BMGTStudent
Part One of the report focusing on understanding the environment…
Part One of the report focusing on understanding the environment of business before you begin.
The first part of the report to Mary is to highlight the start-up mistakes that set her on the path to poor growth. There are two major points that you wish to highlight:
Why understanding the local and global economy in which the business will operate could have made a difference.
Why understanding the difference between being an entrepreneur and a small business owner
Using the consulting template attached for part one of the report entitled: “Understanding the Environment of Business Before You Begin”.
Explain in detail at least five obstacles Mary faces in today’s local and global economy that must be overcome to a successful business and how they would have set her business in a better position today.
Explain to Mary the difference between being an entrepreneur and a small business owner.
Demonstrate how understanding the difference would have made her growth easier.
Make one recommendation to Mary that she can use going forward from this analysis.
MARYS Small Business Story: MobleyLight Company:
The History of MobleyLights Mary Mobley owns a business that makes geometric shaped lamps called Mobleylights. The Mobleylights are made from plastic panels that fit together like puzzle pieces. The pieces make lamps of different shapes, patterns and colors. The Mobleylights come in a variety of shapes and sizes with the largest ball lamp being 4′ in diameter, or 4′ x 4′ square. The largest lamp sells for $125 while the most popular model, a 15″ diameter model sells for $49.99. People who purchase more than three Mobleylights get one free. The choice can be hanging lamps or sit on a desk or a table. Mobleylights are popular with children and teenagers for room decor. Party planners like Mobleylights because they can set a mood in the room and they can be use again in different ways supplementing the patterns or colors from time to time. Mary first started the business in a kiosk of a local mall. The overhead was low and sales varied. She broke even almost immediately. By the end of the first year; she was making a profit. Mary expanded to another mall by the end of second year doubling sales. Encouraged by the success, Mary thought it may be time to open a shop. She looked for a spot in a small strip of stores but not in a strip mall. She found a place on the main street of “Old Town” in Ellicott City, Maryland. It was a small store with questionable parking but a high volume of foot traffic. Mary began doing lighting for party events and sales skyrocketed. Yearly sales went from $200,000 to $500,000. Thrilled with her success, Mary began to take on help. She even considered opening a shop or kiosk at the Baltimore Harbor Pier thinking she would have a lot of foot traffic. Mary was constantly thinking of ways to expand the customer base of the company. She opened a kiosk in the Harbor Building housing “Philips,” a popular Maryland landmark restaurant. Sales were far from stellar but the business still showed growth. The company was now looking at over a million dollars in sales with expenses of just over $500,000. The business had 18 employees. At this point, Mary had not really explored internet sales or social media. Unbeknownst to Mary, who had been very busy growing the business, You Tube was showing instructional videos on how to make the lamps and included online websites where people could purchase the panels and other materials needed to make the lamps. One day, a downtown employee spoke with Mary about the videos. Mary was shocked. The employee said she overheard someone say to a friend, “Yes I think they are cute too, but you can go online and buy the panels and make it yourself for half the price.” Within six months of this conversation, Mary, found that sales were dropping in the various kiosks, but not in the party business. Mary closed two of the kiosks, the Baltimore and the location at the first mall. She stuck with the store and the second mall location. Sales were doing well at both locations although profits were flat. One year later, Mary closed the remaining kiosk. She kept the party business in the store front. Later, Mary would close the party business as well but continue to work out of her house. Her million-dollar business had reverted to $300,000 in the span of three years
