Entrepreneurship AND Small Business Management Seventh Edition Entrepreneurship Foundation, Inc. 1 Connecticut Edition Information in shaded boxes is specific to Connecticut The Entrepreneurship Foundation administers a Connecticut business proposal competition. For details, see http://www.entrepreneurshipfoundation.org/competition.html Edition 7.0 ELECTRONIC ISBN-13: 978-0-9967327-5-8 PRINT ISBN-13: 978-0-9967327-6-5 Contact: [email protected] © Academy Publishing, 2012, 2013, 2014, 2015, 2016, 2019, 2020 2 Table of Contents Introduction to Entrepreneurship .................................................................................................................... 6 A. PERSONAL GOALS ................................................................................................................................... 7 B. COMPANY GOALS: THE STARTUP CHECKLIST .................................................................................... 8 1– Lean Launch Methodology ........................................................................................................................... 9 A. BUSINESS MODELING ........................................................................................................................... 10 B. LESSONS LEARNED ............................................................................................................................... 11 C. INCREMENTAL LAUNCH STRATEGY.................................................................................................... 12 2 – Concept Development ............................................................................................................................... 13 A. IDEATION ................................................................................................................................................. 14 B. PATENT SEARCH .................................................................................................................................... 16 C. FEASIBILITY ANALYSIS OF IDEAS ........................................................................................................ 17 D. FINAL CONCEPT (PRODUCT, OR SERVICE) ...................................................................................... 21 3 – Competitive Positioning ............................................................................................................................ 22 A. COMPETITION RESEARCH .................................................................................................................... 23 B. COMPARISON OF FEATURES TO COMPETITOR PRODUCTS .......................................................... 24 C. INDUSTRY ANALYSIS ............................................................................................................................. 25 D. TARGET MARKET NICHE ....................................................................................................................... 26 E. SIZE OF TARGET MARKET .................................................................................................................... 27 F. COMPETITIVE STRATEGY ..................................................................................................................... 28 G. BARRIERS TO ENTRY ............................................................................................................................ 29 4 – Business Model Canvas ............................................................................................................................ 30 A. LEAN BUSINESS MODEL CANVAS........................................................................................................ 31 B. ASSESS SKILL NEEDS ........................................................................................................................... 34 C. PROJECT MANAGEMENT (TEAM COLLABORATION) ......................................................................... 35 D. MARKET RESEARCH: SURVEY CUSTOMERS TO VERIFY ASSUMPTIONS ..................................... 36 E. VALIDATE DEMAND (THE LANDING PAGE) ......................................................................................... 38 F. PIVOT RECORD ...................................................................................................................................... 40 5 – Designing the Product or Service ........................................................................................................... 41 A. MINIMUM VIABLE PRODUCT OR SERVICE .......................................................................................... 42 B. PHYSICAL PRODUCT PROTOTYPING .................................................................................................. 43 C. RESOURCES FOR PRODUCT PROTOTYPING AND MANUFACTURING........................................... 45 D. ELECTRONIC PRODUCT PROTOYPING .............................................................................................. 46 E. SOFTWARE AND MOBILE APP RAPID PROTOTYPING....................................................................... 48 F. SOFTWARE AND MOBILE APP FINAL DEVELOPMENT....................................................................... 49 G. MARKET TESTING THE PRODUCT OR SERVICE ............................................................................... 50 6 – Insurance .................................................................................................................................................... 51 A. TYPES OF BUSINESS INSURANCE....................................................................................................... 52 B. TYPICAL BUSINESS INSURANCE RATES AND COVERAGES ........................................................... 54 7 – Location ...................................................................................................................................................... 56 A. SOURCING PHYSICAL LOCATIONS ...................................................................................................... 57 B. COMPARING LOCATIONS ...................................................................................................................... 58 8 – Pricing the Product or Service ................................................................................................................ 60 A. FINAL PRODUCT COSTING ................................................................................................................... 61 B. SHIPPING AND HANDLING COSTS ....................................................................................................... 62 C. PRICING A PRODUCT THAT YOU MANUFACTURE ............................................................................ 64 D. PRICING MULTIPLE PRODUCTS FOR RESALE ................................................................................... 65 E. PRICING OF SERVICES .......................................................................................................................... 66 F. BREAK EVEN CALCULATION FOR A PRODUCT OR SERVICE .......................................................... 68 3 9 – Budgeting and Accounting ....................................................................................................................... 69 A. PERSONAL EXPENSE BUDGET ............................................................................................................ 70 B. BUSINESS BUDGETING AND ACCOUNTING ....................................................................................... 71 10 – Management ............................................................................................................................................. 75 A. BUILDING THE MANAGEMENT TEAM ................................................................................................... 76 B. INCENTIVIZING THE MANAGEMENT TEAM ......................................................................................... 78 C. ADVISORY COMMITTEE (NON-PAID MEMBERS OF THE TEAM) ....................................................... 80 D. SELECTING AN ATTORNEY ................................................................................................................... 81 11 – Brand Image ............................................................................................................................................. 83 A. COMPANY NAME .................................................................................................................................... 84 B. LOGO ........................................................................................................................................................ 88 C. PACKAGING ............................................................................................................................................ 91 D. LABELING ................................................................................................................................................ 92 E. PHONE NUMBER..................................................................................................................................... 93 F. BUSINESS EMAIL ADDRESS .................................................................................................................. 94 G. BUSINESS CARDS .................................................................................................................................. 95 12 – Website ....................................................................................................................................................