Market viability analysis

Market viability analysis
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Contents
Executve summary……………………………………………………………………………………………………………………..3
Introducton……………………………………………………………………………………………………………………………….4
Lean Start-Up methods you have used…………………………………………………………………………………………..5
Tools you have used…………………………………………………………………………………………………………………….6
Identfy stakeholders and consumers in your tests…………………………………………………………………………..8
Risk management strategies…………………………………………………………………………………………………………9
Results of your testng with the market………………………………………………………………………………………..10
MVP and MVP strategy………………………………………………………………………………………………………………11
GO/NO-GO………………………………………………………………………………………………………………………………12
Summary…………………………………………………………………………………………………………………………………13
References……………………………………………………………………………………………………………………………….14
Appendix…………………………………………………………………………………………………………………………………16
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Executive summary
A lean business model is an approach that helps the business in managing and creating startups.
Many entrepreneurs spend months and years in developing the product but when they launch the
product fails because they never show it to the target customer. The lean business model helps the
business develop a prototype and get feedback from the customer and develop that prototype as
per their feedback so that when the product launch in the market it is easily acceptable.
This report shows how an entrepreneur uses a lean business model to develop a venture
3
Introduction
The SA (student agency) provides VET, higher, and ELICOS courses to the Columbian students.
To provide training and educational facilities, the student agency needs to obey the rules and
regulations framed by National Regulation ASQA and TEQSA and Federal Parliament.
Vision Statement: Our Vision is to become the first choice of both the corporate and individual
clientele in Melbourne Australia. Our values are teamwork, excellence, service, and integrity.
Mission statement: Our mission is to become one of the top 10 student agencies in the next 10
years.
Business structure: Student agency provides the bridge which reduces the gap between the
university/school and the student of Columbia. We provide services like assisting in the selection
of the course, admission process, scholarships, guidance, and support services to the students and
marketing services to the universities. We have a tie-up with both the universities and the
students.
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Lean Start-Up methods you have used
The best methods for the start-up is build, measure, and learn cycle. As I am running a venture
this helps me to understand the need of the customer (Hechavarria, et.al. 2016). Lean Start-up
method involves following steps
Phase 1: Build
As most of the college students are facing the problem related to finding the right course in the
right universities and if they find the course they face challenges with the admission process. The
student agency provides a solution to that. As for the initial stage, the main focus of SA is
students. The entire process is run through a website where students book their services and slots
and then our expert will coordinate with the students and provide a solution to them. A
questionnaire is developed to analyze what students think about the services? Are they satisfied
with the service? If no why and what changes they want?. The questionnaire is distributed to
those students through online channels
The Hypothesis that I formed before starting the business is that the SA will solve the student’s
problem related to the admission process.
Phase 2: Measure
The data collected through the questionnaire helps analyze student perception regarding SA.
According to the data collected, SA can fulfill the customer expectations and the hypothesis I
made before starting the venture is right. But some students find it difficult to coordinate it with
us through the Website.
Phase 3: Learn
Through the questionnaire, I had found that there is a gap in the communication channel. To fill
that gap SA decided to open a new customer service department (CSD), a toll-free number is
available on the website. The customer can contact the CSD instead of waiting for the expert to
contact them (Galli 2019). .
5
Tools you have used
Business model canvas
This model was propounded by Alexander Osterwalder. This model shows the blueprint of the
business model that is it shows who are the target audience, what is the value proposition, what
are the channels through which the company offers value proposition, how the company earns
money and much more (Joyce & Paquin, 2016)
The business model canvas of SA
Customer segment
The target customer of SA is the students of Columbia who want to pursue courses like
ELICOS, higher and VET and the universities/ schools/ colleges. The students and the
universities show a positive response in the questionnaire.
Value proposition
There is four value proposition provided by SA. First low commission/ competitive
commission, second-best services, third are a responsible employee and last SA provide
a vast variety of services to both the students and the universities.
Channels
The channels used by SA to promote its services are advertised on TV, Radio,
newspaper, word of mouth, social media like LinkedIn, Twitter, Instagram and
Facebook, banners, handbills, fliers, and websites.
Customer relationships
SA builds customer relationships through the website and customer service department.
On the website, the students book their services and slots and then our expert will
coordinate with the students and provide a solution to them. And they can also call the
CSD for the assistance.
Revenue stream
The sources of revenue are the commissions from the universities/ schools/ colleges.
And the payment options are bank transfer, cash, POS, online bank transfers, check, and
bank draft.
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Key activities
The key activities taken by SA are assistance services, IT management, customer
support, and HR management. Assistance services are a selection of the course,
admission process, scholarships, guidance and support services to the students and
marketing services to the universities. IT management is responsible for managing the
website.
Key resource
The key resources of SA are a competitive commission and high-quality services,
engaged and loyal workforce, and website and CSD.
Key partners
The key partners are social networking, universities, school, institutions and social
influencers.
Cost structure
The costs related to SA are
Service: 20%
Salaries: 50%
IT costs: 20%
Marketing cost: 10%
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Identify stakeholders and consumers in your tests
The key stakeholders are social networking, universities, school, institutions and social
influencers. The target customer of SA is the students of Columbia who want to pursue courses
like ELICOS, higher and VET and the universities/ schools/ colleges. After doing the informal
survey like observation and talking to the student I have found out that the main problem that
students are facing is finding the right course in the right universities and if they find the course
they face challenges with the admission process.
After the observation, I feel that this can be a venture as it solves the problem of the students.
After starting the venture I again run a formal test to check the satisfaction level of the students
and the universities. And found out that SA can fulfill customer expectations.
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Risk management strategies
The risk management strategies used by the SA are PEST analysis to identify all the external
factors that affect the operation of the business (ARAYA-CASTILLO LUIS, et.al. 2018).
Political
The SA (student agency) provides VET, higher, and ELICOS courses to the Columbian
students. To provide training and educational facilities, the student agency needs to obey
the rules and regulations framed by National Regulation ASQA and TEQSA and Federal
Parliament. Any changes in the rules and regulations directly affect the SA.
Economical
The target customers are the students. Most of the students can’t afford the high prices
for the course plus fluctuation in the currency affects the prices of the courses and fees
structure.
Social
Studying abroad is becoming a trend and a social symbol. Most of the students want to
study in Australia because of the trend and they want to explore a different country. This
trend can be beneficial for SA.
Technological
Advance technology in the education sector helps the Dirtbusters to provide efficient
and fast services. For example online courses, etc.
Through the questionnaire, I had found that there is a gap in the communication channel.
To fill that gap SA decided to open a new customer service department (CSD), a tollfree number is available on the website. The customer can contact the CSD instead of
waiting for the expert to contact them.
9
Results of your testing with the market
During the entire planning of the venture few hypotheses are formed and the result is an analysis
based on a test conducted through a questionnaire (Edjossan-Sossou, et.al 2020)
Hypothesis 1: SA will solve the student’s problem related to the selection of the course and
admissions process
Result: yes, students and universities are satisfied with the services and it solves the issue related
to the selection of the course and admissions process
Hypothesis 2: The key promotional tool is the word of mouth and social media
Result: Yes, most of the students and staff members came to know about the SA are through the
WOM and social media accounts
Hypothesis 3: SA can turn out to be a marketing tool for universities.
Result: yes, the admissions in the universities have increased after they had the tie-up with SA.
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MVP and MVP strategy
A minimum viable product is a strategy used by the business to test their product and services on
the small target customer before launching it on a larger scale. This strategy is used to test the
customer’s viewpoint or perception regarding the product. The company makes changes in the
product as per the customer feedback before launching it again (Anh, et.al 2019).
There are three different types of MVP strategies are
Wizard of Oz: in this, the hypothesis is created and the test is run to prove or disapprove the
hypothesis. In this, the customer believes that the products are fully developed but the company
only shows the mimic of the future product.
Smokescreen: in this, the product does not develop but the business shows the video to the target
customer that how it will look after the product is developed.
Concierge: in this, the businesses focus on one customer at a time and design the product and
services according to that customer. After the experiment has competed with the entire target
customer the business combines all and develops one product or services (Tripathi et.al 2019).
MVP strategy in the case of Dirtbusters
SA selects one college to test the viability of the venture. Currently, SA is focusing only on the
students of Columbia and has a tie-up with three universities. A questionnaire is prepared to
analyze the perception of the target customer before launching this model for the different
universities and different nationalities of students. This strategy helps to identify the loopholes in
the venture process and also helps to find a way to solve those loopholes. MVP strategies help to
identify the communication gap.
To fill that gap SA decided to open a new customer service department (CSD), a toll-free number
is available on the website. The customer can contact the CSD instead of waiting for the expert to
contact them.
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GO/NO-GO
I will GO with this venture. The hypothesis that I formed before starting the venture is proved
true. After using all the tools and techniques of the lean business model and risk strategies, it is
proven that the business can solve the problem faced by the target customer. This venture turns
out to be profitable as there are no major competitors in the market. The SA can maintain the cost
and earn profits.
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Summary
To succeed in my venture ‘Student agency’ I used to build, measure and learn a model to analyze
the customer perception about the services and make changes in the business according to that.
This helps my business to grow. The MVP model helps the business to identify the target
customer and to launch the product for a small portion of the target customer as a test to identify
whether the venture will be successful or not. It helps to make changes in the business according
to the feedback of the customers. The risk strategy that I used is the PEST model that helps to
understand the external factors that affect the operation of the business. After analysis of all the
factors, I have decided to GO with this venture.
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References
Hechavarria Diana M, Matthews, C. H., & Reynolds, P. D. (2016). Does start-up
financing influence start-up speed? evidence from the panel study of entrepreneurial
dynamics.
Small Business Economics, 46(1), 137–167.
https://search-proquest-com.ezproxy.laureate.net.au/docview/1754489838?
accountid=176901
Joyce, A., & Paquin, R. L. (2016). The triple layered business model canvas: a tool to
design more sustainable business models.
Journal of Cleaner Production, 135, 1474–
1486. doi: 10.1016/j.jclepro.2016.06.067
ARAYA-CASTILLO LUIS ANDRES, RODRIGUEZ RAMIREZ JAVIER, VARGAS
MONTERO, M. A. R. I. T. Z. A., & VILLALOBOS RODRIGUEZ GERARDO. (2018).
Lean start-up as a strategy for the development and management of dynamic
entrepreneurships.
Dimension Empresarial, 16(2), 193–208.
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Galli, B. J. (2019). Reflection of literature on using lean innovation models for start-up
ventures.
Journal of Modern Project Management, 7(3), 6–18. doi:
10.19255/JMPM02101
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De, C. W. S., Van, D. V. J., Boers, R., Brandsma, T., Haij, M., Moosel, W., … Van, D. S.
G. (2018). Agile development in meteorological r&d achieving a minimum viable product
in a scrum work setting.
Bulletin of the American Meteorological Society, 99(12), 2507–
2518. doi: 10.1175/BAMS-D-17-0273.1
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Anh, N.-D., Khan, K., Sohaib, S. B., & Tor, L. (2019). Minimum viable products for
internet of things applications: common pitfalls and practices.
Future Internet, 11(2). doi:
10.3390/fi11020050
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Tripathi, N., Oivo, M., Liukkunen, K., & Markkula, J. (2019). Startup ecosystem effect
on minimum viable product development in software startups.
Information and Software
Technology
, 114, 77–91. doi: 10.1016/j.infsof.2019.06.008
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Edjossan-Sossou, A. M., Deck, O., Verdel, T., Galvez, D., Al, H. M., Dupont, L., …
Morel, L. (2020). Sustainable risk management strategy selection using a fuzzy multicriteria decision approach.
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Appendix
Questionnaire for the student
Name:
Which course you are interest in?
о VET
о ELICOS
о Higher
Are you sure which university you want to join?
о Yes
о No
о Partially
Did you use the service of SA?
о Yes
о No
How do you come to know about us?
о Word of mouth
о Social networks
о Flyers
о Advertisement
о Website
Are you satisfied with our services?
о Yes
16
о No
о Partially
Do you face any issue in dealing with us? If yes please specify
о No
о Yes
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Questionnaire for the universities
Do you think that the admission rate has increases after have tie-up with us?
о Yes
о No
о Partially
Which course there is an incensement?
о VET
о ELICOS
о Higher
о All three
Are you satisfied with our services?
о Yes
о No
о Partially
How do you come to know about us?
о Word of mouth
о Social networks
о Flyers
о Advertisement
о Website
Do you face any issue in dealing with us? If yes please specify
о No
о Yes
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