Transcript CT Entrepreneurship 2

ENTREPRENEURSHIP
wPOWER Hub - Wangari Maathai Institute
Entrepreneurship
• Entrepreneurship is the development of a
business from the ground up — coming up
with an idea and turning it into a profitable
business
Business life cycle
Clean energy value chain
Entrepreneurial marketing
• EM is a spirit—an orientation as well as a
process of pursuing opportunities and
launching and growing ventures that create
perceived customer value through
relationships, especially by employing
innovativeness, creativity, selling, market
immersion, networking and flexibility
• 80% of entrepreneurship is sales and
marketing
Cont....
• Marketing provides an effective vehicle for
achieving entrepreneurship. As some have
argued, marketing is the home for the
entrepreneurial process.
Marketing practices
• To have a successful energy business you need
to satisfy the wants and needs of the
customers.
• Planning steps
1.
2.
3.
4.
5.
Analyzing marketing opportunities
Selecting target markets
Designing marketing strategies
Developing market programs
Managing the marketing effort - Execution
Marketing mix
Product
Price
Promotion
Person
Place
The 5 ‘’Ps’’ help energy entrepreneurs to understand key
components of the marketing process & learn how to solve
common marketing problems.
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Product
• What is the product/ service?
• Physical Presentation
• Value Added Qualities
• Bundled Package (Product with Service)
• One Stop Services
Price
Setting the right price
1.
2.
3.
4.
5.
Selecting the Price
Determining Demand
Estimating Costs
Analyzing competitors’ costs, prices &offers
Selecting a price method: for e.g.markup pricing, target return
pricing,value pricing.
Promotion
Common promotion platforms
• Advertising
• Sales Promotion
• Events/Experiences
• Public Relations & Publicity
• Personal Selling
• Direct Marketing
Place
• Where are the energy products accessed from
A - Direct (door to door, market stall, shop)
B – Distribution channels (Manufacturer,
wholesalers, distributors, retailers, own
house/mail order etc.)
Person
 The relationship between the entrepreneur
(producer, salesperson, marketing person) and
his/her clients, suppliers and other persons
important to the business.
 The attitude of the entrepreneur (friendly,
hospitable, capable and efficient).
 The personal reputation of the entrepreneur in the
location (area, village).
 The skills and personal competencies of the
entrepreneur.
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 Customer care
Treating customers well can help you promote your
energy products by word of mouth to neighbours
and friends.
Customer relationship means making a decision
about how you operate, service, help and supply the
customers.
After Sale service
An energy business + a customer care team, sort out
any technical problems and make sure customers are
happy.
Offer warranty/guarantee
To sell your energy product........
You MUST know
• the cost of your product or service is the
amount you spend to produce it
• the price is your financial reward for providing
the product or service
• the value is what your customer believes the
product or service is worth to them
Costing
Before setting a price for your product, you have to know the
costs of running your business.
• Variable costs: These are your expenses specifically to
produce/sell your items (changes based on how much you
produce/sell).
• Fixed costs: These are all the expenses that will not change
with the number of products you sell.
Total costs = Variable costs + Fixed costs
Pricing & Profit
One of the secrets to business success is pricing
your products appropriately and that can
enhance how much you sell.
It's important to find out what your competitors
offer and what they charge
Total Revenue = Price x Number of products
Profit = Total revenue - Total cost
Record keeping
• Good records will help you monitor the
progress of your business, prepare your
financial statements, identify sources of
income, keep track of deductible
expenses,prepare your tax returns, and
support items reported on your tax returns
Cash book
• Cash book: All the day-to-day transactions involving
cash repayments and receipts are recorded in this
book.
Information in the cash book includes:
Cash in hand; Cash purchases; Daily expenses; Cash
receipts
For balancing:
• When you take money out = ( - ) SUBTRACT
• When money comes in = ( + ) ADD
Sales book
In this book you record all the information about what you sell
on cash and on credit. The sales book will show you how your
sales are moving, that is, whether they are going up or down.
Always know how much you have been paid in cash and how
much is remaining (credit) for every product you sell, and
record the information in the sales book!
You can make a separate book for people who owe you money if
you would like. This can be called a “debtors book,” as it is to
keep track of people who are in debt to you.
Make sure you keep a copy of every receipt and fill in your sales
book at the end of each day or week.
Credit book
In this book, you should record all the debts you
have with your suppliers. When you get a loan
or credit from someone, you then have a debt
with those people.
• Creditors are the suppliers to whom your
business owes some money.