product development product planning realisation strict development idea finding policy formulation...

Product Development

Product Planning

Realisation

Strict Development

Idea Finding

Policy Formulation

USEFormulatingGoals & Strategies

Generating and Selecting

Ideas

Market Assesment

Production

Product Policy

New Business

Idea

Product Designing

Production Development

MarketingPlan

ProductDesign

ProductionPlan

Distribution& Sales

New Product Development

Product DevelopmentDr A. Riza Wahono : “ Pengembangan Bisnis ”Modul 3 2

VISION/Mission TO BE SET

What vision do your company have have

- Time scale

- Scale of entreprise

- Turnover of entreprise

- Number of employee

What mission would your entreprise carry

- National

- Technology

- Environment

- Human development, etc

Does it achieveable ?Preparing the first move


Your Company & Business Ideas answers these questions:

* Who are you/your company?* What do your company want?* What will it be like?* Why will your company succeed?* Why will your compnay fail?* How big is a business?

IDEAS looks at two ways to select a business idea:* What are your company skills?* Which is the best market?


YOUR COMPANY

The greatest determinant of the success of your business is SELF ANALYSIS :

• your company,• your company character and • skills.

This you must believe if your business is to have any

chance of prospering. Do not blames external factor for failure and

underestimate for your decisions impact.

Your Company & Business Ideas


• WHO ARE YOU/your company?The indications that can be reached are :– not all business have the necessary

ingredients for success, – there may be many company who possess

the vital skills and characteristics in full, but fail to take advantage of them.



• WHAT DO YOUR COMPANY WANT?

– An important part of your self-analysis should include what it is your company hope to achieve

– Note what your company objectives are.– Part of your self-analysis should be to see

how good or how bad a match your company objectives are to the reality



WHAT WILL IT BE LIKE?– Most probably the answer is much worse

than you can imagine. One of the more dispiriting aspects is that while you may expect hard work for one or two years, it could continue for several. Taking advice, such as counselling, and training are both likely to improve your chance of success.

– If your company manage to survive, life will not always be easy.



• WHY WILL YOUR COMPANY SUCCEED.To be successful if it fulfils three criteria:1. the people involved realistically assess their

strengths and weaknesses and try to overcome shortcomings. This is the most important criterion.

2. the idea and the market for it has the necessary growth potential and you have experience in that market

3. financing is sufficient to cover the shortfall of working capital, especially in the early days.



If you cannot fulfil these criteria at the moment, do

not accept defeat; you may be able to in the future.

You should already have some self-knowledge about your strengths and weaknesses as an owner-manager.

'Are you sure?, checklist can be used as a quick test of where you stand.



• WHY WILL YOUR COMPANY FAIL?

– Your company will fail if your operation does not match up well to the three criteria mentioned above.

– Many causes of failure are a result of lack of skills.– You do not have to be an expert at everything; but

you do have to appreciate the importance of all these aspects so that you can control your business properly.



• HOW BIG A BUSINESS?

– One factor to consider at an early stage is which track are you in. You may know, from the assessment of your skills and character, that the most you aspire to is being a business, pottering along steadily or else



BUSINESS IDEAS• Business Idea does not have to be novel, original or

revolutionary. Should not veer away. Being first is not always best.– To offer such a product has to educate a market and

possibly establish a distribution structure.– Into a market can capitalise on all the effort and

investment made by their predecessors.– The ideal product or service to choose as a basis for your

business is one which you can distinguish from the competition by including some additional feature or benefit which is not available in other products.



BUSINESS IDEAS

Draw up a shortlist of two, three or four ideas which you can define and research before selecting the one to run with .



BUSINESS IDEAS

• Choosing an idea. There are two possible ways: using an established skill, product or knowledge, and, in

general, this gives you the greatest chance of success identifying a market which looks ripe for development by

your business and acquiring the necessary technique and knowledge.

• Your business will not succeed if you have the skill or product but not the market, and vice

versa.



BUSINESS IDEAS

• WHAT ARE YOUR COMPANY SKILLS? expertise. Your company expertise may be

acquired as a result of staff education or training on the job.

Skill which they have acquired in their spare time as a hobby. The disadvantage with these is that you have not acquired any of the business knowledge needed to turn hobbies into a living.



WHICH IS THE BEST MARKET?

• Research some markets in which you believe there are profitable opportunities. The ideal market to base your business in is one which:– is growing or is large– is supplied by businesses which are not efficient or are outdated– has a niche or sector which you can exploit– is not heavily dependent on price to help consumers select one

product rather than another– is not already supplied by products which are heavily branded, that

is, there is not considerable customer loyalty to products from one or more businesses

– is not dominated by two or three very large suppliers, but instead has number of smaller would-be competitors.



Do not be afraid of competitors; they prove that there is business there to get.

If you need to raise money, the decision-makers will want to see some, if not considerable, knowledge and experience in that market.

If you do not have it, you have to concentrate instead on demonstrating your all-round business skills and experience, the strength offered by your character and abilities, and the research you have undertaken into your chosen market.



• NO IDEAS AT ALL?

Try organizing what is called a brainstorming session.

Spend a couple of minutes outlining the sort of idea you are after and what you have already considered but dismissed and why.

Ask for other people reactions and hope that some ideas will emerge.



BUSINESS IDEAS

• DEFINING YOUR BUSINESS IDEAS

Draw up a short list of two or more ideas.– Draw up a pen portrait of each idea. – Carry out research before encapsulating your final

choice in a detailed business plan with realistic forecasts. definitions of a couple of the most promising ideas, you will find that during the detailed estimation and calculation stage, one idea will emerge as the favourite.



BUSINESS IDEAS

The brief sketch should define the following points: a description of the product or service an indication of why it will sell a description of the intended market an indication of whether your idea is for the local market only or is

applicable to the international market your estimate of the approximate price how you think it will be sold, for example, through shops, salespeople,

distributors a first stab at the amount of sales you can make how it will be made, if it is a product its approximate cost.



SUMMARY1. An unusual aspect of starting NEW business is that you make the

decision yourself that you have the necessary qualities and abilities to make a success of it .

2. Analyse what you expect and hope to achieve from self-employment.

3. Do not underestimate the problems and difficulties which emerge for business

4. Use the checklists , 'Are you sure?' to identify your weaknesses and strengths.

5. Try to take advantage of the many training courses and advice agencies available to help improve those weaknesses

6. Do not be dissuaded from launching a business because you do not have an original idea. With the right management and a promising marketplace, a well-worn idea can be successful.



SUMMARY (Cont’

7. The market can be crucial in determining success or failure (rated second most important factor after management by providers of finance). Carry out detailed market research 'Who will buy?’.

8 . Develop brief descriptions of a couple of ideas before researching More thoroughly. Select the favourite and make up a detailed business plan before setting up the business.



MARKET : • You may know which market you want to enter; you may have got your eye

on a product which you think has potential. • Study your prospective marketplace in detail. Researching the marketplace

comes before raising money, making profit and cash flow forecasts, finding premises or any of the other steps you have to take to form your business.– Knowing the number of customers – you should be able to obtain information about what your potential

customer needs. This, in turn, should aid you to angle your product or service to satisfy the greatest demand.

– To persuade people to purchase something they already want;– educating a market to buy your product if the market has expressed no

great desire for it can be a long haul.• Show with confidence that you understand the structure of your market and

have a clear idea of where your product will be positioned compared to the competition. You will obtain financial backing.


MARKET :

How Much

Why

Who RESEARC

H Product DevelopmentDr A. Riza Wahono : “ Pengembangan Bisnis ”Modul 3 27

Market research and how you can proceed to find out about your particular market. 1. What it is you need to know about the market. Define the bit (or segment) of the market you are specifically going for,

• WHO WILL BUY? (Who Will Be Your Costumers?) • WHY WILL THEY BUY? • HOW MUCH WILL THEY BUY?

2. How to carry out the research.• HOW TO DO THE RESEARCH looks at the nitty-gritty of

carrying out the market research needed. How is it done? What sources do you use? Are some more important than others?

MARKET :


• WHO WILL BUY? (Who Will Be Your Costumers?) which are your customers and what are their common characteristics?

• WHY WILL THEY BUY? helps you form your sales proposition to your target market. What are the main features and benefits which your potential customers are looking for? Can your product supply them? This process helps you to define your service or product specifically, and in relation to the competing products, so that your product is differentiated from the run-of-the-mill.

• HOW MUCH WILL THEY BUY? leads into how you can utilize the information about market and potential customers to make realistic sales forecasts

MARKET :


• Basically, you should be looking for a niche in your proposed market (market segmentation) which allows you to charge a reasonable price and so maintain reasonable profit margins. To achieve this, your product needs to be clearly distinguishable from the competition (product differentiation).

• Once you have sorted out the groups, look at the competitive position, you need to be able to offer customers some additional benefit in your service or product, and it must be a benefit they want.

• For a small firm, a strong attraction of using this market segment approach to sales is that you may be able to achieve a dominant position in that segment.

MARKET : ( Who Will Buy )


• If your business is on a smaller scale, it still makes sense to look for a niche to exploit, because of the advantages it offers in being able to keep your prices above rock-bottom level.

• There are several different ways of grouping people. These include looking at potential customers :– by examining facts about their life, such as where

they live or the kind of work they do. Or– how they behave when they are deciding to buy a

product, such as whether price makes a substantial difference to their buying decision.

– Use the step-by-step analysis to help you sort out groups or segments.



MARKET GROUPING

• Identify a group of people with similar tastes in your target market does not necessarily mean that you have unlocked a source of sales for your product.

• To be useful, a market grouping needs to have certain characteristics.– The segment needs to be big enough to give you the living you require.

You must also be able to differentiate it from other groups, so that its size can be measured.

– The segment must be easy to reach. There is no point in selecting a target group which is difficult to reach. If it is, you will experience problems getting your message across or supplying the product because of location.

– The group must have common features which actually lead to similar buying decisions.




Consumer market

Age Sex

MaritalStatus

AreaSocial Class

User

Life style

Price

Quality

Distribusi

MARKET GROUPINGProduct DevelopmentDr A. Riza Wahono : “ Pengembangan Bisnis ”Modul 3 33


Professional/IndustrialMarket

Type Scale DeliveryPrice After sale

MARKET GROUPING


WHAT DO YOU KNOW ABOUT YOUR LIKELY CUSTOMERS?

• Knowing a range of information about them to understand your potential customers and sell to them. If it is a business you are selling to, you need to have information on the organization and buying policies. Investigate the other suppliers to your customers and acquire and analyse information on the services and products bought by them.



• find out what your customer wants. • What are the benefits and features of a service or product

which your target group rates most highly? (Research) • have the framework of your customer needs, • your sales package can be altered to achieve the desired

objective. These include:* appearance* delivery time * maintenance * performance* quality

MARKET : ( Why Will They Buy )


• By adjusting your service/product in this way to meet the wants and needs of your target market, you are trying to establish that you have at least one unique feature which your competitors don't have.

• It would be a mistake to believe that buyers act in a rational way, comparing products and choosing their purchase on the basis of some organized assessment.

MARKET : ( Why Will They Buy )


• Estimate of how much you are going to sell and when that is likely to happen. You need this data to formulate your sales and cash forecasts.The level of sales you can make over the years depends on:

• the market size• the market structure• the market share you can establish (and the competition

you face)• the market trends, that is, whether it is growing, static

or declining• the investment in time and money to sell your product.

MARKET : ( How Much Will They Buy )


MARKET SIZE• This could be either its monetary value or the number of units sold

in the market. Beyond this you need an estimate of the market potential.,

• assess the size of the particular segment you are interested in.

MARKET STRUCTURE• This is the process by which the final product is sold to the end-

consumer. • know how your particular market works to be able to estimate the

value of sales. • Any study of market structure can only apply at the time the study

is made, because distribution networks are constantly evolving,



MARKETSHARE

To be able to forecast your sales you need some idea of– what share of the market your competitors have– information about your competitors' business and products to

enable you to position and price your own offering. – there are some ways of influencing the share you can seize.

• build a reputation for good, consistent quality.• maintaining a reasonable level of marketing activity: PR,

advertising and sales activity.• if your product is recognized as being ahead of the

competition in performance, design or whatever.



MARKET SHARE

Look at your competitors in a detailed fashion. * what are the competitive products and how much do they sell?* how well have they done in the last few years?* how is the company organized?* how is their selling carried out?* if they produce goods, how is it done and what are the facilities?* W ho are the main customers?* what is the pricing policy and what sort of delivery is offered?



MARKET TRENDS

• Market size, market structure and market shares do not remain the same.

• anticipated changes in the economy can affect the buying patterns of individual markets.

• New information or research may emerge on the effect of certain items (for example, health hazards).

• look closely at your market to guess what changes will occur which might affect the market trends if the changes caused by government or local authority policy.



The basic research methods include: • desk research, studying directories and other

literature • interviews with customers, suppliers,

competitors, distributors, ex-employees of competitors

• test trials.

MARKET : ( How To Do A Research)


MARKET : ( How To Do A Research)

Problem Formulation

Determine Research Design

Design Data CollectionMethod & Forms

Design Sample & collect data

Analyse & Intrepret data

Research Report


WHICH IS THE BEST MARKET?

• Research some markets in which you believe there are profitable opportunities. The ideal market to base your business in is one which:– is growing or is large– is supplied by businesses which are not efficient or are outdated– has a niche or sector which you can exploit– is not heavily dependent on price to help consumers select one

product rather than another– is not already supplied by products which are heavily branded, that

is, there is not considerable customer loyalty to products from one or more businesses

– is not dominated by two or three very large suppliers, but instead has number of smaller would-be competitors.


Summary

1. Market research which is undirected is not very useful; it needs to concentrate on who will buy, why will they buy and how much will they buy.

2. It is much easier to sell a product which meets some already perceived need rather than to try to educate a market to buy a new, perhaps revolutionary, product or service.

3. Look for groups within your target market which you think you can sell to, either because no one is currently selling to them or because you can adapt your product to meet their needs.

4. Use the step-by-step guide to help you identify a suitable market group.


Summary

5. Rational and emotional factors affect your target group's willingness to buy. Research these and alter your product or sales approach to match.

6. Knowing how much customers will buy is crucial to your business planning. You need to research market size, market structure, market share, the competition and market trends.

7. Try to carry out your research in a systematic way so that it can be properly analysed. Use desk research, interviews and test trials, if possible.


SIMULATION

How Much

Why

Who What


product development product planning realisation strict development idea finding policy formulation...

Documents

company skills

company objectives

youyour company

company character

riza wahono

pengembangan bisnis

human development

chance of success