Entrepreneurship Rubrics

Question: Describe about electronic enterprise "ULTIMATE Limited". Answer: Executive Summary The organizations mission is to provide quality services to clients, analyse their preferences, offer outstanding customer care services and to supply different electronics products such as mobile phones, tablets, CCTV cameras, television sets, radio calls, laptops, amplifiers and other devices which are in line with desired market quality and designs that will outwit other competitors in the market realm. Introduction The proposed electronic enterprise is called ULTIMATE limited. Its location is in Canberra and its primary objective will be to specialize in the provision of electronics products such as mobile phones, tablets, CCTV cameras, television sets, radio calls, laptops, amplifiers and other devices and services to all the clients from any part of Australia and beyond. The reason for operating the electronic business is due to the massive growth in the civilization and hence the need to digitalize operations (Gumpert. David E. 1990). In this regards, the demand for electronic products has been enormous and has grown steadily over the years. The trend is expected to increase further given the fact that most business are automating their operations and adopting new technologies that intensive use of electronic products. Additionally, the company chose to be based in the capital since there is a ready market. The accessibility of the market, as well as the vast population of Canberra that uses electronics, is essential for the success of the business. The company projects returns for the next three year period starting with 2016 all the way to 2018. The company expects to receive and to earn of $ 355,800 in 2016, $ 577,500 in 2017 and $700,000 in 2018. As evident from above, the net profit is projected to increase cumulatively due to the profitability of operations of the business. To achieve this, the company will use several marketing strategies that include collaboration with influencers, consumer approaches as well as a competitive pricing strategy. The company will adopt a customer-based approach with the interests of customers at heart so as to meet the needs of the client. The management team will be composed of an expert team of qualified personnel with the necessary management skills, academ ic as well as work experiences. Market Feasibility Given the gap that exists in the Australian Capital, the ultimate company have shown it wise to bridge the gap by supplying the electronic gadgets to various customers who demand these products. The customers include students, business persons and government and non-government bodies. Organization is set to explore the markets by providing new products and modifying the existing ones to suit the needs of the customers. Besides, there will be a provision after sale services that entail door to door delivery of goods and incorporating mobile shops that ensure that all customers across the country are served with various electronic gadgets. The organization will also ensure that the products are differentiated and diversified in order cater for all classes of customers. The diversification will help explore new opportunities and serve almost all the needs of the customers (Handley, Stephan. 2006). The business is set to form various alliances with the related companies and other business units to gain competitive and comparative edge in both local and global markets. Through acquisitions and mergers, the business will be in a position to acquire a larger market share and improve its profits and revenue sources. Eventually, this will enable the organizational business to expand its scope and make the best use of the intermediate goods of other companies, firms, business units and organization. Ultimate business is contemplating of expanding the scope of the enterprise by seeking the gaps that exist in the market as far as the production; distribution and consumption of the electronics devices are concerned (Kerin, Hartley, Berkowitz, Rudelius. 2006). Then the gaps are to be bridged by carrying out a detailed research, innovations and inventions that will ensure that the needs of all stakeholders are taken into considerations.Also, the company is also aiming at providing various services and enterprise solutions (networking and storage), which are the most profitable ultimate's businesses at the moment. The company should focus on growing these divisions as they promise better growth opportunities and higher profit margins. Competition is intensive in the Consumer Electronics industry, and this has prompted the electronics business entities to stay on toes and embrace technology and innovation consistently.While most consumer electronics companies have widely acknowledged outsourcing and offshoring as an enabler of cost competitiveness, Ultimate uses offshore partnerships to drive benefits beyond labour arbitrage. The leveraging offshoring is to drive competitive advantage by tapping into specialized skills and expertise offered by developing economies in Australia, Africa and Latin America. Primarily, this will improve the operations of the business and help create an avenue for the enterprises the enterprise grow (Malburg, Christopher R. 1994). The business is hell bent at exploring new opportunities and business ventures in this dynamic electronic market. The returns offered by venturing new opportunities are indeed attractive and hence the need for Ultimate business to embrace new opportunities. Insights that enterprises consider in as far as venturing into new opportunities and adopting continuous growth include: Competitiveness in the local as well as the foreign market. Embracing new technology in the dynamic electronics market. Gaining massively from export sales. Contribution to national production. Contribution towards defence production. Import substitution. Location wise mobility. In Australia, the small business opportunity is getting quite exciting and innovative over time. As a small medium enterprise, business opportunity can be seen from every sector including financial services, customer care, education, automobiles, advertising etcetera. Getting to grow every segment of the enterprise requires the identification of new opportunities. Given the fact that the Australian business market is enormous and full of promising new opportunities, increased purchasing power and consumerism fuels the business scenario in Australia. Technical Feasibility The business growth has a 5-year strategic plan in which it will see it cashflows grow massively and in which it will expand its services. The company plans to utilize most of its internal resources to finance operations and will reinvest profits obtained to provide additional services (Malburg, Christopher R. 1994). Nevertheless, it will acquire some additional funds through loans, investors, and friends' etcetera to expand the scope of operations and hence finance new business adventures for the betterment of the enterprise at large. There is a need for the business to decipher business model of different sectors and companies to pitch in products or solutions. A good way is expansion and diversification of the line of the electronic products that the business speializes.with. There is hence an opportunity in the electronic market for competitive advantage that will indeed help the company, investors and employees to climb the up the ladders. To spot, acquire and utilize new opportunities, it is essential for Ultimate to advertise its service far and wide. To make this a success, the business will adopt and aggressive campaign given acquiring new markets from the existing customer base. Essentially, this will not be done without offering education to the public as well as avail special offers for them to partake and gain interest in the company. Thus, the enterprise sees itself growing to be a monopoly in the electronic market while still embracing total quality and having customer welfare at heart. The manner in which customers are treated is of great essence. Ultimate pays particular attention to how customers are treated and is hell bent on making the customers have the best experience whenever they come to seek the services offered by the business. Ultimate recognizes the fact that it is impossible for growth to occur without the customers. Hence customers are the ones who keep Ultimate in business and hence need to be treated with a lot of care and caution. Due to this, the company will see to it that they are informed well in advance and are reached out from all the corners of the nation and that they are treated in a unique manner. This will also include offering high quality product as a customer friendly price (Cross, Wilbur and Richey, Alice M.. 1998). Human Feasibility It comprises of individuals who require diversified services. The group is diverse, heterogeneous and is composed of mainly average income earners. Their preferences vary according to individual choice and sovereignty. They play the informative role and thus help in the general expansion of the business. The company is therefore set not to expose them to negative externalities by exposing them to a lot of damages. Also, the company will ensure recruitment is done on the basis of merit without any favour (Rogoff, Edward G. 2004). Given that the business is a start up enterprise, the business has no the extensive experience. However, the management have incurred a lot of cost in the advertisement and promotional activities in order to inform the consumers on the availability of the products, there usage and how they can impact on their lives. The management team also did face a lot of pressure and competition on the already existing companies and other firms which are also in the same industry. Moreover, the company have also suffered due to insufficient capital and other assets like storage facilities which can be used to expand the daily operation and provide efficient services. As shown by the statement of financial position, the businesses is making good profit and also show signs of improving with time. However, the business is exposed to the risk of loss since it still don't have efficient storage facilities to enhance in the assemblage and the storage of both imported and locally made electronic products. In addition, the number of employees is growing and the company is expecting the wage rate to increase immensely now and even in the future. Therefore, this should be backed by the growth in both labours and capital productivity. There is also increase in those who have shown interest to buy shares of our company. It is because of the good reputation the company have developed in recent last (Zimmerer, Thomas. 2005) The business is contemplating on improving on the market brand in order to capture large market and counter the competitors. In addition, the company is expecting the revenue to increase in the near future while the cost of labour also increases due to increment in the number of employees as the company expands. The organizations vision is to see its operations grow massively, dominate in the long run and offer relevant, helpful and essential services to the market. In order to achieve this, Ultimate has a strategic objective in which it embraces total quality management as well as several other principals which will act a code of conduct of the business. Starting from the employees to the CEO, each associate of the enterprise is entitled to share in the visions and missions of the company. Meeting the organizational goals is the onus of each and every person in the organization thus the business is helmed to soar higher heights of success by achieving the set organizational strategic objectives. Financial Feasibility Start Up Capital: The intended investment capital is estimated to be $.800, 000. The acquisition of the proposed capital is as outlined below: Owners Equity : $500,000 Donations and contributions : $300,000. The amount contributed from owners' equity, and donations are expressed in ratio of 5:8 Profit and loss for last 12 months and future projections: ULTIMATE LIMITED PRO FORMA INCOME STATEMENT FOR THE YEAR ENDING ITEM 2014 2015 2016 Sales 1,544,000 2,001,700 2,568,940 Less cost of sales (344,000) (488,000) (600,000) Gross Profit/ Loss 1,200,000 1,513,700 1,968,940 Less EXPENSES Salaries (420,000) (540,000) (680,000) Rent (180,000) (180,000) (180,000) Depreciation (30,000) Registration (20,000) License (15,000) (4,000) (4,000) Electricity (7,000) (7,000) (7,000) Water (7,200) (8,200) (9,000) Telephone (15,000) (20,000) (25,000) Advertisement (90,000) (60,000) (100,000) Transport (30,000) (47,000) (122,000) Miscellaneous (60,000) (70,000) (221,940) Total (874,200) (936,200) (1,268,940) Net Profits 325,800 577,500 700,000 Cash Flow Plan: Ultimate Company Inc. Cashflow Statement For the Year Ended Dec 31, 2014 Cash Flows from Operating Activities:$ Operating income (EBIT) 350,000 Depreciation Expense 30,000 Gain on Sale of Equipment - 56,000 Increase in accounts receivable 5, 630 Decrease in prepaid expenses 18,000 Decrease in Accounts Payable - 22,800 Decrease in accrued expenses - 74,830 Net cashflow from operating activities 250,000 Cashflows from Investing Activities Sale of Equipment 43,000 Purchase of New Equipment 146,000 Net Cashflows from Investing Activities 189,000 Cashflows from Financing Activities: Payment of Bond Payable (135,200) Net Cashflow from Financing Activities (135,200) Net change in Cash 303,800 Beginning Cash Balance 122,000 Ending Cash Balance 325,800 Capital expenditure budgets: DESCRIPTION CAPACITY AMOUNT ($) 1. Equipment CCTV Woofers Office equipments 150 2. Computers Features: RAM Hard Drive Processor Speed 180 3. Furniture and fittings Wooden, ceramic and metallic 200 4. Motor vehicles Lorries 1200 The company is set to maximize the financial opportunities in order to enhance the development and expansion of the enterprise. In addition, the company have established a program to train the employees on the ethics and interpersonal skills in order to enhance flow of communication between the employees and the customers, employees and their bosses and employees and their fellow counterparts. Moreover, the company shall participate in the community based programmes by supporting the local educational programs and sporting activities, besides ultimate is set to boost the economy by adhering to the registered activities without acting ultra-vires.it will be achieved by employing competitive personnel to manage and control all the activities of an organization. The business has shown a positive trend since its inception in 2014 and has generated a net income which when invested back, has helped the company add on to its stock and has diversified its operations too (Wickham, Phillip A. 1998). The definite upward trend in the financial prospects of the company has attracted investors to the company and this has additionally helped the company to have an upward trend in its growth. Ultimate Company plans to boost its financial resources that will add to the investments of the company and hence enable to the enterprise record higher incomes in the future. The company projects to generate a return on its investment of 20% and increase its profitability level by 15% for the first 3 years, 20% in the next two years, 25% in the proceed 3 years after which it will achieve and target to attain profitability on investment of 30% and more. Nevertheless, the company plans to add onto its resources of investment and add equipment that will indeed improve efficiency and effectiveness of the business operations. Conclusion In order to evaluate efficiency, the enterprise utilizes the efficiency ratios in assessing how Ultimate is conducting its operations. The efficiency ratios measure how well assets of the company are employed. They can be used to evaluate the benefits produced by specific assets, such as inventory or accounts receivables or by a business's assets collectively. Efficiency ratios help in the evaluation of how effectively the company is putting its investment to work (Malburg, Christopher R. 1994). The greater the turnover, the more capable the company is at producing a benefit from its investments in assets. Significant of the efficient ratios to compute include the inventory turnover which helps indicate how many times the inventory is created and sold during the period. Another important ratio that the enterprise analyses is the total turnover rate which helps shows the extent that the investment in total assets results in sales. Thus it is an efficient rate to use in measuring how U ltimate utilizes its assets. In order to establish how effective the organization is, the company will compare the total asset turnover with the industrial asset turnover, and when its more, it will be a sure indication of how useful the enterprise is in producing a benefit from its investments in assets. Reference Cross, Wilbur and Richey, Alice M.. (1998). The Prentice Hall encyclopaedia of model business plans. Prentice Hall (also has disk of PDF's for templates) Bygrave, William D. (1994). The Portable MBA in Entrepreneurship. John Wiley and Sons. Debelak, Don. (2006) Perfect phrases for business proposals and business plans. McGraw-Hill. Jacksack, Susan (Ed.). (1998). Business plans that work: for your small business. Riverwoods, Illinois: CCH Incorporated. Gumpert. 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