example of the paper to be done.

Assignment 1: To Build or Buy

Business Plan for a Bookstore

Business 402

Introduction

Being a student, I have to regularly visit bookstores to purchase study materials. Earlier, this task was done by my parents and family members when I was young, but as I grown up I started purchasing it all by myself. There is a bookstore in my neighborhood where most of my purchases take place. I have been in the bookstore located in Pensacola, Florida so much that I have become very much familiar with the guys at the store. One day, when I was at the store making some purchase, a young brown lady came in asked whether they have the novel called “Five Point Someone” and the shopkeeper said that they did not have any such novel. Out of my curiosity I searched it on the Internet and found that it is one of the highest selling novels in India written by an Indian writer Chetan Bhagat. I wondered why they have not this book if this is so much popular and considering the fact that there are a large number of Indians residing in the community. Then an idea came in my mind, if I open a store that only caters to Indian customers that would really sell.

Business Concept

The idea to open the business of a bookstore is primarily inspired by the mentioned incident. Once the idea crept in and keep on thinking and evaluating the opportunity as to why it can turn out to be a successful venture when there are a large number of bookstores in my community. In order to be successful in a particular business where a number of players already operate in, it is requisite to make some changes in the traditional ways of doing business in order to distinguish from others in a way the customers perceive it to be significant to them (Storey, & Greene, 2010). If you start selling the same products and in similar fashion, the ones who have already established their business are more likely to stay ahead in the competition, as they have created a customer base that keep on coming for repeat purchase. On the other hand, a new business struggles hard to find its place in the market as the competition makes it tough and it is quite difficult to create a new customer base (Longenecker, et al., 2013).

While my idea is not completely unique like Facebook, but the way it would operate and the kind of products it will focus to attract the target audience is quite unique. Today, businesses focus a lot on differentiation realizing the fact that the organizations going untraditional way have been doing well as (Hatten, 2011). In my case, I would be following suit and will not include a large and undefined audience but a concentrated and well-defined target segment and convey them that my business takes care of their specific needs that they cannot find anywhere. However, there are places where Indian customers can go and find the Indian books but not in the community. Also, no one sells these books separately for Indians, thus they do not offer many choices. These customers can find a wide array of choices in Indian books right from novels, religious books, or any other popular books. In such a case, they will be impelled to come to my bookstore.

Indians are connected to their roots per se as their values and cultures drive them to do so. Furthermore, Indians are very united and integrated which helps them develop their own group. Once a group member experiences anything that connects to their roots, they are more likely to recommend other group members through word-of-mouth communication. This will help my business get publicity in free and this will be even more effective than any marketing campaigns. If someone recommends something to others, they are more likely to show their faith and confidence in that primarily because the person recommending does not have any personal benefits for in it. He/she is recommending just because he/she has positive experience out of that and wants to convey to others as well to take the benefits (Pakroo, 2012).

Furthermore, Indians live in this country miss their culture and tradition and do not want to miss any opportunity to experience and live those experiences in the foreign country if they get such a chance. Literature is something that helps the readers visualize in the personal context. If a novel is written by a foreign writer, he/she is more likely to depict his/her own culture and characters. The readers reading books will not be able to visualize in their own context. On the other hand, if a book is written by a writer who belongs to the same community, it is more likely that the readers can associate themselves.

Lastly, the business will not cater to only target market. There are a number literary enthusiasts who like to read literature from different countries to feel different cultures. These customers will also find it worthy for themselves. They will find the popular books from India at one place and they would not have to wander anywhere else.

Business Format

The preferred way of doing this business will be opening a new business instead of acquiring the current one. The owner of the mentioned bookstore will demand high price for the business as his business is doing well. Furthermore, he will make the valuation for the existing books in the deal and these books will be of no use to me and completely waste of money. On the other hand, in a new business I will be able to purchase those books that I intend to sell. In addition, I will be able to choose a place where the proximity of Indians is the highest and where I can get the shop for rent at reasonable price and within my budget.

Most importantly, even if the business of the mentioned bookstore falls in the small business, their scale may be different than my intended business. In opening the new bookstore, I know my limitations and the scale to which I want to carry out the business. A new start-up begins with limited products and if the products start selling, he can always expand the business. So, there is less risk involved with it. On the other hand, there is a huge risk involved with the ones that have already huge inventory. However, the inventory should be such that is sufficient to cater to the needs of the customers. In the underlying case, the customers will only come if they discover that there are lot of choices.

Budget

The proposed budget is presented in the following table. I will take US$ 40000 in loan from banks and rest I will invest US$ 3000 from my own. The idea is to maintain a fair balance between these two. If I go for higher proportion of loan amount, my profitability will be hammered down and if I go for lower proportion of that my personal investment will be at risk. Therefore, it is required that I maintain balance between these two.

Marketing Plan

Objectives

The marketing objectives of the bookstore intends to attain the following:

1. To achieve a sales target of $150000 in the first years

2. To make it popular in the community, especially among Indians

3. To carve a niche

Marketing Mix

Product

The products will the books written by Indian authors in English. The books will comes in different varieties including novels, story books, cultural books, recipe books, and many more.

Price

The price will be competitive and set in accordance to the competition. However, there will be certain books which will be highly priced due to cost associated with them. Generally, the foreign books are costlier which will increase the selling price.

Place

The bookstore will be opened in my community and it would have proximity to the markets. Preferably, it will be located in the areas known for book stores

Promotion

The promotion will be mainly done through catalogues and online. A lot of focus will be placed on online marketing considering the budget is low.

Pros your Own Business

Personal and professional growth. You will get stronger emotionally and spiritually as you work on different aspects of your own business. Combine your passion and strengths to serve your customers and client. New ideas. Set your own daily schedule, make your own hours.

Cons your Own Business

You may have anxiety provoking to step out in faith and take risks with your own money, time, and energy. You need a good idea, potential customers, and knowledge of marketing, finance and management to succeed.

Buying an Existing Business

Pros - Banks take a more favourable view because of the existing track record: the existence of customers, staff, supplies, facility, and cash flow.

Cons - Involve less risk, and there's less to learn the hard way, when compared with starting a new business.

Ownership – The Company will be Limited Liability Company (LLCs) which will offer the same personal liability protection as a corporation, but with great tax and management flexibility. The company does not have to pay taxes on its profits, but instead, profits and losses are "passed through" to the owners, who must then pay tax on their share of LLC income.

Mission Statement

The idea to open the bookstore looks feasible looking at various analyses. The store is looking to carve a niche and it would distinguish itself from others which will ultimately help it stay ahead in the competition. It has a well-defined target audience and the audience is very much prospective. The bookstore will have a variety of different nationalities for a wide range of customers.

References

Hatten, T. S. (2011), Small business management: Entrepreneurship and beyond. Cengage Learning.

Longenecker, J., Petty, J., Palich, L., & Hoy, F. (2013), Small Business Management. Cengage Learning.

Pakroo, P. H. (2012), The Small Business Start-up Kit. Nolo.

Scarborough, Norman M, (2012), Effective Small Business Management; 10th ed.p.cm.

Storey, D. J., & Greene, F. J. (2010), Small business and Entrepreneurship. Financial Times Prentice Hall.