentals of Information Systems. 7th ed. Cengage

Learning.

Woessner, S. 2011. Increase Online Sales Through Viral Social Networking: How to Build Your

Website Traffic and Online Sales Using Facebook, Twitter, and LinkedIn--in Just 15

Steps. Atlantic Publishing Company.

Yip, G.S. and Bink, A.J.M. 2007. Managing Global Customers: An Integrated Approach.

Oxford University Press.

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