Developing Business Idea in Malaysia.ppt

idea on how to develop business in Malaysia

1. DEVELOPING BUSINESS IDEADEVELOPING BUSINESS IDEA

2. LEARNING OBJECTIVES
•At the end of the topic, students should be At the end of the topic, students should be
able to:able to:
Understand the importance of a business ideaUnderstand the importance of a business idea
Develop a viable business ideaDevelop a viable business idea

3. WHAT IS A BUSINESS IDEA?
•A concept which can be used for commercial
purposes.
•Typically centers on goods or service that can
be sold for money.
•The ability to come up with a business idea can
be transformed into a viable business.
•The idea, that supported by feasibility study
and a business plan can be sold to interested
investors, firms and interested parties.

4. SUCCESSFUL BUSINESS IDEA
•Can lead to a very profitable
business if introduced at the right
time.
•Timing makes all the difference in
failure or success.
•Ensure there are valid business
opportunities for entrepreneur.
•Can be done through market
survey.

5. MARKET ANALYSIS
•Entrepreneur must analyze the market to Entrepreneur must analyze the market to
determine:determine:
Industry issues – PEST analysisIndustry issues – PEST analysis
Market structure – Monopoly,Oligopoly, etcMarket structure – Monopoly,Oligopoly, etc
Market size – no of potential target customer Market size – no of potential target customer
Market growth – an increase in the demand Market growth – an increase in the demand
for a particular goods/service over timefor a particular goods/service over time
Market capacity - no of potential customer Market capacity - no of potential customer
to support the businessto support the business

6. MARKET ANALYSIS
Market share - % of total sales volume in a Market share - % of total sales volume in a
market market
Cost structure – the expenses that a firm Cost structure – the expenses that a firm
must take into account when must take into account when
manufacturing a product or providing a manufacturing a product or providing a
serviceservice
Opportunity cost – benefit, profit or value Opportunity cost – benefit, profit or value
of something that must be given up to of something that must be given up to
acquire or achieve something elseacquire or achieve something else

7. MARKET ANALYSIS
Barriers to entry – economic, regulatory/ Barriers to entry – economic, regulatory/
technological factors that restrict entry of new technological factors that restrict entry of new
firms into an industry or market. Such barriers firms into an industry or market. Such barriers
may take the form of:may take the form of:
 clear product differentiationclear product differentiation
 economies of scaleeconomies of scale
 restricted access to distribution channelsrestricted access to distribution channels
 collusion on pricing and other restrictive trade collusion on pricing and other restrictive trade
practicespractices
 well established brandswell established brands
 fierce competitionfierce competition

8. MARKET ANALYSIS
To evaluate business idea, the common process To evaluate business idea, the common process
used is to answer the following questions:used is to answer the following questions:
 what is the need you fill or problem you solve? what is the need you fill or problem you solve?
(value proposition)(value proposition)
 who are you selling to? who are you selling to? (target market)(target market)
 how would you make money? how would you make money? (revenue model)(revenue model)
 how will you differentiate your company from how will you differentiate your company from
competitors? competitors? (unique selling proposition)(unique selling proposition)
 what are the barriers to entry?what are the barriers to entry?
 how many competitors do you have and what how many competitors do you have and what
quality are they ? quality are they ? (competitive analysis)(competitive analysis)

9. MARKET ANALYSIS
 how big is your market in ringgit? how big is your market in ringgit? (market size)(market size)
 how fast the market growing or shrinking? how fast the market growing or shrinking?
(market growth)(market growth)
 what percent of the market do you believe what percent of the market do you believe
you could gain? you could gain? (market share)(market share)
 what type of company would this be? what type of company would this be? (sole (sole
proprietorship, partnership or limited co.)proprietorship, partnership or limited co.)
 do you plan to use debt capital or raise do you plan to use debt capital or raise
investment? If so, how much and what type? investment? If so, how much and what type?
(investment needs)(investment needs)

10. BUSINESS IDEA FORMAT
11..Cover PageCover Page
* Company’s name &logo* Company’s name &logo
* Address of the business* Address of the business
* Name of the business owners* Name of the business owners
* Date of Submission* Date of Submission
3.3.Table of ContentsTable of Contents
4.4.Executive SummaryExecutive Summary
5.5.Main Body of the Business IdeaMain Body of the Business Idea
6.6.AppendicesAppendices

11. EXECUTIVE SUMMARY
•This is the most important section of a business This is the most important section of a business
ideaidea
•Not more than 2 pages-the most crucial part to Not more than 2 pages-the most crucial part to
capture the readers interestcapture the readers interest
•Complete this part after you have a finished Complete this part after you have a finished
business ideabusiness idea
•Information in executive summary:Information in executive summary:
Business idea descriptionBusiness idea description
Uniqueness of the product/serviceUniqueness of the product/service
Overview of organization and experience of Overview of organization and experience of
management team management team
Market opportunitiesMarket opportunities

12. MAIN BODY OF BUSINESS IDEA
1.1.Business DescriptionBusiness Description
2.2.Business LocationBusiness Location
3.3.Corporate StructureCorporate Structure
4.4.Marketing PlanMarketing Plan
5.5.Production/Operation PlanProduction/Operation Plan

13. BUSINESS DESCRIPTION
•The name of your businessThe name of your business
•A background of the industry withA background of the industry with
•Any history of your company (if any) Any history of your company (if any)
should be covered here should be covered here (vision and (vision and
mission)mission)uniqueness or distinctive uniqueness or distinctive
features of this venture should be clearly features of this venture should be clearly
describeddescribed

14. BUSINESS DESCRIPTION FORMAT
•General description of businessGeneral description of business
•Product/service description in detailsProduct/service description in details
•Industry background; Industry background; Eg: Fast food outletEg: Fast food outlet
Food industryFood industry
Fast food industry in MalaysiaFast food industry in Malaysia
Consumer spendingConsumer spending
•Uniqueness of the product/serviceUniqueness of the product/service
•Future prospects of the businessFuture prospects of the business
•Strategy to DifferentiateStrategy to Differentiate

15. BUSINESS LOCATION
•The purpose of this section is to provide The purpose of this section is to provide
additional info on the location of the additional info on the location of the
projectproject
•Such information should include:Such information should include:
Business addressBusiness address
Map and building photograph/visualMap and building photograph/visual
Building specification and facilitiesBuilding specification and facilities
General overview of locationGeneral overview of location
Factors in selecting the business locationFactors in selecting the business location

16. CORPORATE STRUCTURE
•This section will give details of the This section will give details of the
company background and structurecompany background and structure
•Carefully describe the legal structure of Carefully describe the legal structure of
your venture your venture
•Supply resumes of all key people in the Supply resumes of all key people in the
management of your venturemanagement of your venture
•Give information on how much Give information on how much
everyone is to be compensated.everyone is to be compensated.

17. CORPORATE STRUCTURE FORMAT
•Legal formLegal form (partnership, limited company) (partnership, limited company)
•Share distributionShare distribution
•Partners/ Shareholders backgroundPartners/ Shareholders background
•Organizational Chart Organizational Chart (identify relationships)(identify relationships)
•Duties and responsibilities of key personnelDuties and responsibilities of key personnel
•Proposed salaries of key personnelProposed salaries of key personnel
•Manpower PlanningManpower Planning
•Schedule of remuneration Schedule of remuneration

18. MARKETING PLAN
•The success of a business venture depends on the ability of the The success of a business venture depends on the ability of the
business to offer the product or service that is demanded by the business to offer the product or service that is demanded by the
target consumer group.target consumer group.
•4 objectives of marketing:4 objectives of marketing:
Pinpoint the target markets the company will servePinpoint the target markets the company will serve
Determine customer needs, wants, and characteristics through market researchDetermine customer needs, wants, and characteristics through market research
Analyze a company’s competitive advantages and build a marketing strategy Analyze a company’s competitive advantages and build a marketing strategy
around themaround them
Create a marketing mix that meets customer needs and wantsCreate a marketing mix that meets customer needs and wants

19. MARKETING PLAN
•Target market ~ Target market ~ groups of customers that have needs and wants groups of customers that have needs and wants
that can be satisfied by the business through the supply of goods or that can be satisfied by the business through the supply of goods or
servicesservices
•Market size ~ Market size ~ the total potential purchase of the target marketthe total potential purchase of the target market
•Competitors ~ Competitors ~ other businesses that offer similar, substitute or other businesses that offer similar, substitute or
alternative products/ services to the same target marketalternative products/ services to the same target market
•Market share ~ Market share ~ estimated potential sales of the business after taking estimated potential sales of the business after taking
into consideration the market size and competitors’ influencesinto consideration the market size and competitors’ influences

20. MARKETING MIX (4 P’s)
•PProductroduct
•PricPricee
•PlacePlace
•PPromotionromotion

21. MARKETING MIX (4 P’s)
•ProductProduct
Demonstrates ability to deliver customer valueDemonstrates ability to deliver customer value
Goods or ServicesGoods or Services
End user, Industry userEnd user, Industry user
Differentiations, brand, labeling, packagingDifferentiations, brand, labeling, packaging

22. MARKETING MIX (4 P’s)
•Ways to Ways to priceprice a product a product
Premium PricingPremium Pricing
- Use a high price where there is a uniqueness
about the product/service.
- This approach is used where a substantial
competitive advantage exists.
- Such high prices are charge for luxuries such
as Star Cruises, Tanjung Jara Beach Resort
rooms, and Concorde flights.

23. MARKETING MIX (4 P’s)
Penetration PricingPenetration Pricing
- Price charged for products/services is set
artificially low in order to gain market share.
- Once this is achieved, the price is increased.
- Eg: Astro
Economy PricingEconomy Pricing
-- This is a no frills low price.
- The cost of marketing and manufacture are kept
at a minimum. Supermarkets often have
economy brands for soups, spaghetti, etc.
- Eg: Mydin, TESCO, Air Asia

24. MARKETING MIX (4 P’s)
Price SkimmingPrice Skimming
- Selling a product/service at a high price because
company have competitive advantage. However,
the advantage is not sustainable.
- The high price tends to attract new competitors
into the market, and price inevitably falls due to
increased supply.
- Eg: DVD players, electronic gadget

25. MARKETING MIX (4 P’s)
•PlacePlace
also known as channel, distribution, or intermediary.also known as channel, distribution, or intermediary.
the mechanism through which goods/ services are the mechanism through which goods/ services are
moved from the manufacturer/ service provider to the moved from the manufacturer/ service provider to the
user or consumer.user or consumer.

26. MARKETING MIX (4 P’s)
•Channels of distribution Industrial Channels of distribution Industrial
GoodsGoods


Manufacturer
Manufacturer
Industrial User
Industrial UserWholesaler

27. MARKETING MIX (4 P’s)
•Channels of distribution Consumer Channels of distribution Consumer
GoodsGoods


Manufacturer
Manufacturer
Manufacturer
Consumer
Consumer
WholesalerRetailer
ConsumerRetailer

28. MARKETING MIX (4 P’s)
•Promotion objectivesPromotion objectives
A = AWARENESS
I = INTEREST
D = DESIRE
A = ACTION
•Promotion includes:Promotion includes:
Publicity Publicity - any commercial news covered by media that boosts sales but for which the - any commercial news covered by media that boosts sales but for which the
company does not paycompany does not pay
 Personal selling Personal selling - personal contact between sales personnel and potential customers - personal contact between sales personnel and potential customers
resulting from sales effortsresulting from sales efforts
Advertising Advertising - any sales presentation that is non personal in nature and is paid - any sales presentation that is non personal in nature and is paid

29. MARKETING MIX (4 P’s)
•Examples of PromotionExamples of Promotion


NewspapersNewspapers

RadioRadio

TelevisionTelevision

World Wide WebWorld Wide Web

MagazinesMagazines

Direct mailDirect mail
SamplesSamples
DirectoriesDirectories
Trade showsTrade shows
Specialty advertisingSpecialty advertising
Special events and Special events and
promotionspromotions

30. MARKETING PLAN FORMAT
•Research and analysisResearch and analysis
Target marketTarget market
Market sizeMarket size
CompetitionCompetition
Market shareMarket share
•Marketing Mix Strategies (4P’s)Marketing Mix Strategies (4P’s)
Products/servicesProducts/services
PricePrice
Place/ distributionPlace/ distribution
PromotionPromotion
•Competitors strengths and weaknessesCompetitors strengths and weaknesses

31. OPERATION PLAN
•This section will describe the planning of day-to-day operations This section will describe the planning of day-to-day operations
activities to ensure that the business fulfils customer expectations.activities to ensure that the business fulfils customer expectations.
•Process Flow chartProcess Flow chart
Schematic representation of the production operation process from Schematic representation of the production operation process from
the start until the product or service is sold or deliveredthe start until the product or service is sold or delivered
It must show:It must show:
- The sequence (step by step)
-Description of each process/activity

32. OPERATION PLAN
•Example Process Flow chartExample Process Flow chart

Chief mechanic gets information from client on the problems with the vehicles
Discuss repair work with client
Preliminary inspection of the vehicle by mechanics
Get agreement from client on repair work to be done
Chief mechanics fill Job Order form
Pass the Job Order form to mechanic on duty

33. OPERATION PLAN
•The flow chart can be represented using conventional symbolsThe flow chart can be represented using conventional symbols
•5 symbols normally used:5 symbols normally used:
= Operation (activities that transform input into output)
= Transportation (movement of materials from one place
to another)
= Inspection (check quality and standards of in process
materials)
= Delay (Process is delayed or materials waiting for
further process)
= Storage (Materials are stored in the storage area or
warehouse)

34. OPERATION PLAN
•Material Requirement Material Requirement
Materials needed for the operations of a businessMaterials needed for the operations of a business
Can be in the form of raw materials or ready Can be in the form of raw materials or ready
productproduct

Item Quantity
Required
Price per
unit
Total
Purchase
Flour 100kg RM2/kg RM240
Butter 25kg RM10/kg RM250

35. OPERATION PLAN
•Layout Plan for operation can be based on:Layout Plan for operation can be based on:
 Product Product ((e.g. FOOD PROCESSING factory)e.g. FOOD PROCESSING factory)
 Process Process (e.g. in STEEL workshop)(e.g. in STEEL workshop)
 Retail Retail (e.g. in a BOOK STORE)(e.g. in a BOOK STORE)

36. OPERATION PLAN
Layout Layout
based on based on
productproduct
Examples:
Food processing, car
assembling

37. OPERATION PLAN
Layout Layout
based on based on
processprocess
Examples:
Steel workshop,
hospital

38. OPERATION PLAN
Layout Layout
based on retailbased on retail
Examples:
Bookshop, groceries

39. OPERATION PLAN

Tool/ Machinery/
Equipment
Quantity
Stove
1
Oven
1

40. OPERATION PLAN FORMAT
•Process flow chartProcess flow chart
•Material production requirementMaterial production requirement
•Manpower production requirementManpower production requirement
•Operation plan layoutOperation plan layout
•Tools/ Machinery/ EquipmentTools/ Machinery/ Equipment

41. REFERENCE & APPENDIX FORMAT
•ReferencesReferences
References are written with details of authors, References are written with details of authors,
titles, publication and time (year) of publish titles, publication and time (year) of publish
from the books, journals, magazines and from the books, journals, magazines and
internet. internet.
•AppendixesAppendixes
It should attach related information such as:It should attach related information such as:
- registration of company’s form- registration of company’s form
- details of market studies- details of market studies
- relevant magazine articles- relevant magazine articles
- etc- etc

42. GROUP PRODUCT PRESENTATION
•THE CONTENTS NEED IN YOUR PRESENTATION
SUCH BELOW:
–INTRODUCTION OF THE PRODUCT
–PRODUCT / SERVICE BENEFIT OR ADVANTAGE
–MARKET SIZE
–MARKET SHARE
–MARKETING STRTEGIES (4P)
–BUSINESS MODEL
–SWOT ANALYSIS
–FLOW CHART OF OPERATION ACTIVITIES
–FINANCIAL PLANNING
- CONCLUSION
YOUR PRESENTATION IS NOT MORE THAN 15 SLIDE, CREATIVE AND
SEDUCTIVE PRESENTATION WILL BE ADVANTAGE MARK GIVEN
PRESENT BY NEXT WEEK