Advanced entrepreneurship - legal and financial decisions Essay

Advanced entrepreneurship - legal and financial decisions - Essay Example Every year thousands of immigrants arrive in New York.The immigrants come with promising talent and academics,high hopes of living the American dream.Along with this,the natural increase in the population of a city resulted in a population growth rate of 5% The inhabitable land definitely does not increase with the same rate and this result into densification of population in the city centers. The two – bed room apartment, with all the traditional bulky furniture, that can be bought in no less than $500,000 can hardly accommodate a family of four, let alone allow them a comfortable living. Hence a problem exists and with it comes new opportunities to do business. The Industry: This business idea is related to furniture industry. A new product called ‘Space Saving Furniture’ is presented to Triangle Solutions as a prospective business opportunity in New York City, Manhattan and similar densely populated metropolitan areas. The art of furniture design combined with the latest technology in engineering yields a broad range of multi-purpose furniture products. The new designs are more comfortable, occupy lesser space, and can be easily modified to fit different needs throughout the day. The catalog of product includes a study table that turns into a two tier beds for kids at night, a superb sofa set that turns in to a double – bed when needed, a shelf that can be disassembled to give four small chairs if required and so on. The list includes a whole range of easy to operate furniture products that can fit into offices, bed rooms, kitchens, bathrooms, study rooms etc. and can serve at least two, if not more, functions at a time. Market Size: There are at least 2.14 million apartments in New York City alone according to a survey conducted in 2008 (DiNapoli, 2009, p. 1). Most of the residents of these apartments suffer with the problems of low accommodation. Compared with the real estate prices and monthly rents, space saving furniture is a financially feasible option for the apartment dwellers to increase their accommodation. Hence it is estimated that the product will be extremely popular with the majority of the population. Competition exists in this market as well. There are a few companies such as Resource Furniture which are already marketing the product. However, we believe that a strong marketing campaign can certainly attract the so far untapped customer base. Team Requirements: The team for this business must consist of following experts. Interior Decorator: To design the aesthetics of the furniture Product and Industrial Design Engineer: For general product design Mechanical Engineer: For material selection, load calculations and hydraulic system design etc. Marketing Manager: For devising marketing and sales strategy and its implementation Director Operations: To manage the production, inventory and general operations. Finance Officer: To manage finances. Scalability of the Product: The product is scalable over a good range of production and sales volume. Looking at the costs break down, we can observe that the product has very high initial, fixed costs and comparatively low variable cost. The initial cost includes the cost of equipments and machinery required for production and the design expenses. The variable costs include the materials, marketing and energy bills. Hence increasing the production and hence the sales volume will result in lesser payback time and greater profits. On the contrary, if low sales are forecasted for a particular product, then the costs can be reduced by using simpler production machinery instead of highly specialized machinery for each product. This machinery will have low initial and running cost but has more production time. Financials: The business can be started by establishing an office / display center at Furniture Market in New York. A small manufacturing facility will be set up close to the display center. The initial capital required for it is $2 5,000. All the