Becoming an Entrepreneur in textile and clothing industry
What Is the Process of Entering Entrepreneurial World?
Entrepreneurship refers to the willingness to design, develop, launch and manage a given business venture to gain profit. Raising business ventures is associated with various uncertainties, entrepreneurship also entails the ability to accept and manage the risks related to the business venture. In as much as starting and developing a business may seem to be a dangerous act because there is no guarantee that investment idea will work, entrepreneurial spirit will not give up even if there will be a loss of money for some years before the business picks up. Entrepreneurship involves an application of the innovative ideas and willingness to manage the associated risks. The concept of economics brings out entrepreneurship as a factor that can produce the profit when combined with other factors of production such the land, natural resources, labor, and capital. This, therefore, shows that entrepreneurship is for profit (Levy & Scully, 2007, pp. 971-991).
Entrepreneurship can be of various types depending on the criteria used to grade them. These include small business entrepreneurship, the scalable startup, large-scale entrepreneurship and social enterprise. All kinds of entrepreneurs undergo similar stages before establishing the business. These steps start with idea generation which entails its preparation and incubation, then, a feasibility study is conducted on the identified idea which is later launched and managed in the market. These stages are the road to all the success of the innovative entrepreneurial ideas (Khan et al., 2007, pp. 1055-1077).
Entrepreneurship is critical for the growth of every country. Entrepreneurs help in coming up with businesses that are essential for the sustainability of the nation. Entrepreneurs are people who can take and implement lucrative innovative ideas and their associated risks to realize a profit. The willingness of an entrepreneur to take and work on the innovations creates jobs for people which intern improves the living conditions of people (Fauchart & Gruber, 2011, pp. 935-957). This, therefore, develops the community, enhances the standard of living, giving it a global competitive advantage thus social growth.
Joining the entrepreneurial world has never been easy for many people. This difficulty is mostly attributed to the fact that there are many uncertainties associated with starting a business venture. Many industries in the marketing offer options for joining the entrepreneurial world (Edmiston, 2010, pp. 1-93). Different people have different preferences on the choice of the business line to take. However, the selection of the industry to join depends on various factors which primarily include taxation, liability and also the record-keeping. These factors significantly influence the choices of people in the industry and therefore, contribute to the diversity in the business industries (Ramoglou, 2013, pp. 432-453).
Buying a franchise
I would like to join textile and clothing industry. Clothing is one of an essential need for humans, every person needs clothing, and this shows that this is an industry with a potential market. Clothing is an inevitable part of living that everyone has to buy it. If an appropriate strategy is embraced, there are many chances of succeeding in the industry. This, therefore, shows business dealing in the sector can make the profit and be assured of sustainability if appropriate strategies are put in place (Lawrence, 2014).
Just like other industries, the textile and clothing industry is evolving fast, and the consumer needs are changing all the time. This, therefore, shows that the industry needs to adopt change through creativity and innovation. People always want to get the little clothing items of the time. Capitalizing on the creation of trends and fashions will make a company succeed in the industry (Clarke & Cornelissen, 2011), pp 776–778). In my consideration for joining entrepreneurship, I have realized this gap that needs to be addressed which will, in turn, produce the profit.
Joining the textile and clothing industry is seems appealing to me after consideration of various factors in search for the right choice of the right industry to join. I always have an interest in fashion and trends. Sustaining the business in the textile industry requires continues learning to deliver the best clothing and outfits to the consumers. There are many ways to enter into business; this is no exception for my choice to join the textile and apparel industry. Choosing between buying a buying a business and buying a franchise needs a careful examination (Coleman, 2013).
A textile and clothing company can be acquired through franchising. In this case, the franchisor takes the responsibility of provision of the advanced way of doing business, continuously gives the franchisee guidance and provides an established system. On the other hand, the business has a role of paying back fee or purchases in return for these services. The franchisor and franchisee make an agreement on how they will be operating which covers aspects of non-disclosure agreements; return sharing, controls among others. Different people have different opinions and views about franchising hence different ideas for choosing this option. Franchising provides an excellent alternative to the actual start of one’s business (Hope, et al., 2007).
Advantages of franchising. Franchising has many advantages over other methods of joining the entrepreneurial world. Firstly, the franchisee enjoys a cover from the franchisor. They benefit from the independence in their capacity as small businesses yet supported by lots of benefits from the franchisor. This helps them to grow fast with less pressure of some factors like risks and market among others (Issie, 2010). Secondly, investors do not necessarily need to be experienced in the field before running this business. Franchisors usually take up the role of the provision of the required training to operate in their established business model. This enables people who have not been working in the industry to run the business and reduces the risks of failure due to lack or insufficient knowledge in the field.
Advantages of franchising
Thirdly, franchises are cheaper to acquire. Buying a franchise business is typically less costly as compared to starting one’s business enterprise or even buying an existing business. This makes it appropriate for investors who have fewer amounts to start or buy an existing business to go for this option. Also, franchisees will enjoy operating the benefits that come with an established name. Franchisors usually have a proven management, good work practices, an established brand image and a good reputation. This helps the franchisees to enjoy a profit that comes with this such as a national advertisement (Barbara, 2011, pp. 561–589).
In summary, franchising has higher chances of succeeding compared to starting new businesses. With the established brand name and reputation, the franchisee is assured of the cover from the franchisor, thus more profit for sustainability. Besides, the franchising has little risks of failure in the course. Chances of failing in this option are minimal mainly because there is protection from franchisors. Many investors who have lower money to invest and want a better deal with lower risks usually go for franchising.
Disadvantages of Franchising. Everything that has advantages always has disadvantages too. In as much as buying a franchise looks like a good deal, it also has disadvantages. Firstly, going for a franchise entails entering into an agreement. Some laws in the agreement may restrict the type of activities that the franchisee may engage in which puts a limit on what the investor can do. Secondly, legal agreements give the franchisor a lot of control over the franchisee. In some cases, the franchisor seems to dictate the business since he has a lot of scrutinies and even acts as the final many decision makers. The franchisees are forced to comply fully with the policies and directions passed by the franchisors, and they have no room to change this. This can limit the business in long-term (Baer, 2015).
Thirdly, it is also true that the performance of the franchisor directly affects the well being of the franchisee. This means that when the franchisor performs poorly, there is the likelihood that the fulfillment of the franchisee deteriorates. This link cannot be broken in this type of entrepreneurship. Also, franchising agreement means that profit shall always be shared with the franchisor. This is a lifetime contract as long as the business is operating during the term period and this may limit the profitability of the business enterprise. Also, in franchising, the franchisor does not guarantee the franchisee a guarantee to renew the contract agreement after the end of the term. This can hugely impact the business in case the franchisor turns down to renew the contract.
Disadvantages of Franchising
Buying an existing business enterprise is one of the common ways of entering the entrepreneurial world. Some people prefer this method over franchising while others are not for this approach. In buying an existing business, an investor needs to identify the idea which is in line with their interests and also in line with the talents that they have. This helps one to engage in the business that they find fun doing. The next step is listing all the conditions for the business such as location and time, and then the market is quantified which entails sourcing for a business which suits your conditions yet at a lower price. After buying the company, the operations continue normally or may change as per the investor’s view (Schoon & Duckworth, 2012, pp. 1719-1726).
Advantages of buying an existing business enterprise. Purchasing an existing business as a way of entering into the entrepreneurial world has many advantages. Firstly, there are no fee payments involved. Buying a franchise requires payment of royalty fee as a condition of franchising. This may put the business in a state of financial stress and thus the enterprise strains at the beginning and may even run a loss. Secondly, there are no rules and regulations. Franchising comes along with many policies, rules, and regulation. This greatly limits investor’s control over the business (Hanssan, 2012).
Besides, buying your own business gives one an opportunity to live by their ideas. Going for the franchise means that you are implementing the idea of someone else thus limiting yourself to what you can do. Franchising limits and restricts one’s creativity and innovation. Also, buying an existing business helps one to grow even to the levels of owning a franchise. Owning a business gives no limit and therefore grows to any anything.
Disadvantages of Buying an Existing Business. Going for the option of buying an existing business also has its drawback. Firstly, buying an existing business requires a lot of money. This method is capital intensive, and one needs a huge lump sum of money and thus can’t apply for those whose have little capital. The method requires one to budget money for the accountant, attorney, among others. Secondly, one may be found in a situation where they are negotiating for contracts which are in place to the current owner. This may hinder grow and land one in trouble (Staff, 2007).
Also, the business buyer is forced to investigate why the business owner has made a decision to sell the business. This helps the investor to avoid finding themselves in cases where the seller is disposing a business enterprise that may be having problems that are not easy to handle. The investor is also forced to establish the potential impacts that are likely to happen to the business on buying it. This option is full of risks and uncertainties as compared to franchising (Minniti & Moren, 2010, pp. 305-314).
In the process of entering into the entrepreneurial world, I would consider buying an existing business rather than the purchase of a franchise. In as much as buying an existing business has many drawbacks such as higher capital and associated with many risks, I find this method suitable and appropriate for me. Unlike franchising, buying my own business will give me an opportunity to exercise full control and management of the organization. Also, it will offer me an opportunity to apply my creativity and innovation, unlike franchising which will limit me on what I do. Therefore, buying an existing is appropriate to me because it will help me grow with no limitations; franchising seems like a limiting factor to my growth in business.
Product positioning is a process that the marketing team of a given company employs on how to communicate the product’s information in the best way conveys the message in the best way that depending on the customer needs, channels of communication, and competition among others (David, 2013). This, therefore, shows that product positioning is important since it presents a chance to influence the perception of the market regarding the product. If the product is not well positioned, there are the likelihood of misconceptions by target market about the product which may affect the brand name (Sandra, 2008).
Product positioning is seen to be implemented in four different methods. These are the creation of a selling proposition that is unique, risk reversal, the extreme value and a clearly, complete and concise customer education. All these steps involve five main steps in their implementation. It starts with understanding the target market, establishment, and understanding of the competition that exists in the industry. After that, a mapping of the buying criteria against the competitive positioning in the market, following an assessment of the product’s strength against the established buying criteria and then finally the analyses of the gaps (Andrei, 2010).
I look forward to buying an existing textile and clothing business in Canada. This will operate in the Canadian market which will later be expanded to other areas in the rest of the world. Clothing is an essential need and this inevitable for purchase by the Canadians thus sustainability. The Canadians are fashions, better clothing, and trending clothing. This, therefore, means that raising a business that can be able to offer the best clothing products in the industry will succeed. It should be able to produce clothing that suits the requirements and expectations of the customer’s needs, at an affordable price and this will make it attain a bigger market share (Foo, 2011, pp. 375-393).
The textile and clothing industry already has some players in place. This means that the business will also face competition in its operation. Some players already have an established brand name thus giving competition in the market (Leitao, 2009). This means that the business will, therefore, need to take appropriate strategy to stand the competition in the industry. This plan also calls for a mapping of the consumer’s buying criteria with the existing competitive position. The strategy should be able to identify the specific breakdown features that are various companies offer, and this will help understand what to be added or improved (Blythe, 2009).
The next step in the product positioning process calls for the identification of the strengths that product has over regarding the buying criteria that exists. This helps the company to realize the particular aspects that it can use to capitalize over its competitors and therefore gain a competitive advantage which will, in turn, help it to acquire a bigger market share. The final step in product positioning is the analyses of gaps (Zahra, 2009, pp. 519–532). This is a continuous process where the company identifies the new requirements that exist in the market and work towards filling these vacant gaps. It could also involve continuous improvements such as online order processing system among others. This is important and helps in the sustainability of the business operation (James, 2014).
I will purchase the existing business because it will give me a chance to exercise management practices because I will be the final decision maker unlike acquiring the business through franchising which makes it difficult to practice these skills. Also, this company will help practice my creativity and innovation. This is necessary for both short term and long term growth of the business. The company bought will be a good ground for exercising my qualities (Shane & Nicolaou, 2013, pp. 473-495).
As a recommendation, there is a need for a better risk management system. Buying an existing business has its associated uncertainties and risks. If not well taken care of, the company may run in stress for a long time and may even go down in extreme cases. This involves identification and management of the risks that are associated with that business venture. It starts with better choices of the business enterprise to buy because such wrong decisions will impact negatively on the business operation (Fauchart & Gruber, 2011, pp. 935-957).
Also, it is also recommended that the appropriate marketing strategies should be implemented after the purchase of the existing business enterprise. Those entering the entrepreneurial world through franchising option always enjoy the benefits that come with the established brand. It is also necessary for developing rightful marketing strategies that will see the business gain competitive advantage and thus get a bigger market share. This will help the business to grow.
Conclusion
In conclusion, joining the entrepreneurial world can be confusing to decide on the route to take. In buying a business, one is faced with a challenge of choosing between going for an existing business enterprise or purchase a franchise. Each option has its cons and pros. It is, therefore, necessary for a careful evaluation to take the right choice. Also, for strong buying of the business, the investor needs to position the product in the market and also evaluate the possible available options for successful operation in the entrepreneurial world.
References
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