Portsmouth Centre for Enterprise (PCE)
Challenge Support
"All people and organisations have needs which they fulfil in many different ways. When you can meet these needs better than they are currently being met then you will almost certainly have a business opportunity." (Peter Saunders 1997)
What Makes a Winning Idea
Meeting Customer Needs - sometimes referred to as Providing Customer Delight - is the key to success. You will almost certainly need to adapt your initial idea by listening to what your customers want.
Where do Winning Ideas come from?
Most winning business ideas come from your own experience. They come from you wanting to solve a problem or do something better which is in your own range of experience. Areas which you may consider include:
- Can I make something I dislike doing easier or more pleasant to do? - (e.g. the Dyson vacuum cleaner 22 provides motivation by enabling a person to see the dirt which has been extracted)
- Can I satisfy a need or want? - (e.g. a taxi service for business women staffed only by women).
- Can I redesign an object to benefit from how people misuse it? - (e.g. a pen with a retractable lid that I can't lose).
- Can I provide a product or service faster, at better quality, or more reliably?
Identifying Customers
On the Challenge Application Form, show you have investigated the market for your product or service. Some key ideas are given below:
Customers
Will my customers be:
- businesses - for their own use?
- businesses - to sell on to consumers?
- individual consumers direct?
Purchasers
Who is the person who will make the decision whether to buy what I am offering?
Influencers
Who are the people who can influence the purchaser's decision? e.g. Salesmen know that for couples buying a car, the man generally has the purchasing power and the woman has the influence.
Market Segmentation
This means identifying as clearly as possible exactly who are the customers your product or service is aimed at. e.g. 'provide a taxi service for business women, aged 20 - 60, in the Bristol area' rather than 'provide a taxi service'.
Customers' Needs and Wants
Try asking them! For example, you could:
- convene a small 'focus group'
- get three or four of your target customers and try out your ideas on them as a group, taking careful note of their comments
- devise a short questionnaire and give it out to individuals in your target group
Size of the Market
- how many potential customers are there?
- how can I estimate this? (Local Chambers of Commerce and business sections of libraries can be good sources)
Identifying Competitors
You will need to have completed some market research into your customers before you can begin to consider your competition.
Sources of competition in the Business to Business (b2b) market are quite different from the Business to Consumer (b2c) market. When you are operating in the b2b area, your competition will usually come from other suppliers selling the same, or similar, products/services and is usually fairly easy to identify.
You will need to answer the two fundamental questions:
1) What are my Competitors Offering?
The best way to find out is to ask them. Send for their brochure, ask for a quotation, enquire about their prices.
2)What is my Competitive Advantage? What are my Unique Selling Points (USPs)?
USPs are the reasons customers will buy your product or service rather than your competitors. Are you fulfilling their need faster, more excitingly, competitively, conveniently or effectively? Remember that most businesses make purchases to solve problems - the key to successful selling in the b2b market is to identify the problem and then 'sell' the solution, not the product!
The b2c market, however, is far more complex. If you are supplying a necessity, e.g. food or clothing, then again your competition is fairly clear - other suppliers of food or clothing. If what you are selling is a luxury or frivolous item, then potential competition will often come from quite unexpected areas, as you are relying on your customer making an "impulse" buy with disposable income. This type of trade is quite often seasonal - i.e. people are more willing to buy at particular times of year. Effective 'Point of Sale' marketing material is very important in this market as you have to convince them that they really would like to buy your product there and then, rather than all the other offerings around.
Whichever market you are in you will find that Business Directories are available at most large libraries and are a good source of background information on a market - library staff are usually more than happy to help you identify relevant sources. The high street banks also have extensive Market Information databases which they will share with you, particularly if they think you are going to do your business banking with them! Business Link can do a search for you, but they charge a fee for the service.
Business Planning
You want to find out more about business plans? It is not that difficult really, it's all about getting the right headings down on paper and filling in the gaps. It will allow you to clarify and organise your ideas in a 'business-like' way. If you need any help for anything regarding the business plans, just let us know, and we will do all our possible to help you.
The Business Plan is essentially a sales document
- Consider the reader - how many other plans might he/she have to read?
- Make yours stand out and hold the attention
- Assessors could be: Challenge Judges, Business Angels, Venture Capitalists
What do Assessors look for in a Business Plan?
- Brevity
- Clarity
- Product and Market Overview
- Key Issues
- The Team
- Can this make money?
You need to provide evidence for the statements you make
The Plan should normally contain the following (not necessarily in this order):
A. Executive Summary
The key selling points - stress the potential of your business. What funding do you require? Organise the information into short sections of 2 -3 paragraphs. Excite the reader's interest - it may be all s/he reads
B. Background of the Idea / Company
Set the scene. Identify the need, your motivation / aims and the key milestones in your thinking
C. The Product or Service
Clearly differentiate between features, and benefits to the customer. Don't get too technical and be brief. Include a photo, artist's impression, diagram - it can say more than 1000 words. Relate your product / service to existing ones and clarify the differences. Is more Research and Development required?
D. Sales and Marketing
Who are your customers - are they the end users? Identify the market segment; explain why the product is suitable. What is the potential size of the market? UK or overseas? B2B or B2C? How will you price your product? Who are your competitors? How will you stay ahead? Provide figures for your anticipated sales.
E. The Management Team
Outline key directors, managers, staff, advisers/mentors and their roles. Highlight your experience, skills, talent, integrity and successes. Include CVs in your appendices. Don't be afraid to admit to any gaps in skills etc - this is to be expected. How will you cope with gaps? Do you have a contingency plan?
F. Finance
What funding do you need? Keep financial details in the appendices. Be realistic - not overly cautious or optimistic. Allow for contingencies (things going wrong!). Remember, forecasting is not an exact science
G. Your Strategy or Route to Market
What are the possible routes to market? Do you have a preferred route? Who will be your suppliers? And why? Comment on possible future product development.
H. Risk Analysis
Strengths and weaknesses - internal factors; opportunities and threats - external factors. Be frank - if an assessor perceives weaknesses and threats that you don't, s/he may take a dim view of management. Be aware of current economic drivers.
I. Finally, Remember
Clarity, Brevity and Evidence. Check spelling, grammar and layout Length - 10 pages plus appendices. Be prepared to be questioned on everything in the plan and support any views and opinions - you will be challenged. Include quotes and newspaper articles in appendices. Do any government or other regulations apply? Comment on importance of protection of product / process (e.g. through patent) or speed to market. If you knew nothing about your business idea, would the plan explain it fully and in its best light?
Other Support
General guidance for your entry
If you wish, we can help you in identifying which category to enter and match you with a team/partners if you need particular skills or ideas or even help you to sort out your ideas and get them onto the entry form.
Confidential and Personal support
We will guide you in the process of developing your idea and writing your business plan. You can also try out your presentations on us, we will act like potential investors. (Stage Two)
The useful links section, contains specific and detailed information about business start-ups (funding, processes, finances).
Workshops will be organised by the student enterprise club (Club Sandwich) to support the Challenge. Main topics covered by professional speakers: Market Research, Finances, Business Planning and lots more.