There is a wide variety of business ventures that one could start, and more are coming up daily due to the advanced technology and ingenuity. In this case, Katrina who has always desired to open a flower shop does so and is eventually forced to close it due to intense competition. A report on Katrinas case will be presented.
Katrina made a few mistakes before going into the flower business and some of these mistakes will be examined. There are some basic steps that should be followed prior to starting any form of business. The first step that Katrina failed to take is doing an intensive market research. Selling a product or services does not necessarily mean that people will buy that product. Hence, the act of Katrina contracting with a supplier and putting up a shop was not a guarantee that people would buy form her shop. Doing an in-depth research on the potential market is vital. This includes determining the demand, considering market saturation in order to figure out whether there is enough space for a product or service. It is unfortunate that majority of entrepreneurs including Katrina discover that there was less market share for them to capture when it is already too late. Others realize much later that there was a limited Market audience (Fall, 2003).
The other mistake that Katrina made before starting the business was failing to hire a small business consultant or attorney. It is vital to hire an attorney who has many years experience in new business so that he or she can offer a hand and guide in the entire process of starting a business. Attorneys give advice on various processes such as determination of the appropriate business structure and drafting contracts. An attorney or consultant helps a client to develop a beneficial business structure. Instead of seeking advice from an attorney or business consultant, Katrina decided to consult her friends, who lacked knowledge and had no expertise in matters relating to starting a business. A business consultant would have advised Katrina on pricing issues and on how to buy flowers on a wholesale basis (Fall, 2003).
Advertising is what Katrina could have done to call attention to her shop when it opened. Proper advertising is necessary because it enables consumers to gain awareness and knowledge concerning a new business. There are various types of advertising that Katrina ought to have considered. The first form is internet advertising, which is a perfect way to call attention to a novel or an on-going business. The other form is advertising through local newspapers since this enables local people to aware of a new business venture. Moreover, getting free advertising for a new business can be achieved through the use of local newspapers. Television and radio stations have slots that give an opportunity for advertising small business, though they are more expensive compared to other advertising means (Steingold, 2009). Katrina could have used these stations for advertising her new flower shop.
Creativity is a quality that Katrina ought to have made use of in order to call attention for her shop and attract numerous customers. One form of creative ways of marketing and getting creating awareness about a new business is sung stickers. Stickers are among the marketing tools that are most effective for small businesses. There is increased convenience when using stickers because they only need to be peeled and placed on a surface. After placing them on a flat surface, customers are able to see the marketing message contained on the stickers at any given point of time. For the stickers to yield much benefit, they should be created using the most creative ways possible so that they can grab the attention of customers. Striking colors, catchy phrases and quality printing should be used on stickers. They should also be placed in strategic locations to grab maximum attention (Steingold, 2009).
The other flower shops saw Katrina as a potential threat to their market share and this is the reason why five of the shops started giving discounts and running specials. Moreover, advertising budgets were increased for all the flower shops. Katrina was anew entrant into the market, which could result to decreases profitability for all shops within the flower industry. Other flower shops viewed Katrina as a competitor, considering the fact that Katrina had exceptional flower designed that had won many awards in addition to featuring in the local newspapers.
The basis and centre of all business ventures is a comprehensive and well-written business plan. There is a description on the plans for attracting and retaining customers in a well-written business plan. Hence, through a well-written business plan, Katrina could have attracted and retained many customers. Consequently, her flower shop would not have been closed down. The basis for deriving other management and operational plans is a well-written business plan. A well-written business plan gives an outline of the current business situation, a vision for the business future, business goals and how to achieve them. A well-written business plan would have given Katrina a sense of direction as well as the action plan regarding her flower shop the business success (DeThomas and Derammelaere, 2008).
A well-written business plan outlines the mission statement and purpose of the business. It also states the intended goals and objectives that are realistic, actionable, times, measurable and specific. Te objectives may be many but they should be prioritized in addition to complementing each other. The other element of a well-written business plan is the strategy, which should be based on an intensive market research. A business strategy outlines the action plan and steps to take in order to achieve the set objectives and goals. Investigations on the potential suppliers, potential customers and competitors, economic and market conditions, trends and emerging technologies should be some when implementing a business strategy. This information would have enable Katrina to achieve business success since she would have attained insight on various supplies, competitors and customers prior to starting the business (DeThomas, 2008).
One key challenge for most small businesses is finding the most appropriate supplier. Suppliers can either cause a business to fall or make the business successful. Katrina overlooked the fact that a business owner has to find the right supplier and not signing a contract with the first supplier that he or she comes into contact with. Pricing should be considered when finding the right supplier. It is therefore advisable to choose one supplier from a wide variety of options available. One of the best ways to find several suppliers in at a single place is through trade shows. It is important to make a comparison between different suppliers interested in a given business. Asking potential suppliers different questions is also necessary. For example, it is advisable to ask a supplier about their technology so that a business owner can figure out the ways through which he or she can communicate with the supplier. It is also important to know what extra steps suppliers can take in order to outdo the competitors (Fall, 2003).
When Katrina started her business, there was an extremely high competition. There were already fifteen shops serving a population of 100,000. Moreover, out of the fifteen shops, five of them were very large had amassed many customers. Prior to opening her shop, Katrinas competitors started giving discounts and running special. This in turn increased their market share. Discounts and specials attracted more customers for Katrinas competitors thereby increasing profitability.
It is therefore clear that Katrina had a small market share due to failure to advertise and promote her business. She failed to take the necessary steps required foe calling attention to her shop. Her competitors outsmarted her by utilizing various strategies for increasing their market share. There is a link between market share and profitability and this is the reason why several firms and businesses are committed to increasing their sales relative to competitors (Steingold, 2009). The small market share and minimal profitability eventually forced Katrina to close down her flower shop.
DeThomas, A., & Derammelaere, S. A. (2008). Writing a convincing business plan. Barrons Educational Series
Fall, R. E. (2003). Starting a Small Business. Buy Books on the Web
Steingold, F. (2009). Legal guide for starting and running a small business. Nolo.
James Peter is the author and is associated with meldaresearch.com which is a global custom thesis writing provider. If you would like help in essays, research papers, term papers and dissertations, you can visit BestEssaySite.Com