Question

1. How can an imitation strategy be effectively implemented? Give an example.

2. What are the pros and cons of running a franchise?

3. Describe the skills and personality traits of a successful entrepreneur.

Answer 1

1. How can an imitation strategy be effectively implemented? Give an example.

Ans;

There are two ways to imitate the innovations of others—namely.

(1) developing a "me-too” or copycat offering to compete directly against the originator's innovation.

(2) launching an inventive imitation of a rival's success.

The difference between a "copycat” and "creative imitation" strategy is simple.

A "me-too" offering could be a direct near-duplicate of the original; a "creative imitation" offering attempts to create significant improvements and add a group of value-added services not found within the originator's innovation.
A "me-too" strategy sometimes works. But within the majority of cases, "creative imitation" works far better.
Copycat rivals make little or no change to the essential innovation. They simply "copy" and hope in an expanding market they too will prosper.
Creative imitation needs improvement upon or creating meaningful differentiation from the originator's innovation than the new one.
Copycat/me-too methodology work when the originator fails to completely exploit its market, that is, under-markets.

For example, if a brand new product is introduced in an exceedingly specific geographical region, and also the innovating company fails to roll out the successful product to other regions, competitors will fill the vacuum space with "me-too" look-alike products in the market.
Simply put, the "copycat" is successful if the innovator fails to aggressively maximize its proven success.
Exploiting fast and successfully identified internal successes can fortify the originator's market position and squash "copycats" before they get a grip within the marketplace.

Creative Imitation: A Useful Example
Creative imitation is a good market entry strategy to achieve market position from the originator.
Drucker stated creative imitation satisfies a requirement that already exists instead of creating one: "By the time creative imitators head to work, the market has already been identified and also the demand has already been created.
He offered IBM's entry into the non-public computer market an excellent example of an imitator successfully improving the first innovation.
IBM, for instance, failed to break new technological ground in responding to Apple's pc.
IBM's first pc was a solid product, but the $64000 value-added IBM created lay in establishing convenient distribution centers, providing excellent employee training programs, and guaranteeing the first-rate service.

2. What are the pros and cons of running a franchise?

Ans;

Advantages of Franchising

Advantage 1: Explore a replacement Career, add a replacement Industry! No Experience Necessary
Buying a franchise allows you to figure in a very field that you just don’t necessarily have any previous work experience in, but that's intriguing to you. Franchise brands (also called franchisors) offer extensive and thorough support and training to franchisees so as to teach them and help them understand their company’s business model. By moving into an already established brand that has been operating (assumedly) for years, you may be aware of knowledge, experience, and industry secrets that you just would otherwise have had to find out over the course of your career through an endeavor and error process. Owning a franchise allows help you to tap into previous owners’ of the company and leaders’ collective years-worth of the first-hand experience will help you, increasing your chances of success.

Advantage 2: Lower Risk
Franchises are a more secure investment than new businesses because they need the support and backing of a bigger one who has experience in this. These corporations have business models that are tested, often in numerous markets across the country, and have already proven themselves to be effective. thanks to their history of proven success, getting a franchise commercial loan is less complicated than getting a loan to begin an independent business. The banks know that investing in a very franchise could be a safer bet than investing in a very new business that has not yet had the chance to built up a history of success.

Advantage 3: Loyal Customer Base and Brand Recognition
One of the toughest parts of starting any new business is finding your first customers, which is one in every one of the explanations numerous of} people communicate franchising. Investing in very franchise grants you access to a long time, loyal customer base and potential employee pool. Buying a longtime and recognized brand can provide you with an accelerated path to profitability by bringing in customers and prospective employees from day one.

Advantage 4: Collective Buying Power
When you purchase a franchise and become a part of the franchise system, you'll get pleasure from your franchisor's established deep-rooted relationships with suppliers. this suggests that materials are going to be more cost-effective thanks to the franchisor’s collective buying power.
Advantage 5: Hit the bottom Running with Extensive Franchisor Support
The franchisor will support you to run the business by giving guidelines that you should keep for a successful business. Some franchises even give loans and other kinds of financial assistance to their franchisees to improve the business.

Advantage 6: Be Your Own Boss
Owning a franchise allows you the prospect to be your own boss. you will be able to craft a more flexible schedule for yourself; enjoy having more autonomy over your career; you'll even favor working from home if that’s what you would like. You’ll own a business while having a web to show to when you’re in need of recommendation or assistance. In franchising, there’s an adage that you’re in business for yourself, but not by yourself.

Disadvantages of Franchising

Disadvantage 1: Initial Investment is High
Depending on which franchise you decide on to speculate in, the initial investment is hefty, especially for big-name franchises. As you research, be careful with the monthly royalty fees that some franchisors charge their franchisees. The royalty fee is usually 4 - 6 percent of your sales revenue and marks a discount to your profit potential. However, not all franchises charge royalty fees. The cleaning service franchise MaidPro has no required marketing spend or weekly royalty fees for there service. The leather, plastic, and vinyl restoration franchise Fibrenew, on the opposite hand, offers a flat-rate royalty system that doesn’t require franchisees to report on finances.

Disadvantage 2: Creativity is Limited
Because franchises have already got a predetermined brand, there are creative limitations for franchisees who are looking to explore, alter or make additions to their company’s business model or brand. There are restrictions placed on where you'll operate, what products you'll sell, and therefore the suppliers you'll use thanks to the predetermined business model.

Disadvantage 3: Financial Information is Shared with Corporate
Franchisors are continuously collecting and keep the financial information from their franchisees so as to boost up their business model and audit royalty payments for there business. As a result, franchisees don't have privacy in their business.

3. Describe the skills and personality traits of a successful entrepreneur.

Ans;

1. Passion
This is the foremost significant characteristic that each entrepreneur has, and for obvious reasons. they're successful because they love what they are doing. Such entrepreneurs put all the additional time they need into the business to form it successfully and attain growth. it's a pleasure for them to determine the results of their labor, which matches well beyond the cash received.

2. Strong work ethic
Entrepreneurs who are successful ensure that they're always the one who is first to the office and also the last one to depart.
These people are those that make sure that they are available to the office during their off days, if needed, just to confirm that the outcomes meet their expectations. The successful entrepreneurs are those that always have their mind in their work, whether or not they're not in their workplace.

3. Strong people skills
A successful entrepreneur should have excellent communication skills for selling the products to customers and motivating the workers in the organization. Yes, most entrepreneurs who have the facility to motivate their employees can see their business grow within no time. These entrepreneurs are great at instructing others to achieve success and highlighting the benefits of any situation.
4. Determination
Successful entrepreneurs are never get impacted by the defeats they encounter they take it as a new lesson. For them, failure is like a gap for a hit story, and hence, they struggle again and again just till they get the success they're expecting. Moreover, these entrepreneurs don't seem to be wired to believe that some things don't seem to be possible and can't be done.
5. Creativity
One of the most aspects of creativity is the ability to search out a relationship between two unrelated situations or events. they typically come up with the solutions to those problems that are a mix of other things. These people normally re-purpose things for marketing them to new industries.
6. Competitiveness
The number of companies formed is increasing monthly and each year, as every entrepreneur feels that they'll do a far better job than others. They run with the aim that they have to win at the game they play and win the business that they're creating or have created. it's an entrepreneur that highlights the record of success of their company.
7. Self Starter
Every successful entrepreneur knows that if something has got to be done, it has to be done by themselves. Parameters are set by them, and that they make sure that the projects are following that path. they are doing not look ahead to someone to allow them and are highly proactive.
8. Open-Minded
For those entrepreneurs that are successful or are following others who are successful, understand that every situation and event could be a business opportunity. These people have the aptitude to determine all that's around them and direct the main focus towards their objectives and goals.
9. Confidence
A successful entrepreneur never asks the question or keeps doubts in their mind about if they'll succeed or if they even merit success. they're very confident enough that their knowledge in business and their know-how will help them make their business idea a hit. and that they radiate this confidence in everything that they are doing for the business.
10. Disciplined
Successful entrepreneurs always focus their energy and skills on making the business work, and for removing the distractions or obstacles to their goals. Their overarching strategies help them to succeed in the goals they need while they outline the conceive to achieve the ultimate outcome.