cHarret ‘When identifying opportunities, an entrepreneur must pay close attention to new potential ‘markets and product offerings. Are competitors overlooking a niche in the market we could easily exploit? Is there a better way to reach our customers, such as a greater focus on online sales” Are ‘there new markets we can expand into with our existing business? Can we develop new products that offer customers better value? What opportunities are ends in the industry creating? ENTREPRENEURIAL PROFILE: World Wrestling Entertainment The rapid growth in online streaming of video content led World Wrestling Entertainment (WWE) to shift away from relying on cable television distribution of its shows to launching its own 24/7 online streaming network. WWE Network aits al of the WWE live pay-per-view events, riginal program ming, realty shows, documentaries, classic matches from ts archives, and more than 1,500 hours of video on demand. Customers pay a flat monthly subscription fee to gain acces to all WWE network Content through its Web site and through apps that are compatible with most tablets and smart phones. Viewership of pay-per-view over cable and satelite television has been decining, while online streaming has continued to grow as a new medium for video content, WWE believes that the new business model provides an opportunity to generate more predictable and growing revenues. Hl ‘As WWE Network's experience illustrates, opportunities arise asa result of factors that are be~ ‘yond entreprencurs’ control. Constantly scanning for those opportunities that best match their compa- nies’ strengths and core competences and pouncing on them ahead of competitors isthe key to success. 5 + CRAFTING A BUSINESS PLAN AND BUILDING A SOLID STRATEGIC PLAN 203 Threats are negative external forces that inhibit a company’s ability to achieve its mission. threats goals, and objectives, Threats to the business can take a variety of forms, petitors entering the local market, a government mandate regulating a business activity, an eco- stich as new com- negative extemal forces nat nb a company’s nomic recession, rising interest rates, mounting energy prices. or technology advances making *ly to achieve isms: «8 company’s product obsolete. For instance, the growing reach of cellular phone networks and * ‘advances in smart phone technology pose a threat to companies that provide traditional landline A Hands On...How To Beat the Big Guys ks the news that sends shivers down the spines of small business jon, goals, and objectives ‘anes evenere: WalMart or anyother “big-box” retalescom= ing to town. “How can my small business compete against the gest ret’ in the wort” they wonder. “Can my business survive?™ ‘Although no business owner welcomes a threat ofthis mag- nitude from a giant comaettor with greater buying power, more name recognition, and a reputation for driving small companies out of busines, i no reason to fold uo the tent and go home, Srrart entrepreneurs know that, by formulating and executing the proper strategy, they can nat only sure in the face of larger Competitors but also thrive in their presence Rule 1. Don’t Play Their Game {fundamental conc y's to avoid matching your anys weaknesses agains a competitors strengths. For instance, because Wal-Mart buys in such huge volume fror its suppliers, it can extract tne lowest prices from them, Small companies purchas- ing from those same suppliers cannot; therefor, it makes lle sense for small companies to try to compete with Wal-Mart and othe gant cetalers on pric. Unless your small company has another mare significant cost advantage, competing onthe bass of price sa ipe for disaster Entrepreneurs wno compete successuly emphasize features that giant ciscounters cannot provide—extensive product knowledge, better selection, superior customer sence, 2 hassle~ ‘ree buying experience, higher qual, and others. “Not everyone wants the lowest qualty at the lavest pice,” says one exoer Rule 2. Emphasize the Unique Aspects of Your ‘Company and How They Benefit Your Customers ‘angers Cleaners of Kansas City, Joe Runyan, founder of \Vissour, was faced wth the chalenge of competing with Proctor & amble's entry nto the dry cleaning market with its national rollout of Tide Dry Cleaners. Hangers Cleaners had been able to cifferentiate its service by offering an enwronmentally safe cry cleaning process. Hangers Cleaners uses quid carbon dioxce im stead of the harsh chemicals Lacitionaly used by dry cleaners. ‘owever, Tide Dry Clearing also offered eco-friendly dry cleaning semices. To comaete win a large national brand, Runyan pursued several strategies. Hangers focused on its offeeat image. The cor pany sent out entertaining promotional e-mails, gave away Tshirts bearing the invitation to "Sniff Me,” put funy messages on its, hangers, and held a St, Patick’s Day tailgate party inthe parking lot. The company also pays close attention to customer sevice angers has several programs to helo with fundraising for local nonprofits and schools. The company offers van sevice for pick-up and delvery to affluent negnborhoads willing to pay a premium (continued)204 SECTION II + THE ENTREPRENEURIAL JOURNEY BEGINS Hands On... How To (continued) ‘or the exva service. Akhough many of the other local dry clean cers suffered after tne entry of Tide Dry Cleaners, Runyans business has continued to experience growth in revenues and profs. Rule 3. Hit "em Where They Ain't 8ig companies usualy aim at big markets and often ignore smallout proftableniche markets, whichare dealtargetsforsallcomaanes. ‘Ashley Rosebrook and Stefan Peters entered a crowded personal- ized photo printing industry with ther Web site Pinhole Press, When researching the industry, they found that most of the competion offered too many choxes for the most common custome:—new ‘grandearents and parents. By eating a simple site thas i easy to {se Pinhole found a riche in the market. The founders recently sold Pinto for $33 millon ta large software company, Rule 4. Hire the Best—and Train Them Small companies usually cannot afford to pay the highest wages in an area; however, because their comparies ae smal, envepre- ners have the opportunity t create a work environment in which ‘employees can thrive. Zor instance, one srall company atvacts and rexains qualty workers by allowing ther to use tlexble work sched ls that make it easier for them to manage their busy Ives. The ‘ower also invests heavily n traning workers so that they can move ua the organization—and the pay scale—faster The tring pays off, however, in the form of oreater productivity, ower turnover, increased customer satsfaction, and higher sales per emoloyee Paying attention to seemingly small detalb, such as more commu nication, frequent recognition fer jobs well dane, lss bureaucracy, and flexiole benefits, enaoles small companies to buld a loyal mativaed workforce that can outperform those at larger compas. Rule 5, Bring Back What the Big Boys Have Eliminated fon Samuels founded’ Avenve Bank in Nashville, Tennesse, in 2007, not fong before the financial crisis rocked the banking indus. However, Avenue Bank not only survived one of the most ificlt times in banking since the Great Depression, but the company’ old- fashioned approach to banking aso resulted in stong and steady ‘grow. Avenue focses on highly personalized service, which isn longer avaiable n many national bank chains. Avenue Bank offers ‘the same personal zed sence to sal usinesses and entepreneus. The bank works with startups by offering concierge series, work- ing 19 meet their unique needs rom start-up trough growth Rule 6, Use the Cost Advantages of the Internet to Gain an Edge Emesto Perez-Carilo Jr and his family launched €PC Cigar as 2 premium cigar compary. The promotional channels for cigars include taxi-top advertsing in lage cites, commercials on cable channels, radio ads in large markets, and print ads in national ‘business magazines and speciaty publications that cater to the ‘wealthy. This type of advertising is quite costly and not always highly effective. One ad might cost up to half E°C Cigar’ total marketing budget. Because the company could not afford atradi- tional advertising campaign, the company aut is marketing bud {get into the Interne, social mecta initiatives, trade shows, and special events. EPC Cigars sales grew to more than $1.5 millon in reverue within the fst year Rule 7. Be Great at Something Customers Value, Such as Service and Personal Attention Do not make the mistake of choosing 2 “middle-f-the-road strategy where, one writer says, there “are yellow lines, dead arma- dillos, nd once-great companies that ar slowly going out of bus= ness." Successful small companies differentiate themseles from their larger, more powerful vals by emphasizing superior, friendly, personal service, something ther size makes them uniquely capa- ble of doing, Successful small companies also veat their customers like VIPs. Many small business owners know their customers by rhame, something that large companies cannat achieve. One of the best ways to determine exactly how to provide superior service and personal attention isto idendfy your top five customers and Perioccaly ask them, “How can we serve you better?” Rule 8. Get Involved in the Community Enwepreneurs can make ther small companies stand out from the crowd by supporting events in their local communities. A big budget isnota prerequisite, For instance, Pizza Ranch franchises host "com ‘munity impact” nights. Family members and fiends of employees bus tables to heb fundraising for local causes. Pzza Ranch donates all of the evening tos plus 2 matching share of the profits. The events generally draw addtional donations from the commurity. ‘Te events ne the franchises bul elationshas in the commuiy and make genuine and enduring relationships with custome. 1. Why do many small businesses fal when a big ecount retailer such as Wal-Mart entes their market? 2. Werk with a team of your classmates to identity a foal small business that competes with a bigger competitor Which ofthese strategies has the small comaany employed to become a stronger competitor? What other strategies ‘would you recommend to the owner of this business? 3. Based on your workin question 2, develop a one-page report summarizing your strategic suggestions ee Dat A 2 21 Spann cea ‘po 20 Toa Ret yo, Cogan Ware. GR rca dG Lng Suet oa una Pcue he poner cme ace Go meg srea eee at nn Sia Bes 2008 We Conic ee 203 Any Mea, eee oe Sate eee ne boctanorsnte-ltny-tthesaanmiedectbc mest sacgy¥5 sea Shines “David Gola Frane Nowe 5 2010p. 38 Pablo, 2010, wap cnt Stnlealionssa oti cel “Sit ompleiyi “Avan Bu A Se Teo Atco Seger wrt chennai he