Kingdom of Saudi Arabia
Ministry of Education
Saudi Electronic University
المملكة العربية السعودية
وزارة التعليم
الجامعة السعودية الإلكترونية
College of Administrative and Financial Sciences
Assignment 1
Entrepreneurship and small business (MGT 402)
Due Date: 05/10/2024 @ 23:59
Course Name: Entrepreneurship and small business
Student’s Name:
Course Code: MGT402
Student’s ID Number:
Semester: First
CRN:
Academic Year: 2024-25-1st
For Instructor’s Use only
Instructor’s Name:
Students’ Grade: X / 10
Level of Marks: High/Middle/Low
General Instructions – PLEASE READ THEM CAREFULLY
· The Assignment must be submitted on Blackboard ( WORD format only) via allocated folder.
· Assignments submitted through email will not be accepted.
· Students are advised to make their work clear and well presented, marks may be reduced for poor presentation. This includes filling your information on the cover page.
· Students must mention question number clearly in their answer.
· Late submission will NOT be accepted.
· Avoid plagiarism, the work should be in your own words, copying from students or other resources without proper referencing will result in ZERO marks. No exceptions.
· All answered must be typed using Times New Roman (size 12, double-spaced) font. No pictures containing text will be accepted and will be considered plagiarism).
· Submissions without this cover page will NOT be accepted.
Learning Outcomes:
1. Describe the place of small business in history and explore the strengths and weaknesses of small business.
2. Design a solid projected financial plan and conduct a breakeven analysis for a small company.
3. Demonstrate the ability to deliver and communicate marketing massages in coherent and professional manner.
4. Illustrate the ability to think independently and systematically on developing a viable business model.
Assignment Workload:
This assignment is an individual assignment.
Start-up Business Plan
Assume yourself as an entrepreneur of a small startup business in Saudi Arabia.
Write brief notes on the following objectives:
1. Owners, capital structure and company profile (2 Marks)
a. Your Business Name, Address, E‐Mail
b. Form of ownership: What is the legal structure? Sole proprietor, Partnership, Corporation….
C. Investment capital
2. Company Business Description (300 – 400 words)
A. Scope and type of business (4 Marks)
What business will you be in? What will you do? What market segment will you choose?
• Business idea: what is your big idea? Is it a product or a service? What makes your idea different?
• Mission Statement
• Company’s short-term and long-term goals and objectives.
• Target market and demographics: Who will your customers be? Where do they live? What is your target market passionate about?
B. Business Philosophy (4 Marks)
What is important to you in your business?
• Describe your Industry: Is it a growth industry? What long-term or short-term changes do you foresee in the industry? How will your company take advantage of it?
• Describe your most important company strengths and core competencies: What factors will make the company succeed? What do you think your major competitive strengths will be? What background experience, skills, and strengths do you personally bring to this new venture?
• Risk Assessment: Evaluate the strengths and weaknesses of your business using SWOT.
•Who is your competition and how do you beat them?
Note: Use APA style of referencing
Answers
1. Answer-
a. Name of business: (Auto Addicts).
Business location: Dammam, Saudi Arabia.
Official email address: [email protected].
b. Form of ownership: What is the legal structure? Sole proprietor, Partnership, Corporation….
The legal structure of the business is Sole proprietorships. I chose this type of structure because sole proprietorships offer minimal legal formalities, immediate start-up, control, quick response, income tax benefits, and exclusive ownership of business secrets, allowing for tax-efficient operations and privacy (Sole Proprietorship Explained: Advantages and Considerations | Mailchimp, n.d.).
c. Investment capital
To start the business smoothly and avoid any shortages, a total of 1,000,000 SAR would be enough to cover the initial expenses such as business registration fees, security deposits, remodeling, initial vehicle inventory, insurance deposits, etc. (Upmetrics, 2024).
2. Answer-
A. Scope and type of business
· What business will you be in? What will you do? What market segment will you choose?
The business I will be in will be for buying and selling sports, off-road and classic cars. As a sole proprietor, I will be managing the business. However, I will defiantly need one or two other individuals with me to help running the business. On the other hand, in my business I will be focusing on the following types of main market segmentation: demographic, behavioral, psychographic. I am also using another sub-segmentation that is purely related to cars such as performance seekers, off-Road enthusiasts, classic cars enthusiasts (Shaw, 2024).
· Business idea: what is your big idea? Is it a product or a service? What makes your idea different?
My business biggest idea is to provide products in a good to excellent condition and make it easier for enthusiasts to buy their dream cars based on their financial capacity. I think what makes my idea different is that I will be focusing on both quality and affordability when it comes to what customers wants. As an entrepreneur I am definitely focusing on profit, but I am also focusing on growing the community of this hobby.
· Mission Statement.
Our mission is to excel in all business areas by delivering exceptional customer experiences, being the best workplace, and supporting our community, all while working together.
· Company’s short-term and long-term goals and objectives.
Short-term goals:
1. Hire skilled employees in the field of marketing and automobiles sales
2. Create brand awareness and establish as reliable and trusted cars dealership.
3. Achieve financial stability in the first year.
4. Increasing monthly net sales.
Long-term goals:
1. To create a substantial customer base consisting of various clients both in domestic and international markets.
2. To increase the number of clients serviced by 20% every year by filling an unmet demand with exceptional variety and customer service.
3. To achieve compatibility with as many manufacturers and models as possible, keeping the knowledge base up to date.
4. To expand by adding new locations during the forecast period.
5. To achieve and surpass the industry average profit margin within the first three years.
· Target market and demographics: Who will your customers be? Where do they live? What is your target market passionate about?
The customers of my business are those who love certain types of cars. These types of cars are sports, off-road and classic cars. My customers lives all around the country and there is no specific location; however, most of these enthusiasts lives in big to mid-size cities where they are exposed to the hobby of loving cars. These types of enthusiasts are passionate about owning, working on, and restoring cars. They do not look at cars as only means of transportation, but they also look at them as way of enjoyment and freeing their mind from stress.
B. Business Philosophy
· What is important to you in your business?
It is important for me that my business will simplify car buying and selling, provide peace of mind, and create memorable experiences for both buyers and sellers. Moreover, it is also important for me to build a professional and personal relationship with the sellers, exporter and enthusiasts.
· Describe your Industry: Is it a growth industry? What long-term or short-term changes do you foresee in the industry? How will your company take advantage of it?
After the announcement of the Saudi Arabia 2030 vision, a lot changed in the industry, not to mention the role of social media in that change. People are being exposed to the industry due to the cars events and social media famous enthusiasts. The number of enthusiasts is increasing leading to possibly them seeking to buy or sell cars; hence, possibility to increase my sales.
· Describe your most important company strengths and core competencies: What factors will make the company succeed? What do you think your major competitive strengths will be? What background experience, skills, and strengths do you personally bring to this new venture?
Our company’s key strengths include our skilled team of marketers and salesmen, and robust customer relationships. We aim to thrive by continuously delivering the right products to the right customer.
· Risk Assessment: Evaluate the strengths and weaknesses of your business using SWOT.
Strengths:
· Strong reputation
· Wide vehicle range
· Experienced sales team
Weaknesses:
· Limited lineup of certain cars
· Government regulations
· Bargaining power of consumers
Opportunities:
· Market expansion
· Expanding online sales
· Partnership with banks
Threats:
· Supply chain distribution
· High competition
· Tough economic circumstances
· Who is your competition and how do you beat them?
Our competitors are several well-known businesses in the sector that provide comparable goods and services. The ways to outperformed them are by providing exceptional customer service, consistently introducing new products, and keeping a laser-like focus on sustainability. Furthermore, we want to employ digital marketing tactics in order to expand our audience and cultivate a devoted clientele.
References
Shaw, J. (2024, October 2). Understanding Consumer Segments in the Automotive
Industry: 9 Types of Car Buyers and their Personas. Kadence. https://kadence.com/understanding-consumer-segments-in-the-automotive-industry-9-types-of-car-buyers-and-their-personas/
Sole Proprietorship Explained: Advantages and Considerations | Mailchimp. (n.d.).
Mailchimp. https://mailchimp.com/resources/what-is-a-sole-proprietorship/
Upmetrics. (2024, April 5). How Much Does it Cost to Start a Car Dealership? –
Upmetrics. https://upmetrics.co/startup-costs/car-dealership
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