Importance of ‘Business Plan’ for an Entrepreneur
A carefully crafted Business Plan is one of the most valuable tools in helping entrepreneurs reach their business goals by giving direction and defining objectives. A business plan is helpful in assessing the efficiency of strategies and helps the start-up to benefit from oncoming opportunities. Entrepreneurs can refer to the business plan as a guide that helps prevent and manage problems that may arise on the way to success.
Developing a business plan is a time-consuming process and it may be tempting for an entrepreneur to neglect planning altogether but the time spent in drafting the plan gives you an excellent opportunity to learn more about the industry and competitors. Although the time spent cannot be monetized upon, the benefits of a well devised business plan far outweigh any temporary financial losses.
Plenty of start-ups begin without a business plan relying on their optimism and confidence while others get so involved in operational tasks that they neglect the idea of planning itself. What these businessmen fail to understand is the fact that operating without a business plan is much more time consuming and less efficient than working as per a set plan of action.
One great thing about a business plan is, you may refer to it as a map which provides a reference point that you may need to return to just in case you go astray. The plan shall show you how far you have managed to come and even get you back on track if you drift away. Used as a management tool, the plan can ensure that the business is on track with set operational milestones, sales targets and meeting goals.
A business plan gives you a clear image of your company as of now and what it ideally should be over a set period of time. It describes your company, products or services offered and the factors affecting future growth in both directions. The business plan marks your starting point, evaluates where you stand now and helps you with a vision of tomorrow. Following a business plan makes it easier to adapt with market changes, trends and innovations and helps you reach your goals efficiently.
A self-descriptive business plan that clearly mentions statistics, facts and figures with detailed description of potential growth and profits, persuades investors and financial institutions to provide the necessary capital for an entrepreneurship.
A business plan is essential to attract executive level employees, business partners and helps in securing bonds with dealers, suppliers and retailers. It also designates titles and roles to each individual and by allocating a set of duties for each one to perform, simplifying the entire process.
For an entrepreneur, writing down ideas and concepts on paper is the first step to a successful entrepreneurship. By surveying the market, researching your competitor’s data and mentioning costs incurred and profits expected, you shall not only be compiling invaluable reference material but making yourself your very own ‘Business Bible.’
Exploring Rural Entrepreneurship in India
Starting, owning and managing a start-up business by optimum utilization of local resources for the development of a rural population is what rural entrepreneurship means.
We have seen an influx of rural migration into the cities in search of employment, resulting in overpopulation in the urban areas. To prevent such a situation and to minimize migration owing to unemployment, we need to create situations that create opportunities of employment in the rural areas itself. Value addition to rural resources in rural areas, engaging rural human resources is Rural Entrepreneurship in its truest form.
In countries like India, the need for rural entrepreneurship is very strong and the reasons are, employment generation, income generation, rural development and making villages self-sufficient. Doing so will invariably prompt the villagers to earn and live where they belong rather than moving to bigger towns and cities thus curbing rural to urban migration. An ideal situation would be when citizens from cities and towns find it worthwhile to shift themselves to rural areas looking at the vast possibilities and opportunities that are waiting to be tapped.
Young people with a creative and positive perspective, who aim to work towards the development of rural areas using rightly channelized efforts will be the ones to bring about a drastic change in the situation we see today. These dynamic rural entrepreneurs shall be successful in solving many such chronic problems within a short time span and make a mark in the industry while doubling their profits.
The rapid growth in population and an even faster rate of urbanization creates an increase in demands which are challenging for the traditional small-scale businesses who cannot cope up with the demand and supply cycle. This is where new and innovative solutions of an entrepreneur come in. Bringing in all-new global concepts, business strategies, information technology and a highly efficient infrastructure, the entrepreneur would have all the right tools in hand to chisel out one of the finest masterpiece in rural entrepreneurship.
Most of the industries in the rural sector are small-scale and cottage industries with a huge potential for growth. While being quick yielding they also provide large employment opportunities, which indirectly means, a smaller gestation period and cheaper labour as compared to the urban industries, ultimately resulting in better profit margins.
A host of opportunities are open for rural entrepreneurs and the categories they relate to are Food processing and Agro products, textile industry, cottage and handicraft industry, mineral based industry, engineering related and service industry.
Those who aspire to make it big in the world of rural entrepreneurship need to decide on the type of entrepreneurship suitable for their business and may choose from the following:
Individual entrepreneurship, which is a proprietary concern and a single ownership of an enterprise.
Group entrepreneurship is a partnership and can also be a public or private limited company.
Cluster formation relates to associations consisting of a group of individuals sharing the same interest, religion, caste or occupation etc. which are known as Non-Governmental Organizations (NGOs), Voluntary Organization (VOs), Self-Help Groups (SHGs), Community-Based Organizations (CBOs) and networking of all these.
Co-operatives are autonomous associations of persons united voluntarily for a common purpose.
It is not necessary that those who prefer rural entrepreneurship need to be from rural areas themselves. Enterprising urban citizens who are earnest and sincere enough to ensure and manage rural development must take up innovative projects and also promote the benefits of rural entrepreneurship to others.
[Top]Disruptive Innovation
Disruptive Innovation – what is it & how start-ups can adopt it
The theory of disruptive innovation was introduced by Clayton Christensen, more than thirty years ago. This theory refers to innovation that creates a new market while disrupting or displacing an existing market. It is a process wherein a product or service begins at the bottom of the market and steadily moves up market, eventually displacing established market leaders, competitors and products.
The theory of disruptive innovation is a powerful tool for entrepreneurs and start-ups and needs to be incorporated as a part of their business strategies so as to secure competitive advantage and drive sustainable growth.
For a new entrant to successfully challenge an established company’s business, the needs of the market’s lower segment have to be surveyed and analysed. Most established companies concentrate on the higher tiers of the market, which have been profitable segments for them. These companies focus on improving their products and services by continuous innovation attempting to fulfil the demands of their most profitable customers and land up upgrading their products faster than their customer’s needs evolve. These sustaining innovations result in developing products that are too sophisticated, complicated and very expensive and remain accessible only to the elite customers or to the top, yet smaller segment of the market. While serving these demands, the company tends to ignore the needs of the others or the larger segment of the market.
This is the segment where the start-ups need to focus on. By successfully targeting these overlooked segments and delivering quality products that are suitably functional yet inexpensive, the new entrants are able to gain a strong foothold in the market. Once ready to deliver more, they can move upmarket and tend to the more demanding segment, while preserving their initial customers. Although it may take a little longer to become popular in the top segment, once the product clicks, it won’t take long for the start-up to flourish and eventually deliver higher profits. With persuasion, innovation and quality maintenance, success of the start-up is guaranteed. The transition of the mainstream customers from an established company to adopting the new entrant’s product and services is the result of a successful attempt of disruptive innovation.
[Top]Entrepreneurship in Healthcare
With a population of over 1.342 billion and increasing by the second, a country such as India should be medically sound and financially stable but unfortunately it is just the opposite. With a heavily rising population, the rise in communicable diseases is apparent and with unstable financial conditions, rising ‘lifestyle’ diseases is common. With the country’s existing infrastructure, catering to the growing healthcare demands is difficult. A majority of the Indian population is living below the poverty line and depends on the under-financed and short-staffed public sector for its healthcare needs.
The private sector dominates the healthcare industry across India with a majority of healthcare professionals concentrated around urban areas with high paying consumers while the rural areas remain ignored and their healthcare needs unmet.
Challenges for India’s Healthcare Industry:
1. Population: Being the world’s second-largest populated country with an ever increasing migration – in-between neighbouring countries, across state borders and from rural settlements to urban areas.
2. Infrastructure: Citizens can avail of healthcare services, free treatment and medication at government hospitals but the facilities are not up to mark, are under-staffed and under-financed which forces patients to visit private hospitals and medical practitioners. India’s existing infrastructure is not enough to meet the healthcare needs of a growing country.
3. Insurance: According to the data from Insurance Regulatory and Development Authority, 76% of Indians do not have a health insurance. The Indian Government’s contribution towards insurance stands at 32% as opposed to 83.5% in the UK. Also, India’s healthcare expenditures are one of the lowest in the world.
For the eyes of an entrepreneur, these challenges shall come as opportunities, in fact the present Indian healthcare industry presents numerous openings and untapped opportunities. The lack of trained medical resource and insufficient infrastructure in the public health domain are enough reasons to stir an entrepreneur’s mind with innovative ideas relating to healthcare solutions which shall help eradicate major voids in services and healthcare delivery across the country.
Entrepreneurs who aspire to make a difference can survey the rural areas and evaluate the extent to which our countrymen are deprived of medical aid and aim to set up hospitals in smaller towns and villages which are designed to operate at minimalist costs.
Entrepreneurs who can invest may work towards developing low-cost solutions for healthcare such as, diagnostic kits for rural households, cheaper surgery options, low-cost dialysis technology, and low-cost pathological laboratory, etc. thereby accelerating the country’s social and economic growth by making quality healthcare facilities available to the below average income group. Entrepreneurs must ensure that the work towards developing low-cost solutions for healthcare does not compromise with the quality of healthcare service delivered.
Telemedicine and remote care is a boon in rural India since it provides access to doctors to a large population of under-served people. Developing a telemedicine centre for every district hospital will not only reduce the burden on one hospital but also reduce the patient’s number visits to the hospital. Telemedicine ensures that a large number of remotely placed people are cared for minor health issues without the need to visit the district hospital, which may be way too far to reach. While minor medical cases can be treated over the phone, the ones that are more serious can be called for personal examination and further treatment.
The digital boom and internet penetration is a huge opportunity for growth of healthcare services. Owing to new technology, innovative solutions aimed to provide quick, reliable and effective medical facilities in the rural areas can be developed enhancing communication between doctors and patients. The increase in internet and data usage makes way for innovative mobile applications and e-health portals such as blood bank services and online pharmacies.
Emergency medicine and healthcare is an excellent opportunity for innovation. Entrepreneurs may invest in developing very well equipped ambulance services ready for critical intervention. Employing doctors, nurses and paramedics trained in emergency response techniques is a progressive thought in a country where pre-hospital care is virtually non-existent in rural areas. By launching educational and training departments to prepare resources ready to tackle emergency & trauma and ambulances equipped with critical care units, an entrepreneur shall not only be making a difference by investing but shall be investing for the good of mankind and towards the nation.
Patient care does not end with the patient’s hospital discharge. Most out-patients need treatment once they are back home. Entrepreneurs can develop centres for Medicare and Medicaid which shall have a home healthcare system in place wherein skilled practitioners can provide care to patients in their homes under the direction of a physician. While assisting the patients to recuperate at home and avoiding hospitalisation, the healthcare services should aim at promoting patients’ optimal level of well-being and helping them in improving their functions so that they can live a life of greater independence and fulfilment. Post-treatment patient care is an important feature in healthcare services where patient safety and quality are important aspects and must be adhered to.
Post the Clinical Establishments Act of 2010, some Indian states have worked towards having a better access to affordable healthcare, it is way lower if compared with other developing countries and knowing that India has a long way to go, increases the plethora of opportunities and innovations. The healthcare sector is emerging as the new sunshine industry which make setting up an entrepreneurship in healthcare an excellent business opportunity.
[Top]EDII Wins Excellent Institute Award at National Education Summit & Awards 2017
Excellence – is the word we strive for. It puts us above everyone else. EDII was awarded ‘Excellent Institute for Entrepreneurship Development in India’ at 11th National Education Summit & Award.
For EDII’s contribution towards developing entrepreneurial ecosystem, CMAI association of India awarded this prestigious award to the institute. Shri Rajesh Kumar Chaturvedi, Chairman CMAI & IAS presented the award to Dr. Sunil Shukla, Director, EDII.
[Top]Traits of a successful entrepreneur
Reading about great entrepreneurs is super inspiring and motivational yet how far we let its positivity affect us depends on us, the readers. By working on the crucial attributes of one’s personality, under the right guidance, the entrepreneur in you can emerge at any age and stage of life.
However, the best entrepreneurs share a few common characteristics, which are crucial in building and maintaining a successful business structure. While considering the fact that they come from different cultures and upbringing, income brackets, educational levels and a varied lifestyle, we cannot overlook that they all share a few common traits which are not only strong and positive but are the very pillars of their success.
- Tenacity: No matter how hard it gets, successful entrepreneurs have the ability to sustain. Persistence, perseverance and determination are the key ingredients of success.
- Passion: It is a common assumption that the sole purpose of all entrepreneurs is to make maximum profits. That is not true. Most of the entrepreneurs are actually quite passionate about their work. Challenges excite them whereas mistakes make them wiser. Money, although secondary, is not their purpose of business. The purpose is to follow their passion, which is excellence at work. Those who are not fully passionate about their work tend to slack at it and eventually lag behind.
- Risk-taking: Taking risks in business does not necessarily mean financial risks. It could be related to risking one’s reputation or social standing. It could be risking your time and energy while working on a project. Successful entrepreneurs are not scared of taking whatever risks that come their way. Starting a business with limited funding is not an issue for entrepreneurs who aim to be successful and take it up as a challenge but the same might seem to be a major issue for others who keep dwindling upon the pros and cons instead of taking action.
- Focus: Opportunities don’t just come to successful people. They exist all around us and it is up to us to spot them and that’s what makes us successful. All successful entrepreneurs are so focussed on their business that they develop this trait to spot an opportunity that others wouldn’t even dream of. It is this vision that aids the very success of great entrepreneurs.
- The Desire to Learn: Those who stick to the good old ways may last for a while but not beyond that. It is essential to learn new tricks of the trade, keep oneself updated with the latest innovations and follow the latest systems if you wish to be in the race. Education and experience does help us a lot but keeping pace with the industry and evolving along with the latest trends is absolutely necessary. Successful entrepreneurs do all they can to learn and absorb the latest information which helps them to stay ahead of the rest.
- Handling Failures: No success story is written without an eraser. Mistakes do happen but the wise learn from their mistakes and move on. Entrepreneurs who believe in themselves develop enough patience and persistence to rework or renew and deliver better results the next time. These entrepreneurs relate to such valuable experiences in their future as well.
- Money-management Skills: Being one of the most crucial aspects of every business, entrepreneurs need to be exceptionally good at money management. Be it using your own savings or large amounts of funds deposited by the investors, making every penny count is what successful entrepreneurs do. Correct financial decisions, calculated expenses, spending where it is essential and curbing where necessary is a trait all successful entrepreneurs share.
- Business Relationships: Building relationships and maintaining them is important for any business to flourish. Successful entrepreneurs know this very well and take extreme care in maintaining these business contacts because if not now, they shall soon transform from being contacts to becoming clients.
- Salesmanship: Believing in your own product is the first step of successful salesmanship. Every entrepreneur needs to understand that if they believe that their product is good, half the job is done. The other half rests on how they express themselves to the client. Successful entrepreneurs are good at this because if they as creators of the product are unable to explain this well then who will?!
- Planning Expertise: All successful entrepreneurs are excellent in planning strategies. They organise their time, money and efforts well in advance for efficient implementation. Their business strategies are based on thorough researches and surveys that aid the overall success of the business.
Are you the one? If you are, EDII is right institute for you!
[Top]YES Bank ties up with EDII to lend startups; lends Rs 50 lakh to organic antimicrobial lingerie startup
YES Bank makes its first institutional tie up for lending to start-ups, had joined hands with Gandhinagar-based Entrepreneurship Development Institute of India (EDII), a national resource Institute for entrepreneurship education, research, training & incubation. YES Bank provided Rs 50 lakh to EDII incubated startup – Green Ideology, maker of India’s first organic antimicrobial lingerie brand ‘Inner Sense’.
“Start-ups are critical to the growth of the economy. As an extension of our YES Head-Startup program, we have collaborate with EDII to help start-ups scale up and grow rapidly, thereby creating a multiplier effect on the Indian economy” said Rana Kapoor, Managing Director and CEO, YES Bank.
Founded by Abhishek Lodha and Neerja Lakhani in 2013, Green Ideology has introduced India’s first organic antimicrobial lingerie brand ‘Inner Sense’, claims EDII statement. Green Ideology had initially received a grant of Rs. 5 lakh from the Government of Gujarat acting through its nodal institute EDII, to commence its operations and launch its product range.
With the Rs 50 lakh debt funding from YES Bank, the start-up will now scale-up its operations. YES Bankis providing the loan under the CGTMSE program (Credit Guaratee Fund Trust for Micro and Small Enterprises) to the startups.
“EDII has been mentoring and supporting start-ups. But, our ability to lend to these start-ups was miniscule as we are an educational institute. Now, in association with YES Bank, EDII is in a position to provide debt to many of the start-ups whom we support in various ways” said Sunil Shukla, Director, EDII.
EDII’s recently set up technology business incubator, CrAdLE (Centre for Advancing & Launching Enterprises), headed by Infosys cofounder S Gopalakrishnan as its first chairman, is also nurturing start-ups in the fields of manufacturing, food & agri business, renewable energy and healthcare.
[Top]Do family businesses score over nonfamily businesses?
Family businesses go on for generations together. This gives them an easy advantage over non-family businesses as they have deep industry knowledge of what’s happening currently and the past trends too. That’s not all, they have the commitment and passion towards the success of the business and the industry knowledge helps them to take informed market-focused decisions.
Let’s go through each of these advantages in detail:
- Dedication and passion towards the business goal: In a family business, often non-family members too are treated as a family. This strong relationship built with the employees and other stakeholders result in fruitful daily operations as everyone works towards achieving one goal. While the owners tend to take better care as they have their stakes involved in the company, it makes a huge difference when the employer is appreciative of the employee’s talent.
- Decision making: Not having responsibilities towards any shareholders gives the Indian family businesses greater flexibility in terms of making decisions faster, improving the speed with which they launch new initiatives, change operations, evaluate new business opportunities, etc.
- Industry insights: Family businesses work in one industry for longer durations. This gives them significant experience and expertise. They understand the pulse of the market and their consumers well over non-family businesses. This makes them ready for any challenges.
- Mutual trust: Family businesses thrive on mutual trust and believe in maintaining long-term relationships by providing a conducive, supportive and trusting work environment.
- Reinventing entrepreneurs: The Family Business Survey conducted by PWC suggests that:
- 74% of respondents think that family businesses being more entrepreneurial in nature
- 62% think that family businesses generate more employment in the market
- Nearly 60% of the respondents felt that they reinvent themselves with each generation
Family businesses take pride in their contribution towards providing a greater balance and stability to the economy and are more likely to take greater risks than the non-family businesses. While there are downsides of the family business, it’s their industry knowledge that keeps them going generations ahead!
[Top]EDII Launches CrAdLE to Support New Enterprises
A new Technology Business Incubator (TBI) of the famous Entrepreneur Development Institute of India (EDII) is all set launch, known as the Centre for Advancing and Launching Enterprises (CrAdLE), to support entrepreneurs in getting their new businesses started. The ambitious plan aims to work with about 40 startups in a course of three years. Each of these budding companies would be expected to create 100 jobs each, thereby creating over 4000 jobs in all.
CrAdLE will have Infosys co-founder Kris Gopalakrishnan as its first chairman of its advisory committee. The board would comprise of seasoned entrepreneurs, technologists, venture capitalists, academicians and other professionals from the specific domains that the centre aims at promoting. Businesses will therefore benefit immensely from specialized knowledge and the right technological support for smart organization, communication and selling. In addition, enterprises incubating in CrAdLE will go through review parameters to give them an exact measure of growth they have witnessed in various stages.
CrAdLE will be set up at EDII’s Ahmedabad campus, and a space of 10,000 square feet has been marked for the same. The centre should be up and about in a matter of a few weeks now. Its main focus, as of now, is to help nourish businesses in four sectors: manufacturing, healthcare, renewable energy and food and agriculture.
Gujarat is recognized to have a sizeable number of naturally entrepreneurial people and Ahmadabad shows fine signs of becoming India’s next start-up hub particularly in the non-IT sectors. With the right institutional support, businesses started here can thrive not only in India but in international markets as well. Gopalakrishnan believes EDII’s TDI to be an excellent resource for entrepreneurs, especially at this point of time when there is a most conducive climate of encouragement to new enterprises coming from the PM himself.
Besides facilitating the essential hand-holding to companies in their nascent stages towards a seamless commercialization of ideas, knowledge and technologies, CrAdLE will also provide assistance in legal, financial and technical matters. Moreover, all entrepreneurs who are part of the program will have access to additional sources of funding besides a fund of Rs. 10 crore from the DST for 5 years.
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