Assignment 8A - Solving the Problem
Selected Opportunity:
A rate shopping service to achieve the ideal price and level of service for customers in regards to their mobile phone, internet, and cable services.
The Problem:
Funding for this type of a business is uncertain, so outside investors may be needed to get this service off the ground. Fee structure and customer associated costs are also a concern when starting a service based business.
The Solution:
A viable option for this type of startup business would be to use a crowdfunding platform initially, and to pay investors back as quickly as the funds are available. The estimation is that there will be a 90-day startup period where very little income will be made. Following that time frame, business relationships should be achieved and stable, sustainable income should follow. The crowdfunding site would be a solution to the problem that is the need for startup capital. In order to create a fee structure for the business that keeps it financially sustainable, and keeps costs low for the customer, we may need to hire in an accounting firm to help crunch the numbers so we can achieve our required return in the beginning stages. This upfront cost will be necessary to the longevity of the business, and will serve as an insurance policy against errant figures that could sabotage the business right away. If the cost to hire the accounting firm is figured into that of the startup fees, this should be an attainable goal through the crowdfunding venture.
With the attainable startup capital needed for the business, and the expertise of the accounting firm that will be retained to help with the initial figures, this looks to be a viable solution to the problem of limited startup capital and the creation of a fee structure that will sustain the business and extend a fair market rate price to our customers.
Darren,
ReplyDeleteAs I said in my comment on your last post, I would definitely pay for a service like this. My question is, how would you gain customers? If you start with only a few customers, it will be hard to have any pull with these big companies. I feel like the way you have to attack this is by providing the service for free for a short period of time to spread the word and create a client base. When you have a large enough base, then these companies will pay attention to you. I am also not sure customers would be willing to pay both you and the cable, internet, etc. companies. You may have to take care of everything, from paying to service, to get customers to pay for your service. Great idea, and good luck carrying it out.