Introduction
Pursuing different units in business and economics has led to a broad understanding of the significance of personal and professional development. Action learning, which entails learning by doing, is one of the fundamental approaches towards achieving personal and professional development. Therefore, I will ensure that the concepts learned on financial accounting are applied in my career as an entrepreneur. In my initial stage as an entrepreneur, I intend to start a small business, which will entail the establishment of a green fashion store.
Organizational overview and external environment
The fashion store will specialize in the provision of different designer clothes, footwear, and other fashion accessories for both genders. The business will ensure that its product portfolio is comprised of eco-friendly products. The firm’s target market will involve fashion-conscious consumers, especially high-end consumers. Besides, the target market will include consumers who are conscious of the environment. It is projected that the business will develop a substantial customer base upon its inception owing to the emergence of fashion and environment-conscious consumers.
Business model
The green fashion store will be a sole proprietorship. Therefore, the operation of the store will be the responsibility of the entrepreneur. The choice of the sole proprietorship model hinges on the need to maintain exclusive business control. Thus, decisions on how to operate the business will be the responsibility of the entrepreneur. The choice of the sole proprietorship model has been motivated by the ease associated with establishing such enterprises. Furthermore, the chance of accumulating profits is high because the gains will not be subject to sharing. For example, undertaking all the business activities will aid in eliminating the labor cost, which consumes a significant portion of a firm’s operational expenses. Subsequently, it will be possible to plow back a substantial proportion of the profits into the firm hence stimulating its growth. The adoption of the sole proprietorship will make it relatively easy to make and implement decisions promoting the firm’s growth. For example, it will be possible to implement effective product decisions such as product line extension. The flexibility associated with the sole proprietorship model will make it relatively easy for the green fashion store to maximize profitability by taking the opportunity of the prevailing market changes (White and Durham 45).
Despite the benefits associated with the sole proprietorship, the green fashion store might experience financial problems. The source of this challenge might emanate from financial constraints. The firm will seek funding from commercial banks to deal with the problem of undercapitalization. Through external financing, it will be possible to undertake expansion such as improving the product portfolio (Bevans 47).
Risk and Opportunities
The decision to venture into the green fashion industry by providing eco-friendly fashion apparel, accessories, and footwear have been informed by the identification of changes in consumption behavior amongst the target market. Fashion consumers recognize the need to adopt socially responsible consumption practices. One of the behaviors that consumers are integrating relates to environmental protection. The consumers’ inclination towards such behavior has been stimulated by the development of a high level of understanding of the impact of consumer behavior on climate change. Consumers are shifting to eco-dressing to minimize climate change. This aspect arises from the fact that most synthetic materials are made from petrochemical materials, which are highly polluting (“Infinite Ideas” 26). The eco-dressing behavior presents an enormous business opportunity for the firm.
Despite the high market opportunities, the business might experience a challenge due to intense competition from large apparel and footwear companies. This aspect might reduce the firm’s profitability significantly due to the lack of adequate economies of scale. Additionally, the firm might encounter a risk arising from the occurrence of economic changes such as a financial meltdown. Economic changes might affect the consumers’ purchasing power and ability to outsource the manufacture of its products. The entrepreneur will integrate effective risk management practices.
Strategy and resource allocation
The firm will ensure that it sources its products from well-established eco-fashion designers to attain an optimal market position. This goal will be achieved by establishing a manufacturing contract with the suppliers located in the countries characterized by the low cost of production. This move will aid in minimizing the cost of producing eco-fashion products. Subsequently, the firm will be in a position to set competitive prices for its products. The firm will ensure that its products are branded skillfully to improve its competitiveness. Through effective branding, the firm will be in a position to establish a strong level of brand loyalty.
Attaining sustainability and success in the green fashion industry will largely depend on the efficiency with which different resources are allocated and applied in the operation of the firm. Some capitals including financial, intellectual, human, natural, manufactured, social, and relationship will be considered in the firm’s operations. The entrepreneur intends to facilitate the establishment of the business using different sources of funding, which include the personal savings accumulated over the years and debt financing. The personal savings will form the largest proportion of funding to the start-up. The form of debt financing currently being considered includes getting a loan from a bank. A combination of personal savings and bank loans will aid in ensuring that the start-up is established successfully. Stephens cites the lack of funding as one of the major challenges that face entrepreneurs (56). Moreover, incorporating personal savings will play a fundamental role in minimizing the cost of the start-up.
Over the years, I have developed sufficient competence in financial management. Subsequently, I will apply different financial management practices such as budgeting, cost-benefit analysis, and cost control. Additionally, the firm will ensure that adequate financial reporting is undertaken. This goal will be achieved through the effective development of different financial statements such as cash flow, income statements, and balance sheets. This objective will play a fundamental role in illustrating the firm’s financial position to debt providers. Additionally, integrating financial controls such as budgeting will play a central role in ensuring that the funds invested in different business activities are utilized optimally. The business will ensure that its creditworthiness is sustained to enhance the firm’s financial capital. Additionally, the firm will ensure that the loans advanced are duly repaid.
The competitiveness of the green fashion store will be subject to the quality of its human capital. As an entrepreneur, I have developed the necessary qualities for success in entrepreneurship. Some of the indispensable qualities that I have developed include adaptability, persistence, and work ethic. These attributes will be of value to the firm. One of the work ethics that I have developed entails the willingness to work hard. This virtue will aid in working for long hours. On the other hand, adaptability will ensure that I adjust the business practices to align with the industry changes. Despite the challenges encountered in the business, I will ensure that I remain focused on attaining the overall profit maximization objective.
The operation of the business will further be enhanced by the integration of a high level of intellectual capital. One of the fundamental aspects of intellectual capital that will be incorporated in the business entails knowledge. As an entrepreneur, I will ensure that I develop and leverage different market information regarding fashion trends. The firm’s operation will be guided by changes in the market. This goal will be attained by conducting research and development. Conducting market research will improve the efficiency with which the changes in consumer behavior and market trends are monitored. Based on the market intelligence gained, the firm will be in a position to adjust its strategies. Moreover, the firm will undertake product improvement by investing in research and development.
Focusing on the development of intellectual capital will foster the effectiveness with which the firm generates value, hence its competitive advantage. This aspect will arise from the view that intellectual capital will aid in the optimal utilization of the conventional factors of production, which include land, capital, and labor. Therefore, the firm’s competitiveness will be improved (Marr 8). The development of strong intellectual capital will improve the firm’s effectiveness in undertaking marketing activities. This aspect will be attained by entrenching online marketing to cut the cost of marketing. Nurturing a strong level of intellectual capital will determine the firm’s future sustainability.
In addition to the above forms of capital, the long-term survival of the business will be subject to its efficiency in deploying social and relationship capital. As an entrepreneur, I have gained adequate skills on how to develop interpersonal relationships. Therefore, I will be in a position to use the skills developed in promoting the firm’s operations. One of the fundamental components that will enhance my effectiveness in ensuring that the business benefits from social and relationship capital entails appreciating the different business stakeholders. Realizing the needs of the diverse stakeholder groups such as the suppliers, customers, and financiers will aid in improving the firms’ competitiveness. This goal will be attained by nurturing a high level of trust. Subsequently, the firm will be in a position to sustain a strong relationship with the external stakeholders, hence promoting its long-term sustainability.
The firm will further focus on developing a competitive advantage using manufactured capital. The manufactured capital will be developed by instituting an effective infrastructure that will facilitate the firm’s efficiency in marketing eco-friendly designer products. One of the infrastructures that the firm will consider is developing and implementing an efficient web-based system. The system will enable the enterprise to integrate an online marketing strategy. Thus, the firm will be in a position to minimize the cost of marketing and interaction with customers (Kurtz and Boone 161). Moreover, its manufactured capital will improve the firm’s flexibility in responding to market needs.
The firm’s quest to achieve competitiveness will further be based on the optimal utilization of natural capital. The firm will attain this goal by ensuring efficient utilization of the available natural resources. The firm will consider using renewable sources of energy specifically wind and solar. The integration of the two renewable sources of energy will promote the firm’s commitment to eco-friendly operations.
Performance
The entrepreneur will assess the performance of the business entity by evaluating the level of brand recognition. Reviewing the standard of brand recognition will aid in determining the extent to which the firm’s eco-green fashion products have penetrated the target market. The firm’s performance will also be assessed by reviewing its effectiveness in attaining the set operational objectives such as adherence to set financial benchmarks. The benchmarks include the level of market share and profitability, risk management, attainment of the predetermined milestones, and the establishment of a strong interpersonal relationship with clients. One of the milestones that the firm will evaluate entails the trend in generating sales revenue. Moreover, the firm will assess the returns generated from its engagement in different marketing activities. The firm’s performance will be assessed by evaluating the variation of the actual and the projected outcomes. Based on the performance variance, it will be possible to determine the business’ prospects.
Outlook
The growing level of sensitivity towards environmental protection to minimize the occurrence of climate change highlights the likelihood of the firm experiencing future growth. The firm will experience growth regarding the demand for eco-friendly fashion products. Moreover, the growth in the level of innovation in the production of eco-friendly products is a strong indicator of the firm’s future growth. For example, innovators are developing eco-friendly fashion products using different biodegradable materials. This aspect presents an opportunity for the firm in its quest to improve its product portfolio. One of the segments that the business expects to benefit from entails growth in demand for eco-friendly apparel.
Conclusion
The entrepreneur expects to venture into the green fashion industry successfully and attain profit maximization. This goal will be achieved by pursuing the issues outlined in the integrated report. Moreover, the firm will undertake reviews of the content of the integrated report to evaluate its efficacy. Therefore, it will be possible to make the necessary adjustments.
References
Bevans, Neal. Business organizations and corporate law, Clifton Park: Thomson Delmar Learning, 2007. Print.
Infinite Ideas: Go green! Shortcut to a healthier planet, Oxford: Infinite Ideas, 2011. Print.
Kurtz, David, and Louis Boone. Contemporary marketing, New Jersey: Cengage Learning, 2015. Print.
Marr, Bernard. Perspectives on intellectual capital, New York: Routledge, 2012. Print.
Stephens, Sheila. The everything private investigation book, Avon: Newton Abbot, 2008. Print.
White, Kennedy, and Leslie Duram. America goes green: an encyclopedia of eco-friendly culture in the United State, Santa Barbara: ABC-CLIO, 2013. Print.