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MGT602 - Entrepreneurship - Lecture Handout 42

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PREPARING FOR THE NEW VENTURE LAUNCH: EARLY MANAGEMENT
DECISIONS (Continued….)

CREATING AWARENESS OF THE NEW VENTURE

In the early stages, the entrepreneur should focus on developing awareness of the products offered.

Publicity is free advertising provided by a media outlet. Many local media encourage entrepreneurs to participate in their programs. The entrepreneur can increase the opportunity for getting exposure by preparing a news release and sending it to as many media sources as possible. For radio or TV, the entrepreneur should identify programs that may encourage local
entrepreneurs to participate. Free publicity can only introduce the company. Advertising can be focused on specific customers.

Internet Advertising

The Internet is an excellent medium to create awareness and to effectively support early launch strategies. Creating a website is the most important first stage. The website should indicate: Background of the company. Its products, officers, address, telephone and fax numbers. Contact names for potential sales. Direct sales from the website may also be available. Significant advertising is needed to create interest and awareness of the existence of the website. It is important to change the content of the website as necessary. The entrepreneur may also consider using a banner ad, small rectangular ads similar to billboard ads that appear on browser websites.

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MGT602 - Entrepreneurship - Lecture Handout 38

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PREPARING FOR THE NEW VENTURE LAUNCH: EARLY MANAGEMENT
DECISIONS (Continued….)

RECORD KEEPING

It is necessary to have good records for effective control and for tax purposes. The entrepreneur should be comfortable and able to understand what is going on in the business. With software packages, much of the record keeping can be maintained on a personal computer. The goals of a good record keeping system are to identify key incoming and outgoing revenues that can be effectively controlled.

Sales (Incoming Revenue)

It is useful to have knowledge about sales by customer both in terms of units and dollars. The entrepreneur of a retail store might try to identify the profile of the type of customer that patronizes the store. Retailers also like to have information on specific customers. Credit card purchases can be tracked for information on the type and amount of merchandise purchased. An Internet venture can maintain purchase history data on the types of produces purchased.
Customers’ e-mail addresses can be requested so the customer can be notified of sales. Some Internet firms have established a free membership as a means of following up. In a service venture, records would need to be maintained on when a customer paid their monthly fee. As cash flow problems are the most significant cause of new venture failure, good payment records are necessary. Record keeping of payments can either be handled by a computer software package or a simple card file system. If payments are late beyond a reasonable time, it may be necessary to hire a collection agency, but only as a last resort.

Read more: MGT602 - Entrepreneurship - Lecture Handout 38